Unemployment would be above 14 percent in Pennsylvania and approaching 16 percent nationally if not for the American Recovery and Reinvestment Act and other federal action taken in the wake of the recession, according to a new report released by the Keystone Research Center Thursday.
But still more needs to be done, said the Harrisburg-based think tank in its annual “State of Working Pennsylvania” report.
"Our economy is a product of conscious policy choices," Mark Price, labor economist for the center, said. "Federal policy stopped the economic free fall. And policy choices at the national and state level will powerfully shape the future health of the economy for middle-class families."
Actions taken by the Federal Reserve, Bush and Obama administrations, and Congress have all helped curb unemployment, Price said. Early last year, before passage of the federal Recovery Act, Pennsylvania was losing nearly 30,000 jobs each month. The state by contrast has added 64,000 jobs during the first half of this year. Pennsylvania also benefited from Congress’ recent extension of federal Medicaid assistance to states and additional school funding to preserve teacher jobs, which kept the state from losing as many as 12,000 more jobs.
But Pennsylvania needs to add about 300,000 jobs to replace those lost since the recession began. The state’s unemployment rate, which as of July was 9.3 percent, is expected to be at 7.2 percent in 2014 — a full seven years after the recession began. The state’s job deficit and a deficit in the buying power of the middle class are both greater threats than closing the federal deficit, according to Stephen Herzenberg, center economist and executive director.
"The federal deficit is the wrong enemy," Herzenberg said. "Our economy will recover only when we put Americans back to work and pay them a fair wage."
Several recommendations were made in the report, including: Extending resources for Pennsylvania’s Way to Work Program set to expire Sept. 30, access to capital for small business, extension of unemployment insurance benefits as long as unemployment remains so high that it is impossible for many jobless workers to find jobs and allowing the Bush tax cuts to expire and repurposing the funds to other areas to create jobs.
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Two is the magic number for NASCAR in Phoenix.
Phoenix International Raceway in the Avondale will continue to host two Sprint Cup Series races next year.
NASCAR tweaked its 2011 schedule some, moving venue dates that added some races in some markets but took away races in others.
Phoenix hosts two races now and will host two next season.
PIR will continue to host the second to last race in the fall Sprint Cup. The Kobalt Tools 500 will occur Nov. 13, 2011. The Phoenix track also will host the second race of the 2011 season the Subway Fresh Fit 500 on Feb. 27. PIR now hosts a Saturday night race in April. That date is being switched to a Sunday afternoon time the week after the first race of the season the Daytona 500 guaranteed payday loan.
PIR officials are happy they are keeping two races.
February is a buys month sports wise in the Phoenix and nationally. The Waste Management Open golf tournament runs Jan. 31 to Feb. 6. Cactus League Spring Training starts the beginning of March and the Phoenix Suns and Phoenix Coyotes are in the midst of their seasons.
The Super Bowl is being held at the new Cowboys Stadium in Dallas on February 6.
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The Internal Revenue Service is too busy trying to punish taxpayers instead of helping them navigate the complex tax system, according to a government official who watches out for taxpayers.
The report to Congress by Taxpayer Advocate Nina Olson said that taxpayers looking for help from the IRS only get through on the phone 70% of the time, and have to wait 11 minutes for a response when they actually do get through.
"The IRS is failing to address the needs of taxpayers who are experiencing economic difficulties and has not revised collection policies that harm taxpayers, thereby undermining its goal of increasing voluntary compliance," Olson wrote.
Olson said the IRS has ramped up spending on "hard core" enforcement and handing out levies in recent years, while spending has declined on the type of services that help Americans understand how to pay their taxes. She said that seems misguided, because in many cases the IRS is punishing Americans who had a good tax history before falling into hard times because of the recession.
She said the real problem with compliance is the difficulty in negotiating an increasingly complex tax system. This is because payments from new programs — including the stimulus, Making Work Pay, First-Time Homebuyer Credit and hybrid car credit — have put added pressure on the IRS by creating a backlog of additional work cash advance loan no fax.
"Many of these provisions have created taxpayer confusion, generated considerable telephone and correspondence volumes, … caused IRS processing delays and programming problems, produced several refund fraud schemes and resulted in several spikes in the Taxpayer Advocate Service’s caseload," wrote Olson.
