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    Caen las tarifas aéreas en EE. UU., para alivio de los pasajeros

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    Las aerolíneas están comenzando a ofrecer precios de rebaja, una señal de que tienen problemas para llenar los aviones.En fechas recientes en Estados Unidos, las tarifas aéreas a muchos destinos populares han caído a su nivel más bajo en meses; incluso los viajes durante la temporada festiva son mucho más baratos que el año pasado. Esto les ha dado un respiro a los consumidores, tras meses de frustración por los elevados precios de todo tipo de bienes y servicios.La abundancia de buenas ofertas hace pensar que quizá la vigorosa recuperación de la industria aérea tras la pandemia por fin va bajando el ritmo, ya que la oferta de boletos se empareja con la demanda, que parece relativamente firme, e incluso la supera en algunas rutas.Tengamos en cuenta las tarifas que consiguió hace poco Denise Diorio, maestra jubilada de Tampa, Florida. Gastó menos de 40 dólares en un boleto de ida y vuelta a Chicago y solo pagó 230 dólares por un viaje redondo de Nueva York a París, el cual planea hacer este mes.“Les he venido diciendo a todos mis amigos que si quieren ir a alguna parte, deben comprar sus boletos ahora”, comentó.Las gangas que encontró quizá sean excepcionales, pero Diorio está en lo correcto cuando asegura que hay muchas ofertas.Este mismo mes, el precio promedio de un vuelo nacional cerca del Día de Acción de Gracias estaba casi un 9 por ciento por debajo del nivel del año pasado. En cuanto a los vuelos cerca de la Navidad, eran aproximadamente un 18 por ciento más baratos, según la aplicación de reservaciones y rastreo de precios Hopper. Kayak, el motor de búsqueda de viajes, analizó un rango más amplio de fechas cerca de las fiestas y descubrió que los precios de los vuelos nacionales eran alrededor de un 18 por ciento más bajos por la fecha del Día de Acción de Gracias y un 23 por ciento por Navidad.“En muchos casos, observamos algunas de las tarifas más bajas desde que se reanudaron los viajes tras los recortes de 2020, en realidad”, afirmó Kyle Potter, editor ejecutivo del blog de viajes y servicio de alerta de ofertas Thrifty Traveler.El precio de los boletos para vuelos dentro de Estados Unidos bajó durante el verano, aseveró Potter, y en épocas recientes es más común encontrar ofertas para viajes internacionales, en particular a Europa.Las aerolíneas bajan sus tarifas cuando quieren tentar a más personas a reservar boletos porque la demanda es baja o la competencia es más fuerte. Sin duda, la competencia se ha intensificado en algunas rutas, pero los expertos en viajes indican que no hay certeza de que la demanda vaya en declive.Se espera que el Día de Acción de Gracias de este año establezca una cifra récord para los viajes aéreos, con predicciones de casi 30 millones de pasajeros, según Airlines for America, un grupo de la industria. Esta cifra sería un 9 por ciento más alta que la del año pasado y estaría un 6 por ciento por encima de la de 2019, antes de la pandemia.Pero algunas aerolíneas afirman que la demanda va en descenso en los periodos que no son de festividades o temporada alta. Además, algunos aeropuertos han manejado tal número de vuelos que las compañías de transporte se han visto obligadas a reducir las tarifas para llenar los aviones.Ese no había sido un problema durante la mayor parte del periodo de recuperación tras la pandemia. El clima y otras perturbaciones limitaron la oferta de vuelos el año pasado y en 2021, al igual que la escasez de pilotos capacitados, repuestos y aviones, entre otros factores. Esas condiciones provocaron un alza en el precio de los boletos, mantuvieron llenos los aviones y ayudaron a las aerolíneas a obtener excelentes ganancias.