Connect with us

Economics

The campus is coming for Joe Biden

Published

on

Aconnoisseur of radical chic can find plenty to catalogue these days while observing pro-Palestine protests on Ivy League campuses: the black or red keffiyehs, the conga drums, the folk songs, the kitschy signs (“Dykes 4 Divestment”) and the showy Arabic pronunciations of “Gaza”, so reminiscent of the Spanish-ish inflection given to “Nicaragua” by pro-Sandinista activists back in the 1980s.

And then there are the dainty intersectional gestures of the protesters: “We recognise our role as visitors and, for many of us, colonisers, on this land,” reads the third of nine “community guidelines” scrawled on a whiteboard in the “Gaza Solidarity Encampment”, the bivouac of domed tents on Columbia University’s south lawn. Not only was the land once inhabited by native Americans, but Columbia was guilty of “complicity in the displacement of the Black and Brown Harlem community”.

But such emblems of political taste are superficial. They might mislead the observer about the anger of many protesters, about how deeply it is felt and how deeply it is dividing universities, pitting some Arab-American students and their allies against some Jewish students and theirs. At elite institutions, years of uneven application of speech codes, of unequal attention to those offended by speech, have left students, alumni, faculty and even presidents seeming uncertain what the rules are and how to enforce them. This has doomed them to fighting about how to fight about what they are fighting about. At Columbia, a decision by the president, Minouche Shafik, to get New York City police to break up a previous encampment on April 18th, arresting more than 100 students, has touched off a faculty revolt.

On April 22nd faculty gathered on the granite steps of Low Memorial Library, the main administrative building, to demand an apology and amnesty for the students. One speaker, Christopher Brown, a professor of history, accused Dr Shafik of endangering the students and of failing to defend Columbia’s excellence in testimony to a House committee the day before the police raid. “She has forfeited the privilege to lead this great university,” Professor Brown declared, to raucous cheers and a chant of “Resign!” from hundreds of students. The university says it is negotiating with students over the new encampment, even as workers set up chairs nearby for next month’s commencement.

All this outrage is closing in on another institution, the Democratic Party, and its leader, President Joe Biden. The touchstone for the Columbia protesters is the struggle on that campus for racial justice and against the Vietnam war of April 1968, which culminated in a police crackdown and more than 700 arrests. For Democrats nationally, 1968 is also becoming a touchstone, an ominous one. The campus protests that year found a focus in the Democratic National Convention in August in Chicago, where the party plans to convene in the same month this year.

In 1968 pro- and anti-war delegates shouted and bickered over Vietnam. In the end the Democrats voted down an anti-war plank and nominated Hubert Humphrey, a Minnesota liberal who, as Lyndon Johnson’s vice-president, was tarred as pro-war. A national television audience watched in horror as Chicago police attacked protesters outside the delegates’ hotel with tear gas and clubs. More than 650 protesters were arrested and scores were hurt, as were many police officers.

Any chaos in Chicago would be bad for Mr Biden, who is running, as in 2020, as the candidate of normalcy. But the drama will almost certainly not be as intense as in 1968. Pro-Palestine groups want to rewrite the party’s plank on Israel, yet such fights no longer play out on convention floors. Mr Biden’s aides will control the platform, as they will the script of the convention, now just a particularly dull TV show. As in 1968, Chicago is being stingy with permits to protest, but the police superintendent, Larry Snelling, has said the department is preparing to respond to “large-scale First Amendment activity” with “constitutional policing”. Many of the superficial parallels to 1968 will probably prove to be just that.

Still, “There is a parallel that’s unavoidable,” says Bill Ayers, who as a leader of Students for a Democratic Society was beaten and arrested in Chicago in 1968. “And that is that Hubert Humphrey, the great liberal from the Midwest, tried way too late to extract himself from being a cheerleader for Vietnam.” Dogged by anti-war protesters, Humphrey struggled to unite Democrats and ultimately lost narrowly to Richard Nixon. “Irony of history,” Dr Ayers says. “How could Richard Nixon be elected as a peace candidate? Here’s a great anti-communist warmongering prick.” Though as president Nixon would intensify the war, he claimed as a candidate to have a “secret plan” to end it. Donald Trump has said he would end the Ukraine war in a day and, referring to the war in Gaza, has told Israel to “get it over with”.

