Commentary: The Fed’s Interest Rate Hikes Have only Destroyed $398 Billion of the $6 Trillion It Printed

“Our expectation has been we would begin to see inflation come down, largely because of supply side healing.  We haven’t. We have seen some supply side healing but inflation has not really come down.”

That was Federal Reserve Chairman Jerome Powell on Sept. 21, speaking to reporters following the central bank’s meeting where the Federal Funds Rate was once again increased 0.75 percent to its current range of 3 percent to 3.25 percent in a bid to combat sticky 8.3 percent consumer inflation the past year.

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Analysis: New Pennsylvania Budget Boosts Corporate Welfare to $1.3B

Pennsylvania’s latest budget deal increased spending, and a good chunk favored private businesses, according to critics.

A new analysis from the Commonwealth Foundation says the budget carried $1.3 billion in corporate welfare spending.

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U.S. Senate Passes Massive Tax and Spend Bill Targeting Carbon Emissions, Prescription Drug Costs, More

The U.S. Senate on Sunday passed a $740 billion new taxing and spending bill that seeks to combat climate change and allow the government to control the price of prescription medications, among other things.

No Republicans voted for the bill, named the Inflation Reduction Act of 2022, in the divided 50-50 Senate, forcing Vice President Kamala Harris to break the tie. The measure must return to the House for a concurrence vote after senators passed several amendments Sunday. The House is expected to take the bill up again on Friday. If the House concurs, President Joe Biden has indicated he will sign it.

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Crom’s Crommentary: Biden Is Governing Like It’s the 1970s

Friday morning on The Tennessee Star Report, official guest host Aaron Gulbransen welcomed the original all-star panelist Crom Carmichael to the studio for another edition of Crom’s Crommentary.

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‘It’s An Absurd Argument’: Economists Take Apart One of Biden’s Favorite Talking Points

The Biden administration’s oft-touted talking point that employment has boomed under the administration is misleading and instead simply a natural recovery from pandemic losses, economists told the Daily Caller News Foundation.

Facing consecutive quarters of negative gross domestic product (GDP) growth, sky-high inflation and plummeting consumer sentiment, the Biden administration has routinely cited a low unemployment rate and strong on-paper jobs creation as positive results of President Joe Biden’s economic stewardship. But the notion that these figures represent booming job creation is misleading since the economy has merely rebounded by adding back jobs that were lost during the pandemic and has still yet to reach pre-pandemic levels, economists told the DCNF.

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Pennsylvania Budget Lauded by GOP, Dems, but Critics Call Spending ‘Not Sustainable’

Pennsylvania Capitol Building

After missing the June 30 deadline for a budget deal, an agreement has been made.

The $45.2 billion budget was approved by the Senate on Friday after the House approved it Thursday. It awaits the signature of Democratic Gov. Tom Wolf to become official.

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Arizona 2022 Legislative Session Ends with $18 Billion Budget, Failure to Ban All Abortions, and 79 Bills Waiting for Ducey

The 2022 Arizona Legislative session ended Friday, after passing the annual budget and 385 bills – 79 of which are waiting for Governor Doug Ducey to sign or veto. Among the spending priorities is a massive expansion of the state’s school voucher system, which Ducey is expected to sign.

However, some political watchers note that the nearly $18 billion budget, composed of 12 bills, is full of pork – one example of which is a large tax credit for Hollywood the Republican leadership insisted on passing.

A proposed bill banning all abortions, meanwhile, was blocked.

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Gubernatorial Hopeful Jensen Calls for ‘Phasing Out’ Minnesota’s Income Tax to Help Fight Inflation, Boost Economy

Republican gubernatorial candidate Dr. Scott Jensen announced at a Thursday press conference his comprehensive plan to fight inflation.

Jensen’s “FIT” plan — “Fight Inflation Together” — comprises a variety of reforms and policies pertaining to taxes and spending. These include but are not limited to investigating wasteful government spending, vetoing tax increases and initiatives that increase the cost of living, eliminating social security taxes, and enacting deregulatory measures that allow businesses to obtain permits and licenses with less hassle.

