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If Donald Trump were to be elected president in 2024, what would it mean for U.S. tax policy and the national debt?
There are growing expectations that he could deliver another round of big tax cuts, with the reductions coming right as those enacted in 2017’s Tax Cut and Jobs Act are due to expire in 2025.
“If Republicans hold their House…
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European Union countries are meant to have placed an array of sanctions on Russia, preventing exports of a host of goods and services, ranging from high-end machinery to luxury cars, to the country in the wake of its unprovoked 2022 invasion of neighboring Ukraine.
And official data do show that EU exports to Russia have slumped, by 31% during the first five months of the year.
But, curiously, exports from EU countries to Russia’s neighbors have surged.
Take Germany, for instance, whose exports to Kazakhstan are up 105% on a year-over-year basis. German exports to Central Asia and Belarus are up 75%.
“Not all of this stuff is going to Russia. But a lot of it probably is,” tweeted Robin Brooks, chief economist at the Institute of International Finance, who produced the chart.
And it’s not just Germany. Sweden also has seen a surge of exports to Kazakhstan.
Meanwhile, Germany, Poland, the Czech Republic and Hungary have boosted exports to Kyrgyzstan.
Read on:
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BRUSSELS — The European Union was edging closer to setting a $60-per-barrel price cap on Russian oil — a highly anticipated and complex political and economic maneuver designed to keep Russia’s supplies flowing into global markets while clamping down on President Vladimir Putin’s ability to fund his war in Ukraine.
EU nations sought to push the cap across the finish line after Poland held out to get as low a figure as possible, diplomats said Thursday. “Still waiting for white smoke from Warsaw,” said an EU diplomat, who spoke on condition of anonymity because the talks were still ongoing.
The latest offer, confirmed by 3 EU diplomats, comes ahead of a deadline to set the price for discounted oil by Monday, when a European embargo on seaborne Russian crude and a ban on shipping insurance for those supplies take effect. The diplomats also spoke on condition of anonymity because the legal process was still not completed.
The $60 figure would mean a cap near the current price of Russia’s crude, which fell this week below $60 per barrel, and is meant to prevent a sudden loss of Russian oil to the world following the new Western sanctions. It is a big discount to international benchmark Brent, which traded at about $88 per barrel Thursday, but could be high enough for Moscow to keep selling even while rejecting the idea of a cap.
When the final number is in place, a new buyer’s cartel — which is expected to be made up of formal and informal members — will be born. Western allies in the Group of Seven industrial powers led the price cap effort and still need to approve the figure.
Oil is the Kremlin’s main pillar of financial revenue and has kept the Russian economy afloat so far despite export bans, sanctions and the freezing of central bank assets that began with the February invasion. Russia exports roughly 5 million barrels of oil per day.
The risks of the price cap’s failure are immense to the global oil supply. If it fails or Russia retaliates by stopping the export of oil, energy prices worldwide could skyrocket. Putin has said he would not sell oil under a price cap and would retaliate against nations that implement the measure.
U.S. and European consumers could feel the ramifications in more spikes to gasoline prices, and people in developing countries could face greater levels of food insecurity.
With the EU and U.K. banning insurance for Russian oil shipments, the price ceiling allows companies to keep insuring tankers headed for non-EU countries as long as the oil is priced at or under the cap. That would avoid a price spike from the loss of supplies from the world’s No. 2 oil producer and put a ceiling on Russia’s oil income near current levels.
The Treasury Department has released guidance meant to help firms and maritime insurers understand how to abide by the price ceiling, saying the price cap could fluctuate depending on market conditions.
Robin Brooks, chief economist at the Institute of International Finance in Washington, said the cap should have been implemented earlier this year, when oil was hovering around $120 per barrel.
“Since then, obviously oil prices have fallen and global recession is a real thing,” he said. “The reality is that it is unlikely to be binding given where oil prices are now.”
Critics of the price cap measure, including former Treasury Secretary Steve Mnuchin, have called the plan “ridiculous.”
Mnuchin told CNBC during a panel in November at the Milken Institute’s Middle East and Africa Summit that the price cap was “not only not feasible, I think it’s the most ridiculous idea I’ve ever heard.”
