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Trump Tweets ’No Inflation’ As Consumer Prices Hit New High

Trump’s claim on Tuesday morning that the country is not experiencing inflation was contradicted by data from his very own Labor Department.

At 8:49 a.m., Trump tweeted about his disastrous trade war with China. After mentioning currency devaluation, Trump claimed, “Prices not up, no inflation,” ending his missive with, “Fake News won’t report!”

However, just 19 minutes before Trump opined about the state of the economy, the department released data showing inflation had hit a six-month high. Bloomberg ran a headline at 8:30 a.m. saying, in part, “U.S. Core Inflation Hits Six-Month High,” and used the same language in their tweet about the topic at 8:36 a.m.

The department’s report also contradicted Trump’s claim about prices, which are, in fact, going up as a result of Trump’s trade war with China.

“[It] is clear tariffs are beginning to drive goods prices higher,” Sarah House, a senior economist at Wells Fargo & Co., said, according to Bloomberg.

Tuesday is not the first time one of Trump’s lies has been corrected by his own administration.

In January, U.S. intelligence leaders outed Trump as a liar about North Korea, ISIS, Iran, and Russia during congressional testimony. Trump handled the situation by yelling at those leaders to “go back to school.”

In April, Trump falsely accused Mexican soldiers of drawing their weapons on National Guard personnel. Afterward, a military spokesperson was forced to correct Trump, explaining that the situation was a brief misunderstanding between U.S. Army soldiers and Mexican soldiers that was solved with a simple conversation between the two groups.

In May, Trump falsely claimed missile tests by North Korea did not break a U.N. agreement. Two days later, his acting defense secretary went on CNN to correct Trump, saying the tests were, indeed, a violation.

In June, Trump falsely claimed transgender soldiers could not serve because of the medication they take. A Defense Department spokesperson corrected Trump, saying there is no medical reason why transgender soldiers cannot serve.

Also in June, Trump made the bizarre claim that the moon is a part of Mars and that NASA should not be talking about going to the moon. A few days later, NASA Administrator Jim Bridenstine had to clean upTrump’s mess with a statement.

It is not always just the U.S. government that corrects Trump. In April, French officials made a public statement rebuking Trump’s suggestion of how to put out the fire engulfing the Notre Dame cathedral. Trump’s idea to use “flying water tankers” could have led the entire structure to collapse.

Before Tuesday, the Washington Post cataloged more than 12,000 lies Trump has told since being in office. It is unclear how many of those lies have been corrected by his own administration, but that number grew on Tuesday.

Published with permission of The American Independent.

Danziger: Iron Rice Bowl Cracks

Jeff Danziger lives in New York City. He is represented by CWS Syndicate and the Washington Post Writers Group. He is the recipient of the Herblock Prize and the Thomas Nast (Landau) Prize. He served in the US Army in Vietnam and was awarded the Bronze Star and the Air Medal. He has published eleven books of cartoons and one novel. Visit him at DanzigerCartoons.com.

Labor Department Proposes Extending Overtime Pay

It’s common for American workers to stay later than their hours suggest – “face time” being seen as a measure of one’s commitment to the job. According to a Gallup survey released last November, the average full-time American worker now works 47 hours a week, nearly a full day longer than the standard 40-hour week. And most of those workers don’t get paid anything extra for those additional hours.

President Obama is hoping to change that. In a proposal announced Tuesday, the Department of Labor would extend overtime pay to nearly 5 million Americans. The plan would simplify and update rules so that millions of workers can determine if they are eligible for overtime pay.

As of now, most full-time employees are classified as being exempt from receiving overtime because they are considered managers, administrative personnel, or professionals of some description. But bestowing those titles, especially “manager,” has become a convenient loophole for employers, who can offer meaningless promotions as a way to get out of paying employees overtime.

Currently, employers can avoid paying overtime if an employee makes more than $455 a week or $23,660 a year. The new proposal would more than double the threshold, to $970 a week or $50,440 a year.

According to the Wall Street Journal, the new proposal recommends that, moving forward, these numbers should change automatically, tied to either wage growth or inflation in order “to ensure the threshold’s buying power doesn’t erode in time.” Because that’s exactly what has happened since the 1938 Fair Labor Standards Act originally established the federal minimum wage and overtime rules. Those numbers have only been changed eight times since then, and only once since 1975.

Housing costs are rising, so much so that minimum-wage workers can’t afford to rent a one-bedroom apartment anywhere in the country. At the same time, real wages – after inflation has been taken into account – have been stagnating for decades.