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Arizona Legislature Considering ‘Build Back Broke’ Type of Budget with Earmarks, Funding for School Social Workers, and Government Employee Pay Raises

The Arizona Legislature is rushing to pass a budget before the 2022 session ends in a few days on June 30, but some Republican legislators are balking at agreeing to vote for the 12 budget bills due to the amount of spending, $17.9 billion. State Sen. Michelle Ugenti (R-Scottsdale) tweeted on Monday, “Arizona’s version of @JoeBiden’s Build Back Broke (aka the legislature’s introduced budget) is not fiscally responsible. You cannot spend your way out of a looming recession.”

She objected to the budget adding an extra half a billion dollars. “I can’t think of anything more fiscally irresponsible than spending recklessly on member pet projects while Arizonans struggle to keep up with crushing inflation,” she tweeted. The Republican Liberty Caucus of Arizona called the budget “bloated and wasteful.” 

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Gov. Walz Offers Minnesotans $1,000 Checks to Spend Half of $9.2 Billion Surplus

Gov. Tim Walz suggested sending half of the state’s $9.2 billion surplus back to taxpayers in a 15-minute special session.

Walz last weekend proposed sending individuals $1,000, and married couples $2,000.

Only Walz can call a special session, but he hasn’t after a GOP and DFL broad deal for $4 billion in tax relief and $4 billion in savings disintegrated in May as the regular session concluded.

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Commentary: Recession Predictor 10-Year, 2-Year Treasuries Spread Inverts Once Again Amid Crushing Inflation

The spread between 10-year and 2-year treasuries, a reliable indicator of incoming recessions that has predicted almost every recession in modern economic history, inverted once again overnight Monday amid financial markets turmoil with interest rates rising rapidly, the dollar strengthening and equities markets crashing.

That is almost certainly terrible news for President Joe Biden and Congressional Democrats ahead of the 2022 Congressional midterms. The White House has attempted to highlight relatively low unemployment numbers as signs of a healthy economy, with President Biden on June 3 declaring the latest jobs numbers as “good news.”

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City of Dearborn Facing $22 Million Deficit

The city of Dearborn plans to restructure health care benefits and cut spending as it faces a $22 million deficit equivalent to firing 349 full-time employees.

The Metro Detroit city cited rising costs for the deficit, including $3.2 million in wage and benefit increases, $2.7 million for deferred fleet maintenance, and $1.2 million for increased fuel and other supplies.

However, budget details note the city has consistently spent more than it collected in revenue.

Dearborn Mayor Abdullah Hammoud told residents at a public meeting last week: “You are not going to lose benefits,” Fox2 reported. “At no point in time will the rug ever be pulled away from them, we never want to do that.”

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Think Tank: Detroit’s ARPA Spending Unsustainable

Detroit skyline at night

Nine years after declaring bankruptcy, the city of Detroit received more than $826.7 million in one-time federal stimulus money but still projects a deficit in fiscal year 2027.

A Citizen’s Research Council of Michigan (CRCM) report says the city’s plan to spend one-time dollars on recurring programs is unsustainable.

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Virginia Budget Deal Includes Middle-Class Tax Cuts, Grocery Tax Cut

After months of debate about Virginia’s biennium budget, lawmakers reached a deal to provide an income tax cut for the middle class, a reduction in the grocery tax and a pay raise for teachers.

The deal earned approval from Republicans and Democrats in a joint conference committee, but still needs to pass the House of Delegates and the Senate and be signed by Gov. Glenn Youngkin. Republicans narrowly control the House and Democrats narrowly control the Senate.

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Arizona Free Enterprise Club Labels Red4ED ‘One of the Most Expensive Failures in Arizona Political History’

The Arizona Free Enterprise Club (AFEC) analyzed the success of the Red4ED movement in Arizona since it launched a little over four years ago, and concluded that after spending over $30 million, the movement not only failed to accomplish anything, but failed to stop historic tax cuts. Red4Ed’s two initiatives and referendum were struck down by courts as “legally flawed,” resulting in AFEC labeling its efforts “the largest, most expensive failure in Arizona political history.” 

