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The Senate Big Beautiful Bill $6000 per person deduction makes Social Security tax free for 88% of Americans over 65 years. This is close as one can get to making Social Security benefits tax free for people over 65 years. It is a move that is seen favorably by social security recipients. Protecting the elderly on fixed incomes when the cost of living went up 12% in just 1 year in 2022 is an essential step for any administration that cares for the daily lives of the American people. In this sense the DJT administration has made a bold move in three key areas no taxes on social security benefits, no taxes on tips which address employment in hospitality/restaurants, and doubling the child care benefit for mothers, tackling key population sectors. To pay for this and keep the deficits down the dollar strong, one other action was taken- to increase investment in the economy and in manufacturing by allowing expensing of investment 100%. Fed chairman Powell repeatedly states he is very optimistic about this action generating the kind of investment boom American needs to restore good standards of living.   ...

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Galston focusses attention on the major problem facing democracies in Europe and the U.S.- that of providing decent paying jobs and improved economic prospects for lower and middle income households. He cites the surveys from the Pew Research Report and the U.S Bureau of Labor Statistics showing how middle income households median net income remains stuck at levels of 1997, and lower income households at levels of 1996. The median net worth of American households adjusted for inflation presents an alarming picture of being at $96,000 in 1983 and $98,000 in 2013 for middle income families, and being at the level of $12,000 for lower income families the level of 1975. Most of the new jobs as much as 95% are being created in the low wage service sector and the BLS statistics show the future looking much the same- with huge numbers of low wage jobs, fewer decent manufacturing jobs because of automation and jobs shifts to low cost locations overseas, remaining manufacturing jobs in the U.S shrinking by another 800,000 to 7% of the workforce by 2025. The result is the alarming rise of populist politicians like Trump in the U.S., Le Pen in France , and populist politicians in Hungary and Poland. Cultural liberals in the Democratic Party and the Republican establishment are both threatened by the rise of cultural illiberalism, xenophobia, and nationalism, as economic anxiety increases, and fears of terrorism and immigrants add to this anxiety. Progressive tendencies in the Republican party since the days of Theodore Roosevelt and of professional elites in the Democratic Party could become endangered if no serious effort is made to come up with solutions to the problems these trends present. The disconnect between the concerns of the working and middle class and the professional elites as the gap widens and the social compact in America and Europe breaks apart, means a new mindset will be required in America and Europe to deal with this. ...

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The shadow economy is about 24% of Greece's economy, according to a study at the University of Chicago. Unreported income is $28 billion or 15% of GDP. The Greek government of Antonis Samaras is taking new steps to tackle this problem. New regulations allow customers to go without paying if service providers refuse to give a receipt for the transaction. Restaurants will be required to post the regulation in their menus. Doctors, lawyers and other service providers will have to follow the new rules.

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Krugman points out that the inflation adjusted wages of non-supervisory workers in the retail field in America has declined by 30% since 1973. He says there are no adverse effects on unemployment because workers in retail are not competing with workers in other countries as happens in manufacturing. They are also some of the lowest paid workers to begin with, and the numbers are not small. One estimate is that here are 30 million workers who would benefit from an increase in the minimum wage from the current level of $7.25 to $10.10. State by state comparisons provide proof of this as no evidence of losses in employment are to be seen when one state has raised the minimum wage and another neighboring state has not. Germany is facing a similiar problem of low paid temporary workers and a new coalition government is planning an increase in the minimum wage in 2014 as a response to increasing inequality and disparity in incomes developing in the last two decades.

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Jim Dwyer discusses proposed legislation in the New York City Council in November 2011, to set a "living wage" of $10 per hour, plus benefits, for workers at new developments receiving more than $1 million in public money. Under this legislation employers who do not include benefits would pay an hourly wage of $11.50. Discussion in the City Council has led to questioning this legislation on the grounds that the developments would not be built under the new rules. Dwyer points to San Francisco, which has set the minimum wage at $10.24 for January 2012, plus mandatory contributions to health insurance funds. The number of low wage workers in New York City with some college education has increased by 70%, according to the Fiscal Policy Institute. Wages at the bottom were $10.85 an hour, adjusted for inflation in 1990, in 2010 the wages were $10. What this does is further increase the income disparities and inequality in the U.S. Because of the demographic changes in America with Hispanic children representing a large proportion of young children, and the high rate of dropouts from highschool in the Mexican American community in New York, this means more children in New York City growing up below the poverty line....

