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Tag: Subsidies

  • Trump wants to ax an affordable housing grant that’s a lifeline for many rural communities

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    Heather Colley and her two children moved four times over five years as they fled high rents in eastern Tennessee, which, like much of rural America, hasn’t been spared from soaring housing costs.

    A family gift in 2021 of a small plot of land offered a shot at homeownership, but building a house was beyond reach for the 45-year-old single mother and manicurist making $18.50 an hour.

    That changed when she qualified for $272,000 from a nonprofit to build a three-bedroom home because of a grant program that has helped make affordable housing possible in rural areas for decades. She moved in last June.

    “Every time I pull into my garage, I pinch myself,” Colley said.

    Now, President Donald Trump wants to eliminate that grant, the HOME Investment Partnerships Program, and House Republicans overseeing federal budget negotiations did not include funding for it in their budget proposal. Experts and state housing agencies say that would set back tens of thousands of future affordable housing developments nationwide, particularly hurting Appalachian towns and rural counties where government aid is sparse and investors are few.

    The program has helped build or repair more than 1.3 million affordable homes in the last three decades, of which at least 540,000 were in congressional districts that are rural or significantly rural, according to an Associated Press analysis of federal data.

    “Maybe they don’t realize how far-reaching these programs are,” said Colley, who voted for Trump in 2024. Among those half a million homes that HOME helped build, 84% were in districts that voted for him last year, the AP analysis found.

    “I understand we don’t want excessive spending and wasting taxpayer dollars,” Colley said, “but these proposed budget cuts across the board make me rethink the next time I go to the polls.”

    The HOME program, started under President George H. W. Bush in the 1990s, survived years of budget battles but has been stretched thin by years of rising construction costs and stagnant funding. That’s meant fewer units, including in some rural areas where home prices have grown faster than in cities.

    The program has spent more than $38 billion nationwide since it began filling in funding gaps and attracting more investment to acquire, build and repair affordable homes, HUD data shows. Additional funding has gone toward projects that have yet to be finished and rental assistance.

    To account for the gap left by the proposed cuts, House Republicans want to draw on nearly $5 billion from a related pandemic-era fund that gave states until 2030 to spend on projects supporting people who are unhoused or facing homelessness.

    That $5 billion, however, may be far less, since many projects haven’t yet been logged into the U.S. Department of Housing and Urban Development’s tracking system, according to state housing agencies and associations representing them.

    A spokesperson for HUD, which administers the program, said HOME isn’t as effective as other programs where the money would be better spent.

    In opposition to Trump, Senate Republicans have still included funding for HOME in their draft budget. In the coming negotiations, both chambers may compromise and reduce but not terminate HOME’s funding, or extend last years’ overall budget.

    White House spokesperson Davis Ingle didn’t respond to specific questions from the AP. Instead, Ingle said that Trump’s commitment to cutting red tape is making housing more affordable.

    A bipartisan group of House lawmakers is working to reduce HOME’s notorious red tape that even proponents say slows construction.

    In Owsley County — one of the nation’s poorest, located in the rural Kentucky hills — residents struggle in an economy blighted by coal mine closures and declining tobacco crop revenues.

    Affordable homes are needed there, but tough to build in a region that doesn’t attract larger-scale rental developments that federal dollars typically go toward.

    That’s where HOME comes in, said Cassie Hudson, who runs Partnership Housing in Owsley, which has relied on the program to build the majority of its affordable homes for at least a dozen years.

    A lack of additional funding for HOME has already made it hard to keep up with construction costs, Hudson said, and the organization builds a quarter of the single-family homes it used to.

    “Particularly for deeply rural places and persistent poverty counties, local housing developers are the only way homes and new rental housing gets built,” said Joshua Stewart of Fahe, a coalition of Appalachian nonprofits.

    That’s in part because investment is scant and HOME steps in when construction costs exceed what a home can be sold for — a common barrier in poor areas of Appalachia. Some developers use the profits to build more affordable units. Its loss would erode those nonprofits’ ability to build affordable homes in years to come, Stewart said.

    One of those nonprofits, Housing Development Alliance, helped Tiffany Mullins in Hazard, Kentucky, which was ravaged by floods. Mullins, a single mother of four who makes $14.30 an hour at Walmart, bought a house there thanks to HOME funding and moved in August.

    Mullins sees the program as preserving a rural way of life, recalling when folks owned homes and land “with gardens, we had chickens, cows. Now you don’t see much of that.”

    In congressional budget negotiations, HOME is an easier target than programs such as vouchers because most people would not immediately lose their housing, said Tess Hembree, executive director of the Council of State Community Development Agencies.

    The effect of any reduction would instead be felt in a fizzling of new affordable housing supply. When HOME funding was temporarily reduced to $900 million in 2015, “10 to 15 years later, we’re seeing the ramifications,” Hembree said.

    That includes affordable units built in cities. The biggest program that funds affordable rental housing nationwide, the Low Income Housing Tax Credit, uses HOME grants for 12% of units, totaling 324,000 current individual units, according to soon-to-be-published Urban Institute research.

    Trump’s spending bill that Republicans passed this summer increased LITHC, but experts say further reducing or cutting HOME would make those credits less usable.

    “It’s LITHC plus HOME, usually,” said Tim Thrasher, CEO of Community Action Partnership of North Alabama, which builds affordable apartments for some of the nation’s poorest.

    In the lush mountains of eastern West Virginia, Woodlands Development Group relies on HOME for its smaller rural projects. Because it helps people with a wider range of incomes, HOME is “one of the only programs available to us that allows us to develop true workforce housing,” said executive director Dave Clark.

    It’s those workers — nurses, first responders, teachers — that nonprofits like east Tennessee’s Creative Compassion use HOME to build for. With the program in jeopardy, grant administrator Sarah Halcott said she fears for her clients battling rising housing costs.

    “This is just another nail in the coffin for rural areas,” Halcott said.

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    Kramon reported from Atlanta. Bedayn reported from Denver. Herbst contributed from New York City, and Kessler reported from Washington, D.C.

    ___

    Kramon is a corps member for The Associated Press/Report for America Statehouse News Initiative. Report for America is a nonprofit national service program that places journalists in local newsrooms to report on undercovered issues.

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  • Van Gogh Museum may close if the Dutch government doesn’t help fund repairs

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    THE HAGUE, Netherlands — The Amsterdam museum that displays a priceless collection of works by one of the world’s most popular artists, Vincent van Gogh, may have to close if the Dutch government doesn’t help foot the bill for major repairs to its aging building, the museum’s director said Thursday.

    Since its opening in 1973, nearly 57 million visitors have passed through the Van Gogh Museum to gaze at iconic works including one of his paintings of a vase of sunflowers as well as “Almond Blossom,” “The Potato Eaters” and a colorful depiction of his bedroom in the French town of Arles.

    But Director Emilie Gordenker says the original building, which is owned by the Dutch state, is in such poor condition it needs urgent and extensive repairs to keep its priceless collection and visitors safe.

    “If we don’t address the major maintenance that needs to happen, we will have to close,” she told The Associated Press in a telephone interview. The New York Times first reported on her concerns on Wednesday.

    She said the 50-year-old building needs “major maintenance,” and two years of talks with the government have not resolved a dispute about how to pay for repairs expected to start in 2028, last three years and cost 104 million euros ($121 million).

    “It’s now getting very urgent,” she said.

    She said that during the renovation, the museum would be partly closed and would therefore earn less from ticket sales. “The only thing we’re asking them to do is to help us finance the basic maintenance,” she said.

    The nearby Rijksmuseum shut down for years for a largescale renovation, but Gordenker says that kind of major facelift is not what the Van Gogh Museum is appealing for.

    Among other things, urgent repairs are needed for air conditioning, elevators, even the sewage system.

    “It’s not the fun, sexy, let’s build a new wing stuff,” she said.

    In a written reaction, the Ministry of Education, Culture and Science said that the museum receives an annual subsidy “sufficient to carry out the necessary maintenance. This position is based on extensive expert research commissioned by the Ministry.”

    It said the museum objected to the subsidy decision last year and recently filed an appeal in a Dutch court that will be heard in February next year. “It is not unusual for parties to have a subsidy decision reviewed by the court,” the ministry added.

    The dispute has its origins in a decision by Van Gogh’s family to transfer a trove of his art — more than 200 paintings, 500 drawings and 900 letters along with works by contemporaries such as Paul Gauguin — to a foundation set up in 1962 to keep the collection together. In return, the government pledged to build and maintain a museum where the works could be displayed, the museum said in a statement.

    Gordenker argues that means the government should also help to fund the work the museum now needs.

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  • FACT FOCUS: No, taxpayers will not receive new stimulus checks this summer

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    Don’t splurge just yet.

    Rumors spread online Friday that the U.S. government will soon be issuing stimulus checks to taxpayers in certain income brackets.

    But Congress has not passed legislation to authorize such payments, and, according to the IRS, no new stimulus checks will be distributed in the coming weeks.

    Here’s a closer look at the facts.

    CLAIM: The Internal Revenue Service and the Treasury Department have approved $1,390 stimulus checks that will be distributed to low- and middle-income taxpayers by the end of the summer.

    THE FACTS: This is false. Taxpayers will not receive new stimulus checks of any amount this summer, an IRS official said. Stimulus checks, also known as economic impact payments, are authorized by Congress through legislation and distributed by the Treasury Department. Republican Sen. Josh Hawley of Missouri last month introduced a bill that would send tax rebates to qualified taxpayers using revenue from tariffs instituted by President Donald Trump. Hawley’s bill has not passed the Senate or the House.

    The IRS announced early this year that it would distribute about $2.4 billion to taxpayers who failed to claim on their 2021 tax returns a Recovery Rebate Credit — a refundable credit for individuals who did not receive one or more COVID-19 stimulus checks. The maximum amount was $1,400 per individual.

