European Union Proposes Economic Overhaul Amid Environmental Concerns

    The European Union's executive branch has introduced an ambitious plan to overhaul its economic strategy, responding to industry leaders' worries about high taxes, rising energy costs, and strict regulations. EU Commission President Ursula von der Leyen aims to turn Europe into a center of industrial innovation by relaxing restrictions and offering essential support. However, environmental groups are raising alarms, concerned that deregulation might jeopardize the EU's climate objectives. Critics contend that the plans favor energy-intensive industries, which could weaken the European Green Deal. Despite these worries, von der Leyen reassures that environmental and social commitments will remain intact. The proposal, which includes substantial investments and cost-saving initiatives, will be further reviewed by the EU parliament and member states.

https://apnews.com/article/eu-economy-green-industry-reform-89a3b66611523d676f37c3fc966cf948

Insurers will struggle to dodge climate-change tab

    The frequency and severity of natural disasters are on the rise, resulting in significant economic losses worldwide. In 2024, these losses reached an average of $368 billion, with insurers covering about 40%, which leaves a large part uninsured. As a result, insurers are pulling back coverage in high-risk areas, including certain regions of California and Louisiana. Governments, facing the challenge of managing the financial impact of catastrophic events without imposing politically unpopular tax increases, are looking into collaborative solutions like Britain's Flood Re and Switzerland's pooled risk model. However, these approaches have their drawbacks, often necessitating extra funding after disasters, with insurers likely shouldering a substantial share of the costs linked to climate-related damages.

https://www.reuters.com/breakingviews/insurers-will-struggle-dodge-climate-change-tab-2025-02-26/

Inflation, looming trade war take a toll as confidence of the U.S. consumer tumbles

The Conference Board's report revealed a significant 9.3-point drop in Americans' short-term expectations for income, business, and the job market, falling to 72.9, which may signal a potential recession. This marked the most significant month-to-month decline since August 2021. Concerns over inflation were notable, with an increase in mentions of trade and tariffs. Consumer confidence also dropped, with expectations of a recession rising to a nine-month high. Views on current conditions fell 3.4 points to 136.5, and perceptions of the labor market weakened as consumers became more pessimistic about future business conditions. This shift in sentiment reflects broader concerns about economic stability, as Americans appear increasingly uncertain about the near future. Additionally, inflation's continued grip on the economy, combined with expectations of slower economic growth, has made many cautious about their financial outlook. With recession fears climbing, many consumers are adjusting their expectations downward, and businesses may soon go downwards, too, with their planning and investments. In addition, if Americans feel uncertain or pessimistic about their financial future, they're less likely to spend, which directly impacts demand for goods and services. Lower consumer spending could ripple through other sectors, affecting everything from production to employment. Finally, This news could indicate increased volatility in the stock market, mainly as investors digest these concerns and adjust their strategies. 

https://finance.yahoo.com/news/us-consumer-confidence-plummets-february-150845549.html

Willy Wonka's Golden Ticket

    President Donald Trump has announced that he wants to sell "gold cards" to wealthy foreigners, looking to receive a visa in exchange for $5 million. President Tump said "You have a green card. This is a gold card." The Presidents initial estimation suggests that millions of cards will be sold. When questioned about who would be allowed to buy this gold cards, Trump was asked about Russian Oligarchs in which he said he knows some Russian Oligarchs that are really nice people.

    The idea is not new as the United States currently has an EB-5 immigrant investor visa program, which allows foreign investors to contribute to American projects in exchange for the ability to apply for a US visa. Interestingly, President Trump and his businesses have taken advantage of this program to fund major property developments. 

    The EB-5 program was created in 1992 and grants green cards to immigrants who make a minimum investment of $1.05 million, or $800,000 in economically distressed zones. In 2019, the Trump administration tried to raise these requirements but it was struck down by a federal judge. Eventually, the Biden Administration revisited the requirements in 2022. 

    The end goal of the new gold card is unclear as it quickly received bipartisan criticism. Both sides mentioned that this new program either deviates from the administrations goals or needs heavy reform. 

Latin America’s China Ties Won’t Be Easily Severed

The growing competition between the U.S. and China is changing politics in Latin America. A recent example is Panama, which decided to step away from China’s Belt and Road Initiative after a visit from U.S. Secretary of State Marco Rubio. This shows Panama moving closer to the U.S., but not all Latin American countries will follow the same path. Over the last 20 years, while the U.S. focused on wars in the Middle East, China built strong trade relationships in the region, becoming the top trading partner for many countries, including Brazil. Now, the U.S. wants to regain its influence, but that won’t be easy because many countries rely on China for trade and investment.

