Tag: economy
Steve Scalise

How Medicaid Cuts Will Harm Workers, Employers -- And The US Economy

How are Republicans trying to sell a bad bill? They tell lie after lie about how only able-bodied adults who refuse to go to work will be affected by their One Big Ugly Bill.

“That single mom that’s working two or three jobs right now to make ends meet under this tough economy, she doesn’t want to have to pay for somebody who’s sitting at home," House Majority Leader Steve Scalise said. When Sen. Josh Hawley (R- MO) was asked whether he was worried about working people being thrown off Medicaid because they failed to jump of all the hurdles created by the new legislation, he replied simply, “I’m for work requirements.”

These obfuscations ignore the fact that 92 percent of adults on Medicaid are already working. They work in stores, restaurants, hotels and offices. They serve as home health, nursing home and hospital aides. They build homes, staff warehouses and take the dirtiest and most dangerous jobs in manufacturing. They pick our fruits, vegetables and other agricultural commodities.

Why do they need Medicaid? Because their employers are small (less than 50 workers) and do not provide coverage. Or, if they are a large employer and required to at least offer coverage, the firms charge their employees so much in co-premiums that their workers cannot afford it on their measly paychecks. In order to qualify for Medicaid — even in the 39 states and District Columbia that have expanded the program — you have to earn under 138 percent of the federal poverty level, which is around $44,000 for a family of four in 2025.


A new report from Families USA found that nearly 20 million American workers are on Medicaid. Nearly half work for firms with less than 50 employees, which are not subject to the Affordable Care Act’s requirement they offer coverage.

Given only half (53%) of small firms even offer health insurance, their employees must turn to either ACA plans or Medicaid (if their wages are very low) for coverage. “Simply put, Medicaid is one of the only options for low-wage workers to get health insurance, and it makes a dramatic difference in these workers’ lives,” the report said.

The demographics of workers on Medicaid

The report also broke out who these low-wage workers are. Women make up a slight majority (56 percent), which isn’t surprising given female predominance in the lowest paid occupations of the retail, health care, education and social service sectors.

The racial share of workers on Medicaid generally reflect the broader society. Fully 46 percent are white; 27 percent are Hispanic; 17 percent are black; and six percent are of Asian descent. The bureaucratic roadblocks to obtaining coverage, which accounts for the vast majority of the 10 million people who will lose coverage over the next decade, will have just as big effect in Red states as in Blue states.

To sum up: Medicaid coverage subsidizes nearly every industry in America and in every state. It helps those industries be more productive since workers on Medicaid have less medical debt, are more able to pay rent and feed their families, and are healthier since they are more likely to seek out preventive care.

“Proposed cuts to Medicaid are therefore a direct threat to essential workers and core American industries,” the report concluded. “By seeking to push people off of Medicaid coverage, this budget bill not only threatens the health and financial security of our nation’s low-wage workers but also the security of our nation’s economy.”

Merrill Goozner is a former editor of Modern Healthcare, where he writes a weekly column. He is a former reporter for The Chicago Tribune and professor of business journalism at New York University. Please consider subscribing to his Substack.

Reprinted with permission from Gooz News.

Donald Trump

Chin Up! We're Doing Better Than Expected -- Or At Least Trump Is Doing Worse

It’s wonderful to see isn’t it? A snake in the grass slithering up to bite the ass of the person who had beckoned it forth?

That is the spectacle we have been treated to for these weeks and months since January 20, as one executive order signed by Trump after another has fallen to the considerations of judges who, one, can read the law, and two, require that assertions made in the executive orders, and those made by Trump’s DOJ lawyers in court, must be backed up by evidence and that pesky bane of every authoritarian, reason.