    Those who hadn’t already filed their 2021 tax return would have needed to file it by April 15 to claim the credit. The IRS official said there is no new credit that taxpayers can claim.

    Past stimulus checks have been authorized through legislation passed by Congress. For example, payments during the coronavirus pandemic were made by possible by three bills: the Coronavirus Aid, Relief and Economic Security Act; the COVID-related Tax Relief Act; and the American Rescue Plan Act.

    In 2008, stimulus checks were authorized in response to the Great Recession through the Economic Stimulus Act.

    The Treasury Department, which includes the Internal Revenue Service, distributed stimulus payments during the COVID-19 pandemic and the Great Recession. The Treasury’s Bureau of the Fiscal Service, formed in 2012, played a role as well during the former crisis.

    Hawley in July introduced the American Worker Rebate Act, which would share tariff revenue with qualified Americans through tax rebates. The proposed rebates would amount to at minimum $600 per individual, with additional payments for qualifying children. Rebates could increase if tariff revenue is higher than expected. Taxpayers with an adjusted annual gross income above a certain amount — $75,000 for those filing individually — would receive a reduced rebate.

    Hawley said Americans “deserve a tax rebate.”

    “Like President Trump proposed, my legislation would allow hard-working Americans to benefit from the wealth that Trump’s tariffs are returning to this country,” Hawley said in a press release.

    Neither the Senate nor the House had passed the American Worker Rebate Act as of Friday. It was read twice by the Senate on July 28, the day it was introduced, and referred to the Committee on Finance.

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    Find AP Fact Checks here: https://apnews.com/APFactCheck.

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  • Joe Biden paid $89 million to boost electric motorcycle production. It’s failing.

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    In 2024, President Joe Biden’s Energy Department awarded $1.7 billion in grants to increase domestic manufacturing of electric vehicles (E.V.s), including $89 million to Harley-Davidson to expand its manufacturing plant in Pennsylvania for electric motorcycle production. At the time, Energy Secretary Jennifer Granholm claimed the funding would “ensure that our automotive industry stays competitive.” Then-Sen. Bob Casey (D–Pa.) championed the grant, with his office declaring that it would “help Harley Davidson make investments necessary to hit its goal of producing more zero-emission motorcycles.”

    More than a year later, it appears that this funding plan is failing.

    Despite the $89 million in government subsidies provided to LiveWire, which was initially launched as part of Harley-Davidson but has since spun off, the company has sold only 55 electric motorcycles in the second quarter of 2025, a 65 percent decline compared to the same quarter in 2024. In the second quarter of 2025, LiveWire’s electric motorcycle business yielded $800,000 in revenue. Overall, in the second quarter of 2025, the company generated $5.9 million in consolidated revenue from its electric motorcycles and electric bikes.

    LiveWire has operated at a loss since its founding in 2021. After peaking at $46.83 million in 2022, annual revenue has declined for two consecutive years, dropping 43 percent from the company’s peak year in 2022. The company has never had a profitable quarter, a trend that is expected to continue through 2025.

    While it’s projected sales of up to 3,000 electric motorcycles over the past two years, LiveWire has sold only 2,418 electric motorcycles since its inception in 2021. Last year, the company sold just 612 motorcycles, falling short of its 2023 sales of 660 machines and well below its initial 2024 projection of 1,000 to 1,500 bikes. Despite a history of missing sales targets, LiveWire again projected sales of 1,000 to 1,500 electric motorcycles for 2025.

    A significant appeal of gas-powered motorcycles lies in the owner’s ability to customize their bike. By design, electric motorcycles are quiet and difficult to modify.

    Although the upfront cost of LiveWire electric motorcycles is significantly lower than most new Harley-Davidson gasoline models, LiveWire’s financials suggest that the market has clearly expressed its preference. The $89 million grant to Harley-Davidson is only one in a long list of failed, costly green energy projects funded by the Biden administration, which also includes a $9.63 billion loan to Ford to build three manufacturing plants for the company’s E.V. batteries in Tennessee and Kentucky. Only one of these factories has been built—and has yet to roll out batteries—while the other two have no set opening date.

    In May, amid a continued decline in sales, Harley-Davidson suspended its full-year financial forecast due to the imposition of President Donald Trump’s tariffs. If the company’s second-quarter financial outlook is any indication of future performance, there will be little relief to come. In the second quarter of 2025, Harley-Davidson’s revenue dropped 19 percent year-over-year, with global motorcycle shipments down 28 percent. To date, tariffs have cost the company $17 million in 2025.

    Like many other projects before it, government funding has not helped LiveWire turn a profit. It has instead artificially prolonged its financial runway and potentially discouraged disruptive thinking and entrepreneurial spirit.

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    Tosin Akintola

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  • After millions lose access to internet subsidy, FCC moves to fill connectivity gaps

    After millions lose access to internet subsidy, FCC moves to fill connectivity gaps

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    LOS ANGELES (AP) — The Biden administration is moving to blunt the loss of an expired broadband subsidy program that helped more than 23 million families afford internet access by using money from an existing program that helps libraries and schools provide WiFi hotspots to students and patrons.

    Jessica Rosenworcel, chairwoman of the Federal Communications Commission, told The Associated Press last week that the agency had voted in July to “modernize” a federal program known as E-Rate to fill at least some of the gaps left by the Affordable Connectivity Program, which gave families with limited income a monthly subsidy to pay for high-speed internet.

    “A lot of those households are at risk of disconnection,” Rosenworcel said after a visit to a Los Angeles elementary school. “We should be clear that it’s not always an on-off switch. It’s about sustainability.”

    The Affordable Connectivity Program, part of a broader effort pushed by the administration to bring affordable internet to every home and business in the country, was not renewed by Congress and ran out of funding earlier this year.

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    Mothers of students at Union Avenue Elementary School, which has a 93% Latino student population, told Rosenworcel that their need for the internet has never been greater. They said the cost of rent and food makes it hard to prioritize maintaining a continuous connection.

    After listening to the mothers describe using WiFi in a McDonald’s parking lot so they can take part in remote doctor’s appointments, pay bills, and provide their kids with an internet connection for their online homework, an emotional Rosenworcel called their stories “chilling.”

    “That family and that child are going to have a harder time thriving in the modern world without that connection at home,” she said.

    The E-Rate program, established in the 1990s, has provided more than $7 billion in discounts for eligible schools and libraries since 2022 to afford broadband products and services. According to a data analysis by the AP, it offered benefits to more than 12,500 libraries, nearly half of them in rural areas, and 106,000 schools.

    For the most recent round of funding, the E-Rate program was expanded to include WiFi on school buses. Starting next year, Rosenworcel said, the list of eligible products will expand to WiFi hotspots.

    The Affordable Connectivity Program was helping one in six families in the U.S. afford internet access. Rosenworcel said the decision to include WiFi hotspots in E-Rate was partly a response to the failure to extend the subsidies.

    “Every child needs internet access at home to really thrive,” Rosenworcel said.

    Alex Houff, who manages digital equity programs for the Baltimore County Public Library in Maryland, said the library began a WiFi hotspot lending program right before the COVID-19 lockdown began in 2020 with around 50 devices. She said the program has grown to include 1,000 devices, which still falls short of meeting demand. There are more than 160 people waiting to use a hotspot, Houff said.

    “Most of the time we were hearing from branches that their communities were borrowing these hotspots because it was their only source of connectivity,” Houff said.

    Affordability, Houff said, is the biggest barrier to connection. She said the library system would apply for E-Rate funding to double the number of hotspots it offers to patrons.

    The expansion of the program has not pleased everyone. The two Republicans sitting on the commission argued that E-Rate was meant to bolster and support internet access within the classroom, not at home or other places where students “might want to learn.”

    “The last I checked, schools, which have classrooms, and libraries, are physical locations with addresses; not philosophical, conceptual ideas of instruction or education,” Republican commissioner Nathan Simington said in a statement after the vote.

    Rosenworcel, who took over as chair of the FCC after President Joe Biden defeated Donald Trump in the 2020 election, said the Republican members’ characterization of where the program ought to be applied was too restrictive.

    After the FCC voted to expand WiFi hotspots to school buses, a group of Republican senators endorsed a lawsuit challenging the agency’s decision. Sen. Ted Cruz of Texas, who led the group of senators, said in a news release that the commission’s new rule was an overreach that would “harm children by enabling their unsupervised access to the internet.”

    Disagreements between political parties aren’t the only threat to E-Rate. The Fifth Circuit Court of Appeals — the same one where Sen. Cruz filed an amicus brief about WiFi on school buses — ruled at the end of July that the funding mechanism that supports E-Rate and other FCC-administered internet access programs, known as the Universal Service Fund, is unlawful.

    “There is a big cloud of uncertainty over the future of the Universal Service Fund right now because of this Fifth Circuit decision,” John Windhausen, the executive director of the Schools, Health and Libraries Broadband Coalition. “It’s a horrible decision, and it’s totally out of line with past Supreme Court precedent and totally out of line with other appeals courts that have ruled in just the opposite way.”

    Further litigation is expected. The case could be taken up by the Supreme Court, Windhausen said.

    Chairwoman Rosenworcel said she’s confident in the integrity of the Universal Service Fund, saying the Fifth Circuit’s decision is “misguided and wrong.”

    “It’s done a lot of good for the United States to make sure, no matter who you are or where you live, you get access to modern communications,” Rosenworcel said.

    Rosenworcel said the FCC could mobilize quickly if Congress would simply renew the Affordable Connectivity Program, which might be the easiest way to address the need.

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  • The 2024 GOP Platform Promises To ‘Make America Affordable Again.’ So Why Are They Embracing Fiscal Insanity?

    The 2024 GOP Platform Promises To ‘Make America Affordable Again.’ So Why Are They Embracing Fiscal Insanity?

