State Farm discontinuing 72,000 home policies in California in latest blow to state insurance market
Associated Press – March 21, 2024
Homes leveled by the Camp Fire line a development on Edgewood Lane in Paradise, Calif., on Nov. 12, 2018. State Farm will discontinue coverage for 72,000 houses and apartments in California starting summer 2024, the insurance giant said. The Illinois-based company, California’s largest insurer, cited soaring costs, the increasing risk of catastrophes like wildfires and outdated regulations as reasons it won’t renew the policies on 30,000 houses and 42,000 apartments, the Bay Area News Group reported Thursday, March 21, 2024. (AP Photo/Noah Berger, File)Residences leveled by a wildfire in Paradise, Calif., are seen on Nov. 15, 2018. State Farm will discontinue coverage for 72,000 houses and apartments in California starting summer 2024, the insurance giant said. The Illinois-based company, California’s largest insurer, cited soaring costs, the increasing risk of catastrophes like wildfires and outdated regulations as reasons it won’t renew the policies on 30,000 houses and 42,000 apartments, the Bay Area News Group reported Thursday, March 21, 2024. (AP Photo/Noah Berger, File)
SACRAMENTO, Calif. (AP) — State Farm will discontinue coverage for 72,000 houses and apartments in California starting this summer, the insurance giant said this week, nine months after announcing it would not issue new home policies in the state
The Illinois-based company, California’s largest insurer, cited soaring costs, the increasing risk of catastrophes like wildfires and outdated regulations as reasons it won’t renew the policies on 30,000 houses and 42,000 apartments, the Bay Area News Group reported Thursday.
“This decision was not made lightly and only after careful analysis of State Farm General’s financial health, which continues to be impacted by inflation, catastrophe exposure, reinsurance costs, and the limitations of working within decades-old insurance regulations,” the company said in a statement Wednesday.
“State Farm General takes seriously our responsibility to maintain adequate claims-paying capacity for our customers and to comply with applicable financial solvency laws,” it continued. “It is necessary to take these actions now.”
The move comes as California’s elected insurance commissioner undertakes a yearlong overhaul of home insurance regulations aimed at calming the state’s imploding market by giving insurers more latitude to raise premiums while extracting commitments from them to extend coverage in fire-risk areas, the news group said.
The California Department of Insurance said State Farm will have to answer question from regulators about its decision to discontinue coverage.
“One of our roles as the insurance regulator is to hold insurance companies accountable for their words and deeds,” Deputy Insurance Commissioner Michael Soller said. “We need to be confident in State Farm’s strategy moving forward to live up to its obligations to its California customers.”
It was unclear whether the department would launch an investigation.
Last June, State Farm said it would stop accepting applications for all business and personal lines of property and casualty insurance, citing inflation, a challenging reinsurance market and “rapidly growing catastrophe exposure.”
The company said the newly announced cancellations account for just over 2% of its California policies. It did not say where they are located or what criteria it used to determine that they would not be renewed.
Trump Told Pence Certifying Election Would Be ‘Career Killer,’ Valet Testified
President Donald J. Trump warned his vice president against failing to overturn the 2020 election results, according to an account by the White House valet by his side on Jan. 6.
By Luke Broadwater and Maggie Haberman – March 21, 2024
President Donald J. Trump speaking during the rally on the Ellipse that preceded the attack of Jan. 6, 2021.Credit…Pete Marovich for The New York Times
The threat from President Donald J. Trump to his vice president, Mike Pence, was clear and direct: If you defy my effort to overturn the 2020 election by certifying the results, your future in Republican politics is over.
“Mike, this is a political career killer if you do this,” Mr. Trump told Mr. Pence by phone on the morning of Jan. 6, 2021, according to the White House valet who was with the president for much of the day and told Congress he had overheard the conversation.
The testimony of Mr. Trump’s valet, provided to the now-defunct House Jan. 6 Committee in 2022 but not previously released publicly, offers a rare firsthand look into the former president’s behavior in the hours before, during and after a mob of his supporters stormed the Capitol seeking to halt the certification of President Biden’s victory.
In the valet’s account, laid out in a transcript obtained by The New York Times, an agitated Mr. Trump pressured Mr. Pence to overturn the election and stewed about Mr. Pence’s refusal for hours after violence engulfed Congress. Told that a civilian had been shot outside the House chamber amid the mob attack, he recalled, Mr. Trump appeared unconcerned.
“I just remember seeing it in front of him,” the valet said of a note card Mr. Trump was given bearing news of the casualty as he watched the riot unfold on television. “I don’t remember how it got there or whatever. But there was no, like, reaction.”
As unflattering as portions of the aide’s testimony were to Mr. Trump, he did not confirm some of the more graphic and damning claims made by witnesses in front of the Jan. 6 committee.
For instance, the valet said he did not remember hearing Mr. Trump use vulgar language in describing his view that Mr. Pence was a coward, or agree with rioters who were chanting for Mr. Pence to be hanged. And he did recall hearing the president ask about contacting top officials on the possibility of dispatching the National Guard to Capitol Hill — though there is no indication that he ever followed through.