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Years of Tory cuts and austerity spending left the UK unprepared for the pandemic, says this editorial in The Guardian. The running down of the public sector was a policy choice says The Guardian. In the decade before Covid the Tories cut public spending as a proportion of the GDP from 46% to 39% leaving Britain exposed during the pandemic. Jeremy Hunt continues in a long line of Tory chancellors who are impervious to comprehension of the fall in incomes of ordinary households, the working nurses and teachers who turn to food banks. Hunt even talks about another 100 billion pounds of cuts over the next 2 years. And  turning Britain into a Silicon Valley, when Silicon and Tech is failing in the US, and when the US Justice Department is seeking the breakup of Big Tech with support from Republican Bill Barr. 

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Now that the euro dollar parity is reached what happens next. This report in WSJ shows there is room for more downside because of the weaker European economy. It says Europe had less of the covid payments to lower income groups and smaller payments than in the US. As a result this shows up in consumer spending. The parity with the dollar does not reflect the event of a shutoff of Russian supplies of gas to Germany. If this happens it will impact the euro further.

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Social isolation, economic isolation is affecting many parts of Japanese society. Mental health decline is seen in working women, part time employed, unemployed workers, and elderly. Prime minister Suga has appointed 71 year old Testsushi Sakamoto to a newly created post- Minister of Loneliness. The pandemic has worsened the social and economic isolation of people.

Another state of emergency is expected for Tokyo and Osaka as coronavirus cases rise in April 2021. Income adversity is affecting many people from women laid off, workers furloughed during the pandemic, students, and others.

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Action to tackle the cost of living crisis taken by G-7 countries France, Germany, Italy, Canada, US, is shown here in The Guardian. France and Germany have taken the strongest action to protect lower income people, the US with the Inflation Reduction Act has taken broad steps to limit healthcare costs and invest in the economy. The UK appears to be the weakest in taking action and the new budget of Mr. Kwarteng is seen in this way as failing to protect vulnerable parts of the population.

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New fixed rate 30 year US mortgages have interest rates of 7% in September 2023. Interest rates on car loans also have become much higher. The American Association of Realtors says the typical American family cannot afford to buy a median priced home. The typical American household would need 42 weeks of income to buy a new car up from 33 weeks in 2020. Car buying is unaffordable for buyers now because of high car prices and high interest rates on car loans, says the chief of Moody's Analytics.

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Prince Mohammed bin Salman, son of the Saudi king Salman, oversees economic policy. He says stock sales of 5% of Saudi Aramco will be used to create a sovereign wealth fund of about $2 trillion that would help create the jobs with income from overseas investments and projects at home. About three times the jobs created in 2003-2013 will be needed with the demographic changes, according to McKinsey consultants. This will act as a diversification away from oil income dependence.

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The median household headed by a person 60-62 years of age with a 401(k) account has less than one fourth of what is needed to maintain a standard of living at retirement, according to data from the Federal Reserve and analyzed by the Center for Retirement Research at Boston College for the Wall Street Journal. Including Social Security and any pensions or other savings, the savings are way short of what is needed for retirement. Households used in this data had a median income of $87,700 in 2009. The 85% needed for a decent standard of living upon retirement is $74,545. Social Security would provide an estimated 40% of pre-retiremment income, or $35,080 for that median family, leaving $39,465 that has to come from other sources. The median 401(k) account has $149,400 which would only provide a fixed income each year of $9,073- only one fourth of the $39,465 needed. To generate that $39,465, households have to have $636,673, and only 8% of American households approaching retirement have that amount. Half of the families have other pension income of $26,500 a year, which added to $9,073 in 401(k) income gets the total income up to $35,573. Other studies using different data by the Employee Benefit Research Institute show results that are largely similiar. The Employee Benefit Research Institute, is supported by 401(k) providers. Its estimate of the median person is based on individuals in the 60's who have worked at the same company for more than 30 years. This data shows an estimated median person having about $158,754, not much different from the Fed data. Why is the amount in most Americans 401(k) savings so low? There was a mistaken sense that a 6% annual contribution, with a 3% company match would be enough. Vanguard Group says the current median amount that people contribute is 9%, counting the employer contribution. Now Vanguard is advising people to contribute more, 12 to 15%, including the employer contribution. Other problems for the low savings is that saving started late, or contributions were suspended after a job loss, or medical emergencies, other debt. The stock market collapses of 2000-2002 and 2007-2009, added to the problems, by wiping out a portion of the savings. The low rate of interest on savings for most of the last decade hurt even conservative investors and lowers the kind of retirement account income used by seniors. The way people are coping with this is to work longer, in some cases into the 70's, cutting down on spending for food, travel, and taking greater risks for higher returns, risks that could make the situation worse....

