In the January edition of Consumer Corner, we detailed Republican efforts to undermine the Consumer Financial Protection Bureau (CFPB), the sole watchdog in financial markets for American consumers. Since then, Mick Mulvaney, the bureau’s interim director, has doubled down on these efforts, accelerating changes that weaken critical consumer protections and lighten oversight of banks and other financial institutions.
Jul 09 2018
People Who Did Not Qualify for Premium Tax Credits Dropped Coverage as Health Premiums Spiked
The consequences of Republicans’ sabotage of the Affordable Care Act marketplaces continue to pile up. In just the latest example, about 1 million Americans were priced out of the individual health insurance market last year. Average monthly enrollment among people who did not receive advance premium tax credit (APTC) subsidies fell by 20 percent between 2016 and 2017, just as average monthly premiums increased by 21 percent. By contrast, individual plan enrollment among individuals who qualified for APTC subsidies fell by 3 percent. While the administration concludes that the spike in premiums drove people out of the market, President Trump and congressional Republicans are doubling down on efforts to further destabilize markets, raise premiums, and eliminate coverage for millions of Americans.
Many rural communities continue to struggle with the aftermath of the Great Recession. Total employment in nonmetro areas is still below its prerecession level. Last week, the Joint Economic Committee Democrats released a report examining the challenges and opportunities that rural America faces. After a year and a half of Trump administration actions that have hurt rural Americans, the report proposes a policy agenda that would lead to rural economic progress.
Jun 21 2018
Separating Families Has Lasting Consequences
When provided the opportunity, refugees become key contributors to the nation’s economic vitality. International research has shown that refugees enter the workforce, boost native-born workers’ wages, and increase job opportunities. Instead of welcoming these new American families into the social and economic fabric of our nation, the Trump administration is tearing them apart.
Jun 21 2018
JEC Dems Call for Investments in Rural America
Yesterday, Joint Economic Committee Democrats, under the leadership of Ranking Member Senator Martin Heinrich (D-N.M.), unveiled a new report that takes an extensive look at “Investing in Rural America,” and proposes policies to revitalize these communities that have not yet recovered from the Great Recession. Here is a look at some of the report’s coverage:
American workers continue to wait for the raises they were promised as part of the Republican tax law. The average hourly wage for production and nonsupervisory workers was lower in May 2018 than it was in May 2017, after adjusting for inflation. Wage growth for most workers remains weak and now that inflation is starting to pick up, wages are barely keeping pace with the growing cost of living. This comes on top of decades of stagnating wages for most workers.
Jun 14 2018
GOP Tax Scam Undermines Local Investments
It was inevitable that there would be unintended consequences from the GOP tax law. Debate and input were limited and the plan changed rapidly, barely giving nonpartisan experts any time to think through its impact. Now that the law has taken effect we are starting to see more and more of those unintended harms. Just this week, the Wall Street Journal reported how bank holdings of municipal bonds dropped for the first time since the recession, due to the new tax law leading to less demand.
President Trump is right to praise the health of the labor market, but the current low level of unemployment is the result of an expansion spanning nearly a decade, not policy changes made six months ago. After the worst recession since the Great Depression, the United States has consistently added jobs every month since September 2010. The pace of job creation has slowed since President Trump took office though. In his first 16 full months in office, the economy has added an average of 185,000 jobs per month, compared with 205,000 per month in the last 16 full months of President Obama’s tenure.
Over the last few years, the Federal Reserve (Fed) has steadily increased the federal funds rate, usually by 25 basis points. These increases ultimately lead to higher interest rates on a variety of financial products, from student loans to home mortgages. With the Fed poised to raise interest rates another two or three times this year, consumers are starting to see the impacts of higher rates materialize.
Many families are still suffering from the large financial setbacks of the Great Recession. New research from the Federal Reserve of St. Louis highlights the ongoing financial struggle families headed by different age cohorts face as they attempt to regain wealth and income lost during this period. Families headed by those born after the 1960s, for example, have been unable to fully regain income lost during the Great Recession by the end of 2016. The youngest families studied, headed by those born during the 1980s, have fallen furthest behind in the typical wealth-accumulation life cycle, leaving them with limited income growth compared to other families. In spite of suffering losses during the Great Recession, though, families headed by someone born in the 1930s through the 1950s were able to rebuild wealth and regain income by 2016.