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    The Republican National Committee just released its 2024 platform. While calling it a platform is a stretch, the list of bullet points gives an idea of what the potential next Trump administration’s goals are. Here’s one issue that should be front and center: End inflation and make America affordable again.

    To be sure, “make America more affordable” would be a great slogan and a great objective. It’s similar to what many have called an “abundance agenda.” While there is plenty to dislike in a platform that at times feels unserious and destructive, this part I like.

    Abundance isn’t achieved by the same old subsidies or tax breaks for special interests, price controls, or spending loads of taxpayer money on transfer payments. It’s achieved by freeing up the supply side of our economy. That means freeing producers and innovators from excessive regulatory obstacles and heavy tax burdens (including tariffs) so they can provide more of what Americans need.

    The Trump administration platform assures us it will move in this direction. For instance, it wants to increase America’s dominance as an energy producer, which will only be achieved through a deregulation agenda. Apart from counterproductive tax incentives for first-time homeowners, it expresses a commitment to lowering housing costs through deregulation.

    The platform states it will “cancel the electric vehicle mandate and cut costly and burdensome regulations” as well as “end the Socialist Green New Deal.” I assume that means ending the expensive subsidies and tax breaks in the Inflation Reduction Act. Great idea, but get ready to hear all the recipients of these handouts cry that they won’t be able to do what they were already doing before being given the subsidies.

    A deregulation agenda would serve the Republicans’ goal of boosting manufacturing much better than tariffs, which former President Donald Trump continues to love despite overwhelming evidence that they don’t do what he claims. Most tariffs raise the prices of inputs used by American firms, including manufacturing, to produce outputs that serve their customers.

    Something similar could be said about Republicans’ swipes at immigrants. Fewer immigrants will create labor supply shortages, hurt manufacturing, and slow the economy.

    Still, even with their disastrous trade and immigration agenda and the many contradictory goals espoused by this platform, implementing the deregulatory part of the agenda will make some strides at freeing the supply side and hence lowering prices. Indeed, President Joe Biden has not only maintained many of Trump’s tariffs, but he’s added some of its own. He’s also systematically favored subsidizing the demand for certain things—nudging customers to buy what he wants them to buy—while taking actions that restrict supply. That’s a recipe for affordability failure.

    But as far as affordability goes, I’m less optimistic about the prospect of the next administration ending inflation. That’s because Trump and other Republicans are firmly embracing fiscal irresponsibility and excessive debt. The platform contains no mention of a plan to get government debt under control. Instead, it pledges to “fight for and protect Social Security and Medicare with no cuts, including no changes to the retirement age.”

    Many voters love hearing this promise. But maintaining these two objectively underfinanced programs will inevitably explode the debt burden over the next 30 years. In the entire history of the United States so far, Uncle Sam has accumulated roughly $34 trillion in debt. Under the Trump plan, the government would need to borrow another $124 trillion for these programs alone.

    Leaving aside the question of who will lend us all this money when foreign buyers are already scaling back purchases of U.S. Treasuries, remember that most of the inflation we’ve recently suffered is the product of massive Biden administration spending on top of the COVID-19 spending without any plan to pay for it. As such, announcing that the U.S. will simply go on another borrowing spree sends a poor signal, and it might even increase inflation.

    This is made more important because Trump wants to make permanent the tax cuts that are set to expire after 2025, end taxes on tips, and more. If Congress and the president do this without any offsetting spending reductions, it will add at least another $4 trillion in debt over 10 years. With more inflationary fuel, we could easily see the Federal Reserve raise interest rates again, making borrowing money even more expensive than it already is.

    The bottom line is that Trump’s deregulatory agenda could have a shot at lowering some prices. But it will only be a game-changer if he becomes serious about fiscal responsibility. Right now, he isn’t, so I wouldn’t count on it.

    COPYRIGHT 2024 CREATORS.COM

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    Veronique de Rugy

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  • Biden, Trump, and RFK Jr. are all anti-freedom

    Biden, Trump, and RFK Jr. are all anti-freedom

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    Last week, presidential candidate Robert F. Kennedy Jr. asked me to moderate what he called “The Real Debate.”

    Kennedy was angry with CNN because it wouldn’t let him join its Trump-Biden debate.

    His people persuaded Elon Musk to carry his Real Debate on X, formerly Twitter. They asked me to give RFK Jr. the same questions, with the same time limits.

    I agreed, hoping to hear some good new ideas.

    I didn’t.

    As you know, President Joe Biden slept, and former President Donald Trump lied. Well, OK, Biden lied at least nine times, too, even by CNN’s count.

    Kennedy was better.

    But not much.

    He did acknowledge that our government’s deficit spending binge is horrible. He said he’d cut military spending. He criticized unscientific COVID-19 lockdowns and said nice words about school choice.

    But he, too, dodged questions, blathered on past time limits, and pushed big government nonsense like, “Every million dollars we spend on child care creates 22 jobs.”

    Give me a break.

    Independence Day is this week.

    As presidential candidates promise to subsidize flying cars (Trump), free community college tuition (Biden), and “affordable” housing via 3 percent government-backed bonds (Kennedy), I think about how bewildered and horrified the Founding Fathers would be by such promises.

    On the Fourth of July almost 250 years ago, they signed the Declaration of Independence, marking the birth of our nation.

    They did not want life dominated by politicians. They wanted a society made up of free individuals. They believed every human being has “unalienable rights” to life, liberty, and (justly acquired) property.

    The blueprints created by the Declaration of Independence and the Constitution gradually created the freest and most prosperous nation in the history of the world.

    Before 1776, people thought there was a “divine right” of kings and nobles to rule over them.

    America succeeded because the Founders rejected that belief.

    In the Virginia Declaration of Rights, George Mason wrote, “All power is vested in, and consequently derived from, the people.”

    By contrast, Kennedy and Biden make promises that resemble the United Nations’ “Universal Declaration of Human Rights.” U.N. bureaucrats say every person deserves “holidays with pay…clothing, housing and medical care and necessary social services.”

    The Founders made it clear that governments should be limited. They didn’t think we had a claim on our neighbor’s money. We shouldn’t try to force them to pay for our food, clothing, housing, prescription drugs, college tuition.

    They believe you have the right to be left alone to pursue happiness as you see fit.

    For a while, the U.S. government stayed modest. Politicians mostly let citizens decide our own paths, choose where to live, what jobs to take, and what to say.

    There were a small number of “public servants.” But they weren’t our bosses.

    Patrick Henry declared: “The governing persons are the servants of the people.”

    Yet now there are 23 million government employees. Some think they are in charge of everything.

    Rep. Alexandria Ocasio-Cortez (D–N.Y.), pushing her Green New Deal, declared herself “the boss.”

    The Biden administration wants to decide what kind of car you should drive.

    During the pandemic, politicians ordered people to stay home, schools to shut down and businesses to close.

    Then, as often happens in “Big Government World,” people harmed by government edicts ask politicians to compensate them.

    After governments banned Fourth of July fireworks, the American Pyrotechnics Association requested “relief in the next Senate Covid package to address the unique and specific costs to this industry,” reported The New York Times. “The industry hopes Congress will earmark $175 million for it in another stimulus bill.”

    Today the politically connected routinely lobby passionately to get bigger chunks of your money.

    For some of you, the last straw was when the administration demanded you inject a chemical into your body.

    When some resisted vaccinations, Biden warned, “Our patience is wearing thin.”

    His patience? Who does he think he is? My father? My king?

    At least Kennedy doesn’t say things like that. But he does say absurd things. In a few weeks I’ll release my sit-down interview with him, and you can decide for yourself whether he’s a good candidate.

    This Fourth of July, remember Milton Friedman’s question: “How can we keep the government we create from becoming a Frankenstein that will destroy the very freedom we establish it to protect?”

    COPYRIGHT 2024 BY JFS PRODUCTIONS INC.

    The post Biden, Trump, and RFK Jr. Are All Anti-Freedom appeared first on Reason.com.

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    John Stossel

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  • Millions in Nigeria have little to no electricity. It’s straining businesses and public services

    Millions in Nigeria have little to no electricity. It’s straining businesses and public services

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    IBADAN, Nigeria — Dimly lit and stuffy classrooms stir with life every morning as children file in. Rays of sunlight stream through wooden windows, the only source of light. Pupils squint at their books and intermittently the blackboard as teachers try to hold their attention.

    It’s a reality for many schoolchildren across Nigeria, where many buildings don’t have access to the national electricity grid. In Excellent Moral School in Olodo Okin in Ibadan, “the entire community is not connected, including the school,” said school founder Muyideen Raji. It acutely affects pupils, he said, who can’t learn how to use computers or the Internet and can’t study in the evenings.

    About half of Nigeria’s more than 200 million people are hooked up to a national electricity grid that can’t provide sufficient daily electricity to most of those connected. Many poor, rural communities like Olodo Okin are off the grid entirely.

    In a country with abundant sunshine, many are looking to solar energy to help fill the gaps, but getting risk-averse investors to finance major solar projects that would give Nigeria enough reliable energy is an uphill struggle. It means that millions in the country are finding ways to live with little to no electricity.

    Studies have shown that Nigeria could generate much more electricity than it needs from solar energy thanks to its powerful sunshine. But 14 grid-scale solar projects in the northern and central parts of the country that could generate 1,125 megawatts of electricity have stalled since contracts were signed in 2016.

    Those trying to develop solar projects in the country blame interest rates for borrowing which can be as high as 15 percent, two to three times higher than in advanced economies and China, according to the International Energy Agency.

    That means it’s more costly for solar companies to work in Nigeria or other developing nations than in rich countries. Africa only has one-fifth the solar power capacity of Germany, and just 2% of global clean energy investments go to the continent.

