US ECONOMY & POLITICS

U.S. private payrolls growth slows as labor shortages linger – Reuters, 8/4/2021

• U.S. private payrolls increased far less than expected in July as shortages of workers and raw materials constrained hiring in the manufacturing and construction industries.
• Private payrolls rose by 330,000 jobs last month, less than half of the 695,000 that had been anticipated by a Reuters survey of economists.
• Data for June was revised down to show 680,000 jobs added instead of the initially reported 692,000.
• Employers are struggling to find willing workers to fill a record 9.2 million job openings even as 9.5 million people are officially unemployed, a disconnect caused by the pandemic.
• The slowdown in hiring last month was across all business sizes and industries. Leisure and hospitality payrolls increased by 139,000 jobs, below the 330,000 average in the second quarter.
• Factories added only 8,000 jobs in July after averaging 35,000 last quarter. A global shortage of semiconductors is hampering production in the automobile sector.
• Hiring at construction sites stalled, with payrolls rising by just 1,000 jobs.

Andrew Cuomo Faces Impeachment Call as President Biden Urges Him to Quit – Wall Street Journal, 8/4/2021

• Democrats who control the New York state Assembly accelerated their impeachment investigation of Gov. Andrew Cuomo as former supporters called for his removal after a report detailed numerous instances of sexual harassment by the governor.
• The Assembly’s judiciary committee, which is conducting the impeachment inquiry, plans to meet Monday and combine the report with evidence it has already collected, members said.
• The 150-member Assembly, where Democrats outnumber Republicans by more than two to one, would need to vote on impeachment articles.
• If they are approved, according to the New York state Constitution, Mr. Cuomo would be stripped of his powers before an impeachment trial begins in front of state senators and the state’s top judges.
• Lt. Gov. Kathy Hochul would become acting governor, the first woman to serve as the state’s chief executive.

Biden Administration Issues New Eviction Moratoriums – Wall Street Journal, 8/4/2021

• The Biden administration Tuesday announced a new federal moratorium on evictions, bowing to pressure from progressive Democrats to revive lapsed tenant protections despite White House officials saying they lacked the legal authority to do so.
• The action aims to buy states and localities more time to distribute about $47 billion in rental assistance designed to help tenants harmed by the pandemic who have fallen behind on their rent.
• As of June 30, just $3 billion of that money had reached tenants and landlords.
• Some landlords have turned down the payments, saying the aid carries too many conditions, such as preventing the eviction of problematic tenants or compelling them to turn over sensitive financial information.
• Though money began flowing early this year, most state and local governments had to start their programs from scratch, with many not getting off the ground until late May or early June, according to the Treasury Department.

Fed’s Clarida Says Economy Could Warrant Interest-Rate Increases by Early 2023 – Wall Street Journal, 8/4/2021

• Significant fiscal stimulus this year is speeding the economy’s recovery so that the Federal Reserve is able to consider lifting interest rates from near zero by early 2023, said a top central bank official in a speech Tuesday.
• Fed Vice Chairman Richard Clarida said he expects that, under his current projections for inflation and employment, “commencing policy normalization in 2023 would…be entirely consistent with our new flexible average inflation targeting framework.”
• The Fed’s new framework is aimed at addressing the problem the central bank faces of having less room to stimulate the economy once interest rates are lowered to zero, sometimes called the “effective lower bound” or “ELB.”
• Inflation has accelerated this year as the economy faces supply-chain bottlenecks and materials shortages.
• The Fed’s preferred inflation gauge, excluding volatile food and energy categories, rose 3.5% in June from a year earlier, compared with a 3.4% year increase in May.
• Mr. Clarida said he expects inflation to decline next year, but that he expects it will still continue to run somewhat above the Fed’s 2% goal.