She said the 70% response rate to taxpayer calls was actually an improvement, up from 53% in the prior year. That compared to an 87% response rate to calls five years ago.
The advocate acknowledged that the job of the IRS has gotten more difficult in recent years, causing the under-funded agency to strain under the added responsibilities of administering new services. She suggested that the IRS develop a strategic plan acknowledging its "dual role as part tax collector and part benefits administrator" in its effort to seek more funding.
IRS officials were not immediately available for comment.
The new owner of Anna Bannana’s in Moiliili has received his liquor license and plans to rename the bar Anna O’Neil’s after renovating and remodeling the pub.
The Honolulu Liquor Commission recently transferred the liquor license from former owner Banyan Tree LLC to Anna O’Brien’s Inc., headed by Bill Comerford. He also owns Honolulu establishments O’Toole’s Irish Pub, Kelley O’Neil’s and Irish Rose Saloon.
Comerford said he plans to close the bar for about a month for renovations and hopes to reopen later this summer under the new name. He declined to say how much he’s investing in the renovation.
“We’re just trying to make everybody understand that by changing the name we are honoring the past by keeping ‘Anna’ in it and trying to give a little bit of our own influence by putting the ‘O’Brien’s’ on it so they know who’s operating it,” he said.
He said he will continue to offer a mixed bag of live music that is a popular draw at Anna Bannana’s.
Attorney General Andrew Cuomo remains the overwhelming favorite to become New York’s next governor yet voters want to hear more from him on the state’s budget woes.
That message is from a Quinnipiac University poll released Tuesday.
Overall, 64 percent of New York voters, against 21 percent, want the Democratic candidate to weigh in on the protracted fiscal situation. Broken down by party, Republicans say (68-20) percent Cuomo isn’t explaining enough, an opinion shared by Democrats (58-26) percent and independent voters (71-15) percent.
“Imagine that: Voters want to hear more from a politician. Attorney General Andrew Cuomo has been too quiet on how we would solve Albany’s budget mess, which he’ll inherit — if he’s elected,” said Maurice Carroll, director of the Quinnipiac University Polling Institute.
Despite his silence, Cuomo maintains a 72-16 percent approval rating and holds a commanding lead on two Republican challengers. Quinnipiac has Cuomo in front of former Congressman Rick Lazio, 58-26 percent, up from 55-26 percent April 13. When put against Buffalo businessman Carl Paladino, Cuomo’s advantage is 59-23 percent, compared to 60-24 percent in a previous poll.
Lazio, the endorsed GOP candidate, tops Paladino in a Republican primary 46-17 percent, with 28 percent undecided.
The poll results on the governor’s race and other issues, including the U.S. Senate seat held by Kirsten Gillibrand and President Barack Obama’s job performance can be found here.
General Motors has made a final payment of $5.8 billion to the U.S. and Canadian governments, paying off the last of its $6.7 billion in loans, the company said Wednesday.
"I am very pleased to announce that, as of today, General Motors has repaid, in full and with interest, the loans made last July by the U.S. Treasury and Export Development Canada," said GM chief executive Ed Whitacre, speaking at a plant in Fairfax, Kan., where GM builds Chevrolet Malibu and Buick LaCrosse sedans.
Whitacre also announced that GM would make two big investments for production of the next-generation Malibu: $136 million in the Fairfax facility, which will become the primary production point for the car, and $121 million in its Detroit-Hamtramck plant, which will provide additional production at times of peak demand.
GM has already begun manufacturing the Chevrolet Volt electric car in Hamtramck, where it also makes the Buick Lucerne and Cadillac DTS large cars.
On Tuesday night, the automaker wired $4.7 billion to the U.S. Treasury Department and $1.1 billion to Canada.
"GM’s ability to pay back our loans ahead of schedule is a sign that our plan is working," Whitacre said.
But the loan money is only a fraction of the financial support that the federal government gave to GM over the past 12 months to stop it from going out of business.
Overall, GM received $50 billion in federal help. In return, the government got $2 billion in preferred stock and 61% of the company’s privately held common shares.
Taxpayers could recoup money from a possible sale of GM stock to the public in the future.
A White House report issued shortly after GM’s announcement was upbeat on the progress that both General Motors and Chrysler have made since coming out of bankruptcy but noted that the government would likely not make a profit on the funds it had invested.