Mexico is in a tricky position—it has a strong trade partnership with the U.S. under the USMCA deal but is also seeing a big increase in Chinese investment. Other countries like Argentina, Peru, Chile, and Bolivia have welcomed China’s money for projects in farming, mining, and infrastructure. While Trump may not try to completely cut China out of Latin America, he is likely to push back against Chinese influence in key areas, especially those affecting U.S. security. Many Latin American nations may try to stay neutral in this power struggle, but because China’s economic role is so big, avoiding taking sides will be difficult.

https://americasquarterly.org/article/latin-americas-china-ties-wont-be-easily-severed/

German business leaders say new government must act quickly to rescue stagnant economy

German business leaders say new government must act quickly to rescue stagnant economy 

Link: https://finance.yahoo.com/news/german-business-leaders-government-must-143737702.html

Germany had elections on Sunday February 23rd where the center-right party won and subsequently put their leader Freidrich Merz in the seat as chancellor. Germany had a high voter turnout of 82.5% (compared to the average 66% American voting turnout as a point of reference) and commentators point to the public desire for a change in direction as the reason.

Freidrich Merz has vowed to prioritize European unity and security as it deals with global shifts and concerns over the new Trump administration as well as the Russia and Ukraine war. As the chancellor, Merz will be tasked with providing a unified front pulling the continent together as well as domestically. The chancellor also determines the composition of the Federal Cabinet. There is a complication to this for Merz as domestically there is a desire for there to be a coalition formed between the center left Social Democrats as Merz has already vowed to not work with the far-right Anti-Immigrant Alternative party. 

Merz knows that the “world out there isn’t waiting for [Germany]” as he looks to unify the country and in the process perhaps fulfill hopes of a coalition that strengthens the center ground and works hard to draw investments to their country. Currently, Germany is facing struggles with companies cutting jobs, deciding against investing in Germany, and burdening taxes for workers and firms. Now, time will tell if they find the “fiscal space” to figure it out and if they can do it “quickly.”      

Apollo Economist Warns DOGE Layoffs Could Threaten U.S. Economy and Markets

Elon Musk’s Department of Government Efficiency (DOGE) layoffs could have a much greater impact on the economy and financial markets than previously expected, according to economist Torsten Slok. He warns that while initial estimates suggested 300,000 layoffs, the total number could reach 1 million when factoring in contract workers, who make up 66.5% of the federal workforce. These cuts are historically significant, mirroring reductions under Bill Clinton, and come as agencies like the IRS and Forest Service have already laid off up to 220,000 probationary workers. Despite a relatively strong economy, with 4% unemployment and 2.3% GDP growth, billionaire investor Steve Cohen cautions that reduced federal spending could negatively impact markets and growth. President Trump, who has long tied stock market performance to his success, has seen the S&P 500 decline since taking office, despite an initial post-election rally. However, some analysts, like Morgan Stanley’s Michael Wilson, argue that while DOGE’s cost-cutting measures may slow growth in the short term, they could ultimately strengthen the economy by promoting private sector expansion and improving long-term fiscal sustainability. 

Article: https://www.forbes.com/sites/dereksaul/2025/02/24/doge-layoffs-pose-growing-risk-to-us-economy-and-markets-says-apollo-economist/

D.C. Unemployment Surge

Unemployment claims in Washington, D.C., spiked to 1,780 for the week ending February 8, 2025, a 36% increase from the week before.  Nearly 4,000 D.C. workers have filed for unemployment since Trump took office, with the surge starting in the new year.  This rise coincides with Trump and Elon Musk's push to reduce the federal workforce, leading to layoffs and buyout offers.  While D.C. had one of the highest unemployment rates at 5.5% in December 2024, the broader national job market remains stable at 4% unemployment.  The impact on D.C. workers depends on their industry. Those in fields like accounting may find new jobs quickly, while others in areas like software development may struggle.  Many displaced workers may find new opportunities due to their valuable skill sets. 