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The stimulus checks in government pandemic aid packages are being spent prudently in the US. Government aid checks were sent out in the first wave since March 2020 and now again in the second wave in 2021. The stimulus pandemic checks are being allocated wisely. A Federal Reserve Bank of New York study shows that Americans saved about 36% of the first stimulus payment checks, 29% was spent, and 35% was used to pay down debt. For the second stimulus payment underway in 2021 this survey also shows Americans are expected to spend even less and use even more to pay down debts. With stores mostly closed, travel restricted, and consumers not having the opportunities to spend, and the sense of insecurity, additional income from unemployment checks, saving has increased. Americans saved $1.4 trillion in the first 9 months of 2020 compared to half that in the same period in 2019, according to analysis by Berenberg Economics. That amount is about 10% of household spending. The tight spending during 2020 means, say economic researchers, that spending will jump in 2021 after the vaccination drive. The trend is positive in that Americans tended not to save enough. People in China and India, tend to save more giving government a larger pool of savings to draw from in national infrastructure spending. In November 2020 Commerce Department estimate is that saving in the U.S. was 12.9%, up from 7.5% in November 2019. Anecdotal evidence shows U.S. savings accounts for people at the lower end of incomes have been depleted for years, hit by the unemployment of the 2009 recession. This was caused by errors by the banking community and business. To this is added people in arts and culture, people in professions involving contact, travel and leisure, food, during this pandemic ten years later. National priorities need to be set to bolster this part of American society and its core social fabric. The steps to bring home manufacturing jobs under Mr. Trump and the "Buy American" initiative under Mr. Biden is just the first step. More steps are needed and the resources, implementation and drive to bring America back to the healthy society of social cohesion and upward mobility aspirations under presidents Truman and Eisenhower in the 1950's. ...

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The Treasury Department Report to U.S. president Reagan in Nov. 1984 offers an approach based on fairness that has great relevance to today's effort at tax reform. This approach resulted in the the Tax Reform Act of 1986. Similiar families with the same income were expected to pay the same amount in taxes in the interests of fairness. The tax revenues were set without any loopholes or exemptions, and the question was asked how much does marginal rates of everyone have to go up so that a particular group gets its exemption or loophole supported by its lobbyist?

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O'Malley, Sanders, and Clinton emphasize the issue of wages, income disparities, rising inequality, and a shrinking middle class in the first Democratic debate of the U.S. 2016 presidential election. Clinton points out that "at the center of my campaign is how we're going to raise wages." Sanders says that "the middle class of this country for the last 40 years has been disappearing." Clinton points out her opposition to the Trans Pacific Partnership trade agreement because it does not help raise American wages. Clinton calls herself a progressive, but "a progressive who gets things done," and a moderate when it comes to getting things done. Sanders points to the "deep injustice, an economic injustice that threatens to tear our country apart, and it will not solve itself." Sanders points to the wealth concentration in the U.S. "with the top one tenth of 1 percent owning about as much as the bottom 90 percent, and 57% of all new income going to the top 1 percent." Clinton comes to Sanders defense on the issue saying "it's our job to rein in the excesses of capitalism so that it doesn't run amok and doesn't cause the kind of inequities we're seeing in our economic system."...

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It takes years to rebuild after a hurricane even with homeowners insurance as this report shows in WSJ, and people on low incomes are affected more with mortgage delinquencies and bankruptcies. People with resources still have to borrow to rebuild their lives setting them back years.

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The personal saving rate of savings as a percentage of disposable income increased from 3.2% in November 2011 and 4% in May 2012, to 4.4% in June 2012. This happens as consumers reduce spending in mid 2012.