"Overall, the investments made by the prior and current administration in GM, Chrysler, and GMAC will likely result in some loss, but the U.S. Treasury anticipates it to be much lower than forecast last year," the report said.
Mark Reuss, president of GM’s North American operations, said in an interview with CNNMoney.com that he was "positive" that GM’s stock would ultimately be profitable for taxpayers.
Microchip Technology Inc. has completed its purchase of Silicon Storage Technology Inc., closing the nearly $300 million deal.
Chandler-based Microchip (Nasdaq:MCHP) finalized is acquisition of SST (Nasdaq:SSTI) after shareholders approved the deal in a special meeting on Thursday.
We are pleased to have completed this transaction,” said Steve Sanghi, Microchip president and CEO, in a prepared statement. “Through this acquisition, we gain access to SST’s SuperFlash technology and extensive patent portfolio, which are critical building blocks for advanced microcontrollers. We expect that SST will also enhance our ability to customize technology variants, thereby adding an advantage over competing technologies.”
Microchip sought SST’s technology as a way to build its presence in the memory market and add to its own patent portfolio. Microchip twice upped its bid for the Sunnyvale, Calif.-based manufacturer after rival bids were submitted to its board.
“We are confident that SST will flourish as a part of Microchip,” said Bing Yeh, co-founder and CEO of SST. “As part of a larger, more diversified company, we believe that SST will be better positioned to deliver the superior service and innovative NOR flash and embedded flash solutions that our customers expect.”
Today will mark the last day that SST’s stock trades. Owners of the stock will receive $3.05 in cash as part of the sale.
Chalk up a legal victory for developer Paul McKee and his $8.1 billion NorthSide plan to remake 2 square miles northwest of downtown St. Louis.
Cole County Circuit Judge Patricia Joyce has dismissed the suit that challenged the constitutionality of the state’s Distressed Areas Land Assemblage tax credit. On Dec. 31, the state gave McKee $19.6 million of the credit.
Two St. Louis residents, Barbara Manzara and Keith Marquard, had filed a suit claiming that the never-before-used tax credit was unconstitutional.
Joyce ruled Monday that the law passes constitutional muster. She rejected the plaintiffs’ claim that the credit awarded to McKee shifts the risk of loss away from his project and represents improper use of public money. Instead, the sale of the tax credit benefits the redevelopment area, the judge ruled.
McKee’s lawyer Paul Puricelli said Wednesday that Joyce "covered all the issues" in finding the law valid. "The primary basis for her opinion was that the statute makes it explicit that any proceeds from these tax credits have to be used for the underlying redevelopment," he said.
The plaintiffs’ lawyer, Irene Smith, said she will appeal. Smith said that a tax credit intended merely to assemble property for redevelopment falls short of a legitimate use of taxpayer money.
"It’s the use of public money in a reckless way," she said.
State lawmakers designed the land-assemblage credit in 2007 to encourage lending on speculative projects such as NorthSide. The credit allows full reimbursement for money spent on interest and loan fees to buy at least 50 acres of land in low-income neighborhoods and a 50 percent reimbursement for the cost of land itself.
McKee sold his tax credit in January and used the proceeds to pay down much of his debt to the Bank of Washington, Mo., his main lender so far on the NorthSide project.
"The notion of the land assemblage tax credit is to acquire land," Puricelli said. "It’s appropriate to use the credit to pay off land assemblage costs."
Still pending is a suit claiming the Board of Aldermen and St. Louis officials failed to follow procedure in approving NorthSide’s $390 million tax increment financing, the largest ever in the city. The matter awaits a ruling by St. Louis Circuit Judge Robert Dierker, who finished hearing testimony about a month ago.
A plan by Japan to raise the limit on sales of bills used for currency intervention and accounting for earnings on foreign reserves in yen may offer additional funds for a budget hit by dwindling tax revenues.
The borrowing ceiling for the so-called foreign-exchange special account will be lifted by 5 trillion yen ($56 billion) to 145 trillion yen for the next fiscal year should the parliament approve the proposed 2010 budget. A Finance Ministry official speaking on condition of anonymity said the increase reflects rising earnings on Japan’s $1 trillion of reserves.
Prime Minister Yukio Hatoyama’s administration is struggling to reduce a record debt burden and fulfill pledges to boost spending on childcare and education. The Finance Ministry has already tapped some special accounts that are excluded from the budget to help restrain the fiscal deficit.