“La industria de la aviación nunca había registrado el tipo de márgenes de ganancias y rendimiento sobre capital visto en los últimos 2 años y medio”, señaló John Grant, principal analista de la empresa consultora y de datos de aviación OAG. “Casi estamos de nuevo en una industria más normal”.Para las principales aerolíneas estadounidenses continúan los buenos tiempos, impulsados en particular por una gran demanda de vuelos internacionales. Pero las compañías más pequeñas y de bajo costo han comenzado a sufrir. Varias revelaron resultados financieros decepcionantes para el trimestre concluido en septiembre. Los ejecutivos de esas aerolíneas han dicho que la demanda va en descenso, las tarifas han caído y los costos se han mantenido elevados. También señalan que el mal clima y la escasez de controladores de tráfico aéreo les han complicado la operación aérea.Por ejemplo, JetBlue Airways perdió 153 millones de dólares en el tercer trimestre, en contraste con las ganancias de 57 millones de dólares registradas en el mismo periodo el año pasado. La empresa indicó hace poco que planea cambiar algunos vuelos de mercados abarrotados, como Nueva York, a otros en los que espera un mejor desempeño, como el Caribe. Las compañías de transporte económicas Spirit Airlines y Frontier Airlines les informaron hace poco a los inversionistas que buscaban recortar decenas de millones de dólares en costos.La competencia ha sido aguerrida en algunos mercados importantes, lo que ha impulsado a la baja las tarifas y las utilidades.En Denver, donde se encuentran las oficinas generales de Frontier, este verano hubo un 14 por ciento más asientos disponibles que en el verano de 2019, según la proveedora de datos de aviación Cirium. Miami y Orlando, Florida, dos destinos populares a los que vuelan muchas empresas, experimentaron aumentos en capacidad todavía mayores.No obstante, mientras que las aerolíneas añadieron vuelos en mercados populares en busca de captar pasajeros, en aeropuertos de otras ciudades, como Los Ángeles, un centro de actividades de muchas aerolíneas importantes, se observaron reducciones considerables en la capacidad con respecto al verano de 2019.“Es evidente que existe una enorme correlación entre las aerolíneas que funcionan bien y aquellas que tienen dificultades, en términos de sus márgenes, cuando comparamos dónde están sus concentraciones”, señaló el mes pasado Barry Biffle, director ejecutivo de Frontier, durante una teleconferencia para presentar los resultados de la aerolínea correspondientes al tercer trimestre.En cuanto a las rutas internacionales, los analistas no saben con tanta certeza por qué las tarifas van a la baja ni si se mantendrán así. Gangas como las que consiguió Diorio para su viaje a París podrían ser señal de que las aerolíneas más grandes pronto enfrentarán presiones financieras o sencillamente que la industria va regresando a una normalidad prepandémica.“Por lo regular, la demanda de viajes a Europa baja durante el invierno”, explicó Steve Hafner, director ejecutivo de Kayak. “Así que me parece que eso refleja las tendencias normales”.Pero la demanda de viajes internacionales podría enfrentar obstáculos, en parte debido a las guerras de Medio Oriente y Ucrania. Los analistas también advierten que muchos consumidores quizá estén menos dispuestos a derrochar dinero en viajes o tengan menos posibilidades de hacerlo ahora que en los dos años pasados, cuando contaban con el dinero que habían ahorrado durante la pandemia. Incluso si la demanda se mantiene firme, las aerolíneas corren el riesgo de ofrecer demasiados asientos en rutas populares al extranjero.Cualquiera que sea la causa de la reciente caída de las tarifas, las ofertas son un bienvenido alivio para los viajeros después de sufrir años de precios altos, dijo Potter.“En cualquier caso, la receta para vuelos baratos está ahí”, afirmó. “Si se trata solo de un pequeño exceso de capacidad, es una victoria para los consumidores. Si la demanda de viajes está cayendo, en cierto modo es una ganancia aún mayor para las personas que nunca van a renunciar a viajar”.Niraj Chokshi escribe sobre la aviación, los ferrocarriles y otras industrias del transporte. Más de Niraj Chokshi More