    “The same project put up in Nigeria and Denmark; the Danish project will get funding for 2 to 3 percent” interest rate, said Najim Animashaun, director of Nova Power, one of the stalled solar projects. Meanwhile he struggles to get loans even with interest rates of 10 percent or higher, “even though my solar project can produce two and half times more power,” than a Danish one.

    Nigeria also does not set so-called cost-reflective tariffs, meaning the price consumers pay for electricity doesn’t cover the costs to produce and distribute it. This means distribution companies can’t fully pay producers and the industry relies on government interventions to stay afloat, scaring off lenders from investing in the solar industry.

    Currently, power producers say they are owed up to 3.7 trillion Naira ($2.7 billion) by the government, making it difficult to meet obligations to their lenders and contractors.

    One option would be getting World Bank guarantees that would put investors at ease and make them more willing to put money into solar projects — but the government is wary of signing up to anything that would force them to pay large sums even if electricity from the projects does not get the consumers because of inadequate transmission and distribution infrastructure.

    But without World Bank guarantees “nobody will develop or finance a project with a government subsidy, because it can dry off,” said Edu Okeke, the managing director of Azura Power. Azura Power has a stake in the now-stalled 100 megawatt Nova solar project in Nigeria’s northern Katsina State.

    With less than 8,000 megawatts of capacity and an average supply of less than 4,000 megawatts — less than half of what Singapore supplies to just 5.6 million people — power outages are an everyday occurrence in Nigeria.

    Communities like Excellent Moral School’s in Ibadan that have no access to electricity are often surrounded by more fortunate ones that are connected to the grid but experience frequent outages and have to use gasoline and diesel-run private generators.

    With the long-running petroleum subsidies now removed, many households, schools, hospitals and businesses struggle with the cost of the fuel for their backup generators.

    “We have stopped using a diesel generator as an alternative due to costs,” said Abdulhakeem Adedoja, the head of Lorat Nursery and Primary School in Ibadan. He added that although the school is in an Ibadan area that is connected to the grid, they could go two weeks without a power supply.

    The problem is not just the lack of electricity for computer-aided learning, proper lighting, and fans to make classes less stuffy for pupils and teachers, but also that students are unable to complete their school assignments at home, Adedoja said.

    For more energy-hungry small businesses like restaurants, they either close shop or continue with alternative power generation, incurring high costs that hurt their capacity for expansion.

    Ebunola Akinwale, the owner of Nature’s Treat Cafe in Ibadan, said she pays 2.5 million Naira ($1,700) monthly to power backup generators in her four branches.

    “If nothing changes, I probably would have to close one or two branches,” she said, though she is planning to go solar which she enthuses will help us cut “pollution from the diesel (generators).” She’s in talks with her bank for a low-cost loan package specially designed for young women entrepreneurs to finance the solar alternative.

    However, not every business and household has such access or can afford the upfront capital for a private solar system. School heads Raji and Adedoja said they find the costs prohibitive.

    The stalled solar projects aren’t happening as finances don’t add up, but even for other sources of electricity generation, Nigeria struggles to attract desperately needed private financing.

    The power minister, Adebayo Adelabu, said in May that in order to address the financial crisis affecting the electricity sector, prices must reflect the true costs of service because a broke “government cannot afford to pay 3 trillion Naira ($2.4 billion) in subsidy.”

    The government also insists that Nigerians paying fully for the electricity they consume would encourage investments in the sector.

    There has been some pushback to that, as labor unions went on strike in early June in part to protest electricity tariff increases.

    But businesspeople like Akinwale understand the government’s position because regularly supplied grid electricity, even without a subsidy, is “still cheaper and cleaner” than diesel for generators, she said.

    If finances for grid-scale solar projects do not add up, the government should offer incentives such as tax relief and payment plans to encourage private solar adoption, Akinwale said. “Sunlight is there abundantly,” she said.

    Former regulatory chief Sam Amadi doubts if consumers in Nigeria — where the minimum wage is 30,000 Naira ($20) a month — “can today pay for energy consumed without subsidy.” He also wants a policy that makes it more affordable to have smaller-scale solar projects dotted across communities, businesses and homes.

    Until then, there are consequences to the frequent blackouts, he said.

    “I have the story of a person who died in hospital because the electricity went out during operation,” he said. “Every day, we see the real-world effects of the lack of electricity.”

    ___

    The Associated Press’ climate and environmental coverage receives financial support from multiple private foundations. AP is solely responsible for all content. Find AP’s standards for working with philanthropies, a list of supporters and funded coverage areas at AP.org.

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  • Biden is marking Earth Day by announcing $7 billion in federal solar power grants

    Biden is marking Earth Day by announcing $7 billion in federal solar power grants

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    WASHINGTON — President Joe Biden is marking Earth Day by announcing $7 billion in federal grants for residential solar projects serving 900,000-plus households in low- and middle-income communities. He also plans to expand his New Deal-style American Climate Corps green jobs training program.

    The grants are being awarded by the Environmental Protection Agency, which unveiled the 60 recipients on Monday. The projects are expected to eventually reduce emissions by the equivalent of 30 million metric tons of carbon dioxide and save households $350 million annually, according to senior administration officials.

    Biden’s latest environmental announcements come as he is working to energize young voters for his reelection campaign. Young people were a key part of a broad but potentially fragile coalition that helped him defeat then-President Donald Trump in 2020. Some have joined protests around the country of the administration’s handling of Israel’s war with Hamas in the Gaza Strip.

    Senior administration officials said young Americans are keenly invested in the Biden climate agenda and want to actually help enact it. The Climate Corps initiative is a way for them to do that, the officials said.

    Solar is gaining traction as a key renewable energy source that could reduce the nation’s reliance on fossil fuels, which emit planet-warming greenhouse gases. Not only is it clean, but solar energy can also boost the reliability of the electric grid.

    But solar energy can have high costs for initial installation, making it inaccessible for many Americans — and potentially meaning a mingling of environmental policy with election-year politics.

    Forty-nine of the new grants are state-level awards, six serve Native American tribes and five are multi-state awards. They can be used for investments such as rooftop solar and community solar gardens.

    Biden is making the announcement at northern Virginia’s Prince William Forest Park, about 30 miles southwest of Washington. It was established in 1936 as a summer camp for underprivileged youth from Washington, part of President Franklin D. Roosevelt’s Civilian Conservation Corps to help create jobs during the Great Depression.

    Biden used executive action last year to create the American Climate Corps modeled on Roosevelt’s New Deal. He is announcing Monday that nearly 2,000 corps positions are being offered across 36 states, including jobs offered in partnership with the North American Building Trades Unions.

    Biden has often used Earth Day as a backdrop to further his administration’s climate initiatives. Last year, he signed an executive order creating the White House Office of Environmental Justice, meant to help ensure that poverty, race and ethnic status do not lead to worse exposure to pollution and environmental harm.

    He has tried to draw a contrast with GOP congressional leaders, who have called for less regulation of oil production to lower energy prices. Biden officials counter that GOP policies benefit highly profitable oil companies and could ultimately undermine U.S. efforts to compete with the Chinese in the renewable energy sector.

    Biden will use his Virginia visit to discuss how “a climate crisis fully manifest to the American people in communities all across the country, is also an opportunity for us to come together,” said White House National Climate Adviser Ali Zaidi.

    He said the programs can “unlock economic opportunity to create pathways to middle-class-supporting careers, to save people money and improve their quality of life.”

    The awards came from the Solar for All program, part of the $27 billion “green bank” created as part of a sweeping climate law passed in 2022. The bank is intended to reduce climate and air pollution and send money to neighborhoods most in need, especially disadvantaged and low-income communities disproportionately impacted by climate change.

    EPA Deputy Administrator Janet McCabe said she was “looking forward to these funds getting out into the community, giving people skills, putting them to work in their local communities, and allowing people to save on their energy bills so that they can put those dollars to other needs.”

    Among those receiving grants are state projects to provide solar-equipped roofs for homes, college residences and residential-serving community solar projects in West Virginia, a non-profit operating Mississippi solar lease program and solar workforce training initiatives in South Carolina.

    The taxpayer-funded green bank has faced Republican opposition and concerns over accountability for how the money gets used. EPA previously disbursed the other $20 billion of the bank’s funds to nonprofits and community development banks for clean energy projects such as residential heat pumps, additional energy-efficient home improvements and larger-scale projects like electric vehicle charging stations and community cooling centers.

    ___

    St. John reported from Detroit.

    ___

    Alexa St. John is an Associated Press climate solutions reporter. Follow her on X, formerly Twitter, @alexa_stjohn. Reach her at ast.john@ap.org.

    ___

    The Associated Press’ climate and environmental coverage receives financial support from multiple private foundations. AP is solely responsible for all content. Find AP’s standards for working with philanthropies, a list of supporters and funded coverage areas at AP.org.

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  • Biden is marking Earth Day by announcing $7 billion in federal solar power grants

    Biden is marking Earth Day by announcing $7 billion in federal solar power grants

    [ad_1]

    WASHINGTON — President Joe Biden is marking Earth Day by announcing $7 billion in federal grants for residential solar projects serving 900,000-plus households in low- and middle-income communities. He also plans to expand his New Deal-style American Climate Corps green jobs training program.

    The grants are being awarded by the Environmental Protection Agency, which unveiled the 60 recipients on Monday. The projects are expected to eventually reduce emissions by the equivalent of 30 million metric tons of carbon dioxide and save households $350 million annually, according to senior administration officials.

    Biden’s latest environmental announcements come as he is working to energize young voters for his reelection campaign. Young people were a key part of a broad but potentially fragile coalition that helped him defeat then-President Donald Trump in 2020. Some have joined protests around the country of the administration’s handling of Israel’s war with Hamas in the Gaza Strip.

    Senior administration officials said young Americans are keenly invested in the Biden climate agenda and want to actually help enact it. The Climate Corps initiative is a way for them to do that, the officials said.