Rachel Ziemba, an adjunct senior fellow at the Center for a New American Security, said that while a worst-case scenario envisions Russia cutting off the global supply of its oil, “the Saudis and Emiratis would boost production.”
“Russia has made is clear the countries that abide by the cap won’t receive their oil and that could result in cuts to natural gas exports as well,” she said. “This will be an interesting few weeks and few months.”
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Hussein reported from Washington. AP Business Writer David McHugh contributed from Frankfurt, Germany.
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BRUSSELS — The European Union and the United States are treading precariously close to a major trans-Atlantic trade dispute at a time when the two Western giants want to show unity in the face of challenges from Russia and China.
EU trade ministers on Friday insisted they would be forced to respond if Washington stuck to all the terms of its Inflation Reduction Act, which is favorable to local companies through subsidies and, according to the EU, will unfairly discriminate against its firms that want to compete for contracts.
“Nobody wants to get into a tit-for-tat or subsidy race. But what the U.S. has done really isn’t consistent with the principles of free trade and fair competition,” Irish Trade Minister Leo Varadkar said.
Even though the allies have stood shoulder to shoulder by imposing strict sanctions against Russia since the Feb. 24 invasion of Ukraine, they cannot gloss over the trade differences.
“What we are asking for is fairness. We want and expect European companies and exports to be treated in the same way in the U.S. as American companies and exports are treated in Europe,” EU Commission Vice President Valdis Dombrovskis said.
And beyond the European Commission, which negotiates on behalf of the 27 member nations on trade issues, the concerns are largely shared in EU national capitals, too.
“All the member states are concerned,” said Czech Trade Minister Jozef Sikela, who chaired the emergency meeting.
The Czech minister said the EU still hopes divergences can be solved during a Dec. 5 meeting of the task force that the U.S. and EU have set up, with the possibility that the bloc would be treated like Canada and Mexico and be exempted from the subsidy conditions.
Trade disputes have been a red line for decades in trans-Atlantic relations, highlighted by fights over aircraft subsidies and steel exports and affecting everything from hormone-treated beef to liquor exports.
Planned subsidies under the Inflation Reduction Act passed by the U.S. Congress in August, are especially grating for the EU. For example, electric car buyers are eligible for a tax credit of up to $7,500 as long as the vehicle runs on a battery built in North America with minerals mined or recycled on the continent.
The EU believes that the measure is a potential trans-Atlantic trade barrier discriminating against foreign producers. Potential actions the EU can take are complaints before the World Trade Organization, trade sanctions or upping subsidies for their own companies.
Those considerations have to weighed against the need to cooperate on the geopolitical stage and the essence of showing a united front.
“We see that the parts from the East actually are trying to divide us,” Estonian Trade Minister Kristjan Jarvan said. “And of course economy plays a huge role in that.”
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LONDON — The British government on Sunday denied a report that it is seeking a “Swiss-style” relationship with the European Union that would remove many of the economic barriers erected by Brexit — even as it tries to improve ties with the bloc after years of acrimony.
Health Secretary Steve Barclay told Sky News “I don’t recognize” the Sunday Times report, insisting the U.K. was still determined to “use the Brexit freedoms we have” by diverging from the EU’s rules in key areas.
Switzerland has a close economic relationship with the 27-nation EU in return for accepting the bloc’s rules and paying into its coffers.
The U.K. government said “Brexit means we will never again have to accept a relationship with Europe that would see a return to freedom of movement, unnecessary payments to the European Union or jeopardize the full benefit of trade deals we are now able to strike around the world.”
But despite the denials, the new Conservative government led by Prime Minister Rishi Sunak wants to restore relations with the EU, acknowledging that Brexit has brought an economic cost for Britain. Treasury chief Jeremy Hunt last week expressed optimism that trade barriers between the U.K. and the EU would be removed in the coming years.
The shift comes as public opposition grows to the hard form of Brexit pursued by successive Conservative governments since British voters opted by a 52%-48% margin to leave the bloc in a 2016 referendum.
Now, according to polling expert John Curtice, 57% of people would vote to rejoin the bloc and 43% to stay out.