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    Sharp Drop in Airfares Cheers Inflation-Weary Travelers

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    Airfares to many popular destinations have recently fallen to their lowest levels in months, and even holiday travel is far cheaper than it was last year, providing some welcome relief to consumers who have been frustrated for months by high prices for all manner of goods and services.The glut of deals suggests that the airline industry’s supercharged pandemic recovery may finally be slowing as the supply of tickets catches up and, on some routes, overtakes demand, which appears relatively robust.Consider the fares that Denise Diorio, a retired teacher in Tampa, Fla., recently scored. She spent less than $40 on flights to and from Chicago and paid just $230 for a round-trip ticket from New York to Paris and back, a trip she plans to take this month.“I’ve been telling all my friends, ‘If you want to go somewhere, get your tickets now,’” she said.The bargains she found may be exceptional, but Ms. Diorio is right that deals abound.Early this month, the average price for a domestic flight around Thanksgiving was down about 9 percent from a year ago. And flights around Christmas were about 18 percent cheaper, according to Hopper, a booking and price-tracking app. Kayak, the travel search engine, looked at a wider range of dates around the holidays and found that domestic flight prices were down about 18 percent around Thanksgiving and 23 percent around Christmas.“In a lot of cases, we’re seeing some of the lowest fares that we’ve seen really since travel started coming back after the drop-off in 2020,” said Kyle Potter, executive editor of Thrifty Traveler, a travel blog and deal-watching service.Domestic ticket prices fell over the summer, Mr. Potter said, and deals on international travel, particularly to Europe, have become more common recently.Airlines lower their fares when they are trying to get more people to book tickets as demand is slowing or they are facing stiffer competition. There’s little question that competition has intensified on some routes, but travel experts say it’s not clear whether demand is waning.Thanksgiving this year is expected to set a record for air travel, with nearly 30 million passengers forecast, according to Airlines for America, an industry group. That would be about 9 percent more than last year and 6 percent more than in 2019, before the pandemic.But some airlines say demand is slowing outside of holiday and other peak travel periods. In addition, some airports have been so flooded with flights that carriers have been forced to cut fares to fill planes.That hadn’t been much of a problem for most of the recovery from the pandemic. Weather and other disruptions limited the supply of flights last year and in 2021, as did shortages of trained pilots, parts and planes, among other factors. That drove up ticket prices, kept planes full and helped airlines take in strong profits.Thanksgiving this year is expected to set a record for air travel, with nearly 30 million passengers anticipated.Stefani Reynolds for The New York Times“The airline industry has never delivered the types of profit margins and return on capital that it has done over the last 2.5 years,” said John Grant, chief analyst with OAG, an aviation advisory and data firm. “We’re getting back to a more normal industry.”For the largest U.S. airlines, the good times have continued, fueled in particular by thriving demand for international travel. But smaller and low-fare carriers have started to suffer. Several reported disappointing financial results for the three months that ended in September. Executives at those airlines have said demand is weakening, fares are falling and costs remain high. They also say bad weather and a shortage of air traffic controllers have made flying more difficult.JetBlue Airways, for example, lost $153 million in the third quarter, compared with a $57 million profit in the same period last year. The company said recently that it was moving flights away from crowded markets, such as New York, to those where it expected stronger performance, such as the Caribbean. The budget carriers Spirit Airlines and Frontier Airlines recently told investors that they were looking to cut costs by tens of millions of dollars.Competition has been fierce in some important markets, driving down fares and profits.In Denver, where Frontier is based, about 14 percent more seats were available on flights this summer than in the summer of 2019, according to Cirium, an aviation data provider. Miami and Orlando, Fla., two popular destinations served by many budget carriers, saw even larger increases in capacity.But while airlines added flights in popular markets as they chased passengers, airports in other cities, including Los Angeles, a hub for several major airlines, had large declines in capacity from the summer of 2019.“You’ll find that there’s a large correlation between the airlines that are doing well and the ones that are struggling, margin-wise, when you compare where their concentrations are,” Barry Biffle, Frontier’s chief executive, said last month on a conference call to discuss the airline’s third-quarter results.When it comes to international routes, analysts are less certain of why fares are falling and whether they will remain low. The kinds of deals that Ms. Diorio got for her Paris trip could mean that larger airlines soon find themselves facing a financial squeeze or merely that the industry is returning to a prepandemic normal.“Historically, demand to Europe softens in the winter,” said Steve Hafner, Kayak’s chief executive. “So I think that reflects normal trends.”But demand for international travel could face challenges, partly because of the wars in the Middle East and Ukraine. Analysts also warn that many consumers may be less willing or able to splurge on travel than they were in the last couple of years, when they had pandemic savings to draw from. Even if demand remains strong, airlines risk offering too many seats on popular overseas routes.Whatever the cause of the recent drop in fares, the deals are a welcome break to travelers from years of high prices, Mr. Potter said.“Either way the recipe is there for cheap flights,” he said. “If it’s just a little bit of overcapacity, that’s a win for consumers. If travel demand is dropping, in some ways that’s an even bigger win for people who are never going to give up on travel.” More