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Nikki Haley managed to get 20 to 30% of the vote in the 14 states that she lost in 2024 Super Tuesday contest- mostly moderate, higher income and better educated voters. This report says over half of voters for Nikki Haley will support candidate Trump in 2024. Of the remaining voters some may still support the Republican candidate others may support Biden or not vote. 

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The Washington Post survey of 1200 readers on how the Republican healthcare plan of Speaker Ryan and the House of Representatives looks to them, how it affects them in their lives. Here Somasekhar of the Post gives the stories of 5 Americans. Some see the prospect of losing their insurance under the Republican plan even as they reach an older age, others a smaller segment says the Post, whose premiums jumped under the Affordable Care Act say they faced high premiums and high deductibles. The Post says the large majority of opinions have expressed anxiety over the proposed Republican Ryan House plan for healthcare. One of them is an uninsured poor farmer, Mr. Woosley,  income about $18000 who gained benefit from expanded Medicaid under the Affordable Care Act,  one Mr. Smith, 32 years, a personal injury attorney who faces paying $10,000 if he did not take insurance and $10,000 if he took insurance because of high premiums so a wash either way deciding to do without it, one a tech worker Mrs. Powers, 62 years, income $22,000 on year and $4000 the next, from middle class during the tech boom but facing fewer opportunities and uncertain income from part time work, hit by the deep recession facing fewer opportunities as she gets older and now the prospect of losing insurance without government subsidies, one who is from the middle class who sees little benefit from the Affordable Care Act and is forgoing insurance because of the high premiums yet faces a penalty for not being insured under the ACA, another Mr. Blanchard, 52 years, is from the middle class, a computer programmer who lost his job in downsizing, earns $100,000 as a consultant self-employed, pays $767 in premium a month and relies on the Affordable Care Act which helps him gain freedom from working at a company that could downsize,  another is a middle class programmer Mr Riffle,age 44, and his wife, who does not qualify for a subsidy with a $71,000 family salary from working 4 jobs between himself and his wife- this person finds it too expensive for his salary to buy insurance $900 a month and $14,000 deductible under the Affordable Care Act. His views are worth listening to as they go to the crux of the problem- he says he may not be any better with the Republican plan. He sees the real problem as the high cost of health care in the U.S. and the only way this can be fixed is for members of Congress to be asked to use the insurance exchanges they create. If this sample is representative it shows that there are real problems with both the Affordable Care Act and the Republican plan, that the high cost of health care the problem lurking behind every plan that does not squarely address this, and till that happens and members of Congress experience what ordinary people face, this problem can never by fully solved.   Woosley, Smith, Powers, Blanchard, Riffle, and their personal experience is at the crux of what is right and wrong  with the Affordable Care Act, and also with the new Republican plan of Speaker Ryan and the House of Representatives. For every Woosley, Powers and Blanchard who benefit, there is a Smith and a Riffle who are indifferent or are affected by the high cost under Affordable Care Act and the current system of medical care with its high cost. The Affordable Care Act does not  tackle high cost, for that to happen the culture in America that makes it possible and acceptable to charge high prices must change. Another problem apart from bringing health care costs is that any solution needs to have the whole country behind it. If the notion that all people are entitled to basic health care is to stand, the whole country needs to believe it as they do in countries like France, Britain, Germany and Japan. If this has to be made a workable proposition health care has to be offered at a price that makes this possible to achieve, and that idea also needs the deep and broad sense of support from the culture in America similar to that in these other countries. Until that happens politicians in America will get elected and turned out of office in turns on issues such as health care, based on which side they take and which problems they choose not to face squarely and responsibly. ...

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Some sensible guidelines in taking loans for graduate schools are provided in this WSJ report- debt repayments should not be more than 10% of discretionary income so that money is there for high food, housing costs and savings. Debt should not exceed the first year's salary whn starting to work.

And students considering grad school need to be aware that while they are in grad school their undergraduate loans can grow by 50% from say $27,000 to $41,000.

47.3 million Americans carry 1.777 trillion in student debt, of which federal government is 1.693 trillion, growing at $48 billion a year. The average debt per person at about $40,000 default at about 5%.

