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Economy to Overcome Other Issues in 2020, says Trump

President Donald Trump is hoping that simple message in 2020 will help foil his eventual Democratic Party challenger. 

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President Donald Trump
U.S. President Donald Trump attends a Keep America Great Rally at the Rupp Arena in Lexington, Kentucky, U.S. VOA

“It’s the economy, stupid” has been a catchphrase of U.S. presidential politics since the 1992 campaign, when Bill Clinton unseated incumbent George H.W. Bush. Nearly three decades later, U.S. President Donald Trump is hoping that simple message in 2020 will help foil his eventual Democratic Party challenger.

Trump — in tweets, at political rallies and in remarks to reporters — constantly emphasizes the performance of the U.S. economy, stock market surges, low unemployment rates and his tax cuts to boast he is doing a great job as president.

Economists and political analysts are divided on whether that message will enable the incumbent to stay in office beyond January 2021.

Culture war, partisan split

Ever since Clinton, “we’ve all kind of assumed that should be true. And I think for the most part, it is,” said Ryan McMaken, senior editor and economist at the Mises Institute, a politics and economics research group in Alabama. He cautioned, though, that Trump finds himself on one side of a culture war that his predecessors did not have to confront, as well as a deep partisan divide on consumer confidence.

Walmart Supercentre
Balo Balogun labels items in preparation for a holiday sale at a Walmart Supercenter, in Las Vegas. Black Friday once again kicks off the start of the holiday shopping season. But it will be the shortest season since 2013 because of Thanksgiving falling on the fourth Thursday in November, the latest possible date it can be. VOA

Policy analyst James Pethokoukis at the Washington-based American Enterprise Institute, a public policy research group, also is cautious about the economy prevailing over all other issues.

“Just having a strong economy is not going to guarantee you re-election,” he said. “People often point back to the 2000 election, which occurred after a decade of tremendous economic growth any way you want to measure it — gross domestic product, jobs and wage growth. And yet, [Clinton’s vice president] Al Gore still lost that election to George W. Bush.”

McMaken questioned whether voters in key swing states — such as Wisconsin, Michigan, Pennsylvania and Ohio — who cast ballots for Trump in 2016 were experiencing enough of the touted economic performance to vote again for the president.

Overall, however, “it’s not a bad economy to run on if you’re Donald Trump,” said Pethokoukis.

Trump, said to have concerns about the direction of the economy ahead of next November’s election, will likely push for more tax cuts, passage of a renegotiated North American trade pact and continued pressure on the country’s central banking system, the Federal Reserve, to lower interest rates.

A LB Steel LLC's employee manufactures a component
A LB Steel LLC’s employee manufactures a component for new Amtrak Acela trains built in partnership with Alstom in Harvey, Illinois, U.S. VOA

Trouble ahead?

There are rumblings of economic storm clouds on the horizon. The impact can be seen in Trump’s trade war with China, which has hurt U.S. farmers and raised prices for consumer goods. It’s also reflected in the Institute for Supply Management’s Manufacturing Index, an underperforming U.S. Private Sector Job Quality Index and a ballooning record national debt, in addition to the worrying level of money owed to creditors by middle-class Americans.

“We’ve actually been in a sort of a manufacturing recession, seen a shrinkage of factory jobs, the exact kinds of jobs that I’m sure that people voting for the president thought would be a lot better now,” said Pethokoukis.

So far, none of this has prompted a major stock market correction.

“There seems to be a lot of adaptations in the markets to Trump’s America. That may work to his advantage,” said the Mises Institute’s McMaken.

Analysts note a lack of emphasis on economic platforms so far by the leading Democratic U.S. presidential candidates seeking to oust Trump next year.

But such a platform is likely to be touted when the opposition party holds its convention next July in Milwaukee and picks its campaign ticket. Pethokoukis suggested the Democratic Party should devise a plan with a goal to boost American worker productivity, which has flatlined for years.