Vice President Mike Pence officiating over the electoral vote confirmation on the night of Jan. 6, 2021. A White House valet testified that President Donald J. Trump had pressured Mr. Pence to overturn the election and stewed about his refusal to do so for hours after violence broke out.Credit…Erin Schaff/The New York Times
“Did you hear the president say that?” a staff investigator for the House Jan. 6 committee asked the valet, inquiring about reports that Mr. Trump had called Mr. Pence an expletive meant to refer to a wimp.
“I did not — no, sir,” the valet responded.
Mr. Trump himself has not disputed using that language, and Ivanka Trump’s chief of staff testified that Ms. Trump had told her that Mr. Trump had an “upsetting” conversation with Mr. Pence and that the president had accused him of cowardice, using “the ‘p’ word.” The valet also acknowledged that he wasn’t with the president at all times, and that he had left the Oval Office during a portion of Mr. Trump’s call with Mr. Pence.
At another point, the valet was asked whether he remembered “any comments that the president or anybody around him made with respect to those chants, ‘Hang Mike Pence.’ ”
He answered that he recalled the refrain, “but I don’t remember any comments from the president or anybody on staff.”
Mr. Trump has previously defended the rioters’ use of the chant, telling ABC News’ Jonathan Karl that “the people were very angry,” and calling that anger “common sense.”
House Republicans furnished the transcript to The Times after they obtained it from the White House, which was reviewing and redacting it along with a handful of others provided by the House Jan. 6 committee. The copy reviewed by The Times is heavily redacted, and the valet is referred to simply as “a White House employee.”
For more than a year since winning control of the House, Republicans have been investigating the work of the Jan. 6 committee, looking for signs of bias. They have suggested that the panel did not release certain transcripts because they contradict some of the testimony from a prominent witness, Cassidy Hutchinson, who served as an aide to Mark Meadows, the White House chief of staff at the time. While much of her testimony has been corroborated, Ms. Hutchinson acknowledged that in some cases she was relying on secondhand or thirdhand accounts of events in her testimony to the panel.
“It took a whole lot of work to get these,” Representative Barry Loudermilk, a Republican of Georgia who is leading the G.O.P.’s investigation, said of the transcript of the valet’s testimony and a batch of others he obtained from the White House and the Department of Homeland Security.
Mr. Loudermilk conceded there was “some testimony in it that may not be favorable to Trump,” but he added: “We’re putting it all out there, not doing what the select committee did, and putting things out there that will be favorable to our side.”
In court filings, though, federal prosecutors who have charged Mr. Trump with crimes for his role in the effort to overturn the 2020 election have said some of the committee’s transcripts were subject to confidentiality agreements, and those were sent to the White House and Secret Service for review and redactions before they could be released. Federal prosecutors said they had provided these “sensitive, nonpublic transcripts” to Mr. Trump and his legal team, according to a court filing last year.
Trump supporters fighting with security forces outside the Capitol on Jan. 6, 2021. Credit…Kenny Holston for The New York Times
Representative Bennie Thompson, the Mississippi Democrat who chaired the House Jan. 6 committee, said nothing in the valet’s account changes the essential facts of what his panel uncovered about Mr. Trump’s role in summoning supporters to Washington to challenge the election results and doing nothing to stop their attack at the Capitol.
“Despite Mr. Loudermilk’s attempts to rewrite the violent history of Jan. 6, the facts laid out in the select committee’s final report remain undisputed — and nothing substantive was left out nor hidden,” he said. “While the valet did not witness everything that happened in the White House that day, the testimony confirms Trump’s indifference to the violence and his anger at Vice President Pence for performing his duty under the Constitution.”
The valet also shed more light on how Mr. Trump’s White House had devolved into dysfunction during his final weeks in office. He said Mr. Trump was often “frustrated,” “upset” and “mad” at Pat A. Cipollone, the White House counsel who frequently served as a check on some of the former president’s more extreme impulses — so much so that the valet asked aides to keep the lawyer away from the president at lunchtime to avoid upsetting him.
The valet also confirmed Mr. Trump’s penchant for tearing up documents and other material given to him, which by the law governing presidential records are supposed to be preserved.
“That’s typically what he would do once he’s finished with a document,” the valet said of Mr. Trump. “But that was his sign of, like, he was done reading it, and he would just throw it on the floor. He would tear everything — tear newspapers, tear pictures.”
The valet also testified that Mr. Trump expressed an interest on Jan. 6 in speaking to General Mark A. Milley, then the chairman of the Joint Chiefs of Staff, and Speaker Nancy Pelosi about sending the National Guard to the Capitol — a step that has been a matter of much dispute given the hourslong delay in the troops’ eventual arrival.
Mr. Loudermilk said it was that aspect of the valet’s account that caught his eye.
“That stood out to me like, ‘OK, this is totally in contrast to what we’ve seen, and I’ve never seen this before.’ And so that’s when we started digging,” Mr. Loudermilk said.
Ultimately, though, Mr. Trump made no such call, General Milley told the House panel.
The valet also testified about the contrast between the reaction of White House staffers and Mr. Trump as the riot was underway.