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    Solar Manufacturing Lured to U.S. by Tax Credits in Climate Bill

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    A combination of government policies is finally succeeding in reversing a long decline in solar manufacturing in the United States.Six years ago, an executive from Suniva, a bankrupt solar panel manufacturer, warned a packed hearing room in Washington that competition from companies in China and Southeast Asia was causing a “blood bath” in his industry. More than 30 U.S.-based solar companies had been forced to shut down in the previous five years alone, he said, and others would soon follow unless the government supported them.Suniva’s pleas helped spur the Trump administration to impose tariffs in 2018 on foreign-made solar panels, but that did not reverse the flow of jobs in the industry from going overseas. Suniva’s U.S. factories remained shuttered, with dim prospects for reopening.That is, until now. Last month, Suniva announced plans to reopen a Georgia plant, buoyed by tariffs, protective regulations and, crucially, lavish new tax breaks for Made-in-America solar manufacturing that President Biden’s signature climate law, the Inflation Reduction Act, created.Solar companies have long been the beneficiaries of government subsidies and trade protections, but in the United States, they have never been the object of so many simultaneous efforts to support the industry — and so much money from the government to back them up.The combination of billions of dollars of tax credits for new facilities and tougher restrictions on foreign products appears to be driving a wave of so-called reshoring of solar jobs. Those efforts are succeeding where more modest approaches did not, although critics argue that the gains come at a high cost to taxpayers and may not hold up in the long run.In the year since the climate law was passed, companies have announced nearly $8 billion in new investments in solar factories across the United States, according to data from the Massachusetts Institute of Technology and the Rhodium Group, a nonpartisan research firm. That is more than triple the amount of total investment announced from 2018 through the middle of 2022.Suniva plans to reopen and expand a factory to make solar cells in Norcross, Ga., by spring. REC Silicon will restart this month a polysilicon plant in Moses Lake, Wash., that it shut down in 2019. Maxeon, a Singapore-based producer of solar cells and modules, will start work next year on a $1 billion site in New Mexico.In each of those cases, executives cited the incentives in the climate law as a driving factor in their investment decisions.In recent years, China overtook foreign competitors through huge government investments that allowed it to build factories 10 times as large as American ones.Gilles Sabrie for The New York Times“It was kind of exactly what we had in mind in terms of what would be needed, to pull these kinds of manufacturing initiatives forward,” said Peter Aschenbrenner, Maxeon’s chief strategy officer.China has loomed large over the industry for more than a decade. American demand for solar power has grown sharply since 2010 — by about 24 percent each year in that time, according to the Solar Energy Industries Association, a trade group. But much of that spending went to cheaper foreign solar panels, often made by Chinese companies or with Chinese parts. That raised concerns of American overreliance on China, which is restricting supplies of other key products and whose solar production has been troubled by human rights concerns.U.S. solar manufacturing employment peaked in 2016, with just over 38,000 workers. By 2020, nearly one-fifth of those jobs were gone.Factory solar jobs have begun to grow again.E2, an environmental nonprofit organization, estimated that new investments announced in the first year of the climate law would create 35,000 temporary construction jobs and 12,000 permanent jobs across the entire solar industry in the years to come. Thousands of those permanent jobs are related to manufacturing, including an expected 2,000 at Maxeon’s planned plant in New Mexico.Economists and executives said that surge was largely due to public subsidies that flipped the economics of the solar industry in favor of domestic production.Mr. Aschenbrenner said Maxeon’s cost of domestic solar manufacturing would fall roughly 10 percent, just through a new manufacturing tax credit in the climate law that targets the production of both solar cells and solar modules. That is enough to offset the higher wage and construction costs of American factories, he said.The law also includes credits for customers, like homeowners and utilities, that install solar panels and begin generating electricity from them. If the customer buys panels that are sourced from the United States, like the ones Maxeon is planning, the value of that credit grows 10 percent.Those incentives could be enough to build an American industry that, within a matter of years, could be large and efficient enough to compete with China even without subsidies, Mr. Aschenbrenner said.Others are more skeptical. Analysts at Wood Mackenzie, an energy consultancy, estimate that nearly half the solar module capacity announced by 2026 will not materialize, given that some manufacturers announce long-term plans to gauge feasibility and interest.The recent embrace of subsidies and tariffs by politicians of both parties also irks some economists, who say that while such programs can save or create jobs, they do so at an extremely high cost.A 2021 study by the Peterson Institute of International Economics of past industrial policy programs found that the Obama administration’s 2009 investment in Solyndra, a solar company that ultimately went bankrupt, cost taxpayers about $216,000 for each job created, more than four times prevailing industry wages. Other programs were even more expensive.REC Silicon, a Norwegian maker of polysilicon, entered into a deal with QCells to supply that company’s planned U.S. plants.Megan Varner/Reuters“With certain kinds of technology, you can subsidize and protect your way to having factories,” said Scott Lincicome, who studies trade policy at the Cato Institute, a libertarian think tank. “The question is always about at what cost?”In addition to the costs incurred to taxpayers, protections for the U.S. industry are making solar products more expensive in the United States than in other countries, Mr. Lincicome said. That slows the adoption of solar technology, in contrast to climate goals.Trends in the global solar industry have often been closely linked with government action. The industry started booming over a decade ago when Germany and Japan began offering subsidies for solar power.In recent years, China overtook foreign competitors through huge government investments that allowed it to build factories 10 times as large as American ones. Since 2011, China has invested more than $50 billion in the sector, ultimately capturing more than 80 percent of the global share of every stage in the manufacturing process, according to the International Energy Agency.Tariffs also shaped the industry’s evolution. The United States imposed levies on Chinese solar products in 2012. The next year, China retaliated with tariffs of up to 57 percent on U.S. polysilicon, a raw material for solar panels.That proved to be the death knell for the factory that REC Silicon, a Norwegian maker of polysilicon, was operating in Washington State, said Chuck Sutton, the company’s vice president of global sales and marketing. With few companies still standing outside China, REC Silicon “basically didn’t have any customers left,” he said.REC Silicon worked with the Trump administration to get China to commit to buying more American polysilicon as part of a 2019 trade deal. But China never followed through on those purchases.The turnaround for REC Silicon came, Mr. Sutton said, with the new tax credits this year. The manufacturer entered into a deal with QCells to supply its polysilicon to QCells’ planned U.S. plants. The deal allowed REC Silicon to reopen its Washington site, Mr. Sutton said.To compete with China, the industry needed “a whole-of-government approach,” Mr. Card of Suniva said, that included both tariffs and tax credits for domestic manufacturing.“They are not opposing forces,” he said. “They work together and make each other stronger.” More

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    U.A.W. Reaches Tentative Deal With Stellantis, Following Ford