Arizona Educators United launched Red4Ed in 2018 ostensibly to increase teachers’ salaries and funding for K-12 education. People and teachers showed up all over, at the state capitol and at events and protests, wearing red shirts and carrying red signs. But AFEC said “the movement was quickly hijacked by the teachers’ unions and other out-of-state special interest groups.” It soon turned into “a singular quest to double the state income tax through a ballot initiative.”

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Rep. John Rose Commentary: Inflation Is the Invisible Tax

Inflation is an invisible tax that Tennesseans have to pay each and every day. Everywhere you look, inflation is wreaking havoc. At the gas station: gas is up 48 percent. At the grocery store: beef is up 20 percent, chicken is up 15 percent, butter is up 14 percent, fruits and vegetables are up 7 percent, and coffee is up 12 percent. At home: electricity is up 11 percent, furniture is up 15 percent, and rent is up 5 percent. What about a vacation? You still won’t be able to escape inflation as hotels are up 29 percent and flights are up 23 percent.

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Minnesotans Demand Permanent Tax Cuts: ‘They’re Stealing from Us’

Minnesotans are calling on Gov. Tim Walz and the Legislature to return the record-breaking $9.3 billion budget surplus to the people by permanently cutting taxes.

A crowd gathered inside the Minnesota Capitol rotunda Saturday for the “Give it Back Tax Rally.” The rally was hosted by the Center of the American Experiment and involved several speakers including multiple radio hosts and a former U.S. congressman.

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Georgia Lawmakers Approve $30.2 Billion Budget as 2022 Session Draws to a Close

Georgia State Capitol

Georgia lawmakers capped off the 2022 legislative session by approving the state’s fiscal 2023 budget.

The state Senate voted 53-0 in favor of House Bill 911, while the state House voted 160-5.

The $30.2 billion budget, which starts July 1, represents a 10.8 percent increase over last year’s budget and includes a $5,000 pay increase for state employees. Coupled with more than $17.6 billion in federal money, the state’s budget exceeds $57.9 billion.

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Analysis Details $8.9 Billion Spending Increase in Lee’s Budget Proposal

Bill Lee speaking

Tennessee Gov. Bill Lee’s $52.6 billion budget proposal uses $8.9 billion more in general fund dollars than the state’s current budget, according to an analysis from The Sycamore Institute.

The additional spending comes from multiple sources. A large portion is from excess taxes and fees collected over the past three years and an influx of federal funds.

The Sycamore Institute pointed to $5.2 million more in funds available this fiscal year than what was budgeted in July, including a $2.3 billion surplus from fiscal year 2021 and $2.3 billion more in surplus from fiscal 2022.

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Wisconsin Manufacturers & Commerce Chief: Gov. Evers Misses the Mark with Workforce Development Money

The state’s largest business group says Gov. Tony Evers’ could have done better with his latest workforce development effort.

The governor on Tuesday announced plans to spend $60 million in coronavirus stimulus money to try and get more people back to work in the state.

“There is no one-size-fits-all solution to addressing the workforce challenges across our state, so these funds are critically important to encourage regions and communities to develop cutting-edge, long-term solutions to the unique workforce challenges they face,” the governor said.

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House Passes Democrats’ Social Spending Bill After Congressional Budget Office Score

Kevin McCarthy and Nancy Pelosi

Congressional Democrats passed a $1.75 trillion social spending plan Friday, putting the bill’s fate in the hands of a deeply divided Senate.

The bill funds universal pre-kindergarten, climate change spending, Obamacare subsidies, an extension of the monthly child tax credit payment and more wide ranging spending items. House Republican Leader Kevin McCarthy spoke more than eight hours on the House floor overnight to delay the vote until Friday morning, but afterward it passed 220-213 along party lines with one Democrat opposed.

“We are very excited for what it does for the children, for the families,” House Speaker Nancy Pelosi, D-Calif., said in a press conference after the bill’s passage.

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In Another Viral Speech, Rep. Schweikert Says It’s About Time to Declare the Pandemic over, and Exposes Fraud and Budget Gimmicks in ‘Build Back Better’

Just two weeks after his House floor speech on financial fraud in Congress went viral, Arizona Rep. David Schweikert (R-Ariz.) delivered another epic speech, this time focusing on COVID-19 and President Joe Biden’s Build Back Better bill. Schweikert said the country is about at the point to declare the pandemic over, and he slammed Biden’s “social spending plan” for “economic violence” against the working poor and “laced with budget gimmicks.”