Portland's 'Urban Doom Loop'

Right after the Pandemic, there was a lot of hubbub over the concept of 'urban doom loops' as companies shut down and people left offices in major cities to work from home. As people left, offices became more vacant, economies shrunk, and more people moved away. Although predicted to occur across the country, at the time, this trend was associated with what was happening in San Fransisco. Post-pandemic, this worry seemed to be placated, as San Fransisco brought in big tech to revitalize parts of its economies, and many cities recovered from the pandemic recession. One such case, unfortunately, is not Portland. Portland is suffering from population loss, leaving economists predicting an 'urban doom loop' ahead. Although, according to the KGW8 article, Portland's economy is usually responsive to the general economy, this no longer seems to be the case. Portland has been in the news cycles for the past couple of years- usually because of Oregon's 2021 decriminalization of drugs- but generally for its homeless population. It is often pointed to as an example of urban decay in America due to politicized issues like housing and criminal justice reform. As debates occur over how cities should be governed, the question of how to revitalize cities still looms large, and Portland is no different. 

Source: https://www.kgw.com/article/news/local/the-story/portland-state-of-economy-urban-doom-loop-population-income-loss/283-b7bde05a-9d3d-4a61-9a18-870d63849f0f

Conservative Opposition Wins German Election

The Christian Democratic Union allied with the Christian Social Union won the largest share of votes in the German elections today according to exit polls. The two conservative parties secured 28.5% of votes, while the far-right Alternative for Germany (AfD) won 20%. In third place with 16.5% of the votes is Chancellor Olaf Scholz’s Social Democratic Party. The CDU’s lead candidate, Friedrich Merz, is currently the frontrunner to succeed Scholz as Chancellor. Germany’s previous government was a coalition made up of the SPD, Green Party, and the Free Democratic Party. This coalition fell apart last year due to disputes within the government over economic fiscal and budget policies. The conservatives will set up a government as Germany, the largest economy in Europe, is lagging. The economy has shrunk over the past two years, and industries such as housebuilding and auto are facing difficulties. It will be important to keep a watch on Germany as the new government is formed and new policies are put into place, as the state of the German economy has a large impact on the economic performance of the EU.

 

https://www.cnbc.com/2025/02/23/german-2025-federal-election-results.html

Musk orders U.S. federal workers to report on work by Monday or resign

 The Trump administration and mainly Elon Musk has sent a mandatory email to federal employees to send in a detailed explanation of what they did as an federal employee last week. If they refuse to send the required request they will ultimately be sending in their resignation. However, the AFGE (Labor Union) has promised to fight any unlawful terminations. But it seems like this DOGE, from the Trump administration, has been quite rushed and even labor unions cannot fight it. Many people believe that because of this DOGE process there has been many mistakes because of its fast paced movement. "Doge has led to haphazard firings that resulted in numerous mistakes and forced several agencies to quickly rehire vital employees, such as working in nuclear safety, defense and power generation." Trump has said many times that Musk is well fit for DOGE. On the other hand the white house says Musk is not even an employee for DOGE and this is why federal agencies are asking employees not to summit emails back because of absence of validity. It will be interested to see what happens.  

https://www.cnbc.com/2025/02/23/musk-orders-us-federal-workers-to-report-on-work-by-monday-or-resign.html 

Are Our National Parks in Crisis?

Our national parks welcomed over 325 million visitors in 2023, showing significant growth from the previous year, and the trend continues to rise. One might expect that this surge in visitors would create more job opportunities within these parks. However, the opposite has occurred; from 2010 to the present, our national park workforce has decreased by 20%. Many employees fear for their jobs, especially since the new presidential administration took office. The National Parks Conservation Association (NPCA) has highlighted multiple challenges regarding both permanent and temporary positions, as 2,000 workers have lost their jobs. This situation has led to staff shortages nationwide, with new employees enduring probationary periods that could result in further terminations. 

This staff shortage has placed a significant strain on the remaining workers within the parks. NPCA leaders emphasize that adequate staffing and resources are crucial for national parks to fulfill their mission and safely accommodate millions of visitors. They are concerned that these policy changes may not only impact the natural environment but also have serious implications for visitor safety and experience. The NPCA warns that this could lead to unsafe conditions, overflowing trash, and unclean facilities, which would compromise the environment and diminish the visitor experience.

 It is essential for us to stay informed about these issues and policies. I wasn’t even aware that these changes were taking place due to federal decisions, and that the parks would even be affected, however, the temporary pause on federal grants set forth by our government has disrupted the funding for vital park projects. This could cause severe damage to our national parks and facilities.

If we want to preserve these national treasures, we must advocate for their protection. By remaining engaged, we can help ensure these invaluable resources are protected for future generations.

Sources: https://www.npca.org/articles/6680-how-the-new-administration-s-actions-will-affect-national-parks