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    The United Automobile Workers union announced the deal with Stellantis, the parent of Chrysler, Jeep and Ram. It also expanded its strike against G.M.The United Automobile Workers union announced on Saturday that it had reached a tentative agreement on a new labor contract with Stellantis, the parent company of Chrysler, Jeep and Ram.The agreement came three days after the union and Ford Motor announced a tentative agreement on a new contract. The two deals contain many of the same or similar terms, including a 25 percent general wage increase for U.A.W. members as well as the possibility for cost-of-living wage adjustments if inflation flares.“We have won a record-breaking contract,” the U.A.W. president, Shawn Fain, said in a video posted on Facebook. “We truly believe we got every penny possible out of the company.”Shortly after announcing the tentative agreement with Stellantis, the union expanded its strike against General Motors, calling on workers to walk off the job at the company’s plant in Spring Hill, Tenn. The plant makes sport utility vehicles for G.M.’s Cadillac and GMC divisions.Under the tentative new contract with Stellantis, Mr. Fain said, the company has agreed to reopen a plant in Belvidere, Ill., to produce a midsize pickup truck and to rehire enough workers to staff two shifts of production.The union also won commitments to keep an engine plant in Trenton Mich., open, and to keep and expand a machining plant in Toledo, Ohio. According to the union, these moves will create up to 5,000 new U.A.W. jobs.The union also won the right to strike if the company closes any plant and if it fails to follow through on its promised investment plans, Mr. Fain said.“If the company goes back on their words on any plant, we can strike the hell out of them,” he said.Mr. Fain said Stellantis workers would now return to their jobs.In a statement, Stellantis said, “We look forward to welcoming our 43,000 employees back to work and resuming operations to serve our customers.”The tentative agreement with Stellantis will require approval by a union council that oversees negotiations with the company, and then ratification by U.A.W. members. The council will meet on Thursday, Mr. Fain said.The deal with Stellantis means that only General Motors has not yet reached an agreement with the U.A.W.Erik Gordon, a business professor at the University of Michigan who follows the auto industry, said the new contracts impose higher labor costs on the Detroit manufacturers as they are ramping up production of electric vehicles and are competing with rivals who operate nonunion plants.“The Detroit Three enter a new, dangerous era,” he said. “They have to figure out how to transition to EVs and do it with a cost structure that puts them at a disadvantage with global competitors.”The union’s contracts with the three automakers expired on Sept. 15. Since then, the union has called on more than 45,000 autoworkers at the three companies to walk off the job at factories and at 38 spare-parts warehouses across the country.The most recent escalation of the strike at Stellantis came on Monday when the U.A.W. told workers to go on strike at a Ram plant in Sterling Heights, Mich., that makes the popular 1500 pickup truck. The strike has halted the production of Jeep Wranglers and Jeep Gladiators at a plant in Toledo, Ohio, and 20 Stellantis parts warehouses.For decades, the union has negotiated similar contracts with all three automakers, a method known as pattern bargaining. Like the contract it hammered out with Ford, the tentative Stellantis deal would lift the top U.A.W. wage from $32 an hour to more than $40 over four and a half years. That would allow employees working 40 hours a week to earn about $84,000 a year.Stellantis, G.M. and Ford began negotiating with the U.A.W. in July. The companies have sought to limit increases in labor costs because they already have higher labor costs than automakers like Tesla, Toyota and Honda that operate nonunion plants in the United States.The three large U.S. automakers are also trying to control costs while investing tens of billions of dollars to develop new electric vehicles, build battery plants and retool factories.Stellantis, which is based in Amsterdam, was created in 2021 by the merger of Fiat Chrysler and Peugeot, the French automaker. The company’s North American business, based near Detroit, is its most profitable.Stellantis surprised analysts recently by posting much stronger profits than G.M., which is the largest U.S. automaker by sales. Stellantis earned 11 billion euros ($11.6 billion) in the first half of the year while G.M. made nearly $5 billion.Noam Scheiber More

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    American Household Wealth Jumped in the Pandemic