The great divide

McMaken pointed out that the widening chasm between the well-off and those struggling economically in the United States makes Trump vulnerable — something emphasized by left-leaning Democratic presidential contenders such as Bernie Sanders and Elizabeth Warren.

Donald Trump says the economy isn't doing well
Tents and tarps erected by homeless people are shown along sidewalks and streets in the skid row area of downtown Los Angeles, California, U.S. VOA

“On the ground level, I would say just in general, the economy isn’t doing as well,” concluded McMaken.

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Amid an impeachment drive by the Democrats, Trump is repeatedly hammering on a specific message to those questioning his suitability for office while being impressed with the performance of their pension accounts during his presidency.

“Love me or hate me, you’ve got to vote for me,” Trump said at a rally in New Hampshire in August, warning that Americans’ investments portfolios would go “down the tubes” if he lost next year’s election. (VOA)

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Tourists Return to Venice as Italy Reopens Borders

International tourists start to return to Venice as Italy reopened its borders after the pandemic

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Tourists have slowly started to return to Venice after the pandemic. Pixabay

International tourists have started to return to Venice after Italy reopened its borders as the once worst-hit country recovers from the coronavirus pandemic as per Latest Travel News & Tourism News.

The city’s streets and squares were still relatively empty, highlighting the profound change for its 50,000 residents, reports Efe news.

Before the pandemic, Venice welcomes around 30 million people annually.

Shops, markets and restaurants have reopened after almost three months of lockdown.

Follow NewsGram on Twitter to keep yourself updated.

Since the relaxation of the quarantine measures a couple of weeks ago, the outdoor tables of the city’s cafes and restaurants had begun to come to life, mostly with locals and visitors from neighbouring towns and cities in the Veneto region.

Angela Barbato, an advisor at the Bel-Air Fine Art Gallery, says around 70 per cent of her clients are foreign.

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Before the pandemic, Venice welcomes around 30 million people annually. Pixabay

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While waiting for their return she has been responding to inquiries from callers in the US, Australia, Germany and other places asking when they can return to Venice.

“We are a group of international galleries and we already have loyal clients abroad and Venice is clearly a very international recruitment site,” she said.

The gradual return of foreign visitors has revived the local economy but also fuelled the anxiety of some residents who have become accustomed to a quiet and clean city and are afraid of a surge in mass tourism. (IANS)

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Canada Faces Sharpest Downturn in GDP Since 2009

Canadian economy sees worst quarterly performance since 2009

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Canada witnesses worst quarterly performance since 2009 due to the COVID-19 outbreak. Pixabay

Canada’s national statistical agency said that the country’s economy saw the worst quarterly performance since 2009 due to the COVID-19 pandemic.

Statistics Canada said on Friday that it came as the GDP suffered a big drop in March as restrictions against the spread of COVID-19 began rolling out during the month, reports Xinhua news agency.

The downturn in GDP, the sharpest since the first quarter of 2009, reflects measures rolled out in March to contain the COVID-19 pandemic, such as closures of school and non-essential businesses, border shutdowns and travel restrictions, as well as events earlier in the quarter, mainly the Ontario teachers’ strike and rail blockades in February.

The country’s GDP fell 7.2 per cent in March from February, the most severe month-on-month fall, while annualized growth for the first quarter decreased by 8.2 per cent, the largest since the depths of the Great Recession.

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The country’s GDP fell 7.2 per cent in March from February, the most severe month-on-month fall. Pixabay

Household spending was reduced by 2.3 per cent in the first quarter of 2020, the steepest quarterly drop ever recorded.

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Spending reductions were influenced by substantial job losses, income uncertainty and limited opportunities to spend because of the mandatory closure of non-essential retail stores, restaurants and services, and restrictions on travel and tourism activities.

Real GDP plummeted by a record 11 per cent in April from March as most sections of the economy were shut down to fight the COVID-19 outbreak.

