The Hill’s Morning Report — Americans tap savings amid higher prices

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The Hill's Morning Report — Americans tap savings amid higher prices

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Americans tap savings amid higher prices 

When families gather this week for Thanksgiving meals, sticker shock may resonate.

Inflated food prices mean consumers spend more on holiday classics after two years of steadily rising grocery expenditures. Economists and experts blame the pinch on everything from supply chain snags to the impact of war in Ukraine on grain shipments to the spread of avian influenza, which forced some poultry and turkey farms to cull flocks, thus reducing supplies for Americans’ feasts.

Poultry prices rose almost 15 percent on an annual basis in October, according to the Labor Department. Pre-made baked goods, baking mixes and frozen desserts were also at least 15 percent more expensive last month than a year ago, reports The Hill’s Sylvan Lane.

“As we’ve seen across the economy, American consumers are experiencing higher prices driven by a perfect storm of factors,” said Laura Strange, senior vice president for National Grocers Association, a trade group for independent grocery stores.

Emptier wallets also nudged Americans to plan fewer holiday gift purchases this year — an average of nine instead of 16 in 2021 (The Wall Street Journal). Charitable giving also is projected to decline as the year comes to an end. The culprit? Inflation. 

Making ends meet amid higher prices for basic commodities such as food, energy and shelter impact “excess savings,” which accumulated when Americans initially eschewed restaurant dining, travel and luxuries during the height of the pandemic. How long will those savings hold out? Experts say about nine to 12 more months (The Wall Street Journal).

The trend is worrisome. The personal savings of Americans hit $626 billion in the third quarter of 2022, reports MarketWatch. That’s down from $1.98 trillion — with a “t” — in the second quarter of 2021, and down from $4.85 trillion in the second quarter of 2020 when savings were boosted by government stimulus checks. But it’s also down from $1.41 trillion in the second quarter of 2019, well before the coronavirus pandemic shut down economic activity and, at least temporarily, many U.S. jobs.

The general outlook among consumers dimmed noticeably in November, according to the University of Michigan Survey of Consumers. It’s not hard to figure out why. Higher mortgage and interest rates, rising gasoline costs, talk of a potential recession and shrinking investment accounts contributed to a funk about the state of the economy, now and next year (CNBC).

There was one good news-bad news headline on Monday as oil prices plunged while economic woes intensified globally. It suggested that U.S. gasoline prices might drop below $3 per gallon for the first time in 18 months (Forbes).


Related Articles

The New York Times: Today, 31 states and Washington, D.C., permit sports gambling either online or in person and five more states have passed laws that will allow such betting. Americans placed an average of nearly $8 billion per month in legal sports bets in the first half of 2022, compared with less than $1 billion a month three years earlier, according to SportsHandle, a trade publication. By 2026, some analysts predict, the average could hit $20 billion a month.. 

Yahoo Finance: The Federal Reserve on Wednesday will release minutes from its two-day meeting earlier this month, offering hindsight clues about the central bank’s economic outlook. 


LEADING THE DAY

POLITICS 

Senate Minority Leader Mitch McConnell (R-Ky.) defeated Sen. Rick Scott’s (R-Fla.) bid to take his job at the helm of party leadership, but the battle isn’t over as McConnell now faces a fight with Scott and other Senate conservatives over whether to pass an omnibus spending package before Christmas. The Hill’s Alexander Bolton reports that conservatives say they’re going to renew their demand that McConnell pass a long-term stop-gap spending measure until 2023 so that the incoming House majority can negotiate the size and scope of federal spending for next year.

House Republican Leader Kevin McCarthy (Calif.) is siding with Scott and Sens. Ted Cruz (Texas) and Mike Lee (Utah) — who want to block a year-end spending bill. But that will delay funding for Ukraine and could throw Congress’ annual defense authorization bill into limbo.  

The Wall Street Journal: A GOP House majority could shield industries from new taxes, regulations.

Politico: More moderate House Republicans are taking their turn to plot their leverage in next year’s paper-thin House majority. And even Democratic centrists are discussing the topic.

Looking forward to 2024, a new Harvard CAPS-Harris poll released exclusively to The Hill on Monday found that 20 percent of respondents said they believed former President Trump was the biggest loser in the midterms, while 14 percent said MAGA Republicans were the biggest losers. The findings add to questions within the party about Trump’s strength heading into 2024 after many of his endorsed candidates lost up and down the ballot earlier this month, fueling speculation that his grip on the party is weakening, writes The Hill’s Julia Manchester.