    Solar is gaining traction as a key renewable energy source that could reduce the nation’s reliance on fossil fuels, which emit planet-warming greenhouse gases. Not only is it clean, but solar energy can also boost the reliability of the electric grid.

    But solar energy can have high costs for initial installation, making it inaccessible for many Americans — and potentially meaning a mingling of environmental policy with election-year politics.

    Forty-nine of the new grants are state-level awards, six serve Native American tribes and five are multi-state awards. They can be used for investments such as rooftop solar and community solar gardens.

    Biden is making the announcement at northern Virginia’s Prince William Forest Park, about 30 miles southwest of Washington. It was established in 1936 as a summer camp for underprivileged youth from Washington, part of President Franklin D. Roosevelt’s Civilian Conservation Corps to help create jobs during the Great Depression.

    Biden used executive action last year to create the American Climate Corps modeled on Roosevelt’s New Deal. He is announcing Monday that nearly 2,000 corps positions are being offered across 36 states, including jobs offered in partnership with the North American Building Trades Unions.

    Biden has often used Earth Day as a backdrop to further his administration’s climate initiatives. Last year, he signed an executive order creating the White House Office of Environmental Justice, meant to help ensure that poverty, race and ethnic status do not lead to worse exposure to pollution and environmental harm.

    He has tried to draw a contrast with GOP congressional leaders, who have called for less regulation of oil production to lower energy prices. Biden officials counter that GOP policies benefit highly profitable oil companies and could ultimately undermine U.S. efforts to compete with the Chinese in the renewable energy sector.

    Biden will use his Virginia visit to discuss how “a climate crisis fully manifest to the American people in communities all across the country, is also an opportunity for us to come together,” said White House National Climate Adviser Ali Zaidi.

    He said the programs can “unlock economic opportunity to create pathways to middle-class-supporting careers, to save people money and improve their quality of life.”

    The awards came from the Solar for All program, part of the $27 billion “green bank” created as part of a sweeping climate law passed in 2022. The bank is intended to reduce climate and air pollution and send money to neighborhoods most in need, especially disadvantaged and low-income communities disproportionately impacted by climate change.

    EPA Deputy Administrator Janet McCabe said she was “looking forward to these funds getting out into the community, giving people skills, putting them to work in their local communities, and allowing people to save on their energy bills so that they can put those dollars to other needs.”

    Among those receiving grants are state projects to provide solar-equipped roofs for homes, college residences and residential-serving community solar projects in West Virginia, a non-profit operating Mississippi solar lease program and solar workforce training initiatives in South Carolina.

    The taxpayer-funded green bank has faced Republican opposition and concerns over accountability for how the money gets used. EPA previously disbursed the other $20 billion of the bank’s funds to nonprofits and community development banks for clean energy projects such as residential heat pumps, additional energy-efficient home improvements and larger-scale projects like electric vehicle charging stations and community cooling centers.

    ___

    St. John reported from Detroit.

    ___

    Alexa St. John is an Associated Press climate solutions reporter. Follow her on X, formerly Twitter, @alexa_stjohn. Reach her at ast.john@ap.org.

    ___

    The Associated Press’ climate and environmental coverage receives financial support from multiple private foundations. AP is solely responsible for all content. Find AP’s standards for working with philanthropies, a list of supporters and funded coverage areas at AP.org.

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  • Rationed food kept Cubans fed during the Cold War. Today an economic crisis has them hungry

    Rationed food kept Cubans fed during the Cold War. Today an economic crisis has them hungry

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    HAVANA — Like millions of other Cubans, María de los Ángeles Pozo thinks back fondly to when a government ration book fed her family everything from hamburgers, fish and milk to chocolate and beer. People would even get cakes for birthdays and weddings.

    The “libreta,” as Cubans know it, was launched in July 1963 and became one of the pillars of the island’s socialist system, helping people through crises including the cutbacks in Soviet aid that led to the 1990s deprivation known as the “Special Period.”

    That system is undergoing a deep economic crisis that has prompted the exodus of almost half a million Cubans to the U.S. over the last two years, with thousands more heading to Europe. It also has led to a dramatic reduction in the availability of rationed food for those who do not leave.

    Many Cubans feel ill-equipped to handle their new, more unequal country, a feeling that has worsened as small private markets have opened, charging prices similar to international ones in a country that hasn’t allowed non-state commerce in recent decades and where incomes remain between $16 and $23 monthly.

    “Everything comes in small portions and delayed,” said Pozo, 57, a school worker who retired to care for her disabled sister and father in the apartment they share in Old Havana. They earn $10 a month between the three.

    Basic goods like a kilo (2.2 pounds) of powdered milk can cost as much as $8.

    “We don’t have the goods that we were used to anymore,” Pozo said. “We’re suffering a lot of deprivation.”

    Protesters took to the streets in the eastern city of Santiago this month decrying power outages lasting up to eight hours and shortages of food. State media confirmed the protests in Santiago and videos showing people chanting “electricity and food” were quickly shared by Cubans on and off the island on platforms like X and Facebook. A nongovernmental human rights group that monitors Cuba said there had been at least three arrests.

    Pozo pays only $2 at the subsidized state stores at current exchange rates. In February she got a few pounds of rice, beans, some sugar and salt, oil, processed meat and soap for her family of three.

    Pozo said that she doesn’t receive money from relatives overseas, a major marker of class differences in 2024 Cuba, and one that about 70 percent of families do get.

    While there are no official figures, many experts estimate that Cubans overseas sent $3 billion home in 2019.

    Cuba has long struggled with a lack of production.

    The lack of hard currency and needed equipment is making the situation even worse without agricultural supplies like insecticides and fertilizers, said Ricardo Torres, an economist at American University in Washington.

    Without a functioning market economy, Cuban agriculture has long measured itself by socialist production goals that it has rarely been able to meet.

    Camaguey, one of Cuba’s main ranching hubs, only produced 42.8 million liters (11.3 million gallons) of milk last year, out of 81.3 million liters (21.5 million gallons) that producers had agreed to sell.

    Producers, for their part, complain that government prices don’t cover expenses.

    The Cuban government blames the economic damage wrought by COVID-19, along with U.S. sanctions and macroeconomic changes dating to recent years that have led to severe inflation.

    “You can see today private stores that have all the products that you want: milk, bread, sugar — whatever you want — at prices that are not accessible to the majority of the population,” Deputy Foreign Minister Carlos Fernández de Cossío said in a interview with The Associated Press. “The government continues to be committed to provide an equal amount to all.”

    Official figures show Cuba’s average annual inflation of nearly 50% a year over the last three years and a 2% contraction in the Gross Domestic Product.

    Faced with that scenario, the government has been trying to reduce the number of people who receive subsidized food from an estimated four million libretas.

    For most Cubans, the government is failing to take on the most serious issue: low take-home pay as a result of low productivity and inflation.

    “Salaries must rise,” said maintenance main Hilmer Pagán, 53.

    ___

    Andrea Rodríguez on X: www.twitter.com/ARodriguezAP

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  • Nigeria’s currency has fallen to a record low as inflation surges. How did things get so bad?

    Nigeria’s currency has fallen to a record low as inflation surges. How did things get so bad?

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    ABUJA, Nigeria — Nigerians are facing one of the West African nation’s worst economic crises in years triggered by surging inflation, the result of monetary policies that have pushed the currency to an all-time low against the dollar. The situation has provoked anger and protests across the country.

    The latest government statistics released Thursday showed the inflation rate in January rose to 29.9%, its highest since 1996, mainly driven by food and non-alcoholic beverages. Nigeria‘s currency, the naira, further plummeted to 1,524 to $1 on Friday, reflecting a 230% loss of value in the last year.

    “My family is now living one day at a time (and) trusting God,” said trader Idris Ahmed, whose sales at a clothing store in Nigeria’s capital of Abuja have declined from an average of $46 daily to $16.

    The plummeting currency worsens an already bad situation, further eroding incomes and savings. It squeezes millions of Nigerians already struggling with hardship due to government reforms including the removal of gas subsidies that resulted in gas prices tripling.

    With a population of more than 210 million people, Nigeria is not just Africa’s most populous country but also the continent’s largest economy. Its gross domestic product is driven mainly by services such as information technology and banking, followed by manufacturing and processing businesses and then agriculture.

    The challenge is that the economy is far from sufficient for Nigeria’s booming population, relying heavily on imports to meet the daily needs of its citizens from cars to cutlery. So it is easily affected by external shocks such as the parallel foreign exchange market that determines the price of goods and services.

    Nigeria’s economy is heavily dependent on crude oil, its largest foreign exchange earner. When crude prices plunged in 2014, authorities used its scarce foreign reserves to try to stabilize the naira amid multiple exchange rates. The government also shut down the land borders to encourage local production and limited access to the dollar for importers of certain items.

    The measures, however, further destabilized the naira by facilitating a booming parallel market for the dollar. Crude oil sales that boost foreign exchange earnings have also dropped because of chronic theft and pipeline vandalism.

    Shortly after taking the reins of power in May last year, President Bola Tinubu took bold steps to fix the ailing economy and attract investors. He announced the end of costly decadeslong gas subsidies, which the government said were no longer sustainable. Meanwhile, the country’s multiple exchange rates were unified to allow market forces to determine the rate of the local naira against the dollar, which in effect devalued the currency.

    Analysts say there were no adequate measures to contain the shocks that were bound to come as a result of reforms including the provision of a subsidized transportation system and an immediate increase in wages.

    So the more than 200% increase in gas prices caused by the end of the gas subsidy started to have a knock-on effect on everything else, especially because locals rely heavily on gas-powered generators to light their households and run their businesses.

    Under the previous leadership of the Central Bank of Nigeria, policymakers tightly controlled the rate of the naira against the dollar, thereby forcing individuals and businesses in need of dollars to head to the black market, where the currency was trading at a much lower rate.