Schweikert explained how the combination of several factors now means the pandemic is about over. Pfizer’s new antiviral medication, which is about to be approved by the FDA, is 89% effective and will be available to millions by January. There are at-home COVID-19 tests and multiple vaccines. He will be putting forth legislation shortly to address this developing situation.

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Arizona Rep. Schweikert’s House Speech on Fraud, Spending, and Running Out of Money Goes Viral

Rep. David Schweikert (R-06-AZ), known as the wonky numbers member of Congress, gave a speech on the House floor a few days ago about runaway spending in Congress that has gone viral with over 1.2 million views. It’s on Social Security and Medicare running out of money and how the U.S. is headed for a dystopian future if it’s not fixed. He addressed several myths and offered solutions.

He began saying he’s about to say some things most people don’t want to hear, “We call it math.” The biggest threat over the next couple decades facing the country is demographics. “Getting older isn’t Democrat or Republican, it’s going to happen to everyone.” But he says he’s been booed for telling people the truth. “You don’t raise money telling people the truth about what’s going on.” Referring to Congress, he said, “We live in a financial fantasy world in this place … there’s a fraud around here.” 

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Senate Republicans Filibuster Government Funding Bill Over Debt Ceiling Provision With Three Days Until Shutdown

Senate Republicans Monday filibustered Democrats’ bill to fund the government and suspend the debt ceiling, days before a potential federal shutdown and possible debt default.

Republicans vowed for weeks to oppose a debt ceiling increase and urged Democrats to put the provision in their filibuster-proof $3.5 trillion reconciliation bill. But Democrats have thus far refused to do so, and with their bill’s failure Monday, Congress now has just three days to pass a new funding bill to avoid a government shutdown set to begin Friday at midnight.

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Tennessee Tax Revenue Beats August Estimates by $268M

Tennessee’s revenue collection continues to exceed the state’s budgeted expectations.

Tax revenue in August was $267.9 million more than budgeted estimates, reaching $1.4 billion. The growth rate for revenue was 22.11% higher than a year ago.

The August accrued numbers are for taxes collected from July. The August accruals start a new fiscal year for the state.

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As Infrastructure Bill Heads Toward Passage, Tennessee’s Blackburn and Hagerty Sound Alarm on Debt

Bill Hagerty and Marsha Blackburn

As U.S. Senate leaders expect to pass a $1.2 trillion infrastructure bill Tuesday morning, both of Tennessee’s senators, Marsha Blackburn (R) and Bill Hagerty (R) are vehemently opposing the legislation, alarmed by its potential to worsen the national debt.

Senate Democrats have expressed their intention to use a process called reconciliation to avoid any possible filibuster, thus allowing themselves expand the measure to encompass $3.5 trillion in federal spending.

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The Congressional Budget Office Says the Bipartisan Infrastructure Bill Will Increase Deficits by $256 Billion over 10 Years

The Congressional Budget Office estimated Thursday that the bipartisan Senate infrastructure bill will add $256 billion to the deficit over the next decade, undercutting its backers’ claims the spending had been offset.

In FY2020, the deficit hit a record $3.1 trillion. So far in FY2021, the deficit is $2.2 trillion. The national debt is climbing to $29 trillion for the first time in U.S. history.

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U.S. Set to Hit Debt Ceiling Within Four Months, Congressional Budget Office Estimates

The federal government is on track to reach the statutory debt limit in the fall, which would trigger a government shutdown, according to a Congressional Budget Office (CBO) estimate.

The U.S. is projected to reach the debt ceiling of $28.5 trillion by October or November, a CBO report released Wednesday stated. If Capitol Hill lawmakers don’t reach an agreement on raising the limit higher, the government could undergo its third shutdown in less than four years.

“If the debt limit remained unchanged, the ability to borrow using those measures would ultimately be exhausted, and the Treasury would probably run out of cash sometime in the first quarter of the next fiscal year (which begins on October 1, 2021), most likely in October or November,” the CBO report said.