Lawsuits have been filed and Trump’s hastily written executive orders have been subjected to scrutiny by legal minds sharper than those which backed up Trump’s Sharpie. Most recently, the ordinarily somnolent Court of International Trade, in a 3-0 ruling, blocked almost all of Trump’s tariffs, which he had imposed using powers he asserted under the International Emergency Economic Powers Act (IEEPA), a 1977 law which allows a president to regulate international commerce after declaring a “national emergency” due to an “unusual and extraordinary threat ... to the national security, foreign policy, or economy of the United States" originating from outside the borders of the country. The court found that retaliating for tariffs imposed by other countries, or otherwise addressing trade imbalances, does not constitute such a threat and thus does not justify the declaration of national emergency necessary for the assertion of powers under the IEEPA.

The Trump administration quickly appealed, and a court of appeals issued a stay of the trade court’s injunction rejecting or limiting Trump’s tariffs, at least until the case can be heard and a ruling can be issued on the merits. In the meantime, a district court issued a similar ruling blocking Trump’s tariffs in response to a lawsuit filed by a toy company that had been hugely and negatively affected by Trump’s tariffs on trade with China. That ruling has also been temporarily stayed on appeal.

Trump reacted to the trade court ruling by attacking the Federalist Society and its leader, Leonard Leo, on whom he had relied for advice on judicial appointments during his first administration. In a rage-filled post on Truth Social, Trump called Leo “a sleazebag” and “a bad person who, in his own way, probably hates America,” his catchall criticism for anyone he feels has wronged him in some way.

Trump’s assertion of power using executive orders has run counter to a Supreme Court decision that he and his arch-conservative legal allies had long sought. The decision, in Loper Bright Enterprises v. Raimondo, overturned the so-called “major questions doctrine” which dated back to 1984 and required courts to defer to federal agencies when interpreting complicated and ambiguous laws. The trade court cited the Loper decision in its ruling slamming Trump’s tariffs. Trump reacted with fury, writing, “The horrific decision stated that I would have to get the approval of Congress for these Tariffs.”

Well, yes, that is what the sting of the Loper decision feels like when it bites you in the ass.

We are witnessing a delicious moment best summed up by what we might call the hippie-era “what goes around, comes around” doctrine. That occurs when the thing that you wished for starts to affect you in ways that you had not contemplated, perhaps because your contemplation of what you wanted was inadequate in its consideration of what effect it might have in the future.

Multiple lawsuits and federal court rulings have kicked much of Trump’s executive order agenda to the curb. A federal court blocked Trump’s attempt to do away with birthright citizenship, which is written into the text of the Constitution. A federal judge in Boston ruled that Trump cannot stop Harvard from accepting foreign-born students. More lawsuits filed by Harvard seek to overturn Trump’s orders to strip Harvard of federal funds and grants. Legal experts say those lawsuits are likely to be successful because the reasoning behind Trump’s moves against Harvard is so blatantly punitive.

Other judges have overturned Trump’s attempts to bar several major law firms from entering federal government buildings, holding top secret security clearances, or representing companies doing business with the federal government, again because Trump’s orders have been nakedly punitive.

Other judges have ordered the return of people deported under false pretenses. The Supreme Court itself handed down an emergency ruling that the Trump administration must afford undocumented immigrants the same due process rights granted to everyone under the Constitution.

The news website Axios summed up the “flood” of rulings against Trump this way: “The headlines are constant: Judge blocks X; Judge freezes Y; Court allows Z to continue.

On Friday, Trump bid farewell to his erstwhile ally, Elon Musk, at the end of his time as a so-called “temporary federal employee” overseeing his DOGE worm-burrowing into federal agencies seeking to eliminate or undermine them, as he did with USAID and the Department of Education. But even in those two cases, federal judges have reversed some of the DOGE moves and reinstated funding and in some cases order the rehiring of employees who had been summarily fired without cause in violation of federal regulations.

The effect of DOGE and Musk has been, by their own measure, lame. Musk announced on the campaign trail and after he was appointed to head DOGE that he would reduce the federal deficit by $2 trillion. Then it was $1 trillion, then $200 billion, and Musk had stopped talking about the federal deficit and started claiming “savings” from the discovery by DOGE of “waste, fraud, and abuse,” which in Washington D.C. could be uncovered by a street sweeper with a broom and dustpan.