    There was also a huge backlog of accumulated foreign exchange demand on the official market — estimated to be $7 billion — due in part to limited dollar flows as foreign investments into Nigeria and the country’s sale of crude oil have declined.

    Authorities said a unified exchange rate would mean easier access to the dollar, thereby encouraging foreign investors and stabilizing the naira. But that has yet to happen because inflows have been poor. Instead, the naira has further weakened as it continues to depreciate against the dollar.

    CBN Gov. Olayemi Cardoso has said the bank has cleared $2.5 billion of the foreign exchange backlog out of the $7 billion that had been outstanding. The bank, however, found that $2.4 billion of that backlog were false claims that it would not clear, Cardoso said, leaving a balance of about $2.2 billion, which he said will be cleared “soon.”

    Tinubu, meanwhile, has directed the release of food items such as cereals from government reserves among other palliatives to help cushion the effect of the hardship. The government has also said it plans to set up a commodity board to help regulate the soaring prices of goods and services.

    On Thursday, the Nigerian leader met with state governors to deliberate on the economic crisis, part of which he blamed on the large-scale hoarding of food in some warehouses.

    “We must ensure that speculators, hoarders and rent seekers are not allowed to sabotage our efforts in ensuring the wide availability of food to all Nigerians,” Tinubu said.

    By Friday morning, local media were reporting that stores were being sealed for hoarding and charging unfair prices.

    The situation is at its worst in conflict zones in northern Nigeria, where farming communities are no longer able to cultivate what they eat as they are forced to flee violence. Pockets of protests have broken out in past weeks but security forces have been quick to impede them, even making arrests in some cases.

    In the economic hub of Lagos and other major cities, there are fewer cars and more legs on the roads as commuters are forced to trek to work. The prices of everything from food to household items increase daily.

    “Even to eat now is a problem,” said Ahmed in Abuja. “But what can we do?”

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  • Nigeria’s currency has fallen to a record low as inflation surges. How did things get so bad?

    Nigeria’s currency has fallen to a record low as inflation surges. How did things get so bad?

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    ABUJA, Nigeria — Nigerians are facing one of the West African nation’s worst economic crises in years triggered by surging inflation, the result of monetary policies that have pushed the currency to an all-time low against the dollar. The situation has provoked anger and protests across the country.

    The latest government statistics released Thursday showed the inflation rate in January rose to 29.9%, its highest since 1996, mainly driven by food and non-alcoholic beverages. Nigeria‘s currency, the naira, further plummeted to 1,524 to $1 on Friday, reflecting a 230% loss of value in the last year.

    “My family is now living one day at a time (and) trusting God,” said trader Idris Ahmed, whose sales at a clothing store in Nigeria’s capital of Abuja have declined from an average of $46 daily to $16.

    The plummeting currency worsens an already bad situation, further eroding incomes and savings. It squeezes millions of Nigerians already struggling with hardship due to government reforms including the removal of gas subsidies that resulted in gas prices tripling.

    With a population of more than 210 million people, Nigeria is not just Africa’s most populous country but also the continent’s largest economy. Its gross domestic product is driven mainly by services such as information technology and banking, followed by manufacturing and processing businesses and then agriculture.

    The challenge is that the economy is far from sufficient for Nigeria’s booming population, relying heavily on imports to meet the daily needs of its citizens from cars to cutlery. So it is easily affected by external shocks such as the parallel foreign exchange market that determines the price of goods and services.

    Nigeria’s economy is heavily dependent on crude oil, its largest foreign exchange earner. When crude prices plunged in 2014, authorities used its scarce foreign reserves to try to stabilize the naira amid multiple exchange rates. The government also shut down the land borders to encourage local production and limited access to the dollar for importers of certain items.

    The measures, however, further destabilized the naira by facilitating a booming parallel market for the dollar. Crude oil sales that boost foreign exchange earnings have also dropped because of chronic theft and pipeline vandalism.

    Shortly after taking the reins of power in May last year, President Bola Tinubu took bold steps to fix the ailing economy and attract investors. He announced the end of costly decadeslong gas subsidies, which the government said were no longer sustainable. Meanwhile, the country’s multiple exchange rates were unified to allow market forces to determine the rate of the local naira against the dollar, which in effect devalued the currency.

    Analysts say there were no adequate measures to contain the shocks that were bound to come as a result of reforms including the provision of a subsidized transportation system and an immediate increase in wages.

    So the more than 200% increase in gas prices caused by the end of the gas subsidy started to have a knock-on effect on everything else, especially because locals rely heavily on gas-powered generators to light their households and run their businesses.

    Under the previous leadership of the Central Bank of Nigeria, policymakers tightly controlled the rate of the naira against the dollar, thereby forcing individuals and businesses in need of dollars to head to the black market, where the currency was trading at a much lower rate.

    There was also a huge backlog of accumulated foreign exchange demand on the official market — estimated to be $7 billion — due in part to limited dollar flows as foreign investments into Nigeria and the country’s sale of crude oil have declined.

    Authorities said a unified exchange rate would mean easier access to the dollar, thereby encouraging foreign investors and stabilizing the naira. But that has yet to happen because inflows have been poor. Instead, the naira has further weakened as it continues to depreciate against the dollar.

    CBN Gov. Olayemi Cardoso has said the bank has cleared $2.5 billion of the foreign exchange backlog out of the $7 billion that had been outstanding. The bank, however, found that $2.4 billion of that backlog were false claims that it would not clear, Cardoso said, leaving a balance of about $2.2 billion, which he said will be cleared “soon.”

    Tinubu, meanwhile, has directed the release of food items such as cereals from government reserves among other palliatives to help cushion the effect of the hardship. The government has also said it plans to set up a commodity board to help regulate the soaring prices of goods and services.

    On Thursday, the Nigerian leader met with state governors to deliberate on the economic crisis, part of which he blamed on the large-scale hoarding of food in some warehouses.

    “We must ensure that speculators, hoarders and rent seekers are not allowed to sabotage our efforts in ensuring the wide availability of food to all Nigerians,” Tinubu said.

    By Friday morning, local media were reporting that stores were being sealed for hoarding and charging unfair prices.

    The situation is at its worst in conflict zones in northern Nigeria, where farming communities are no longer able to cultivate what they eat as they are forced to flee violence. Pockets of protests have broken out in past weeks but security forces have been quick to impede them, even making arrests in some cases.

    In the economic hub of Lagos and other major cities, there are fewer cars and more legs on the roads as commuters are forced to trek to work. The prices of everything from food to household items increase daily.

    “Even to eat now is a problem,” said Ahmed in Abuja. “But what can we do?”

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  • Argentina, Once One of the Richest Countries, Is Now One of the Poorest. Javier Milei Could Help Fix That.

    Argentina, Once One of the Richest Countries, Is Now One of the Poorest. Javier Milei Could Help Fix That.

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    Argentina actually elected a libertarian president.

    Javier Milei campaigned with a chainsaw, promising to cut the size of government.

    Argentina’s leftists had so clogged the country’s economic arteries with regulations that what once was one of the world’s richest countries is now one of the poorest.

    Inflation is more than 200 percent.

    People save their whole lives—and then find their savings worth nearly nothing.

    They got so fed up they did something never done before in modern history: They elected a full-throated libertarian.

    Milei understands that government can’t create wealth.

    He surprised diplomats at the World Economic Forum this month by saying, “The state is the problem!”

    He spoke up for capitalism: “Do not be intimidated by the political caste or by parasites who live off the state…. If you make money, it’s because you offer a better product at a better price, thereby contributing to general well-being. Do not surrender to the advance of the state. The state is not the solution.”

    Go, Milei! I wish current American politicians talked that way.

    In the West, young people turn socialist. In Argentina, they live under socialist policies. They voted for Milei.

    Sixty-nine percent of voters under 25 voted for him. That helped him win by a whopping 3 million votes.

    He won promising to reverse “decades of decadence.” He told the Economic Forum, “If measures are adopted that hinder the free functioning of markets, competition, price systems, trade, and ownership of private property, the only possible fate is poverty.”

    Right.

    Poor countries demonstrate that again and again.

    The media say Milei will never pass his reforms, and leftists may yet stop him.

    But already, “He was able to repeal rent controls, price controls,” says economist Daniel Di Martino in my new video. He points out that Milei already “eliminated all restrictions on exports and imports, all with one sign of a pen.”

    “He can just do that without Congress?” I ask.

    “The president of Argentina has a lot more power than the president of the United States.”

    Milei also loosened rules limiting where airlines can fly.

    “Now [some] air fares are cheaper than bus fares!” says Di Martino.

    He scrapped laws that say, “Buy in Argentina.” I point out that America has “Buy America” rules.

    “It only makes poor people poorer because it increases costs!” Di Martino replies, “Why shouldn’t Argentinians be able to buy Brazilian pencils or Chilean grapes?”

    “To support Argentina,” I push back.

    “Guess what?” Says Di Martino, “Not every country is able to produce everything at the lowest cost. Imagine if you had to produce bananas in America.”

    Argentina’s leftist governments tried to control pretty much everything.

    “The regulations were such that everything not explicitly legal was illegal,” laughs Di Martino. “Now…everything not illegal is legal.”

    One government agency Milei demoted was a “Department for Women, Gender and Diversity.” DiMartino says that reminds him of Venezuela’s Vice Ministry for Supreme Social Happiness. “These agencies exist just so government officials can hire their cronies.”

    Cutting government jobs and subsidies for interest groups is risky for vote-seeking politicians. There are often riots in countries when politicians cut subsidies. Sometimes politicians get voted out. Or jailed.

    “What’s incredible about Milei,” notes Di Martino, “is that he was able to win on the promise of cutting subsidies.”

    That is remarkable. Why would Argentinians vote for cuts?

    “Argentinians are fed up with the status quo,” replies Di Martino.