Trump emerges from the election a far weaker candidate for re-election than before the midterms,” said Mark Penn, the co-director of the Harvard CAPS-Harris poll. “He remains under water in his personal rating of 44 percent, is seen as having backed losing candidates and now has the possibility of having to fight a real primary in the Republican parties as he drops below 50 percent in a Republican primary. That’s why voters see him as the biggest loser.” 

The Hill: Trump’s record in governor’s race endorsements: a near-even split.

MSNBC: Former acting Solicitor General Neal Katyal: “I expect Trump will be indicted by this special counsel.”

The New York Times: Prosecution rests as Trump company trial moves faster than expected.

GOP rising star and Florida Gov. Ron DeSantis, meanwhile, is already closing the gap with Trump in the Harvard-CAPS poll as he inches closer to a 2024 White House bid. Since last month, the Florida governor’s standing in a hypothetical 2024 Republican primary improved by 11 points, bringing him up to 28 percent (The Hill).

“Month after month DeSantis has been rising and now, he is cutting significantly into Trump,” Penn told The Hill. “If they both run, this will be quite a race and Trump could well lose.”

The Wall Street Journal: DeSantis, others draw distinctions with Trump in 2024 GOP nomination race.

On Dec. 1, former President Obama will hold a rally in Atlanta for Georgia Sen. Raphael Warnock (D), who faces off against Republican challenger Herschel Walker in a runoff election on Dec. 6 (The Atlanta Journal-Constitution).

A growing chorus of Republicans are pleading with the GOP to rebuild its once-robust early and mail voting programs, writes The Hill’s Max Greenwood, and are blaming the party’s reluctance to embrace such efforts for a lackluster showing in the 2022 midterm elections.

Democrats drastically outpaced Republicans in pre-Election Day voting in key battleground states this year, allowing the party and its candidates to run up a massive vote advantage heading into Nov. 8, whereas the GOP banked on heavy Election Day turnout to overpower Democrats. But after the so-called red wave that Republicans had predicted ahead of the midterms failed to materialize, a growing number of influential Republican leaders and operatives say the party needs to compete with Democrats more aggressively when it comes to early and mail voting.

CONGRESS

Because of ties to China and worries about data surveillance, Senate Intelligence Committee Chairman Mark Warner (D-Va.) has warned parents to reconsider the video-sharing app TikTok, popular among children and young adults on smartphones. The Biden administration is considering allowing the app to continue to be used in the United States under a unique agreement, report WTOP and The New York Times.

“All of that data that your child is inputting and receiving is being stored somewhere in Beijing,Warner told Fox News Sunday

Committee member Sen. Tom Cotton (R-Ark.) also urged U.S. users to take a closer look. “It’s not just the content you upload to TikTok, but all the data on your phone — other apps, all your personal information, even facial imagery, even where your eyes are looking on your phone,” he said on Fox.

Sen. Marco Rubio (R-Fla.), the ranking committee member, is sponsoring legislation that would ban TikTok from use in this country.

Warner and Rubio this year urged the Federal Trade Commission to investigate TikTok and its Chinese-based parent company, ByteDance.

Sen. Joe Manchin (D-W.Va.) — who continues to search for enough supporters this year for proposed changes to the federal permitting process for fossil fuel infrastructure projects after coming up empty-handed in September — faces some key Republican opposition to his push to use the National Defense Authorization Act (NDAA) as a vehicle (Roll Call). 

Sen. Tim Kaine (D-Va.) recently said he was hopeful Congress would use the lame-duck period to approve the defense authorization bill and an omnibus spending bill to keep the government funded beyond Dec. 16 through Sept. 30, 2023 (13NewsNow).

“We will likely have a vote on the NDAA and I think we can have a vote the week after the Thanksgiving recess when we get back,” he said last week. “Then, the issue is, do we get a full omnibus budget or do we have another continuing resolution? I have a high degree of confidence we’re going to get an omnibus budget.”

Additional U.S. aid to Ukraine may have to wait for debate in Congress next year, according to some Senate Republicans. But Politico reports that at a security forum taking place in Canada, congressional Republican leaders sound ready to steamroll conservative colleagues who want to stop funding Ukraine’s war effort, a move that’s sure to intensify the GOP divide over U.S. support for Kyiv. Based on interviews at the pro-democracy gathering, lawmakers are ready to allocate well more than the $38 billion the Biden administration requested for Ukraine’s military and economic needs as part of a year-end governing funding bill.

“There are some very loud voices over there,” Sen. Jim Risch (R-Idaho) said during an interview with Politico, referring to conservatives who oppose more assistance for Kyiv. “It doesn’t worry me as much as you wish it wasn’t there … If we were on the other side of this, they’d be pounding the table saying, ‘Send more money to Ukraine.’”