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    Pandemic stimulus, a strong job market and climbing stock and home prices boosted net worth at a record pace, Federal Reserve data showed.American families saw the largest jump in their wealth on record between 2019 and 2022, according to Federal Reserve data released on Wednesday, as rising stock indexes, climbing home prices and repeated rounds of government stimulus left people’s finances healthier.Median net worth climbed 37 percent over those three years after adjusting for inflation, the Fed’s Survey of Consumer Finances showed — the biggest jump in records stretching back to 1989. At the same time, median family income increased 3 percent between 2018 and 2021 after subtracting out price increases.While income gains were most pronounced for the affluent, the data showed clearly that Americans made nearly across-the-board financial progress in the three years that include the pandemic. Savings rose. Credit card balances fell. Retirement accounts swelled.Other data, from both government and private-sector sources, hinted at those gains. But the Fed report, which is released every three years, is considered the gold standard in data about the financial circumstances of households. It offers the most comprehensive snapshot of everything from savings to stock ownership across racial, wealth and age groups.This is the first time the Fed report has been released since the onset of the coronavirus, and it offers a sense of how families fared during a tumultuous economic period. People lost jobs in mass numbers in early 2020, and the government tried to soften the blow with multiple relief packages.More recently, the job market has been booming, with very low unemployment and rapid wage growth that has helped to bolster incomes. At the same time, rapid inflation has eroded some of the gains by making everyday life more expensive.Without adjusting for inflation, median income would have risen 20 percent, for instance, based on the report released Wednesday.The job market has been booming, and at the same time, rapid inflation has eroded some of the gains by making everyday life more expensive.Hiroko Masuike/The New York TimesThe financial progress, particularly for poorer families, is especially remarkable when compared with the aftermath of the last recession, which lasted from 2007 to 2009. It took years for household wealth to rebound fully after that crisis, and for some families it never did.Income climbed across all groups between 2019 and 2022, though gains were biggest toward the top — meaning that income inequality widened.That made for a big difference between median income — the number at the midpoint among all households — and the average, which tallies all earnings and divides them by the number of households. Average income climbed 15 percent, one of the largest three-year pops on record.Wealth inequality was more complicated. Because the rich hold such a large share of financial assets in America, wealth gaps tend to grow in absolute terms when stocks, bonds and houses are climbing in price. True to that, wealth climbed much more in dollar terms for rich families.But in the three years covered by the survey, growth in wealth was actually the largest in percentage terms for poorer families. People in the bottom quarter had a net worth of $3,500 in 2022, up from $400 in 2019. Among families in the top 10 percent, median net worth climbed to $3.79 million, up from $3.01 million three years earlier.Because of the way the data is measured, it is difficult to break out just how much pandemic-related payments would have mattered to the figures. To the extent that families saved one-time checks and other help they received during the pandemic, those would have been included in the measures of net worth.Families were also still receiving some pandemic payments when the income measures were collected in 2021, which means that things like enhanced unemployment insurance probably factored into the data.Some Americans appear to have taken advantage of their improved financial positions to invest in stocks for the first time: 21 percent of families owned stocks directly in 2022, up from 15 percent in 2019, the largest change on record. Many of those new stock owners appear to have been relatively small investors, likely reflecting at least in part Americans’ enthusiasm for “meme stocks” like GameStop during the pandemic.The Fed’s newly released figures show that significant gaps in income and wealth persist across racial groups, although Black and Hispanic families saw the largest percentage gains in net worth during the pandemic period.Black families’ median net worth climbed 60 percent, to $44,900. That was a bigger jump than the 31 percent increase for white families, which lifted their household wealth to $285,000. Hispanic families saw a 47 percent increase in net worth.At the same time, racial and ethnic minorities saw slower income gains in the period through 2021. Black and Hispanic households saw small declines in earnings after adjusting for inflation, while white families saw a modest increase.For the first time, the report included data on Asian families, who had the highest median net worth of any racial or ethnic group.While the data in the report is slightly dated, it underscores what a strong position American families were in as they exited the pandemic. Solid net worth and growing incomes have helped people to continue spending into 2023, which has helped to keep the economy growing at a solid pace even when the Fed has been lifting interest rates to cool it down.That resilience has stoked hope that the Fed might be able to pull off a “soft landing,” one in which it slows the economy gently without crushing consumers so much that it plunges America into a recession. More