    Milei is an economist. He named his dogs after Milton Friedman, Murray Rothbard, and Robert Lucas, all libertarian economists.

    I point out that most Americans don’t know who those men were.

    “The fact that he’s naming his dogs after these famous economists,” replies Di Martino, “shows that he’s really a nerd. It’s a good thing to have an economics nerd president of a country.”

    “What can Americans learn from Argentina?”

    “Keep America prosperous. So we never are in the spot of Argentina in the first place. That requires free markets.”

    Yes.

    Actually, free markets plus rule of law. When people have those things, prosperity happens.

    It’s good that once again, a country may try it.

    COPYRIGHT 2024 BY JFS PRODUCTIONS INC.

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    John Stossel

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  • Georgia taxpayers lose $160,000 for every job created by film tax credits

    Georgia taxpayers lose $160,000 for every job created by film tax credits

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    For nearly two decades, Georgia has lured big-time Hollywood movie studios with the promise of lucrative tax breaks for filming in the state.

    And here’s a predictable plot twist: Handing out welfare to wildly successful movies—like Avengers: Endgame, which earned more than $2 billion at the box office but nevertheless also qualified for tax credits because it was filmed in Georgia—hasn’t been a good deal for taxpayers.

    A new audit of Georgia’s Film Tax Credit program found that the state “loses money” on the program. A lot of money, actually: about $160,000 for every job the program creates. Georgia is now spending about $1.3 billion annually on the program, but it generates a return on investment of just 19 cents per dollar, the auditors conclude.

    “This program should be halted immediately,” J.C. Bradbury, an economics professor at Georgia’s Kennesaw State University and a longtime critic of government subsidy schemes, posted on X (formerly Twitter). In a 2020 paper, Bradbury estimated that the state’s film tax credit program cost about $110,000 per full-time job created and that every Georgia household was on the hook for about $230 in additional taxes every year because of the program’s existence.

    In addition to highlighting the tax credit program’s costs, the new audit also suggests that the film industry has inflated the supposed benefits of the program. Georgia’s film tax credit is responsible for creating about 34,000 jobs annually in the state, according to the new audit, but that’s well short of the 59,700 annual job-creation figure that a recent industry-funded study claimed, reported Variety.

    Created in 2005, Georgia’s subsidies for movie and TV production are the biggest such pot of cash available anywhere in the country. Production companies that spend at least $500,000 in the state during a single year are eligible for tax credits equal to 20 percent of their in-state expenditures. There is no cap on qualifying expenditures for production companies, and there is no aggregate cap for annual or lifetime tax credits, according to the audit report.

    There’s no doubt that Georgia’s program has influenced where movie and TV production takes place. The new audit concludes that the program has induced “substantial economic activity in Georgia,” but that’s simply evidence of the fact that lighting a lot of money on fire will eventually produce some heat. The underlying numbers suggest that Georgia’s subsidies are doing a poor job of generating economic growth or creating jobs.

    It’s been the same story pretty much everywhere else, though many states have gotten wise to the film tax credit scheme. In 2009, 44 states subsidized movie and TV production with some combination of rebates, tax credits, and grants. Today, just 22 states and Washington, D.C., offer those programs.

    Even though Georgia’s program has a long history of bipartisan support, changes could be coming. As Reason‘s Joe Lancaster reported earlier this year, Lieutenant Gov. Burt Jones and Georgia Speaker of the House Jon Burns (R–Newington) have pledged to undertake a thorough review of the state’s tax credit programs, including the film tax credit, with an eye toward “ensuring a significant return on investment for Georgia’s taxpayers.”

    With this new audit in hand, Jones and Burns should do their best Thanos impressions and turn Georgia’s deeply flawed movie welfare program to dust.

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    Eric Boehm

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  • Tesla's expensive new Cybertruck may qualify for $7,500 E.V. tax credits

    Tesla's expensive new Cybertruck may qualify for $7,500 E.V. tax credits

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    In late November, Tesla Motors delivered the first 10 Cybertrucks to customers, over four years after it was first unveiled as a concept prototype and two years after it was originally supposed to begin production. The odd, angular electric vehicle with a stainless steel exterior attempts to marry Tesla-style sports car performance with the rugged function of a pickup truck. The Wall Street Journal characterized it as “a giant, steel triangle on wheels.”

    Depending on options, the Cybertruck can achieve 600–845 horsepower and cost between $60,000–$100,000—clearly making it a luxury purchase and not for the shopper on a budget.

    So why, then, do some models qualify for federal tax credits?

    As part of President Joe Biden’s pledge to transition the U.S. to greener sources of energy, the 2022 Inflation Reduction Act (IRA) established $7,500 tax credits for purchases of electric vehicles (E.V.s).

    “Working families will be able to use tax credits that make electric vehicles more affordable,” brags the White House’s Clean Energy webpage. “Purchasing an electric vehicle (EV) can save families thousands of dollars on fuel costs over the life of their car.”

    But according to FuelEconomy.gov, maintained by the U.S. Department of Energy, the Cybertruck can qualify for the tax credits as well.

    A listing on the Department of Energy's FuelEconomy.gov website saying the all-wheel drive Cybertruck is eligible for $7,500 tax credits.
    (FuelEconomy.gov/U.S. Department of Energy)

    The site notes that qualifying models must be assembled in North America and are limited to a retail price of $80,000, the same parameters put on any vehicles that hope to qualify. Since the Cybertruck is assembled in Tesla’s Texas Gigafactory and two of its current options retail under $80,000, it could indeed qualify.

    Neither the IRS nor the Department of Energy responded to Reason‘s requests for confirmation that the Cybertrucks would qualify, but Tesla clearly thinks so: The Cybertruck order page on the automaker’s website lists “purchase price” alongside prices with “probable savings,” which “assume IRA Federal Tax Credits up to $7,500 for Rear-Wheel Drive and All-Wheel Drive and est. gas savings of $3,600 over 3 years.”

    It’s worth wondering why the Cybertruck should qualify for tax credits that are nominally intended to benefit people who want to switch to an electric vehicle and need a little help. It stands to reason that anybody both willing and able to spend around the median annual household income on a futuristic-looking luxury truck should have to cover the entire cost themselves, without any help from the American taxpayer.

    Earlier this year, Biden promoted the E.V. tax credits by tweeting a photo of himself driving a GMC Hummer EV, even though no version of the Hummer EV available at the time cost less than $84,000. For the 2024 model year, GMC is planning to offer the base model EV2 starting at $79,995—$5 below the cutoff. Similarly, Tesla currently set the all-wheel-drive Cybertruck’s retail price at $79,990.

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    Joe Lancaster

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  • Whistleblower says utility should repay $382 million in federal aid given to failed clean coal plant

    Whistleblower says utility should repay $382 million in federal aid given to failed clean coal plant

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    ATLANTA — A former employee is suing to force a Mississippi utility to repay $382 million that the federal government gave to build a failed coal-fueled power plant.

    Kelli Williams, a former construction manager for Atlanta-based Southern Co., filed a whistleblower lawsuit against the company and its subsidiary Mississippi Power Co. in 2018. That lawsuit, unsealed Monday, alleges that the two firms defrauded the U.S. Department of Energy and state regulators in a failed quest to build a $7.5 billion power plant.

    Williams says the company lied repeatedly about the plant’s cost overruns and spiraling delays, enticing the U.S. Department of Energy to keep delivering subsidy payments and persuading the Mississippi Public Service Commission to not revoke its permission for construction.

    “If DOE had known that defendants were intentionally deceiving the agency about the state of the Kemper project and were intentionally withholding accurate data about the project’s progress and viability, DOE would have ceased funding and supporting it,” an amended complaint filed Monday alleges.

    Schuyler Baehman, a spokesperson for Southern Co., declined to comment. The company has yet to file a reply in court.

    If Williams wins, the company could be forced to pay triple damages, or more than $1.1 billion. Williams, as the whistleblower, would be legally entitled to between 15% and 30% of any money.

    The Kemper County power plant was supposed to be a world leader in turning soft coal into a gas and burning it to generate power, while removing climate-warming carbon dioxide and other pollutants.

    The cost of the plant ballooned and Mississippi Power could never make it run reliably. The company lost $6.4 billion when the three-member Mississippi Public Service Commission in 2017 ordered it to stop building the gasifier and chemical removal unit and instead operate the plant by burning conventional natural gas.

    Bills for Mississippi Power’s 192,000 customers rose 15% in 2015 for the part of the plant that today burns natural gas instead of gasified coal. The rest of the plant has been demolished.

    The debacle has been a powerful argument against the idea that coal can be burned cleanly, although some are still pushing the goal.

    Whistleblower actions under the False Claims Act are filed under seal with the private plaintiff seeking to recover money on behalf of the federal government.

    The plaintiff, called a relator, sends the lawsuit and a statement to federal authorities, who can choose to intervene. Cases can remain sealed for years while the government investigates. In this case, after five years of consideration, the U.S. Justice Department in July decided not to get involved. Now Williams and her lawyers are moving ahead.

    It’s not the first time that Southern Co. has faced whistleblower allegations or lawsuits over the plant. Former engineer Brett Wingo told the U.S. Securities and Exchange Commission in 2014 that the company defrauded investors by misrepresenting the construction schedule. That inquiry ended with no enforcement action in 2017, but by then state regulators had concluded Mississippi Power’s claims of progress weren’t credible.

    “I believe at some point, they began to tell us things that were not true,” said Cecil Brown, a Democrat who served on the Mississippi Public Service Commission from 2016 to 2020.

    Williams says she knows about the wrongdoing because she was repeatedly ordered to prepare unrealistic budget documents that the company provided to regulators to mislead them that the project was on track when insiders knew it was not. The lawsuit says overruns and delays should have triggered reports to the U.S. Department of Energy that the company never filed.