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California Spent $13 Million to Guard 120 Empty Homes

Several tents on the side of the street

The state government of California has been revealed to have spent $13 million on providing security for 120 empty houses for five months, even as a homeless crisis ravaged the state, Fox News reports.

In a report broken by local outlet Fox 11, the California Department of Transportation (CalTrans) paid $9 million to the highway patrol from November 2020 to April 2021, and gave another $4 million to a private security firm over the same period, all for the purpose of protecting the vacant houses in Pasadena.

In a statement addressing the report, CalTrans said that the houses had been purchased by the government 60 years ago, when there were plans for a change in the local infrastructure by connecting the 710 freeway to the 210. However, that project “is no longer moving forward,” the government statement declared.

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Commentary: It is Time to Fight for the Rights of Independent Businesses

As a very young man, I was fortunate enough to start my own company out of my apartment using a small amount of investment capital from friends and family. Over time, that business grew to have over 6,000 employees and revenues in excess of $2 billion. Over nearly a 40-year span, my team and I built what some would consider a remarkable track record, as measured by both sales and profits.

Because of my experience growing that business, I feel a special kinship with small, privately owned businesses and their owners. I also come from a middle-class background, one that shaped me into the person I am today. It is through both the lens of entrepreneur and member of the middle-class that I look through when reflecting upon this Independence Day.

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Commentary: Price Stability, not Inflation, Will Get the U.S. Economy Back to Full Employment Sooner Rather than Later

2020 and 2021 are two sides of the same coin: Price instability brought about by the dollar being either relatively too strong or too weak, which can lead to or exacerbate economic slowdowns, creating higher unemployment and worse if the conditions persist for too long.

In 2020, at the height of the Covid pandemic, the problems included the global economy being shut down plus local lockdowns resulting in a massive recession and a flight to safety into U.S. treasuries as interest rates collapsed, making the dollar too strong. With the onset of deflation, consumer prices plummeted in March and April 2020, with oil even dropping briefly below zero dollars for the first time in history, and a concurrent rise of unemployment as 25 million Americans lost their jobs.

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Biden’s ‘American Jobs’ Plan Could Cost Taxpayers about $666,000 per Job Created

President Joe Biden and VP Kamala Harris

President Joe Biden’s proposed $2 trillion American Jobs Plan could end up costing taxpayers more than $666,666 per job created.

The Washington Post gave Biden “two Pinocchios” for saying the American Jobs Plan, his infrastructure and jobs proposal, will create 19 million jobs. Both Biden and his Transportation Secretary Pete Buttigieg have made the 19 million jobs claim. The source of the statement is a Moody’s analysis, which CNN pointed out had estimated the U.S. economy would add about “16.3 million jobs over the same period if the infrastructure proposal does not get passed.”

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Tennessee Democrats Call for $1B Investment in a ‘Path to Recovery’

Tennessee Senate Democrats are calling for a $1 billion investment in public health clinics, school renovation, clean energy jobs and broadband internet expansion ahead of Gov. Bill Lee’s State of the State address Monday.

In a statewide address Friday aired virtually from her home in Memphis, Senate Democratic Caucus Chairwoman Raumesh Akbari proposed a plan dubbed the “Tennessee Path to Recovery” and called on Republican colleagues to work together to address issues facing Tennessee’s working-class families.

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Ohio Governor Orders Millions More in Cuts to State Agencies

Saying immediate actions are necessary to keep the state’s budget balanced, Ohio Gov. Mike DeWine ordered hundreds of millions of dollars in cuts to state agencies.

“In the springtime, the impact of the COVID-19 pandemic on the global economy, and Ohio’s revenue, was dire. With this, reductions were made to the state biennial budget,” DeWine said. “With this executive order, we are finalizing current year budget reductions at $390 million across all agencies, which is less than the cuts implemented last year.”

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New House Rules Carve-Out for ‘Climate Change’ Bills Exempted from Requiring Projected Price Tag

House Democrats blocked a Republican attempt on Monday to require any proposed climate change legislation to also include its projected cost.

Under the Pay As You Go (PAYGO) rule, any additional government spending proposed must be accompanied by tax increases or separate cuts. After a push from several lawmakers in the Democratic Party’s progressive wing, however, the rules package for the 117th Congress states PAYGO will not apply to legislation relating to the necessary economic recovery or U.S. efforts to combat climate change.