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    U.S. Scales Back Hopes for Ambitious Climate Trade Deal With Europe

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    A negotiating deadline is quickly approaching, and the United States has lowered its expectations for a groundbreaking trade deal.For the past two years, the United States and the European Union have been working toward a deal that would encourage trade in steel and aluminum made in more environmentally friendly ways to combat climate change.But longstanding differences on the way governments should treat trade and regulation have cropped up, preventing the allies from coming to a compromise. With an Oct. 31 deadline to reach a deal approaching, the United States has significantly narrowed its ambition for the pact, at least in its initial iteration.The outcome has been deeply disappointing for American negotiators, including Katherine Tai, the United States trade representative in charge of the talks, according to people familiar with the negotiations. In speeches last year, Ms. Tai described the potential deal as “historic” and “a paradigm-shifting model” that would reduce carbon produced by heavy industries, while also limiting unfair trade competition from countries like China, which has been pumping out cheap steel that is not manufactured in an environmentally friendly way.U.S. negotiators had envisioned setting up a club of nations committed to cleaner production, initially with Europe and later with other countries, that together would act to block dirtier steel, aluminum and other products from their markets. Steel and aluminum production is incredibly carbon intensive, with the industries together accounting for about a 10th of global carbon emissions. But Europeans raised a variety of objections to the approach, including arguing that it violated global trade rules for treating countries fairly.Now, the Biden administration is trying to salvage the talks by pushing for a narrower deal in the coming weeks. The more limited U.S. proposal currently includes an immediate agreement for countries to take steps to combat a flood of dirtier steel from countries like China, as well as a commitment to keep negotiating in the coming years for a framework that would discourage trade in products made with more carbon emissions, the people familiar with the negotiations said.Katherine Tai, the U.S. trade representative, has been seeking a far-reaching deal with the Europe Union.Pete Marovich for The New York TimesThe agreement is expected to be a point of discussion at a summit planned for Oct. 20, when President Biden will meet the president of the European Commission, Ursula von der Leyen, at the White House.The stakes are high: The United States is poised to bring back Trump-era tariffs on European steel and aluminum on Jan. 1, unless the sides reach an agreement, or American negotiators issue a special reprieve. Mr. Biden paused those tariffs for two years in 2021, when negotiations began with Europe.Restoring cooperation between the United States and Europe after years of rocky relations during the Trump presidency has been a key objective for Mr. Biden and his deputies.But the talks faced a basic obstacle: the United States and Europe have fundamental differences in how they are addressing climate change, trade and competition from China, and neither side is yet willing to significantly depart from its own policies.The Biden administration has largely dispensed with traditional trade negotiations focused on opening international markets, arguing that past trade deals that lowered global barriers to trade helped multinational corporations, rather than American workers, while supercharging the Chinese economy.Instead, the Biden administration has embraced tariffs, subsidies and trade arrangements that protect industries in the United States and allied countries, while blocking cheaper products made in China. It has done so in lock step with U.S. labor unions, which are opposed to removing tariffs and other policies that protect their industries.The European Union has criticized the American tariffs and subsidy programs as protectionist policies that threaten to undermine international trade rules.“This administration is trying to significantly retool the way we go about global economic engagement,” said Emily Benson, the director of Project on Trade and Technology at the Center for Strategic and International Studies, a think tank. “What’s unclear is the degree to which our allies buy into that agenda.”For their part, European officials are putting their efforts into an ambitious new carbon pricing scheme, that would tax companies across a range of industries in Europe and elsewhere for the greenhouse gases emitted during manufacturing. European officials have urged the United States to adopt a similar approach but American officials argue such a system is not viable in the United States, where Congress would be unlikely to impose new carbon taxes on American companies.The two governments also differ in how to approach China, which makes more than half of the world’s steel, often by burning coal. American steel makers say their Chinese counterparts receive generous government subsidies that allow Chinese steel to be sold at artificially low prices, unfairly undercutting competitors.European officials have been more reluctant to target China specifically. While the E.U. government has begun to take a more skeptical look at Chinese exports, many European nations still regard the country more as a vital business partner than a geopolitical rival.Given the close alignment between the United States and Europe on many issues, the history of trade negotiations between the governments is surprisingly bleak.The Obama administration pursued a trade deal with Europe that ultimately crumbled as a result of irreconcilable differences over regulation and agriculture. After lobbing both criticism and tariffs at Europe, the Trump administration tried for a more limited agreement, with similarly unimpressive results.The Biden administration successfully de-escalated some of those trade fights. But fundamental differences remain in how the United States and Europe view the role of government and regulation.“It’s incredibly complicated, largely because we have markedly different priorities,” said William Alan Reinsch, the Scholl Chair in International Business at the Center for Strategic and International Studies. “I can see a path but the path involves both sides making concessions that they really don’t want to make.”Miriam Garcia Ferrer, a spokeswoman for the European Commission, said the countries were “fully committed to achieving an ambitious outcome” by October.Valdis Dombrovskis, the European commissioner for trade, has warm relations with the American trade representative but that has not yet resulted in an agreement.Andy Wong/Associated PressThe European Union is seeking a permanent solution to U.S. tariffs and “re-establish normal and undistorted trans-Atlantic trade” while also driving decarbonization and addressing the challenge of global steel overproduction, Ms. Garcia Ferrer said.Sam Michel, a spokesperson for the U.S. trade representative, said that the Biden administration had “been fully committed to these negotiations over the last two years and we are hopeful both sides can reach an agreement that demonstrates the close partnership between the United States and the European Union.”People close to the talks say the outcome has been particularly disappointing given the close alignment and warm relations between Mr. Biden and Ms. von der Leyen, and Ms. Tai and her counterpart, Valdis Dombrovskis, the European commissioner for trade.Ms. Tai and Mr. Dombrovskis committed earlier this year to meeting every month. Mr. Dombrovskis, the former prime minister of Latvia, hosted Ms. Tai at a seaside dinner in the Latvian capital in June, and she brought him to the White House on July 4 to watch fireworks from the lawn.U.S. officials initially thought those meetings might mark a turning point for the negotiations. In a trip to Brussels in July, Ms. Tai told her counterparts that time was running out and that they needed to get something done.But that top-level commitment did not fuel momentum at lower levels of the bureaucracy, and progress fizzled as European negotiators left for summer holidays.The pace of talks has accelerated over the past month, but for a much more limited agreement.Jennifer Harris, a former senior director for international economics at the National Security Council who played a key role in starting negotiations, expressed optimism that progress could be made in the final days and weeks of the negotiations, especially given the upcoming meeting between Mr. Biden and Ms. von der Leyen.The talks now need “the kind of swift injection of tailwind that only leaders can provide,” she said. “I don’t think either leader is going to let this thing fail.” More