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Chile's new constitution was drafted after a vote on a constitutional convention in which many people not involved before and on the fringes of society including indigenous groups were elected. More than half are independents and from different groups of society not well represented before. As a result of this the lack of experience has led to enshrining every single right that one could think of instead of focusing on what the protests were about about - the pension system, unfairness in access to health housing and education in the way funds are allocated from the budget, and promoting fairness in government.  At this time there is no certainty that it will be passed. A 36 year old student protest leader Gabriel Boric is the president elected after two years of protests about the unfairness of the system that took shape under a constitution written by a military dictator Pinochet who ran the country from 1973 to 1990. Pinochet came to power in a coup that is common in the history of South American Republics such as Brazil, Argentina, Chile and other countries. During the period of the government of Marxist president Salvador Allende the country was polarized resulting in the military taking over.  If the constitution is rejected a new convention will be formed to write a new constitution. In following the Structure of the US, Canadian, or British constitution, or the Indian it is important to look at the document so that it will stand the test of time rather than simply enumerating the rights of man. It is also important to focus on how to make the basic rights such as food, housing and education be well funded and society to be run along lines of basic fairness in incomes, while protecting enterprise and industry that can create new wealth for the country. The large South American economies are mainly dependent on commodities for export and there is a need to fund new business sectors which are not in commodity products- copper in the case of Chile- so that the economy can develop in a way that funds progress in incomes. ...

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The need for earth friendly diets is shown in this editorial in The Guardian. Animal based products account for 57% of greenhouse gas emissions compared to 29% for food from plants. An outsize meat and dairy industry accounts for about 15% of the world's greenhouse gas emissions according to UN message in 2021. Mr. Dimpleby is Britain's food minister. He says a 30% reduction in meat eating would make it possible to have sustainable land use in Britain. The Guardian says high income countries are eating double the meat, poultry and fish products that they should be eating for living within the planetary sustainable living boundaries- that is to have no net environmental damage. Go back to the periods before 1600 and European, American, high income countries consumption of animal based foods was a fraction of what it is today.  A new legal regime is seen as a fair, just and sustainable living oriented solution. The Netherlands is doing just this to reduce the size of its large animal and dairy industry as a step towards more sustainable living and planet. It is not easy to convince farmers yet the public supports such a move. With the fires, floods and drought in Europe there is increasing awareness that action needs to be taken even where it is difficult.  ...

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Set a big goal, achieve it and set an even bigger goal- this is the way the PM is setting out to tackle the challenge of Vikshit or Developed Bharat by 2047. 2024 is next step followed by plan to 2030. PM Modi highlights important aspects of the Budget in his comments on the Indian Budget for 2024. The detailed Budget will come after a new government is formed. This provides an outline of the government's key priorities and investment in priorities. The focus is on the youth the next generation for opportunities, the farmers, the poor and the middle class. Investment will increase by 11% in 2024 over the prior year with expenditures of 1.1 million crores. Targets are set for delivering in housing from 40 million houses delivered to add 20 million more houses, for women setting up small business from 20 million lakhpatis to add 10 million more lakhpatis.  For the youth research and innovation budget capital allocation of $1 billion. Manufacturing of 40,000 railway bogies or railcars for the new Vande Bharat trains. Roof Top Solar campaign will give 10 million families free electricity as well as income of Rs 18,000 to sell surplus energy to the electric grid. Income tax remission for 10 million families. ...

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This New York Times editorial describes the impact on lower income Americans of spending cuts that are part of the Romney-Ryan plan.

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The US state of Nebraska has 69,000 job openings and only a third of that in persons looking for work. After Nebraska at 1.3%, the unemployment rate is lowest in Utah at 2.2%, and in Idaho, South Dakota, Oklahoma, all with unemployment rates of below 3%. The US unemployment rate is 4.6% in October 2021.

Factors deterring people from looking for work in the US are fear of coronavirus, child care responsibilities especially for mothers, a desire for work-life balance, desire for stable employment with decent incomes, retiring early, and people moving away from restaurant, hotel, travel and entertainment industries that are hard hit during this pandemic. A sign of how this mismatch between demand for workers and the supply is happening is the national "quits rate,"  a measure of workers leaving jobs as a share of total employment, which is at a record rate of 3%.