After he returned from giving a speech to a raucous crowd at the Ellipse, Mr. Trump was informed that “they’re rioting down at the Capitol,” the valet recalled.
“And he was, like, ‘Oh, really?’ And then he was like, ‘All right, let’s go see,’” and went to watch the violence on television.
The valet spoke of a sense of “disbelief” and then panic that fell over the staff.
“It was like, ‘What are we going to do?’ ” He said officials were “running around pretty much — running from office to office and all over the place,” while Mr. Trump appeared calm.
Hours later, though, the president was still stewing about Mr. Pence.
“Me and him,I think close to the end of the day, he just mentioned that Mike let him down,” the valet said. “And that was it.”
Luke Broadwater covers Congress with a focus on congressional investigations.
Maggie Haberman is a senior political correspondent reporting on the 2024 presidential campaign, down ballot races across the country and the investigations into former President Donald J. Trump.
Takeaways From Trump’s Indictment in the 2020 Election Inquiry
Four charges for the former president. Former President Donald Trump was charged with four counts in connection with his widespread efforts to overturn the 2020 election. The indictment was filed by the special counsel Jack Smith in Federal District Court in Washington. Here are some key takeaways:
The indictment portrayed an attack on American democracy. Smith framed his case against Trump as one that cuts to a key function of democracy: the peaceful transfer of power. By underscoring this theme, Smith cast his effort as an effort not just to hold Trump accountable but also to defend the very core of democracy.
Trump was placed at the center of the conspiracy charges. Smith put Trump at the heart of three conspiracies that culminated on Jan. 6, 2021, in an attempt to obstruct Congress’s role in ratifying the Electoral College outcome. The special counsel argued that Trump knew that his claims about a stolen election were false, a point that, if proved, could be important to convincing a jury to convict him.
Trump didn’t do it alone. The indictment lists six co-conspirators without naming or indicting them. Based on the descriptions provided, they match the profiles of Trump lawyers and advisers who were willing to argue increasingly outlandish conspiracy and legal theories to keep him in power. It’s unclear whether these co-conspirators will be indicted.
Trump’s political power remains strong. Trump may be on trial in 2024 in three or four separate criminal cases, but so far the indictments appear not to have affected his standing with Republican voters. By a large margin, he remains his party’s front-runner in the presidential primaries.
Putin is ready to squeeze Russia’s outrageously wealthy elite to fund a future war with NATO, analysts say
Tom Porter – March 21, 2024
Putin is ready to squeeze Russia’s outrageously wealthy elite to fund a future war with NATO, analysts say
Vladimir Putin is moving to squeeze Russia’s wealthy elite, a think tank said.
He needs the money to boost military spending, analysts said, and is prepared to ruffle feathers.
Analysts said it’s a sign Putin’s readying for a war with NATO.
Russian President Vladimir Putin is preparing to squeeze Russia’s wealthy elite to fund a conflict with NATO, a think tank said.
The Institute for the Study of War, a US think tank, drew attention to two recent speeches in which Putin voiced rare criticism of the rich loyalists who’ve been the backbone of his power.
In a Tuesday meeting with leaders from Russia’s lower parliament, the Duma, Putin set out the priorities for his new term in office.
He urged officials to “act in the interest of the state instead of corporations or parties.”
The remarks could be seen as a thinly veiled swipe at the widespread corruption that characterizes modern Russia (and from which, Putin’s critics allege, he has also handsomely benefited).
In similar remarks given about a month before to Russia’s Federation Council, Putin said that “individuals who ‘lined their pockets’ in the 1990s” — who are among its crop of oligarchs — are not the real elite.
The actual elite, he said, “are workers and military servicemen who proved their loyalty to Russia.”
The ISW said the remarks indicated that Putin was sending a warning shot to the “siloviki,” the wealthy ex-security officials who form an important part of his power base.
Taken together, the remarks pick away at the long-standing implicit bargain analysts say Putin struck with the country’s wealthy, agreeing to leave their riches untouched in exchange for political support.
The ISW said Putin was changing tack, “signaling that Russia’s long-term financial stability will require imposing at least some pain on some wealthy industrialist siloviki,” it said.
Putin appears willing to risk his accord with his wealthy backers to boost preparations “for a potential future large-scale conflict with NATO,” the ISW said.
The report comes after a series of warnings from Western leaders that Putin might be preparing for a war with the West.
Denmark’s defense minister said it could come in as little as five years.
Analysts say that the Russian president has long harbored ambitions to seize back control of territory in northern and eastern Europe that was once part of the Soviet Union and that victory in Ukraine could embolden him.
But fulfilling that ambition would not come cheap.
Who are the siloviki?
When Putin came to power in 1999, he moved to punish some who had grown wealthy during the liberalization of Russia in the ’90s.
Specifically, he took on those who challenged him, such as the oil magnate Mikhail Khodorkovsky.
A new faction expanded its power under Putin, the siloviki.
Some were handed control over state energy companies and corporations in an apparent exchange for their loyalty, becoming vastly wealthy.
The US sought to undermine Putin’s power by targeting the assets of Russia’s wealthy loyalists in a series of sanctions in the wake of the Ukraine war’s start.