The March and April falls are likely to be the largest consecutive monthly declines on record, said the country’s statistics agency. (IANS)

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40.7 Million American Workers Seek Unemployment Benefits

Unemployment has increased worldwide as bussinesses remain shut due to COVID-19 pandemic

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People who lost their jobs are reflected in the door of an Arkansas Workforce Center as they wait in line to file for unemployment following an outbreak of the coronavirus disease (COVID-19), in Fort Smith, Arkansas. VOA
By Ken Bredemeier

 

Applications for unemployment compensation eased again in the U.S. last week, the Labor Department reported Thursday, as some employers started to reopen businesses after the coronavirus pandemic forced their closure.

Even so, another 2.1 million more workers sought cash benefits after being laid off as other businesses curtailed their operations in the face of the continuing threat from the virus and less demand for their products.

In all, since mid-March, 40.7 million workers have now sought unemployment compensation, nearly a quarter of the U.S. labor force of more than 164 million.

However, the current actual number of jobless workers is unknown since some who sought unemployment benefits in previous weeks have now been called back to work by their employers. All 50 state governors have begun to ease restrictions on businesses opening in a patch-work array of directives that varies widely throughout the country.

The U.S. death toll from the virus topped 100,000 on Wednesday and health experts predict tens of thousands more will die in the coming months. But President Donald Trump, facing a November re-election contest against former Vice President Joe Biden, is predicting the country will have a robust economic recovery.

“States should open up ASAP,” Trump said on Twitter this week as the stock indexes advanced sharply. “The Transition to Greatness has started, ahead of schedule. There will be ups and downs, but next year will be one of the best ever!”

But the coronavirus has had a major effect on U.S. commerce, with 27 companies already filing for bankruptcy protection in May and some companies announcing they were closing permanently.

The official April unemployment rate was 14.7%, with Trump economic advisers acknowledging that the May figure, when it is announced in early June, is likely to be 20% or more. They say the rate could remain in double digits on Election Day Nov. 3 and could still be about 10% at the end of 2021.

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White House chief economic adviser Larry Kudlow talks to reporters. VOA

The government at first said the national economy dropped 4.8% in the first quarter, but that was before the full impact of the pandemic became apparent. It raised the figure to 5% on Thursday and economists expect a further decline in the April-to-June quarter.

Larry Kudlow, director of the White House National Economic Council, told the Washington Post recently that there are some “small glimmers of hope” in the economy. But he also acknowledged the ongoing difficulties the coronavirus pandemic poses to the world’s largest economy.

“Look, it’s really hard to model a virus, a pandemic, the likes of which we have not seen for 100 years,” Kudlow said. “The numbers coming in are not good. In fact, they are downright bad in most cases. But we are seeing some glimmers, perhaps … there’s a lot of heartbreak here. There’s a lot of hardship here. There’s a lot of anxiety here. It’s a very difficult situation.”

Numerous states still require social distancing of at least two meters between people in stores and some major retail outlets are requiring their employees and customers to wear face masks. Some governors are limiting restaurants to half capacity.

But in other states, the restrictions have been significantly lifted and crowds have quickly emerged to resume life, shopping or enjoying a day at Atlantic and Pacific beaches, often ignoring the admonitions of health experts to maintain a safe distance from others or to wear a face mask.

Federal Reserve chair Jerome Powell has warned that the American economy could endure a multi-year recession if more aid is not authorized for workers. He said that 40% of American households earning less than $40,000 a year lost jobs in March.

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In a few states, the restrictions have been significantly lifted. VOA

But Trump and Republican lawmakers are balking at approving more government assistance until it can be determined how much effect the already-approved funding is helping the economy.

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U.S. workers filing for jobless benefits normally are paid slightly less than half their normal salaries. But these payments are currently being augmented during the pandemic with $600-a-week supplements from the federal government for four months, through July.

The peak of the unemployment benefit claims likely came in late March with 6.9 million workers filing for the jobless compensation.

The weekly pace of claims has diminished each of the last 10 weeks since then, but the millions of claims have still been unparalleled over decades of U.S. economic history, reaching back to the Great Depression in the 1930s. The number of claims has far exceeded those made during the Great Recession in 2008-2009. (VOA)