Slow slog in U.S. Senate for $1 trillion infrastructure bill – Reuters, 8/3/2021

• The U.S. Senate made gradual progress on Tuesday on a $1 trillion infrastructure investment bill to upgrade roads, bridges, mass transit and broadband services as the Democratic and Republican leaders squabbled over debate on amendments.
• Two days into the debate, Senate Majority Leader Chuck Schumer and Republican Leader Mitch McConnell clashed over the pace of progress on the bill, which appeared headed toward passage but which is still is open to amendments.
• As of Tuesday afternoon, three minor amendments had been approved and three rejected.
• Highlights of the legislation include $550 billion in new spending over five years for items such as roads, rail, electric vehicle charging stations and replacing lead water pipes on top of $450 billion in previously approved funds.

EUROPE & WORLD

China Wants Manufacturing, Not the Internet to Lead the Economy – Wall Street Journal, 8/4/2021

• Social media, e-commerce and other consumer internet companies are nice to have, but in President Xi Jinping’s view, national greatness doesn’t depend on having the world’s finest group chats or ride-sharing.
• Mr. Xi thinks the country needs to have state-of-the-art semiconductors, electric-car batteries, commercial aircraft and telecommunications equipment to retain China’s manufacturing prowess, avoid deindustrialization and achieve autonomy from foreign suppliers.
• So even as the Chinese Communist Party unleashes a multifront regulatory assault against consumer internet companies, it continues to shower subsidies, protection and “buy-Chinese” mandates on manufacturers.
• While manufacturing’s share of Chinese GDP has declined, at 26% it remains the highest of any major economy, and the Chinese government wants it to stay there—in effect insisting that China not follow others down the path of deindustrialization.

A Year After Beirut Explosion, Lebanese Are Still Pushing for Answers – Wall Street Journal, 8/4/2021

• Crowds began to gather in several areas of the Lebanese capital on Wednesday to demonstrate against the country’s political elite, as civil-society groups demand accountability for the deadly explosion in Beirut a year ago, which they blame on their leaders.
• An investigation into the port blast on Aug. 4 last year has so far failed to provide answers to who was responsible for one of the biggest nonnuclear explosions in history.
• The explosion killed more than 200 people, injured some 7,000 and devastated some of the Lebanese capital’s liveliest residential and commercial areas.
• Activists accuse the ruling class of obstructing the investigation, which has led to more than two dozen arrests but not of any ministers or senior officials, many of whom are protected by immunity that Parliament has refused to lift.
• Meanwhile, Lebanon has spiraled deeper into what the World Bank says is possibly one of the world’s three worst economic crises of the past 150 years.

U.S. Faces Growing Pressure to Allow European Travelers – Wall Street Journal, 8/4/2021

• The European Union’s top official called on the U.S. to reverse its ban on travelers from the bloc, urging the Biden administration to act within weeks to match Europe’s opening to Americans.
• The comments by European Commission President Ursula von der Leyen on Wednesday signal a growing risk that U.S. travelers could once again be banned from visiting Europe because of the coronavirus pandemic.
• The warning came as other countries tightened their rules on U.S. visitors.
• Israel announced on Tuesday that from Aug. 11, it would require visitors from the U.S. and several other countries to quarantine for at least seven days on entering the country, even if they are vaccinated or have recovered from Covid-19.

WHO calls for moratorium on COVID-19 vaccine booster doses  – Reuters, 8/4/2021

• The World Health Organization is calling for a moratorium on COVID-19 vaccine boosters until at least the end of September, its head Tedros Adhanom Ghebreyesus said on Wednesday.
• The move was to enable that at least 10% of the population of every country was vaccinated, WHO Director-General Tedros said.
• The call to stop COVID-19 vaccine boosters is the strongest yet from the UN agency as the gap between inoculation rates in wealthy and poor countries widens.
• High-income countries administered around 50 doses for every 100 people in May, and that number had since doubled, according to WHO. Low-income countries have only been able to administer 1.5 doses for every 100 people, due to lack of supply.

Factmonster – TODAY in HISTORY

• Germany invaded Belgium and, in response, Britain declared war on Germany. (1914)
• Denmark ceded the Danish West Indies, including the Danish Virgin Islands, to the United States for $25 million. (1916)
• Anne Frank and her family were found hiding in Amsterdam by Nazis. (1944)
• President Carter signed a congressional act that established the Department of Energy. (1977)