But the Russian economy has managed to withstand the worst effects of the fallout from the Ukraine war, and the loyalty of Putin’s wealthy backers has mostly held firm.
Some members of the Russian business elite were critical of the Ukraine war, fearing the effects on Russia’s economy and society. But, The Guardian reported, many have since resigned themselves to the war and Putin’s continued rule.
And it’s not just Putin’s willingness to shake up his relationship with his wealthy loyalists that indicates his readiness to rapidly expand Russia’s military.
Sergei Shoigu, Russia’s defense minister, announced plans Wednesday to massively expand Russia’s armed forces by creating two new armies.
“Several Russian financial, economic, and military indicators suggest that Russia is preparing for a large-scale conventional conflict with NATO,” the ISW said, “not imminently but likely on a shorter timeline than what some Western analysts have initially posited.”
A caucus representing most House Republican lawmakers endorsed a 15-week national abortion ban on Wednesday. The announcement came one day after former President Donald Trumpindicated that he could support a 15-week abortion ban.
The Republican Study Committee (RSC), which includes nearly 80 percent of all House Republicans, released its 2025 budget proposal on Wednesday, titled “Fiscal Sanity to Save America.” Despite being billed as a budget plan, it is a highly ideological document.
“The gift of life is precious and should be protected,” the document states, adding that the “RSC celebrates the Dobbs v. Jackson Women’s Health Organization decision.” In that case, the Supreme Court overturned federal protections for abortion rights, using the 6-3 conservative supermajority that Trump helped create.
The RSC document goes further: It endorses a 15-week national abortion ban, as well as legislation that could eliminate access to in vitro fertilization, or IVF. In an email to reporters Wednesday night, the Biden White House tied the document to Trump, saying that the “Trump Republican budget would ban abortion nationwide [and] rip away IVF access.”
The RSC budget “applauds” a series of “measures designed to advance the cause of life,” including the “Protecting Pain-Capable Unborn Children from Late-Term Abortions Act, which would prohibit abortions after 15 weeks.”
The proposal meshes with comments Trump made Tuesday suggesting he could back a 15-week national abortion ban. “The number of weeks, now, people are agreeing on 15, and I’m thinking in terms of that, and it’ll come out to something that’s very reasonable,” he said. “But people are really — even hard-liners are agreeing, seems to be 15 weeks, seems to be a number that people are agreeing at. But I’ll make that announcement at the appropriate time.”
The budget plan from the RSC also applauds the “Life at Conception Act, which would provide 14th amendment protections at all stages of life.” As CNN reported last month, the bill “does not include a carveout for IVF,” and “reproductive rights activists worry the legislation — if ever passed — would have a chilling effect on IVF clinics.”
The RSC’s support for the Life at Conception Act comes in the wake of a controversial Alabama Supreme Court decision finding that embryos created using IVF are people in the eyes of the law and covered under the state’s wrongful death statute.
Conservative House Republicans unveil plan to attack Biden admin policies. Here’s what they would target
Ken Tran, USA TODAY – March 20, 2024
WASHINGTON – The Republican Study Committee, the largest caucus made up of House Republicans, unveiled a course on Wednesday for dismantling many of President Joe Biden’s signature policies – though the proposal’s chances are slim for now.
As part of the RSC’s annual budget, first shared with USA TODAY, the group is pushing to roll back or loosen many of the Biden administration’s major federal rules and regulations.
Republicans in the group are taking aim at a wide range of policies, including initiates to combat climate change, a Defense Department policy reimbursing travel for service members who must cross state lines to receive abortions and Justice Department gun control regulations. In the budget, Republicans call for a return to former President Donald Trump’s approach during his term in office.
Rep. Kevin Hern, R-Okla., speaks to reporters after dropping out of the race for Speaker of the House, and endorsed Rep. Mike Johnson, R-La., as House lawmakers seek to elect a new speaker in Washington.
“The RSC Budget would take bold and necessary action to rein in the Biden Administration’s dangerous regulatory regime, returning to the example set by former President Donald Trump,” the proposal reads, accusing Biden of implementing “a radical” agenda.
The conservative group, led by Rep. Kevin Hern, R-Okla., released their plan after Biden announced a federal budget earlier this month with an eye toward new social programs for housing, health care and child care.
But the budget framework from the GOP group, which comprises almost 80% of the House Republican conference, offers a preview into what policy priorities Republicans are itching to advance should they reclaim the White House, the Senate and hold on to the House.
The budget doesn’t just endorse a slate of GOP-led legislation. It also includes pushes meant to curtail the Biden White House’s executive authority “to restore the appropriate balance of power” between Congress and the presidency.
Included is Rep. Kat Cammack’s Regulations from the Executive in Need of Scrutiny Act, or REINS ACT, that would require Congress to sign off on any rule from a presidential administration that has an economic impact of $100 million or more. The bill passed the House last year on a party-line vote, though it has little chance in the Democratic-controlled Senate.
The funds are typically centered around “socially responsible companies” that focus on addressing environmental and social problems. Republicans have derided the rule as too “woke,” but the rule does not require investment into ESG funds.