In the end, Musk claimed that he had “saved” $175 billion. Robert Hubbell yesterday called that figure a “mirage,” citing “A study by the Budget Lab at Yale estimates that cuts to the IRS will result in $350 billion in reduced tax collections over the next ten years—an amount that is double the alleged ‘savings’ by DOGE.”

Much if not most of what Musk and Trump attempted to do with DOGE has been overturned by federal courts, which have found certain of their moves unconstitutional and others to have violated previous Supreme Court decisions such as the Loper decision. In the meantime, the New York Times headlined on the front page of the Sunday paper a major investigative story on Musk’s drug use during the campaign and afterwards while he was working as a temporary government employee.

Musk was described as having used Ketamine, Ecstasy, psychedelic mushrooms, the stimulant Adderall, and the sleeping medication Ambien. The Times reported that Musk, like all federal employees, was supposed to have been drug-tested periodically during his employment. He was said to have been forewarned of the drug tests so that he could pass them.

So, Donald Trump has relied on a drug-addled madman with Nazi sympathies to undertake his reform of the government he is charged with overseeing. And now Musk has turned on him, criticizing Trump’s “big, beautiful bill” and its lifting of the debt ceiling.

When Trump rolled out his plethora of executive orders, signing the first bunch before an adoring MAGA crowd at a sports facility in Washington on inauguration eve, I first thought, Oh-oh. They’re serious this time.

I should have known. The lawyers Trump used to write the executive orders were not from the big law firms he would soon move to eliminate from working on federal government cases, because those firms had long refused to do legal work for him. According to Adam Bonica, a professor of political science at Stanford, Trump lost a stunning 96 percent of the cases filed against him in federal court during May. During April, he lost 76 percent. During March, the number was 74 percent. The judges ruling against the Trump administration were appointed by both political parties, with those appointed by Democrats outnumbering Republican judges by only 8 percent.

The Washington Post reported today that Trump’s FBI is in “chaos” due to the mismanagement of Director Kash Patel. Over at the Department of Defense, the top aides to Secretary Pete Hegseth are said to be at each other’s throats.

Here is my estimation of where we are on the first day of June, 2025. Things could be a whole lot worse, and they’re showing signs of getting better, as Trump continues to attack the judges he appointed to the bench and former allies like Elon Musk are now off the White House leash and his Adderall-fueled tongue is bound to start wagging.

Chin up. We’ve got a long way to go, but Trump and the fools he appointed to his cabinet are living up to every expectation we should have had about them.

Lucian K. Truscott IV, a graduate of West Point, has had a 50-year career as a journalist, novelist, and screenwriter. He has covered Watergate, the Stonewall riots, and wars in Lebanon, Iraq, and Afghanistan. He is also the author of five bestselling novels. He writes every day at luciantruscott.substack.com and you can follow him on Bluesky @lktiv.bsky.social and on Facebook at Lucian K. Truscott IV. Please consider subscribing to his Substack.

Reprinted with permission from Lucian Truscott Newsletter.

First-Quarter Productivity Decline Is A Grim Economic Portent

First-Quarter Productivity Decline Is A Grim Economic Portent

The Bureau of Labor Statistics today released its first estimate of productivity in the first quarter. It showed productivity falling at a 0.8 percent annual rate. This is really bad news.

Productivity matters a lot for both inflation and living standards. In the five years from 2019 to 2024, productivity growth averaged 1.9 percent annually. That is up from 1.1 percent annually in the decade before the pandemic.

The faster rate of productivity growth most immediately translates into lower inflation. As a first approximation, inflation will be equal to nominal wage growth minus productivity growth. If nominal wages are growing at a 4.0 percent annual rate, and productivity is rising at a 1.9 percent annual rate, inflation will be roughly 2.1 percent. (We could have some redistribution from profits to wages, reversing the rise in profit shares in the pandemic, but we’ll leave that one for another time.)