When the U.K. was negotiating its divorce from the EU, Conservative governments under Prime Ministers Theresa May and her successor Boris Johnson ruled out remaining inside the EU’s borderless single market or its tariff-free customs union. Politicians who wanted closer ties were ignored or pushed aside.
The divorce deal struck by the two sides in 2020 has brought customs checks and other border hurdles for goods, and passport checks and other annoyances for travelers. Britons can no longer live and work freely across Europe, and EU citizens can’t move to the U.K. at will.
The British government’s fiscal watchdog, the Office for Budget Responsibility, said last week that leaving the EU has had “a significant adverse effect on U.K. trade.”
Yet only recently have members of the government begun acknowledging Brexit’s downsides. Hunt, who last week announced a 55 billion-pound ($65 billion) package of tax increases and spending cuts to shore up an economy battered by soaring inflation, acknowledged Brexit had caused “trade barriers” with the U.K.’s nearest neighbors.
“Unfettered trade with our neighbors is very beneficial to growth,” he told the BBC, and predicted that the “vast majority” of barriers would be removed – although it would take years.
Any move to rebuild ties with the EU will face opposition from the powerful euroskeptic wing of the Conservative Party. Even the opposition Labour Party — reluctant to reopen a debate that split the country in half and poisoned politics — says it won’t seek to rejoin the bloc, or even the EU’s single market, if it takes power after the next election.
Sunak, who took office last month, is a long-time Brexit supporter, but also a pragmatist who has made repairing the economy his top priority. Russia’s invasion of Ukraine, which has rocked European security and sent energy prices soaring, has put Brexit squabbles into perspective for politicians on both sides of the English Channel.
Sunak wants to solve a festering feud with the EU over trade rules that have caused a political crisis in Northern Ireland, the only part of the U.K. that shares a border with an EU member nation. When Britain left the bloc, the two sides agreed to keep the Irish border free of customs posts and other checks because an open border is a key pillar of the peace process that ended 30 years of violence in Northern Ireland.
Instead, there are checks on some goods entering Northern Ireland from the rest of the U.K. That angered pro-British unionist politicians, who say the new checks undermine Northern Ireland’s place in the United Kingdom. They are boycotting Belfast’s power-sharing government, leaving Northern Ireland without a functioning administration.
The U.K. government is pinning its hopes on striking a deal with the EU that would ease the checks and coax Northern Ireland’s unionists back into the government.
Months of talks when Johnson was in office proved fruitless, but the mood has improved since Sunak took over, though as yet there has been no breakthrough. ———
Follow AP’s coverage of Brexit at https://apnews.com/hub/brexit and of British politics at https://apnews.com/hub/british-politics
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The European Union’s ban on seaborne imports of Russian oil, along with the Group of Seven’s plan to cap prices of oil from Russia early next month won’t guarantee that prices for the commodity will see a lasting rally, or that supplies will tighten further in the days ahead.
“In isolation, the sanctions on Russia should be bullish for prices,” says Matt Smith, lead oil analyst, Americas, at Kpler. However, they may have a limited effect, as Russian barrels get “rerouted and not taken off the market,” while a price cap still has so much uncertainty surrounding it that its impact may be “muted due to workarounds or may simply be ineffective.”
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SHARM EL-SHEIKH, Egypt — A Russian billionaire under sanctions by the United States and Europe over his alleged ties to the Kremlin said Wednesday that he was not surprised by protests against his country at this year’s U.N. climate talks, but insisted that Russia wants to remain engaged on the issue of global warming because it deeply affects the nation.
Andrey Melnichenko, who heads the climate policy panel of Russian business lobby group RSPP, told The Associated Press that “regardless of the very terrible moment which we all experience now, we will participate, we will observe” at the meeting in Sharm el-Sheikh, Egypt.
Pro-Ukraine activists disrupted the start of an event hosted by the Russian delegation at the climate talks Tuesday before being escorted out by security staff.
“I wasn’t surprised,” said Melnichenko, who was speaking on the panel alongside Russian delegates. “What’s so surprising? That there are people who are deeply concerned about what’s happening in Ukraine and want to make their opinion known?”
“I completely 100% understand that,” he said.