Today, the RSC’s proposal is simply a conservative wish list, actions that have little chance of becoming law while Democrats control the Senate and Biden remains in the White House.
But as the presidential election and congressional races across the country pick up steam, the plan could reflect how Republicans are seeking to rally voters in the fall.
“It’s on us to reign in the executive branch and rescind their authority to make decisions that belong to the legislature,” Hern said in a statement to USA TODAY. “Our constituents sent us here to provide a check on the White House. We can’t be passive about it, it’s time for results.”
US economy on solid ground as weekly jobless claims fall, home sales surge
Lucia Mutikani – March 21, 2024
WASHINGTON (Reuters) – The number of Americans filing new claims for unemployment benefits unexpectedly fell last week, while sales of previously owned homes increased by the most in a year in February, signs the economy remained on solid footing in the first quarter.
That was underscored by other data on Thursday showing business activity stable in March, though inflation picked up. Even a gauge of future economic activity turned positive in February for the time in two years. The United States continues to outshine its global peers, thanks to labor market resilience.
The Federal Reserve on Wednesday left interest rates unchanged, with policymakers upgrading their growth forecasts for this year and indicating they still expected to lower borrowing costs three times by year end. Economists said the upbeat economic reports made it more unlikely that the U.S. central bank would start cutting rates before June.
“Companies are not laying off workers and the labor market remains relatively strong,” said Christopher Rupkey, chief economist at FWDBONDS in New York. “And now there are signs of life for existing home sales. This makes easing monetary policy at this juncture more problematic.”
Initial claims for state unemployment benefits dropped 2,000 to a seasonally adjusted 210,000 for the week ended March 16, the Labor Department said. Economists polled by Reuters had forecast 215,000 claims in the latest week.
Claims have been mostly bouncing around in a 200,000-213,000 range since February. Despite a flurry of high-profile layoffs at the start of the year, employers have largely been hoarding labor after struggling to find workers during and after the COVID-19 pandemic.
Unadjusted claims decreased 12,730 to 189,992 last week. Applications in California plunged by 5,369, while filings in Oregon fell 2,580. They more than offset notable increases in Michigan and Missouri.
Fed Chair Jerome Powell told reporters on Wednesday he did not see “cracks” in the labor market, which he described as “in good shape,” noting that “the extreme imbalances that we saw in the early parts of the pandemic recovery have mostly been resolved.” The U.S. central bank has raised its benchmark interest rate by 525 basis points to the current 5.25%-5.50% range since March 2022.
The claims data covered the period during which the government surveyed business establishments for the nonfarm payrolls portion of March’s employment report. Claims rose marginally between the February and March survey weeks. The economy added 275,000 jobs in February.
Data next week on the number of people receiving benefits after an initial week of aid, a proxy for hiring, will offer more clues on the health of the labor market in March. The so-called continuing claims increased 4,000 to 1.807 million during the week ending March 9, the claims report on Thursday showed.
“The labor market is gradually rebalancing, but the adjustment appears to be coming from less hiring rather than a surge in firings,” said Rubeela Farooqi, chief U.S. economist at High Frequency Economics. “We expect job growth to slow somewhat but the unemployment rate to remain low this year.”
HOUSING SUPPLY IMPROVES
Stocks on Wall Street were trading higher. The dollar was steady versus a basket of currencies. U.S. Treasury prices fell.
In a separate report on Thursday, the National Association of Realtors said existing home sales jumped 9.5% last month to a seasonally adjusted annual rate of 4.38 million units, the highest level since February 2023. The monthly increase in sales was also the largest since February 2023.
Economists had forecast home resales would fall to a rate of 3.94 million units. Sales were boosted by an improvement in housing supply, with inventory surging 5.9% to 1.07 million units, the highest for any February since 2020. Supply was up 10.3% from one year ago.
Home resales, which account for a large portion of U.S. housing sales, fell 3.3% on a year-on-year basis in February.
The housing market has been battered by the Fed’s aggressive monetary policy stance as it fights inflation, and the signs of improvement in supply, together with retreating mortgage rates, bode well for the spring selling season.
Nonetheless, housing inventory is still well below the nearly 2 million units before the pandemic. Homes in many areas, especially in the Northeast, continue to receive multiple offers, pushing out first-time buyers, who accounted for only 26% of transactions last month.
That share is well below the 40% that economists and realtors say is needed for a robust housing market. A fifth of the homes sold last month were above listing price.
Many homeowners have mortgages with rates below 4%, discouraging them from selling their houses, contributing to the supply crunch and higher home prices. The median existing home price increased 5.7% from a year earlier to $384,500 in February. Home prices increased in all four regions, and could remain elevated with supply still likely to lag demand.
“If broader activity remains strong, a further normalization of home sales and new listings could be an indication that homebuyers are adapting to a higher level of rates,” said Veronica Clark, an economist at Citigroup in New York.
The increase in sales means more brokers’ commissions, which should boost the residential investment component in the gross domestic product report. Goldman Sachs raised its first-quarter GDP growth estimate to a 1.9% annualized rate from a 1.7% pace. The economy grew at a 3.2% rate in the fourth quarter.