They’re more like guidelines, anyway

Maybe Mr Biden will succeed in brokering a ceasefire in Gaza, and the anger will dissipate. Maybe the protesters chanting today against “Genocide Joe” will nevertheless show up to vote for him. Dr Ayers, who went on to help found the militant Weather Underground and spent years as a fugitive, pulled the lever for Humphrey. “I always vote for the lesser of two evils,” he says, “because they’re less evil.” He argues that voting is a practical rather than moral act, words other activists might take to heart.

The more thoughtful of Columbia’s activists, by the way, may also have something to teach everyone else, on campus and off. “We commit to assuming best intentions, granting ourselves and others grace when mistakes are made,” reads the eighth community guideline in the Gaza Solidarity Encampment, “and approaching conflict with the goal of addressing and repairing.”

Economics

ADP jobs report March 2025:

Published

on

Attendees check in during a job fair at the YMCA Gerard Carter Center on March 27, 2025 in the Stapleton Heights neighborhood of the Staten Island borough in New York City. 

Michael M. Santiago | Getty Images

Private payroll gains were stronger than expected in March, countering fears that the labor market and economy are slowing, according to a report Wednesday from ADP.

Companies added 155,000 jobs for the month, a sharp increase from the upwardly revised 84,000 in February and better than the Dow Jones consensus forecast for 120,000, the payrolls processing firm said.

The upside surprise comes amid worries that President Donald Trump’s aggressive tariffs could deter firms from adding to headcount and in turn slow business and consumer activity. Trump is set to announce the next step in his trade policy Wednesday at 4 p.m.

Hiring was fairly broad based, with professional and business services adding 57,000 workers while financial activities grew by 38,000 as tax season heats up. Manufacturing contributed 21,000 and leisure and hospitality added 17,000.

Service providers were responsible for 132,000 of the positions. On the downside, trade, transportation and utilities saw a loss of 6,000 jobs and natural resources and mining declined by 3,000.

On the wage side, earnings rose by 4.6% year over year for those staying in their positions and 6.5% for job changers. The gap between the two matched a series low last hit in September, suggesting a lower level of mobility for workers wanting to switch jobs.

Still, the overall numbers indicate a solid labor market. Recent data from the Bureau of Labor Statistics indicates that the level of open positions is now almost even with available workers, reversing a trend in which openings outnumbered the unemployed by 2 to 1 a couple years ago.

The ADP report comes ahead of the more closely watched BLS measure of nonfarm payrolls. The BLS report, which unlike ADP includes government jobs, is expected to show payroll growth of 140,000 in March, down slightly from 151,000 in February. The two counts sometimes show substantial disparities due to different methodologies.

Get Your Ticket to Pro LIVE

Join us at the New York Stock Exchange!
Uncertain markets? Gain an edge with 
CNBC Pro LIVE, an exclusive, inaugural event at the historic New York Stock Exchange.

In today’s dynamic financial landscape, access to expert insights is paramount. As a CNBC Pro subscriber, we invite you to join us for our first exclusive, in-person CNBC Pro LIVE event at the iconic NYSE on Thursday, June 12.

Join interactive Pro clinics led by our Pros Carter Worth, Dan Niles, and Dan Ives, with a special edition of Pro Talks with Tom Lee. You’ll also get the opportunity to network with CNBC experts, talent and other Pro subscribers during an exciting cocktail hour on the legendary trading floor. Tickets are limited!

Continue Reading

Economics

Trump tariffs’ effect on consumer prices debated by economists

Published

on

The U.S. government is set to increase tariff rates on several categories of imported products. Some economists tracking these trade proposals say the higher tariff rates could lead to higher consumer prices.

