On The Money — House quashes rail strike threat
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The House voted to block a national rail shutdown and provide rail workers with paid sick leave. We’ll also look at Powell’s newest remarks on rate hikes, who’s getting Trump’s tax returns and another round of record corporate profits.
But first, learn more about Pelosi’s newly anointed successor.
Welcome to On The Money, your nightly guide to everything affecting your bills, bank account and bottom line. For The Hill, we’re Sylvan Lane, Aris Folley and Karl Evers-Hillstrom.
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House votes to avert strike, give paid sick leave
The House passed a bill on Wednesday to avert a railway strike, taking the first major step in avoiding a walkout of workers that would have drastic effects on the U.S. economy as it heads into the holiday season.
The chamber passed the resolution in a 290-137 vote, sending it to the Senate for consideration just over one week out from the Dec. 9 strike deadline.
In a subsequent vote, lawmakers passed a separate measure that would give rail workers seven days of paid sick leave per year, addressing a chief concern unions and progressives had with the agreement. Just three Republicans joined all Democrats present in supporting the measure.
It’s increasingly likely that President Biden will sign a bill to block a rail strike and force through a contract by the end of the week.
The Senate is set to pass a companion bill Thursday, though it’s unlikely Democrats would find enough GOP support for the paid sick leave measure.
Either way, the nation is on track to avoid a rail shutdown that would devastate U.S. supply chains in the middle of the holidays.
Congress overrides workers: Lawmakers will soon force through a contract that train workers at one of the largest labor unions voted down, citing an absence of paid sick leave along with long and unpredictable hours. Rail unions have complained that railroad executives refused to meet their demands because they knew this exact scenario would play out.
Karl and Mychael Schnell have more here.
Read more: Labor activists grumble as rail paid leave appears likely to die in Senate
SLOW DOWN?
Powell: Fed will keep raising rates, but at slower pace
Federal Reserve Chair Jerome Powell said Wednesday the central bank will keep raising interest rates to fight inflation but at a slower pace, signaling a slowdown in rate hikes that have raised costs on new mortgages and car payments to slow the economy.
In a Wednesday speech, Powell said that despite a recent slowdown in price growth, officials are looking for “substantially more evidence to get comfort that inflation is actually declining.”
“Despite some promising developments, we have a long way to go in restoring price stability,” Powell said in a speech hosted by The Brookings Institution.
The key takeaways:
Powell said the Fed would keep raising interest rates and maintain them at levels meant to restrict the economy until inflation was on track to hit the Fed’s 2 percent annual target.
But Powell added that the Fed will likely slow the pace of rate hikes as soon as December after previous increases pushed the U.S. economy to the edge of a recession.
“We have a risk management balance to strike. We think slowing down at this point is a good way to balance the risks,” Powell said.
Sylvan breaks it down here.
THEY ACTUALLY DID IT
House panel gets Trump tax returns
The House Ways and Committee has reportedly received former President Trump’s tax returns, ending Democrats’ multiyear legal battle to obtain the documents.
A Treasury Department spokesperson said Wednesday the department complied with the Supreme Court’s order last week rejecting Trump’s emergency appeal to stop the handover, which effectively capped his yearslong opposition to the effort.
Trump in 2016 bucked the tradition of presidential candidates releasing their tax returns, which are kept confidential unless the citizen themself publishes them.
The Hill’s Zach Schoenfeld has more here.
HIGHER AND HIGHER
Corporate profits hit record high in third quarter amid 40-year-high inflation
Corporate profits in the nonfinancial sector hit a record high of $2.08 trillion in the third quarter even as 40-year-high inflation continues to squeeze American consumers.
Profits adjusted for inventories and capital consumption rose $6.1 billion from the second to third fiscal quarters, the Commerce Department reported Wednesday, continuing a red-hot recovery from the flash recession caused by pandemic shutdowns.
Following a two-quarter dip in 2020, quarterly profits have surged by more than 80 percent over the last two years, from around $1.2 trillion to more than
$2 trillion, adding weight to arguments that the private sector is driving inflation by exploiting consumer expectations to keep prices elevated.Companies in a wide variety of business sectors openly express this confidence on earnings calls with investors,
The Hill’s Tobias Burns explains here.
Good to Know
Amazon said Wednesday that it hit record-breaking sales during the Thanksgiving holiday weekend.
The e-commerce company said the five days between Thanksgiving and the end of Cyber Monday was its “biggest ever” shopping weekend, with customers buying hundreds of millions of toys, clothes and Amazon devices like the Kindle, Echo and home security system Ring.
Other items we’re keeping an eye on:
The U.S. economy grew at a faster rate between July and September than federal officials first estimated, according to federal data released Wednesday.
Private companies added an estimated 127,000 jobs in November, a sharp slowdown from October and the lowest monthly gain in nearly two years, according to a new ADP jobs report.
The average U.S. gas price could drop below $3 per gallon by Christmas, according to price tracker GasBuddy, dipping to the lowest levels since February despite worries about inflation and a possible recession.
Pending home sales, a forward-looking market indicator, declined for the fifth consecutive month in October, falling by 4.6 percent, according to the National Association of Realtors’ Pending Home Sales Index.
That’s it for today. Thanks for reading and check out The Hill’s Finance page for the latest news and coverage. We’ll see you tomorrow.
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