His comments, while not directly critical of Russia’s invasion of Ukraine, indicate a more nuanced view of the bloody conflict than the official Kremlin line, which describes the war as a “special military operation.”
Since late February the war has devastated Ukraine, with bombs and shelling decimating towns and cities and killing thousands.
The war has resulted in a raft of sanctions being imposed on Russian officials and prominent businesspeople linked to the Kremlin.
Melnichenko — who now lives in Dubai — criticized Western sanctions on Russia, which he said were applied without regard for possible consequences, such as the effect restrictions on fertilizer exports would have on global food prices and Russia’s efforts to cut greenhouse gas emissions. Russia is the world’s largest exporter of fertilizers.
“Sanctions were put like a blanket on the Russian economy,” said Melnichenko, who once ran the fertilizer producer Eurochem and SUEK, one the the world’s largest coal companies. “It affects everything. Take for example food and fertilizer supply.”
He claimed the sanctions had affected food supply for “hundreds of millions” of people worldwide.
“Of course, this decision affects Russia’s possibility to move faster on the way of the decarbonization of its economy,” added Melnichenko.
Russian participants at the climate talks in Egypt have kept a low public profile, with no top government officials attending. Although the Russian delegation is half the size of last year’s, it is still larger than that of the United States, according to an analysis by Carbon Brief.
According to Melnichenko, Russia is particularly focused on efforts to reduce emissions and reliance on fossil fuels, along with rules for international carbon markets and carbon offsets — an issue where the Russian government sees great potential due to the country’s huge forests.
Melnichenko said that Russia will continue to export fossil fuels to fulfill demand, and it should be left to markets to decide which forms of energy are the most competitive. Russia is a top exporter of oil and natural gas although it has faced sanctions from EU trading partners. Other countries, like India and China, continue to import Russian oil.
“I believe that Russia’s fossil fuel production (is) very competitive globally in terms of the total cost, externalities included,” he said. “That’s why Russia will be able for a reasonably long period of time, a very long period of time, to maintain quite (a) big share of the fossil fuel market and … benefit from it also.”
Melnichenko, who according to Forbes is worth some $23.5 billion, said the world community should pay more attention to the large share of greenhouse gas emissions that aren’t caused by human activity, such as respiration, decomposition and even volcanoes. Scientists say the global warming measured in recent decades is mainly caused by the large-scale burning of fossil fuels since industrialization.
Asked what role concerns about climate change play in Russian civil society, he said that environmental issues such as air pollution had become more prominent in bigger cities over the past six to seven years
Peaceful protests on the issue were possible, he insisted. “And the government really responds.”
“That’s one of the area where you can have freedom of expression,” he said. “And that’s understandable because it’s pretty safe in terms of the political environment.”
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Follow AP’s climate and environment coverage at https://apnews.com/hub/climate-and-environment
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Associated Press climate and environmental coverage receives support from several private foundations. See more about AP’s climate initiative here. The AP is solely responsible for all content.
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Donald Trump will seek the presidency for a third time in 2024, the former president announced in a speech from his Florida estate Tuesday night, paving the way for a contentious Republican primary and a potential rematch between Trump and President Joe Biden for the White House in two years.
“In order to make America great and glorious again, I am tonight announcing my candidacy for president of the United States,” Trump said from Mar-a-Lago.
The former president spoke a week after midterm elections that saw Democrats keep the Senate, and a number of candidates backed by him lost their races, such as Pennsylvania Senate candidate Mehmet Oz and that state’s GOP gubernatorial candidate, Doug Mastriano. That’s prompted debate about moving on from Trump as the party eyes its 2024 chances.
Now read: Trump vs. DeSantis: Midterm election results shake up the Republican 2024 field
Trump — who a House panel has charged with a conspiracy aimed overturning the 2020 presidential election — is likely to face a crowded field in the contest for the GOP presidential nomination, with Florida Gov. Ron DeSantis seen at this stage as his most formidable opponent. Other potential candidates include former Vice President Mike Pence, former South Carolina Gov. Nikki Haley, Virginia Gov. Glenn Youngkin and former Secretary of State Mike Pompeo.