One model constructed by the Federal Reserve Bank of Boston suggests that in an “extreme” scenario, heightened taxes on U.S. imports could result in a 1.4 percentage point to 2.2 percentage point increase to core inflation. This scenario assumes 60% tariff rates on Chinese imports and 10% tariff rates on imports from all other countries.

The researchers note that many other tariff proposals have surfaced since they published their findings in February 2025. 

Price increases could come across many categories, including new housing and automobiles, alongside consumer services such as nursing, public transportation and finance. 

“People might think, ‘Oh, tariffs can only affect the goods that I buy. It can’t affect the services,'” said Hillary Stein, an economist at the Boston Fed. “Those hospitals are buying inputs that might be, for example, … medical equipment that comes from abroad.” 

White House economists say tariffs will not meaningfully contribute to inflation. In a statement to CNBC, Stephen Miran, chair of the Council of Economic Advisers, said that “as the world’s largest source of consumer demand, the U.S. holds all the leverage, which means foreign suppliers will have to eat the economic burden or ‘incidence’ of the tariffs.” 

Assessing the impact of the administration’s full economic agenda has been a challenge for central bank leaders. The Federal Open Market Committee decided to leave its target for the federal funds rate unchanged at the meeting in March. 

The Fed targets its overnight borrowing rate at between 4.25% and 4.5%, with the effective federal funds rate at 4.33% on March 31, according to the New York Fed. The core personal consumption expenditures price index inflation rate rose to 2.8% in February, according to the Commerce Department. Forecasts of U.S. gross domestic product suggest that the economy will continue to grow at a 1.7% rate in 2025, albeit at a slower pace than what was forecast in January.  

Consumers in the U.S. and businesses around the world are bracing for impact. 
 
“There is a reason why companies went outside of the U.S.,” said Gregor Hirt, chief investment officer at Allianz Global Investors. “Most of the time it was because it was cheaper and more productive.” 

Watch the video above to learn how much inflation tariffs may cause.

Continue Reading

Economics

Trump’s tariff gambit will raise the stakes for an economy already looking fragile

Published

on

U.S. President Donald Trump speaks alongside entertainer Kid Rock before signing an executive order in the Oval Office of the White House on March 31, 2025 in Washington, DC. 

Andrew Harnik | Getty Images

President Donald Trump is set Wednesday to begin the biggest gamble of his nascent second term, wagering that broad-based tariffs on imports will jumpstart a new era for the U.S. economy.

The stakes couldn’t be higher.

As the president prepares his “liberation day” announcement, household sentiment is at multi-year lows. Consumers worry that the duties will spark another round of painful inflation, and investors are fretting that higher prices will mean lower profits and a tougher slog for the battered stock market.

What Trump is promising is a new economy not dependent on deficit spending, where Canada, Mexico, China and Europe no longer take advantage of the U.S. consumer’s desire for ever-cheaper products.

The big problem right now is no one outside the administration knows quite how those goals will be achieved, and what will be the price to pay.

“People always want everything to be done immediately and have to know exactly what’s going on,” said Joseph LaVorgna, who served as a senior economic advisor during Trump’s first term in office. “Negotiations themselves don’t work that way. Good things take time.”

For his part, LaVorgna, who is now chief economist at SMBC Nikko Securities, is optimistic Trump can pull it off, but understands why markets are rattled by the uncertainty of it all.

“This is a negotiation, and it needs to be judged in the fullness of time,” he said. “Eventually we’re going to get some details and some clarity, and to me, everything will fit together. But right now, we’re at that point where it’s just too soon to know exactly what the implementation is likely to look like.”

Here’s what we do know: The White House intends to implement “reciprocal” tariffs against its trading partners. In other words, the U.S. is going to match what other countries charge to import American goods into their countries. Most recently, a figure of 20% blanket tariffs has been bandied around, though LaVorgna said he expects the number to be around 10%, but something like 60% for China.

What is likely to emerge, though, will be far more nuanced as Trump seeks to reduce a record $131.4 billion U.S. trade deficit. Trump professes his ability to make deals, and the saber-rattling of draconian levies on other countries is all part of the strategy to get the best arrangement possible where more goods are manufactured domestically, boosting American jobs and providing a fairer landscape for trade.