The numbers the Obama administration are using in their proposal are the 1975 threshold, last updated in 2004, adjusted for inflation. The 2004 changes made it so that more employees were exempt from overtime –such as managers who did low-level work and supervised employees simultaneously. Due to inflation, the percentage of salaried employees who fell below the overtime-pay threshold steadily decreased, from 65 percent in 1975 to 18 percent in 2004 to 8 percent in 2014, according to the Economic Policy Institute, a nonprofit and nonpartisan think tank focusing on the needs of low- and middle-income workers.

Under the Fair Labor Standards Act, the president has the authority through the Department of Labor to set new rules without lawmakers’ approval, but the Department of Labor will hold a 60-day public comment period before they adopt any changes. It’s expected that businesses and industry groups will push back, arguing that instead of individuals receiving more money, the hours and pay will be spread out among more workers – which could increase part-time employment. Others, like the National Retail Federation, warn that businesses could reduce base pay and compensation, and make it less likely for workers to advance to become actual managers, since businesses will end up cutting the number of higher-ranking jobs.

According to the Economic Policy Institute, the proposed rules would disproportionally affect those who work in food service, insurance agencies, policy processing, customer service, office administration, and retail. Demographically, those likely to be affected include people under 35, women, blacks, and Hispanics, as well as workers with lower levels of education. The White House estimates that of the 5 million workers expected to benefit, 53 percent have at least a college degree and 56 percent are women.

The New York Times, in its editorial supporting the decision, cautioned Republicans to “think twice about” aligning themselves with business interests that oppose the proposal: “No party and no politician that opposes the new overtime rules can credibly claim to care about the middle class.”

As of this writing, no Republican presidential candidate, with the exception of Rick Perry, has commented on the proposed changes. In a statement, Perry, who believes that government should not set policies on pay or benefits, said, “As businesses are forced to spend more on payroll, those costs will be passed on to consumers in the form of higher prices for everyday goods and services.”

Hillary Clinton, however, praised the decision on Twitter.

Photo: Workers, like this woman, who process claims could be part of the millions of people affected by the Labor Department’s new proposed changes to its overtime rules, which would expand the definition and scope of who would be eligible for overtime pay. fatheroftheweasel via Flickr

Oil Plunge, Russia Crisis Challenge U.S. Federal Reserve

Washington (AFP) – The relentless fall in oil prices and Russia’s plunging currency pose big challenges as the U.S. Federal Reserve opens a two-day meeting Tuesday.

The Fed’s last meeting of 2014 was expected to confirm its path toward monetary policy normalization after holding its base interest rate at the zero level for six years to bring the country out of the Great Recession.

But stagnating economies in Europe and Japan and slowing growth in China, coupled with the threats to markets and the financial system from the oil price and Russian crises, could force the U.S. central bank to weigh a pause.

While the world’s most powerful central bank is unlikely to make any immediate changes to its interest rate and liquidity stance, it could signal via comments and economic forecasts a readiness to stick to that stance for longer than expected to help the global economy through a rough period.

The main focus of the Fed, the U.S. economy, has been growing strongly enough for the central bank to begin pulling away from the extraordinary easy-money policies in place since 2008.

Unemployment has come down to 5.8 percent; job generation in November was unexpectedly strong; and year-end retail sales show consumers comfortable with spending and confident about the year ahead.

The one question that has dogged the members of the Federal Open Market Committee, the Fed’s policy arm, has been inflation: it has been too weak to confirm that the economy is motoring under its own power.

And sinking prices of oil and other key commodities and many general imports have in the past two months slowed inflation even more.

For weeks analysts have guessed that the main outcome of the FOMC meeting would be a change in the language it uses to steer market expectations on interest rate policy.

Over the past year, the panel has repeatedly said that a Fed funds rate increase would only come a “considerable time” after the end of the quantitative easing program, which was wound up in October.

That language could be dropped for an even more opaque qualifier that would give the FOMC more flexibility, to either move quickly if growth and prices pick up unexpectedly, or hold off indefinitely if growth stalls. One Fed official has suggested the FOMC just say it will be “patient” before lifting the rate.

Any other signal change from the meeting would come from the collective forecasts of FOMC members of economic growth, unemployment, inflation and rates, which are studied closely for signs of when a first rate hike will come.

For the past year the general view has been that the Fed would move in the middle of 2015. Economist Chris Low of FTN Financial noted that two senior Fed officials known to be more hawkish on raising interest rates both represent US regions where growth could slow significantly due to the oil price drop.

“They may back away from (their hawkish stance) in their forecasts,” he said.

Even so, the 50 percent fall in the price of crude in just six months could turn the US central bankers’ focus to global issues and how Fed policy might help or hurt the world economy.

The steepness of the fall in crude prices, many fear, could spill over into the financial sector and foment more shock waves through the economy.

And Moscow’s inability to stem the ruble’s slide despite hiking interest rates overnight to 17 percent could further sink its economy and spread collateral damage into already-struggling Europe.

(AFP Photo/Mandel Ngan)