The economy’s improving prospects for this year were reflected in a fourth report from the Conference Board showing its leading economic index rebounded 0.1% in February after declining 0.4% in January. That was the first increase since February 2022.
“The economy is poised to continue in expansion mode,” said Priscilla Thiagamoorthy, a senior economist a BMO Capital Markets in Toronto.
(Reporting by Lucia Mutikani; Editing by Chizu Nomiyama, Paul Simao and Andrea Ricci)
The IRS Is Cracking Down on These High-Income Earners. Are You One of Them?
Mark Henricks – March 21, 2024
The IRS building in Washington D.C.
The IRS recently announced a major tax enforcement initiative that will increase scrutiny on high-income earners, partnerships and people with foreign bank accounts. The agency said the effort would “restore fairness to [the] tax system” by focusing on wealthy taxpayers who have seen sharp declines in audit rates over the past decade.
Targeting Million-Dollar Earners With Large Tax Debts
At the center of the IRS crackdown are individuals who report over $1 million in income and have more than $250,000 in recognized tax debt. In its Sept. 8 announcement, the agency said it has identified 1,600 taxpayers fitting these criteria who collectively owe hundreds of millions in unpaid taxes.
The IRS described plans to use specialized revenue officers concentrating solely on collecting from these high-end delinquent accounts starting in fiscal year 2024. For those who fall into this segment, expect the IRS to come knocking as early as next year.
The news follows an injection of billions of dollars into the IRS budget from the Inflation Reduction Act. The agency says the added funding will pay the cost of collecting more from wealthy tax cheats, while maintaining low audit rates for people earning less than $400,000 a year. Another goal is to reduce or limit audits of moderate- and low-income taxpayers claiming the Earned Income Tax Credit (EITC).
AI-Powered Large Partnership Audits
The IRS is also significantly expanding examinations of large partnership tax returns. Because their complexity overwhelmed the tax collection agency’s resources and ability to analyze them, these returns have received limited scrutiny historically, according to the IRS. Audit rates for these large partnerships have also declined in recent years as the agency’s funding and staff have shrunk.
By the end of September, the agency plans to change that by opening audits of 75 of the biggest partnerships in the U.S., each with over $10 billion in assets. In October, the IRS will also begin mailing compliance notices to 500 partnerships for unexplained discrepancies in their balance sheets that could potentially trigger audits if not addressed.
The IRS plan calls for using artificial intelligence to analyze these complex returns. The idea is to employ machine learning to detect anomalies and more accurately target non-compliant returns for audit. This, the agency says, will enable more efficient use of limited IRS exam resources on detailed exams of complex partnership returns.
IRS statements on this new initiative stress that it won’t affect taxpayers with moderate and lower incomes. However, no matter what your income, if you hold partnership interests, especially in a large private equity fund, hedge fund or real estate partnership, you may be affected by the new enforcement.
Increased Enforcement on Foreign Financial Accounts
The Amount You Owe box from a 1040 income tax form.
The IRS is also expanding enforcement for failure to disclose foreign bank and financial accounts. By law, you must file a foreign bank account report (FBAR) separately from your return if you have over $10,000 in offshore accounts.
The IRS found filing discrepancies indicating potential non-compliance among hundreds of taxpayers with average account balances exceeding $1.4 million. The agency is planning to audit the most serious FBAR offenders in 2024.
If you have any foreign accounts or assets, pay close attention to FBAR filing obligations. The IRS intends to have more sophisticated means on hand to identify unreported foreign holdings. Penalties for willful failures to disclose required information can be stiff.
Bottom Line
This IRS is expanding its enforcement efforts on high-income taxpayers and large partnerships for which audit rates have plunged over the past decade. If you earn over $1 million, hold interests in major partnerships or have foreign financial accounts, you may be in the IRS’ crosshairs. Even taxpayers who previously have avoided audits may now attract scrutiny from a more endowed IRS. Now more than ever, it’s advisable to tap into qualified tax advice, be proactive about compliance and respond quickly, accurately and completely to any IRS notices in order to minimize potential penalties and interest.
The Latvian sandwich makers training to push Putin’s army into ‘kill zones’
Sophia Yan – March 21, 2024
Matiss Lopsa, 21, spends a few weeks training with the national guard – ANRIJS POZARSKIS
For most of the year, Matiss Lopsa makes sandwiches in a fashionable cafe in eastern Latvia, but for a few weeks the 21-year-old puts his apron aside and picks up a rifle to train with the national guard.
His home town, Rezekne, lies 35 miles from the border with Russia and is on a direct road to Moscow.
The proximity to danger is not lost on Mr Lopsa.
In January, Latvia reintroduced conscription for men aged 18 to 27 – even for those living abroad. Two years into Russia’s invasion of Ukraine, there are growing fears that Vladimir Putin could make a strike against Nato.
“I thought the government might bring back the draft,” said Mr Lopsa. “So I decided to volunteer, to choose to do this myself now, rather than be surprised if I was suddenly called up.”
He believes the government was right to begin training men like himself how to fight.