The Hill: Rep. Carolyn Maloney (D-N.Y.) may have improperly solicited a sought-after ticket to the exclusive Metropolitan Museum of Art’s Costume Institute Benefit, according to the Office of Congressional Ethics. The congresswoman, who will leave the House at the end of the year, denies any breach of House rules or federal laws. Her lawyer said she did not explicitly solicit an invitation. The New York Times looks at how Maloney’s 2016 ticket led to an ethics inquiry.


IN FOCUS/SHARP TAKES

ADMINISTRATION

Vice President Harris on Tuesday will visit the Philippine island chain of Palawan on the edge of the disputed South China Sea at the end of a weeklong trip in Asia, in a move that could raise tensions with Beijing.

China has staked a claim on a majority of the South China Sea, and the Philippines lodged diplomatic protests against China’s maritime activities in the region. Local fishing communities have reported dwindling fish availability and displacement from their traditional fishing grounds amid hostilities from the Chinese coast guard. Harris’ trip signals U.S. support for the Philippines, and she is undertaking the diplomatic mission at a time when tensions with China are rising over trade, Taiwan, human rights and other matters (The Washington Post).

Reuters: Harris affirms “unwavering” U.S. defense commitment to Philippines.

Bloomberg News: U.S. presses China to ease up on Taiwan as defense chiefs meet.

INTERNATIONAL   

Soccer teams representing seven European nations at the World Cup in Qatar announced Monday that their captains won’t wear LGBTQ armbands after FIFA, the organizer, said players sporting them would be penalized. The captains of England, Wales, Belgium, Denmark, Germany, the Netherlands and Switzerland had planned to wear OneLove rainbow armbands to promote diversity and inclusion.

“We are very frustrated by the FIFA decision which we believe is unprecedented,” the teams said in a statement. “As national federations, we can’t put our players in a position where they could face sporting sanctions including bookings.”

Qatar has come under scrutiny in the lead-up to the World Cup regarding human rights, including concerns over the conditions of migrant workers and the country’s conservative stance on LGBTQ people (The Washington Post).

The Athletic: Human rights at the Qatar World Cup — a guide to everything you need to know.

The Washington Post: What should LGBTQ soccer fans expect at the Qatar World Cup?

Reuters: After months of widespread protests in Iran, players opt not to sing their national anthem at the World Cup.

Ukraine is working to evacuate civilians from recently liberated areas of the Kherson and Mykolaiv regions, amid fears that the damage to infrastructure caused by the war is too severe for people to endure the winter. The evacuations come just over a week after Ukraine retook the city of Kherson — close to the front line with Russia — and areas around it (The Guardian).

BBC: Millions of lives under threat in Ukraine this winter.

CNBC: Ukraine civilian death toll from war tops 6,500; NATO assembly seeks special tribunal on Russian aggression.

The New York Times: For Ukraine, so much unexpected success, and yet so far to go.

At least 162 people were killed when a powerful earthquake struck Indonesia’s main island of Java on Monday, injuring hundreds and shaking tall buildings in the capital, Jakarta, which is 60 miles away. The magnitude 5.6 earthquake struck near the city of Cianjur, and many people are believed to be trapped beneath the rubble, leading to fears that the death toll will sharply increase (The New York Times).

Developed countries agreed to pay for climate damages suffered by their developing counterparts at the U.N. COP27 conference, but the newly agreed “loss and damage” fund lacks both details and actual funding. This leaves critics skeptical about whether the significant symbolic breakthrough will make a difference on the ground (The Hill). 


OPINION

■ Elon Musk woos Trump for an ugly Twitter codependency, by Timothy O’Brien, executive editor, Bloomberg Opinion. https://bloom.bg/3ERCEHJ 

■ Justice is delayed as Mr. Smith goes to Washington, by Jennifer Taub, contributor, The Washington Monthly. https://bit.ly/3Az236t


WHERE AND WHEN

👉 The Hill: Share a news query tied to an expert journalist’s insights: The Hill launched something new and (we hope) engaging via text with Editor-in-Chief Bob Cusack. Learn more and sign up HERE.

The House convenes for a pro forma session at 9:30 a.m. ​​

The Senate will reconvene for a pro forma session at 5:30 p.m. 

The president and first lady Jill Biden will travel to Nantucket, Mass., where they will celebrate Thanksgiving with family.

The vice president is in the Philippines and will fly to Los Angeles to spend the holiday.