See: Here’s how candidates endorsed by Trump performed in the midterm elections
Trump may view DeSantis as posing his most daunting challenge, given the energy he has spent since the midterm elections lashing out at the the Florida governor. The former president remains a popular figure in the Republican Party and has proven himself adept at sidelining rivals for the affection of the GOP base.
Speaking to a crowded room at Mar-a-Lago, Trump bashed the Biden administration and claimed, “we built the greatest economy in the history of the world.” Under Biden, he said, the U.S. is a “nation in decline.” Biden fired back in a video posted on Twitter as Trump was speaking: “Donald Trump failed America.”
“America’s comeback starts right now,” Trump said. “I will fight like I’ve never fought before.”
During his White House term, Trump presided over impressive gains in the stock market, with the 24.2% rise in the Nasdaq
COMP,
ranking as the best ever during a presidential term since the index made its debut in the early 1970s. The Dow Jones Industrial Average
DJIA,
gained 11.8% and the S&P 500
SPX,
rose 13.7% during the four-year span.
Read:Stock-market performance under Trump trails only Obama and Clinton
Some of those gains can be attributed to Trump’s signature legislative achievement: a major corporate-tax cut that saw the top federal rate slashed from 35% to 21%, padding corporate profits and making the shares of large U.S. companies more valuable, often via share buybacks.
Investors were less enthusiastic about the former president’s trade war with China — a high-profile standoff that often sent stocks tumbling on news of new trade restrictions, or soaring on the perception of easing tensions.
From the archives (May 2020): Trade-war collateral damage: destruction of $1.7 trillion in U.S. companies’ market value
The arrival of the COVID-19 pandemic shifted the focus of policy makers in both countries, and Biden has largely kept the tariffs his predecessor put in place. Despite these restrictions, the U.S. trade deficit in goods with China set a record of $355 billion in 2021.
Trump on Tuesday said he wants to eliminate the U.S.’s dependence on China, by bringing manufacturing back to the U.S. He also falsely claimed that inflation is at a 50-year high — it is at a 40-year high.
Economic policy often took a back seat to the various scandals that plagued Trump in his tumultuous term in office, when he became the first president to ever be impeached twice by the House of Representatives.
The first impeachment resulted from a 2019 phone call when he asked Ukrainian President Volodymr Zelensky for a “favor” in announcing the launch of an investigation into Biden, then viewed as a likely Trump rival in the 2020 election. Democrats alleged that Trump withheld aid approved by Congress in an effort to ensure an investigation was announced.
The second impeachment of Trump followed the Jan. 6, 2021, attack on the U.S. Capitol, with a bipartisan majority in the House arguing that he encouraged the attack.
The former president’s legal troubles have not abated since he left office, and he’s facing several state and local investigations, civil and criminal, while some experts believe he will be indicted by Attorney General Merrick Garland for mishandling defense secrets and obstruction of justice after an FBI raid appeared to show that he lied to the government about classified documents in his possession.
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CANBERRA, Australia — Australian Prime Minister Anthony Albanese said Friday he would ask Chinese President Xi Jinping to lift billions of dollars in trade barriers in the event that the two leaders hold their first bilateral meeting.
Both leaders will attend a Group of 20 meeting in Indonesia and then an Asia-Pacific Economic Cooperation forum meeting in Thailand next week.
Albanese was speaking in Sydney before departing Australia on Friday for an East Asia Summit in Cambodia, which Xi is not expected to attend.
A face-to-face meeting between the Chinese and Australian leaders would mark a major reset in a bilateral relationship that plumbed new depths under the nine-year rule of Australia’s previous conservative government.
Beijing had banned minister-to-minister contacts and imposed a series of official and unofficial trade barriers on products including wine, coal, beef, seafood and barley in recent years that cost Australian exporters 20 billion Australian dollars ($13 billion) a year.
Albanese said a meeting with Xi was “not locked in at this point in time.”
“We obviously will be attending the same conferences, or at least two of them (G-20 and APEC) over the next nine days. And I would welcome a meeting if it occurs over that time,” Albanese said.
China lifting economic sanctions was the first priority in returning to normal relations, he said.
“We have some AU$20 billion of economic sanctions against Australia. That is not in Australia’s interest in terms of our jobs and the economy, but it’s also not in China’s interest,” Albanese said.