The consequences, though, could be rough in the near term.

Potential inflation impact

On their surface, tariffs are a tax on imports and, theoretically, are inflationary. In practice, though, it doesn’t always work that way.

During his first term, Trump imposed heavy tariffs with nary a sign of longer-term inflation outside of isolated price increases. That’s how Federal Reserve economists generally view tariffs — a one-time “transitory” blip but rarely a generator of fundamental inflation.

This time, though, could be different as Trump attempts something on a scale not seen since the disastrous Smoot-Hawley tariffs in 1930 that kicked off a global trade war and would be the worst-case scenario of the president’s ambitions.

“This could be a major rewiring of the domestic economy and of the global economy, a la Thatcher, a la Reagan, where you get a more enabled private sector, streamlined government, a fair trading system,” Mohamed El-Erian, the Allianz chief economic advisor, said Tuesday on CNBC. “Alternatively, if we get tit-for-tat tariffs, we slip into stagflation, and that stagflation becomes well anchored, and that becomes problematic.”

Tariffs could be a major rewiring of the domestic and global economy, says Mohamed El-Erian

The U.S. economy already is showing signs of a stagflationary impulse, perhaps not along the lines of the 1970s and early ’80s but nevertheless one where growth is slowing and inflation is proving stickier than expected.

Goldman Sachs has lowered its projection for economic growth this year to barely positive. The firm is citing the “the sharp recent deterioration in household and business confidence” and second-order impacts of tariffs as administration officials are willing to trade lower growth in the near term for their longer-term trade goals.

Federal Reserve officials last month indicated an expectation of 1.7% gross domestic product growth this year; using the same metric, Goldman projects GDP to rise at just a 1% rate.

In addition, Goldman raised its recession risk to 35% this year, though it sees growth holding positive in the most-likely scenario.

Broader economic questions

However, Luke Tilley, chief economist at Wilmington Trust, thinks the recession risk is even higher at 40%, and not just because of tariff impacts.

“We were already on the pessimistic side of the spectrum,” he said. “A lot of that is coming from the fact that we didn’t think the consumer was strong enough heading into the year, and we see growth slowing because of the tariffs.”

Tilley also sees the labor market weakening as companies hold off on hiring as well as other decisions such as capital expenditure-type investments in their businesses.

That view on business hesitation was backed up Tuesday in an Institute for Supply Management survey in which respondents cited the uncertain climate as an obstacle to growth.

“Customers are pausing on new orders as a result of uncertainty regarding tariffs,” said a manager in the transportation equipment industry. “There is no clear direction from the administration on how they will be implemented, so it’s harder to project how they will affect business.”

While Tilley thinks the concern over tariffs causing long-term inflation is misplaced — Smoot-Hawley, for instance, actually ended up being deflationary — he does see them as a danger to an already-fragile consumer and economy as they could tend to weaken activity further.

“We think of the tariffs as just being such a weight on growth. It would drive up prices in the initial couple [inflation] readings, but it would create so much economic weakness that they would end up being net deflationary,” he said. “They’re a tax hike, they’re contractionary, they’re going to weigh on the economy.”

Get Your Ticket to Pro LIVE

Join us at the New York Stock Exchange!
Uncertain markets? Gain an edge with 
CNBC Pro LIVE, an exclusive, inaugural event at the historic New York Stock Exchange.

In today’s dynamic financial landscape, access to expert insights is paramount. As a CNBC Pro subscriber, we invite you to join us for our first exclusive, in-person CNBC Pro LIVE event at the iconic NYSE on Thursday, June 12.

Join interactive Pro clinics led by our Pros Carter Worth, Dan Niles, and Dan Ives, with a special edition of Pro Talks with Tom Lee. You’ll also get the opportunity to network with CNBC experts, talent and other Pro subscribers during an exciting cocktail hour on the legendary trading floor. Tickets are limited!

Continue Reading

Trending