    “The people of Mississippi were deceived from the very beginning on the project,” Williams told The Clarion Ledger of Jackson in 2019. That’s when Southern Co. warned of a U.S. Justice Department investigation that turned out to be the federal inquiry into whether to join Williams’ own lawsuit.

    The lawsuit says the company knew as early as 2011 that its costs would exceed the $2.88 billion cap that Mississippi regulators had approved under pressure from Mississippi Gov. Haley Barbour and federal officials. Barbour was a lobbyist for Southern Co. before becoming governor and was hired again as a lobbyist by the company after his two terms.

    Williams alleges the company did some construction poorly to give the illusion of progress to state inspectors. For example, she alleged Mississippi Power erected piping without permanent fasteners, knowing the work would have to be redone again later at higher cost, an allegation first aired by The Guardian in 2018.

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  • Whistleblower says utility should repay $382 million in federal aid given to failed clean coal plant

    Whistleblower says utility should repay $382 million in federal aid given to failed clean coal plant

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    ATLANTA — A former employee is suing to force a Mississippi utility to repay $382 million that the federal government gave to build a failed coal-fueled power plant.

    Kelli Williams, a former construction manager for Atlanta-based Southern Co., filed a whistleblower lawsuit against the company and its subsidiary Mississippi Power Co. in 2018. That lawsuit, unsealed Monday, alleges that the two firms defrauded the U.S. Department of Energy and state regulators in a failed quest to build a $7.5 billion power plant.

    Williams says the company lied repeatedly about the plant’s cost overruns and spiraling delays, enticing the U.S. Department of Energy to keep delivering subsidy payments and persuading the Mississippi Public Service Commission to not revoke its permission for construction.

    “If DOE had known that defendants were intentionally deceiving the agency about the state of the Kemper project and were intentionally withholding accurate data about the project’s progress and viability, DOE would have ceased funding and supporting it,” an amended complaint filed Monday alleges.

    Schuyler Baehman, a spokesperson for Southern Co., declined to comment. The company has yet to file a reply in court.

    If Williams wins, the company could be forced to pay triple damages, or more than $1.1 billion. Williams, as the whistleblower, would be legally entitled to between 15% and 30% of any money.

    The Kemper County power plant was supposed to be a world leader in turning soft coal into a gas and burning it to generate power, while removing climate-warming carbon dioxide and other pollutants.

    The cost of the plant ballooned and Mississippi Power could never make it run reliably. The company lost $6.4 billion when the three-member Mississippi Public Service Commission in 2017 ordered it to stop building the gasifier and chemical removal unit and instead operate the plant by burning conventional natural gas.

    Bills for Mississippi Power’s 192,000 customers rose 15% in 2015 for the part of the plant that today burns natural gas instead of gasified coal. The rest of the plant has been demolished.

    The debacle has been a powerful argument against the idea that coal can be burned cleanly, although some are still pushing the goal.

    Whistleblower actions under the False Claims Act are filed under seal with the private plaintiff seeking to recover money on behalf of the federal government.

    The plaintiff, called a relator, sends the lawsuit and a statement to federal authorities, who can choose to intervene. Cases can remain sealed for years while the government investigates. In this case, after five years of consideration, the U.S. Justice Department in July decided not to get involved. Now Williams and her lawyers are moving ahead.

    It’s not the first time that Southern Co. has faced whistleblower allegations or lawsuits over the plant. Former engineer Brett Wingo told the U.S. Securities and Exchange Commission in 2014 that the company defrauded investors by misrepresenting the construction schedule. That inquiry ended with no enforcement action in 2017, but by then state regulators had concluded Mississippi Power’s claims of progress weren’t credible.

    “I believe at some point, they began to tell us things that were not true,” said Cecil Brown, a Democrat who served on the Mississippi Public Service Commission from 2016 to 2020.

    Williams says she knows about the wrongdoing because she was repeatedly ordered to prepare unrealistic budget documents that the company provided to regulators to mislead them that the project was on track when insiders knew it was not. The lawsuit says overruns and delays should have triggered reports to the U.S. Department of Energy that the company never filed.

    “The people of Mississippi were deceived from the very beginning on the project,” Williams told The Clarion Ledger of Jackson in 2019. That’s when Southern Co. warned of a U.S. Justice Department investigation that turned out to be the federal inquiry into whether to join Williams’ own lawsuit.

    The lawsuit says the company knew as early as 2011 that its costs would exceed the $2.88 billion cap that Mississippi regulators had approved under pressure from Mississippi Gov. Haley Barbour and federal officials. Barbour was a lobbyist for Southern Co. before becoming governor and was hired again as a lobbyist by the company after his two terms.

    Williams alleges the company did some construction poorly to give the illusion of progress to state inspectors. For example, she alleged Mississippi Power erected piping without permanent fasteners, knowing the work would have to be redone again later at higher cost, an allegation first aired by The Guardian in 2018.

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  • President Biden is naming ‘tech hubs’ for 32 states, Puerto Rico to help industry

    President Biden is naming ‘tech hubs’ for 32 states, Puerto Rico to help industry

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    WASHINGTON — The Biden administration on Monday designated 31 technology hubs spread across 32 states and Puerto Rico to help spur innovation and create jobs in the industries that are concentrated in these areas.

    “We’re going to invest in critical technologies like biotechnology, critical materials, quantum computing, advanced manufacturing — so the U.S. will lead the world again in innovation across the board,” President Joe Biden said. “I truly believe this country is about to take off.”

    The tech hubs are the result of a process that the Commerce Department launched in May to distribute a total of $500 million in grants to cities.

    The $500 million came from a $10 billion authorization in last year’s CHIPS and Science Act to stimulate investments in new technologies such as artificial intelligence, quantum computing and biotech. It’s an attempt to expand tech investment that is largely concentrated around a few U.S. cities — Austin, Texas; Boston; New York; San Francisco; and Seattle — to the rest of the country.

    “I have to say, in my entire career in public service, I have never seen as much interest in any initiative than this one,” Commerce Secretary Gina Raimondo told reporters during a Sunday conference call to preview the announcement. Her department received 400 applications, she said.

    “No matter where I go or who I meet with — CEOs, governors, senators, congresspeople, university presidents — everyone wants to tell me about their application and how excited they are,” said Raimondo.

    The program, formally the Regional Technology and Innovation Hub Program, ties into the president’s economic argument that people should be able to find good jobs where they live and that opportunity should be spread across the country, rather than be concentrated. The White House has sought to elevate that message and highlight Biden’s related policies as the Democratic president undertakes his 2024 reelection bid.

    The 31 tech hubs reach Oklahoma, Rhode Island, Massachusetts, Montana, Colorado, Illinois, Indiana, Wisconsin, Virginia, New Hampshire, Missouri, Kansas, Maryland, Alabama, Pennsylvania, Delaware, New Jersey, Minnesota, Louisiana, Idaho, Wyoming, South Carolina, Georgia, Florida, New York, Nevada, Missouri, Oregon, Vermont, Ohio, Maine, Washington and Puerto Rico.

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  • The government secures a $9 million settlement with Ameris Bank over alleged redlining in Florida

    The government secures a $9 million settlement with Ameris Bank over alleged redlining in Florida

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    WASHINGTON — The Justice Department has secured a $9 million settlement with Ameris Bank over allegations that it avoided underwriting mortgages in predominately Black and Latino communities in Jacksonville, Florida, and discouraged people there from getting home loans.

    The bank denied violating fair lending laws and said it wanted to avoid litigation by agreeing to the deal, which does not include civil monetary penalties.

    It’s the latest settlement over a practice known as redlining, which the Biden administration is tackling through a new task force that earlier this year reached the largest agreement of its kind in the department’s history.

    Between 2016 and 2021, the Atlanta-based Ameris Bank’s home lending was focused disproportionately on mostly white areas of Jacksonville while other banks approved loans at three times the rate Ameris did, the government said.

    The bank has never operated a branch in a majority Black and Hispanic neighborhood, and in one-third of those areas it did not receive a single application over the six-year period, even though other banks did, Attorney General Merrick Garland said.

    “Redlining has a significant impact on the health and wealth of these communities. Homeownership has been one of the most effective ways that Americans have built wealth in our country. When families can’t access credit to achieve homeownership, they lose an opportunity to share in this country’s prosperity,” Garland said at a news conference in Jacksonville announcing the settlement.

    CEO Palmer Proctor of Ameris Bank, which federal officials say has nearly $25 billion in assets and operates in nine states across the Southeast and mid-Atlantic, said in a statement, “We strongly disagree with any suggestion that we have engaged in discriminatory conduct.” Proctor said the bank cooperated with the investigation and reached the agreement in part “because we share the Department’s goal of expanding access to homeownership in underserved areas.”

    Garland has prioritized civil rights prosecutions since becoming attorney general in 2021, and the current administration has put a higher priority on redlining cases than before. The anti-redlining effort has now secured $107 million in relief, including the Ameris settlement, which a judge must approve.

    A $31 million settlement with Los Angeles-based City National in January was the largest for the department.

    The practice of redlining has continued across the country and the long-term effects are still felt today, despite a half-century of laws designed to combat it. Homes in historically redlined communities are still worth less than homes elsewhere, and a Black family’s average net worth is a fraction of a typical white household’s.

    The Ameris case is the first brought by the department in Florida, said Roger Handberg, the U.S. attorney for the Middle District of Florida. “For far too long, redlining has negatively impacted communities of color across our country,” he said.

    Assistant Attorney General Kristen Clarke said combating redlining “is one of the most important strategies for ensuring equal economic opportunity today.”

    Ameris Bank will invest $7.5 million in a loan subsidy fund made available to people in majority-minority neighborhoods under the settlement and spend a total of $1.5 million on outreach and community partnerships, as well as open a new branch in those neighborhoods, along with other requirements as part of the settlement.

    ___

    Associated Press writer Ken Sweet in New York contributed to this report.

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