“Australia has world class products — in seafood, in meat, in wine, in other products that we export to China. It’s in China’s interest to receive those products, it’s in Australia’s interest to export them. So I’m very hopeful — we’ll continue to put our case that these sanctions are not justified, that they need to be removed,” Albanese added.
Asked what China wanted from Australia to improve relations, Albanese replied: “It’s not up to me to put forward their case.”
“What I want to see with the relationship with China is cooperation where we … maintain our Australian values where we must,” Albanese said.
Bilateral relations soured over issues including Australian demands for an independent inquiry into the COVID-19 pandemic, a ban on Chinese telecommunications giant Huawei’s involvement in the Australian 5G networks on security grounds and recent laws that ban covert foreign interference in domestic politics.
China’s Ambassador to Australia Xiao Qian said in August that Beijing would discuss with Australia whether conditions were right in November for Albanese to meet Xi during the G-20 summit.
China’s People’s Daily English-language newspaper reported this week that “signs of resetting bilateral ties have emerged” since Albanese’s center-left Labor Party came to power in May.
The White House has confirmed President Joe Biden will hold talks with Xi on Monday on the sidelines of the G-20 summit in Indonesia, their first face-to-face meeting since Biden became president in January 2021.
The meeting would come as competition for influence among South Pacific island nations heightens between China and the United States, with its allies including Australia, since Beijing struck a security pact with the Solomon Islands early this year that has raised fears of a Chinese naval base being established in the region.
Albanese said Australia has “strategic competition in the region” with China.
“China, of course, has changed its position. And it is much more forward-leaning than it was in the past,” Albanese said.
“That has caused tensions in the relationship, and we need to acknowledge that that’s the context in which the relationship exists,” he added.
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BEIJING — China’s trade shrank in October as global demand weakened and anti-virus controls weighed on domestic consumer spending.
Exports declined 0.3% from a year earlier to $298.4 billion, down from September’s 5.7% growth, the customs agency reported Monday. Imports fell 0.7% to $213.4 billion, compared with the previous month’s 0.3% expansion.
China’s global trade surplus edged up 0.9% from a year earlier to $85.2 billion.
Forecasters expected Chinese trade to weaken as global demand cooled following interest rate hikes by the Federal Reserve and other central banks to rein in surging inflation.
At home, consumer demand has been hurt by a “Zero COVID” strategy that has repeatedly shut down large sections of cities to contain virus outbreaks. That has disrupted business and confined millions of people to their homes for weeks at a time.
Economic growth picked up to 3.9% over a year earlier in the quarter ending in September from 2.2% in the first six months of 2022. But forecasters say activity is weakening as closures spread in response to a spike in infections.
“The economy slowed again in October due to the tightened Covid controls as well as the slowing external demand,” said Larry Hu of Macquarie Group in a report.
The downturn in Chinese demand hurts developing countries that supply oil, soybeans and other raw materials and the United States, Europe, Japan and other suppliers of consumer goods and microchips and other components and technology needed by manufacturers.
Exports to the United States rose 35.3% over a year earlier to $47 billion despite lingering tariff hikes in a trade war over Beijing’s technology ambitions. Imports of U.S. goods rose $52.4% to $12.8 billion.
China’s politically sensitive trade surplus with the United States swelled 29.9% to $34.2 billion.
Imports from Russia, mostly oil and gas, more than doubled, rising 110.5% over a year ago to $10.2 billion.
China can buy Russian energy exports without running afoul of sanctions imposed on President Vladimir Putin’s government by the United States, Europe and Japan. Beijing is stepping up purchases to take advantage of Russian discounts. That irks Washington and its allies by topping up the Kremlin’s cash flow and limiting the impact of sanctions.
Exports to the 27-nation European Union edged up 5.5% to $44.1 billion while imports of European goods shrank 15.5% to $21.4 billion. China‘s surplus with the EU widened by 38.1% to $22.7 billion.
For the first 10 months of the year, China’s exports rose 11.1% to $3 trillion while imports gained 3.5% to $2.3 trillion, the General Administration of Customs announced. The country’s trade surplus was $727.7 billion.
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