“I’m all for it – I think it’s a very, very good way to discipline young men,” said Mr Lopsa, after a day spent tossing meat and vegetables onto flatbread.
“That way, if you are called into war, you won’t be caught short on the first day not physically knowing how to do anything.”
Himars rocket system training in Latvia. Conscription has been reintroduced in the country for men 18 to 27 – INTS KALNINS/REUTERS
It is in anticipation of that “first day” that the Latvian government is seeking to expand its armed forces to 61,000, between active and reserve forces.
In 2024, the military will draft a total of 600 soldiers, with the goal of bringing in 4,000 per year by 2028.
There are exceptions, for example men who are the sole guardians of children or elderly parents, or are studying at university.
Draft-dodgers face fines and a prison sentence of up to five years during wartime.
Latvia is also developing the capabilities of its military. The government has procured new weapons systems from the US, including the Himars rocket system – a key part of Ukraine’s defence against Russia.
It has also purchased German Iris-T air defence units and a naval coastal defence system produced by Kongsberg, a Norwegian firm, and US defence contractor Raytheon. The government has agreed to construct a defensive line with neighbouring Estonia and Lithuania.
Together, the three Baltic nations share the longest Nato border with Russia and Belarus, running about 1,000 miles.
Lithuania, Estonia and Latvia are working together to create a defensive line against Russia if it starts to advance – SEAN GALLUP/GETTY IMAGES EUROPE
One concern along that stretch of land is the lack of geographical obstacles to any invading force.
Tomas Jermalavicius, the head of studies at the International Centre for Defence and Security in Estonia, said: “There are places where there are thick woods and rivers. But there are also places where it’s really wide open, and where it’s really close to critical points.
“If there are no obstacles … the enemy could be standing at the capital doors in no time.”
Targets that could be vulnerable include Lithuania’s capital, Vilinius, and Latvia’s second-largest city, Daugavpils – both less than 20 miles from the border to Belarus.
There’s also the Suwalki Gap, a roughly 60-mile land strip on the border between Poland and Lithuania. It’s a choke point, flanked to the West by the Russian enclave of Kaliningrad and to the east by Belarus, an ally of Moscow.
Were Moscow to seize this strip – known as Nato’s Achilles’ Heel – Estonia, Latvia and Lithuania would be severed from their Nato allies.
Geographical obstacles are of critical concern to the three countries – SEAN GALLUP/GETTY IMAGES EUROPE
Estonia’s new border defence plan aims to address these concerns by working to “channel advancing forces into ‘kill zones’ identified by the defenders for drone fire, for artillery – to turn those channels into a meat grinder”, said Mr Jermalavicius.
While details are still being worked out, Estonia has already said it will build hundreds of bunkers that can withstand direct artillery fire.
Working together is crucial.
“If Estonia does something Latvia does not do, and it becomes possible to launch an attack on Estonia through Latvian territory – this kind of stuff needs to be co-ordinated,” Mr Jermalavicius said.
Already, Latvia is incorporating lessons from the battlefield in Ukraine, where the country’s military instructors have helped to train local soldiers – an exchange that has boosted understanding both ways.
Troops are no longer only drilling in open fields but learning how to engage enemy combatants in urban settings.
But not everyone is as positive about the draft as Mr Lopsa.
Two teenage boys, 16 and 17, in Zilupe, a tiny Latvian town about four miles from Russia, simply laughed off the prospect.
Another boy, 17, told The Telegraph that he’d simply leave the country to evade service.
Konstantin Tupikins, 28, who has just aged out of the military requirement, thinks his younger brother, 15, would not make it as a soldier.
“He’s not really someone with this kind of bravery and courage,” said Mr Tupikins, who now works in the UK, and was home to visit his mother in Zilupe.
Konstantin Tupikins, 28, is over conscription age but fears for his brother – ANRIJS POZARSKIS
On a wintry walk with her daughter in a pram, 28-year-old Ekaterina is “quite against” the idea.
“The government hasn’t done enough for us; for people with disabilities or parents with prams, these winter sidewalks aren’t safe,” she said, gesturing at the icy paths, and declining to give a surname.
“Now they’re asking us to give our children?”
War would especially impact border towns like Zilupe – first, as a potential target given close proximity to Russia; and second, because the majority of its nearly 1,400 residents are Russian.
The primary language here is Russian – not Latvian, nor the local dialect, Latgalian.
Experts worry that these eastern reaches of Latvia – with villages populated by Russians and Belarussians – could give Putin fodder to “justify” an invasion and to establish “people’s republic”, as he did in Ukraine with Donetsk and Luhansk.
Many of Zilupe’s residents settled here before the dissolution of the Soviet Union, retaining family ties in Russia.
Before war broke out in Ukraine, people travelled often between Latvia and Russia.
Trips were so frequent that the train station – the last stop before Russia – is still plastered with signs of what travellers can bring into the EU, including a maximum of 125 grams of caviar.
Some still make the trek, though far fewer do so now, as Latvia has closed many border crossings to Russia and Belarus. Cross-border trains have largely stopped, and untouched snow blankets the tracks running east.