Secretary Blinken is in Qatar. He will greet staff from the U.S. Embassy in Doha at 10 a.m. local time, then meet with Qatari officials, including Deputy Prime Minister and Foreign Minister Sheikh Mohammed bin Abdulrahman Al-Thani. Blinken will participate today in a working lunch with his counterparts during the U.S.-Qatar Strategic Dialogue and then join bin Abdulrahman Al-Thani in the afternoon for a joint press conference held in Doha. 


ELSEWHERE

TRANSPORTATION

Members of a key rail union on Monday announced their rejection of a tentative contract agreement negotiated by the Biden administration, raising a risk of a walkout on Dec. 9 without additional intervention, including possibly by Congress (The Hill).

Train and engine workers at the Sheet Metal, Air, Rail and Transportation Workers’s transportation division (SMART-TD) narrowly voted down the deal, the union announced. A strike amid the holiday shopping season would pose supply chain challenges because railroads transport around one-third of U.S. freight, including food, packaged goods, fuel and car parts that cannot be shipped by other means. 

“This can all be settled through negotiations and without a strike,” SMART-TD President Jeremy Ferguson said in a statement. “A settlement would be in the best interests of the workers, the railroads, shippers and the American people.”

PANDEMIC & HEALTH 

🏈 National Football League games attended by fans during the 2020-21 season were linked with increased COVID-19 case rates in the counties where they were held as well as in counties surrounding the stadiums, according to research. A study published in JAMA Network Open shows spikes of confirmed cases were more prominent when games attracted more than 20,000 attendees, while those with fewer than 5,000 fans were not associated with higher case rates.

The findings suggest “large events should be handled with extreme caution during public health event(s) where vaccines, on-site testing, and various countermeasures are not readily available to the public.” In March 2020, the NFL made the controversial decision to hold its 2020-21 professional season during the ongoing pandemic. Teams underwent continuous testing and contact tracing and through these measures the league was able to maintain relatively low rates of infection among players and staff, JAMA authors explained, but less is known about how the season affected fans who attended the games (The Hill).

Information about COVID-19 vaccine and booster shot availability can be found at Vaccines.gov.

Time: What to do if you get COVID-19 during the holidays.

The Los Angeles Times: How to stay safe at Thanksgiving as cases of COVID-19, RSV and the flu rise.

The Hill: One in seven parents has not talked about vaccines with their child’s doctor, a poll shows.

The Washington Post: Coronavirus variants are dodging antibody treatments. New lab-made options may help.

🦠 In China, where the economic impacts of COVID-19 remain a global concern, Beijing on Tuesday shut parks, shopping centers and museums amid a new surge in infections while more cities in China resumed testing for the coronavirus (Reuters). China Monday reported 28,127 new local cases nationally, nearing its daily peak from April, with infections in the southern city of Guangzhou and the southwestern municipality of Chongqing accounting for about half of Monday’s reported cases.

Total U.S. coronavirus deaths reported as of this morning, according to Johns Hopkins University (trackers all vary slightly): 1,077,225. Current U.S. COVID-19 deaths are 2,222 for the week, according to the Centers for Disease Control and Prevention (CDC). (The CDC shifted its tally of available data from daily to weekly, now reported on Fridays.)


THE CLOSER

And finally … 🦃 Chocolate and Chip, celebrity wild turkeys, won a sweet deal on Monday: Thanksgiving pardons from the president. 

During a ceremony on a crisp morning outside the White House, Biden offered a spotlight to his feathery guests (and extended his microphone to Chocolate), cracking wise about “fowl play,” according to reporters, who tried without success to pry news nuggets out of the president.

The majestic gobblers, raised in North Carolina, offered some audible retorts as the Marine Band played a version of “Freebird.” 

The fanciful tradition in which U.S. presidents serve mercy to turkeys, according to the White House Historical Association, has been traced to President Abraham Lincoln‘s 1863 decision, recorded in an 1865 dispatch by White House reporter Noah Brooks, who noted, “A live turkey had been brought home for the Christmas dinner, but [Lincoln’s son Tad] interceded in behalf of its life. . . . [Tad’s] plea was admitted and the turkey’s life spared.” 

Attentive Morning Report quizzers will recall that the first official White House pardon did not occur until 1989, when President George H. W. Bush issued a presidential pardon for a turkey he was given that year.

Monday’s VIP ceremony attracted North Carolina Gov. Roy Cooper (D) and North Carolina first lady Kristin Cooper, as well as Rep. Dan Bishop (R-N.C.) and Ronald Parker, chairman of the National Turkey Federation. 


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