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    Fragile Global Economy Faces New Crisis in Israel-Gaza War

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    A war in the Middle East could complicate efforts to contain inflation at a time when world output is “limping along.”The International Monetary Fund said on Tuesday that the pace of the global economic recovery is slowing, a warning that came as a new war in the Middle East threatened to upend a world economy already reeling from several years of overlapping crises.The eruption of fighting between Israel and Hamas over the weekend, which could sow disruption across the region, reflects how challenging it has become to shield economies from increasingly frequent and unpredictable global shocks. The conflict has cast a cloud over a gathering of top economic policymakers in Morocco for the annual meetings of the I.M.F. and the World Bank.Officials who planned to grapple with the lingering economic effects of the pandemic and Russia’s war in Ukraine now face a new crisis.“Economies are at a delicate state,” Ajay Banga, the World Bank president, said in an interview on the sidelines of the annual meetings. “Having war is really not helpful for central banks who are finally trying to find their way to a soft landing,” he said. Mr. Banga was referring to efforts by policymakers in the West to try and cool rapid inflation without triggering a recession.Mr. Banga said that so far, the impact of the Middle East attacks on the world’s economy is more limited than the war in Ukraine. That conflict initially sent oil and food prices soaring, roiling global markets given Russia’s role as a top energy producer and Ukraine’s status as a major exporter of grain and fertilizer.“But if this were to spread in any way then it becomes dangerous,” Mr. Banga added, saying such a development would result in “a crisis of unimaginable proportion.”Oil markets are already jittery. Lucrezia Reichlin, a professor at the London Business School and a former director general of research at the European Central Bank, said, “the main question is what’s going to happen to energy prices.”Ms. Reichlin is concerned that another spike in oil prices would pressure the Federal Reserve and other central banks to further push up interest rates, which she said have risen too far too fast.As far as energy prices, Ms. Reichlin said, “we have two fronts, Russia and now the Middle East.”Smoke rising from bombings of Gaza City and its northern borders by Israeli planes.Samar Abu Elouf for The New York Times Pierre-Olivier Gourinchas, the I.M.F.’s chief economist, said it’s too early to assess whether the recent jump in oil prices would be sustained. If they were, he said, research shows that a 10 percent increase in oil prices would weigh down the global economy, reducing output by 0.15 percent and increasing inflation by 0.4 percent next year. In its latest World Economic Outlook, the I.M.F. underscored the fragility of the recovery. It maintained its global growth outlook for this year at 3 percent and slightly lowered its forecast for 2024 to 2.9 percent. Although the I.M.F. upgraded its projection for output in the United States for this year, it downgraded the euro area and China while warning that distress in that nation’s real estate sector is worsening.“We see a global economy that is limping along, and it’s not quite sprinting yet,” Mr. Gourinchas said. In the medium term, “the picture is darker,” he added, citing a series of risks including the likelihood of more large natural disasters caused by climate change.Europe’s economy, in particular, is caught in the middle of growing global tensions. Since Russia invaded Ukraine in February 2022, European governments have frantically scrambled to free themselves from an over-dependence on Russian natural gas.They have largely succeeded by turning, in part, to suppliers in the Middle East.Over the weekend, the European Union swiftly expressed solidarity with Israel and condemned the surprise attack from Hamas, which controls Gaza.Some oil suppliers may take a different view. Algeria, for example, which has increased its exports of natural gas to Italy, criticized Israel for responding with airstrikes on Gaza.Even before the weekend’s events, the energy transition had taken a toll on European economies. In the 20 countries that use the euro, the Fund predicts that growth will slow to just 0.7 percent this year from 3.3 percent in 2022. Germany, Europe’s largest economy, is expected to contract by 0.5 percent.High interest rates, persistent inflation and the aftershocks of spiraling energy prices are also expected to slow growth in Britain to 0.5 percent this year from 4.1 percent in 2022.Sub-Saharan Africa is also caught in the slowdown. Growth is projected to shrink this year by 3.3 percent, although next year’s outlook is brighter, when growth is forecast to be 4 percent.Staggering debt looms over many of these nations. The average debt now amounts to 60 percent of the region’s total output — double what it was a decade ago. Higher interest rates have contributed to soaring repayment costs.This next-generation of sovereign debt crises is playing out in a world that is coming to terms with a reappraisal of global supply chains in addition to growing geopolitical rivalries. Added to the complexities are estimates that within the next decade, trillions of dollars in new financing will be needed to mitigate devastating climate change in developing countries.One of the biggest questions facing policymakers is what impact China’s sluggish economy will have on the rest of the world. The I.M.F. has lowered its growth outlook for China twice this year and said on Tuesday that consumer confidence there is “subdued” and that industrial production is weakening. It warned that countries that are part of the Asian industrial supply chain could be exposed to this loss of momentum.In an interview on her flight to the meetings, Treasury Secretary Janet L. Yellen said that she believes China has the tools to address a “complex set of economic challenges” and that she does not expect its slowdown to weigh on the U.S. economy.“I think they face significant challenges that they have to address,” Ms. Yellen said. “I haven’t seen and don’t expect a spillover onto us.” More

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    U.A.W. Workers at Mack Truck Go on Strike

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    The strike at the truck manufacturer by 4,000 members of the United Automobile Workers comes in the middle of the union’s strikes at three large U.S. car companies.Nearly 4,000 members of the United Automobile Workers union went on strike against Mack Trucks on Monday after rejecting a tentative contract that union’s leaders had worked out with the company.The union informed the truck maker on Sunday that members had opposed the contract by a 73 percent vote, and that a strike would begin at Mack’s factories in Pennsylvania, Maryland, and Florida.“The members have spoken, and as the highest authority in our union, they have the final word,” the U.A.W. president, Shawn Fain, wrote in a letter to Mack’s parent company, Volvo Trucks.The two sides have been negotiating for three months over a range of issues including wage increases, cost-of-living allowances, job security, pensions, prescription drug coverage and overtime. The proposed contract included raises of 19 percent over five years and a bonus of $3,500 for ratifying the agreement.Mack’s president, Stephen Roy, said in a statement that the company was “surprised and disappointed,” noting that the U.A.W. negotiators had called the tentative agreement a “record contract for the heavy truck industry.”Commercial truck sales have been recovering slowly from the disruptions caused by the coronavirus pandemic. Volvo has forecast about a 10 percent increase in industrywide truck sales this year in North America. Mack has about a 6 percent share of the North American market.The Mack strike comes as the U.A.W. is conducting a strike at plants and distribution centers owned by the three automakers, General Motors, Ford Motor, and Stellantis, the maker of Chrysler, Jeep, and Ram vehicles.The auto strike began nearly a month ago at three plants and the U.A.W. has expanded it in a bid to increase the pressure on the manufacturers. About 25,000 of the 150,000 U.A.W. workers employed by the three automakers are on strike. The stoppage affects two plants owned by G.M., two owned by Ford, and one owned by Stellantis, as well as the 38 spare-parts warehouses owned by G.M. and Stellantis.The automakers have offered wage increases of more than 20 percent over four years. They have also agreed to shorten the time — to four years from eight — that it takes a new worker to rise up from the entry-level wage of about $17 an hour to the highest-level wage of $32 an hour.The union is pushing for greater wage increases, noting that raises over the last 15 years have not kept pace with inflation. It is also demanding the companies provide pensions for more workers, pay the cost of retiree health care, and convert temporary employees into permanent staff. More