Income inequality wider in tough times U.S. seeks drop in tariffs overseas

The Trump administration plans to carry on with its confrontational approach to world trade, pressuring other countries to lower their tariffs on U.S. products and perhaps making it harder for imports to enter the United States duty free.

In testimony before Congress Wednesday, U.S. Trade Representative Robert Lighthizer said the administration would push for more change at the World Trade Organization, the Geneva-based enforcer of global trade rules that the administration has accused of anti-U.S. bias. He described the WTO as “a mess” that has failed the United States and the international trading system.

Under WTO rules, Lighthizer complained, other countries levy tariffs — import taxes — “far above” the tariffs the U.S. imposes.

Lighthizer’s comments suggest that “he wants to force others to lower their tariffs to our levels, and he will threaten to raise ours to theirs if they do not,” said William Reinsch, a former U.S. trade official now at the Center for Strategic and International Studies in Washington.

But Reinsch noted that the United States agreed to the existing tariffs in past negotiations.

Federal Reserve Chairman Jerome Powell said one of the most important things the central bank can do to fight income inequality is to get back to full employment.

“There is nothing like a tight labor market for low income communities,” Powell said during testimony before the House Financial Services Committee.

He said the central bank wanted to do everything possible with its interest-rate policies “to get back as quickly as we can to a tight labor market.”

The unemployment rate stood at a 50-year low of 3.5% in February before efforts to contain the coronavirus pandemic shut down wide parts of the U.S. economy. The jobless rate surged and stood at 13.3% in May.

Hertz suspends stock offering

Hertz says it has put its plan to sell $500 million worth of stock on hold because the offering is being reviewed by the Securities and Exchange Commission.

Trading in shares of the car rental company, which filed for bankruptcy protection last month, were halted before the announcement and then later resumed trading.

Hertz said Monday that it received approval from the bankruptcy court to proceed with the stock sale, which would be an unusual move for a company in the throes of a bankruptcy reorganization and a very risky proposition for investors

Chrysler, Peugeot merger questioned

Regulators in Europe plan to take a longer look at the proposed merger of Fiat Chrysler Automobiles and the maker of Peugeot, raising concerns about the potential negative impact on competition.

European Commission Executive Vice President Margrethe Vestager, in remarks posted on the commission’s website Wednesday, pointed specifically at the commercial van sector as an area of competitive concern should FCA and PSA Group become one.

“We will carefully assess whether the proposed transaction would negatively affect competition in these markets and ensure that a healthy competitive landscape remains for all the individuals and businesses relying on commercial vans for their activities,” Vestager said in a news release.

The commission noted that either FCA or PSA Group is the market leader in light commercial vehicles in many countries, and a merger “would remove one of the main competitors.”

Netflix founder aids black colleges

Netflix CEO Reed Hastings and his wife, Patty Quillin, are donating $120 million toward student scholarships at historically black colleges and universities.

The couple is giving $40 million to each of three institutions: the United Negro College Fund, Spelman College and Morehouse College. The organizations said it is the largest individual gift in support of student scholarships at HBCUs.

Hastings has a history of supporting educational causes, including charter schools. He launched a $100 million education fund in 2016, beginning with money toward college scholarships for black and Latino students.

Hastings said now is the time when “everyone needs to figure out” how to contribute to solving racism. He said HBCUs have been resilient “little-known gems” for black education.