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Ohio Ends 2020 Fiscal Year with General Tax Revenue Down $1.1 Billion

Ohio concluded the 2020 fiscal year with General Revenue Fund tax revenues of $1.1 billion, or 4.6 percent, below estimates, a clear indication of the impact the COVID-19 restrictions have had on the state.

Tax revenues in June were $50.5 million, or 2.2 percent, below estimate. However, state officials noted that revenues were better than a month earlier when they were 13 percent below expectations.

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Armstrong Williams Commentary: It’s Time to Talk About Recession

Is America in a recession? It’s an unpopular question to ask, but it has now been over 3 months since COVID-19 restrictions were initiated and it is time for us to get realistic about where we are economically so that we can take the proper steps to minimize further damage to our economy. At this point, the unfortunate reality is that regardless of what we do, it is likely that it will take at least several years to see a partial recovery of economic loss and the time that it will take for a complete recovery remains unknown at this point. 

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Minnesota’s Legislative Deadline Passes with No Agreement on Infrastructure Proposal

The Minnesota legislature failed to reach agreements on a major construction bill, tax relief, or state employee contracts before the midnight Sunday deadline for this session.

The lawmakers could still find a middle ground in a special June session.

Minnesota House Republicans Saturday blocked Democrat’s $2 billion bonding bill. Bonding bills must originate in the House and require a three-fifths majority, or 81 votes, to pass. The final tally fell six votes short.

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Minnesota House Falls Short of Passing Mammoth $2.5 Billion Infrastructure Package

A two-and-a-half billion dollar infrastructure spending package – touted as a top priority for 2020 by the DFL-controlled Minnesota House – fell short of the necessary three-fifths supermajority of votes needed Saturday.

With a final count of 75-58 along party lines the measure missed by a scant six votes.

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Whitmer Creates COVID-19 Spending Oversight Office, Approves $150 Million in Coronavirus Spending

Whitmer MI Capitol overcast

Gov. Gretchen Whitmer created the Michigan COVID-19 Office of Accountability on Monday to provide a check over spending during the coronavirus pandemic.

The office, which resides in the State Budget Office, provides oversight to all spending to fight the coronavirus and will report to the governor and the state budget director.

The Department of Technology, Management and Budget will designate a chief for the office.

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Michigan to Face More Budget Cuts as Tax Revenues Plummet

A storm of skyrocketing unemployment paired with plummeting tax revenue have plunged the state budget into a multi-billion dollar deficit.

State Budget Office Communications Director Kurt Weiss told The Center Square in an email that tax revenues for this fiscal year are projected to drop between $1 billion and $3 billion.

There’s another $1 billion to $4 billion projected for Michigan’s next fiscal year, Weiss said.

Over 1 million people have filed for unemployment benefits, more than a quarter of the state’s workforce.

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Commentary: Alexis de Tocqueville’s Lessons in a Time of Pandemic

The immediate challenge of COVID-19 has been cast as an examination of how individual Americans will fare should they be exposed to the virus. The effort to arrest the spread of the virus has brought unprecedented changes in the daily routines of all Americans. The limitation of activity is apparent when one walks outside. There is a marked silence, regardless of the time of day, almost eerie, that gives one pause.

The check on movement is accompanied by images of field hospitals and graphs showing curves and spreads displayed across news sites. While many are changing their daily routines to comply with the requirements of staying at home and practicing social distancing, a broader concern is the effect on our American democratic foundation.

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Commentary: The U.S. Economy Will Weather the Chinese Coronavirus

American Spirit

President Donald Trump praised the Federal Reserve for cutting the federal funds rate to a range of 0 percent to 0.25 percent, and restarting quantitative easing with $500 billion of U.S. treasuries purchases and $200 billion of mortgage purchases in response to the Chinese coronavirus global pandemic.

“It makes me very happy and I want to congratulate the Federal Reserve,” he said. “That’s a big step and I’m very happy they did it.” Trump has been hounding the Fed for years to cut interest rates to make the dollar more competitive against trading partners’ currencies including the yuan, euro and peso. Now he gets his wish.

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