To take the other side of the same coin, real wages can sustainably increase at the rate of productivity growth. The 1.9 percent rate of productivity growth meant that real wages could rise at roughly a 1.9 percent annual rate. By contrast, the 1.1 percent rate for the decade before the pandemic could only support a 1.1 percent annual rate of real wage growth. Over the course of a decade that’s the difference between a 20 percent rise in real wages and an 11 percent rise.

For these reasons, the productivity slowdown reported for the first quarter is a big deal. Having said this, it is necessary to throw out two important caveats about the first quarter productivity data.

First these data are subject to revisions. Both the numerator or this equation (output) and the denominator (hours) will be revised in subsequent months. When we have the data in June, after two rounds of revisions, the picture may look very different.

The other important caveat is that productivity data are notoriously erratic. For example, productivity shrank at a 2.4 percent annual rate in the fourth quarter of 2015. It rose at a 1.7 percent annual rate in the first quarter of 2016. Reversals like this are very common. This means that even if the first quarter weakness holds up through revisions to the data, it is entirely possible that we see a sharp reversal in the second quarter or the second half of 2025.

First and foremost, the negative productivity growth reported for the first quarter should be seen a warning. We have pursued a number of policies that are likely to do both near-term and lasting damage to the economy. Tariffs, mass deportations, reckless layoffs in the federal government, and slashing research budgets, are all likely to hurt economic growth. Much of the impact will only be seen over the long term, but some may already be showing up in the data.

For example, if ships from China are not coming due to 145 percent tariffs, we will see fewer workers unloading goods, at the ports, fewer truck drivers transporting goods, and before long, empty shelves at the stores. The firings at the federal level, coupled with layoffs elsewhere due to cutbacks of federal support, could show up in higher unemployment rates.

The fall in productivity reported for the first quarter should be taken as a flashing yellow. Maybe all will be okay, but it’s not a good start.

Dean Baker is an economist, author, and co-founder of the Center for Economic Policy and Research. His writing has appeared in many major publications, including The Atlantic, The Washington Post, and The Financial Times. Please consider subscribing to his Substack Dean Baker.

Reprinted with permission from Substack.

Trump Approval Crater Gets Deeper, Even On Immigration

Trump Approval Crater Gets Deeper, Even On Immigration

President Donald Trump's approval ratings appear to be plummeting because his voters are concerned about his approach of governance. A Reuters/Ipsos poll released on Wednesday revealed that only 37 percent of Americans agree with the way the president is handling the economy. This is the lowest rating he has ever received, dating back to the beginning of his first presidential term.

Axios highlighted three polls in a report Thursday, noting, "On the economy, the single most decisive issue of the 2024 election, Trump's polling has never been worse."

Gallup polling released this week also painted a bleak picture for the administration. For the first time since at least 2001, most Americans feel that their economic circumstances are deteriorating.

Another survey conducted by the Pew Research Center revealed that Trump's overall approval rating has decreased to 40 percent, and his economic leadership approval has declined to 45 percent — the lowest levels recorded since tracking started in 2019.

"Trump's approval rating is cratering not because voters reject his goals — but because they're increasingly alarmed by his methods," Axios noted.

The report also highlighted an average of polls by data journalist G. Elliott Morris, which found Trump is not polling great even on immigration, which is considered his best issue.

"Trump is now almost underwater on approval of his handling of immigration, widely regarded as his strongest issue — and 20+ points negative on inflation. In 3 short months, he has completely lost his advantage on both the issues voters elected him to fix," Morris wrote Wednesday on the social platform X.

50 percent of the YouGov survey participants indicated that Trump should bring Kilmar Abrego Garcia, an immigrant from Maryland who was wrongly deported to El Salvador, back to the United States. Only 28 percent believed he should not be allowed to return.

Reprinted with permission from Alternet.

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