“The move probably reflects the government’s aim to increase the transparency and flexibility of using excess money in special accounts” to help find funding sources for the budget, said Susumu Kato, chief Japan economist at Credit Agricole Securities Asia in Tokyo.
Speculation emerged this week that the increase in the ceiling on the bill sales was aimed at increasing the power of the Finance Ministry to intervene in the currency market. While Japan hasn’t stepped into the foreign-exchange market since March 2004, Finance Minister Naoto Kan took office in January saying he was prepared to do so in “emergency situations.”
No Intervention Link
“The increase in the limit has nothing to do with intervention,” said Tohru Sasaki, chief currency strategist at JPMorgan Chase & Co. in Tokyo. Sasaki, who used to work in the foreign-exchange division of the Bank of Japan, said the likelihood of intervention is “extremely low” at a time when the Group of Seven nations is urging China to make its yuan more flexible.
The yen traded at 89.38 per dollar at 4:39 p.m. in Tokyo from 89.02 late yesterday in New York. Japan’s currency reached a 14-year high of 84.83 last November.
The ministry issues short-term bills denominated in yen to finance currency intervention. It also sells the bills to account for profits on foreign reserves in yen. It saves the funds in the special account for addressing currency fluctuations and transfers some of the proceeds to the budget.
Earnings on Reserves
Rising earnings on Japan’s foreign reserves meant that the limit on sales of the securities needed to be lifted, the Finance Ministry official said.
Japan’s reserves, the world’s largest after China’s, have more than tripled in the past decade as the ministry bought U.S. Treasuries and other securities to contain gains in the yen that would hurt exporters. The country’s monetary authorities last stepped into the foreign-exchange market in the first three months of 2004, when they sold 14.8 trillion yen.
The increase in the ceiling is the first since the government raised it by 40 trillion yen for the fiscal 2004 budget, around the time Japanese authorities were last intervening in the currency market.
Toyota’s pain is its rivals’ gain.
All major automakers but Toyota reported higher U.S. sales in February, and most took customers from their powerful Japanese competitor, which has been struggling with a series of massive safety recalls.
Toyota Motor Corp. said its U.S. sales fell 9 percent last month, while Ford, GM, Nissan, Honda and Hyundai all reported double-digit growth compared with February 2009, at the depth of the recession.
The gains may have been even higher without the blizzards that paralyzed the East Coast.
Other winners included Kia Motors Corp. and Subaru. Even struggling Chrysler Group LLC saw improvement. Toyota, by contrast, suspended sales of eight popular models in late January. And it spent last week answering questions from Congress about its safety record.
"We feel we’re getting our fair share of the Toyota business," said Susan Docherty, vice president of marketing at GM, whose sales rose nearly 12 percent.
February was the first full month since Toyota’s decision Jan. 26 to halt sales of some of its vehicles in the U.S. because of safety concerns. Those vehicles went on sale again as dealers repaired them, but Toyota’s image suffered.
Ford Motor Co. posted a 43 percent jump in February U.S. auto sales and outsold General Motors Co. for the first time in nearly a dozen years as it grabbed customers from struggling Toyota. Ford sold 334 more cars than GM in the U free credit report online.S. for the first time since August 1998, when GM was in the midst of a strike.
Most automakers reported that sales to rental car companies and other fleet buyers also were strong as companies began buying again after cutbacks last year. Fleet sales generally mean lower profits to automakers than sales to individuals.
Chrysler, for example, said sales rose half a percent, its first year-over-year monthly increase since December 2007. Car sales rose 38 percent, but truck sales dived 28 percent.
Hyundai Motor Co. said its sales rose 11 percent, driven by sales of the new Tucson small SUV. The company’s redesigned Sonata midsize car saw sales rise 58 percent.
The industry was expecting to see gains over February 2009, which was one of the weakest months in a very depressed year. Sales over President’s Day weekend — which traditionally kicks off the spring selling season — were robust, according to automotive website Edmunds.com.
Still, winter storms at the beginning and end of the month hurt sales on the East Coast and in the Midwest.
"Three and a half feet of snow on these cars," Docherty said. "It took our dealers a bit of time to get all that snow off here and get the customers back into the showrooms."
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