Families on both sides of conflict
The town’s complicated dynamics are perhaps best demonstrated by the fact that residents have sons and nephews enlisted on both sides in the Russian and Ukrainian militaries.
Vladimir, 89, who lives in Zilupe and is from Ukraine, with a son in the military, said: “I regret that innocent young people have to get involved in war. Latvia’s demographics are so old, and now we have to send our youths.”
In Riga, the capital, support for Ukraine remains overwhelming. Government buildings hang Ukraine’s flag and its blue-and-yellow colours can be found on everything from tram doors to trinkets such as coffee cups and candles.
While this reflects widespread unease that Latvia could find itself in Putin’s path, it also reveals a deep-seated resolve to defend the country’s hard-won independence.
The Freedom Monument, a 42-metre sculpture of a copper Liberty erected in 1935, stands testament to that desire.
The statue, which survived decades under Soviet occupation, is guarded today by two soldiers at its stone base; police officers patrol the square.
Krisjanis Karins, Latvia’s foreign minister, said: “We simply have to do things differently than if we weren’t living next to Russia. And, you know, Latvia has always been next to Russia.
“It has never been a democratic country … and this is what’s troubling,” he said. “They won’t stop of their own accord; they can only be stopped.
“They need to run up against the brick wall, and that brick wall needs to be Nato resolve and proven capabilities.”
Republicans — including the new Republican National Committee co-chair Lara Trump and Rep. Elise Stefanik (R-N.Y.) — have recently begun rhetorically asking voters if they believe they are better off now under President Joe Biden than they were four years ago, when Trump was still in the White House.
It’s an updated take on former President Ronald Reagan’s 1980 election question.
And former Secretary of State Clinton, who has been a persistent and vocal critic of presumptive GOP nominee Trump since her shock loss to him in the 2016 election, chimed in with this response to the conservative talking point:
“Multiple indictments and half a billion dollars in civil liability later, pretty much the only person who can say they were better off four years ago is Donald Trump.”
The World Happiness Report released its annual rankings of the happiest countries on Wednesday, with the majority of the top spots going to European nations.
The report, published by the United Nations Sustainable Development Solutions Network, relies on data from the Gallup World Poll, which is analyzed by some of the world’s leading well-being scientists.
The rankings represent the average view of life satisfaction in respective countries, known as “subjective well-being.”
Finland has managed to hold onto the top spot despite Denmark significantly closing the gap between first and second place.
On the flip side, Afghanistan, which was also ranked in last place in 2023, dropped even further for average happiness. America also saw a drop in perceived quality of life, dropping out of the top twenty countries for the first time since the report was published.
Here’s the full list of the top twenty happiest countries in the world, according to the report.
20. United Kingdom
The London tube.Tim Grist/Getty Images
According to the report, older people in the UK are significantly happier than younger age groups.
Despite the UK maintaining its ranking, a recent report from US nonprofit Sapien Labs’ Mental State of the World Report said that the UK is the second most miserable country in the world. It ranked below Ukraine, and the report indicated that factors like having a smartphone at a young age, eating highly processed foods, and decreased social relationships contributed.
19. Lithuania
A street in LithuaniaRicardo Sergio Schmitz
While it’s No. 19 overall, Lithuania ranked as the happiest country for you people, according to the Gallup report. The country’s capital city, Vilnius, is known for attracting young workers from across the globe because of better work opportunities.
18. Czechia
A square in Czechia.Courtesy of National Geographic
Czechia maintained its ranking as 18 for the second year in a row. The country is known for its strong work-life balance and low cost of living.
According to the report, growing happiness in Czechia and other transition countries of Eastern Europe, like Lithuania and Slovenia, is partially why the US and Germany have fallen below the top 20 mark.
17. Ireland
Dublin, Ireland.Getty Images
Ireland has a slower pace of life and is full of cultural traditions, with drinking being a big one. It also has affordable healthcare and a good work-life balance where weekend getaways are common and encouraged.
16. Belgium
Wavre, Belgium.boerescul/Getty Images
Despite a high tax rate, many companies in Belgium offer perks like company cars, meal stipends, and affordable healthcare.
Antwerp, the biggest city in the Flanders region of Belgium, has previously been named one of the happiest cities in the world.
15. Canada
A man wrapped in the Canadian flag.Dave Chan
Canada and the UK are the only countries with populations over 30 million that made the top 20 ranking in the report.
Older Canadians are significantly happier than younger age groups in the country. According to a breakdown of younger and older residents in each country, Canadians under 30 ranked 50 points lower than those 60 and older.
14. Austria
Vienna, Austria.Giannis Alexopoulos/NurPhoto via Getty Images
Many Americans have moved to Vienna and Linz for better work opportunities and overall quality of life. Shortages in engineering, nursing, and baking have opened up opportunities for people living in other countries.
One expat dad living in the country said his overall mental health improved in Austria and the move relieved some of his anxiety related to work. He also gets to travel more easily and spend more time with his family.
Austrians get 38 days of paid time off per year, with 25 days of paid vacation and an additional 13 public holidays off.
A waterfall in Nicoya, Costa Rica. underworld111/Getty Images
Costa Rica returned to the top 20 list after earning the same ranking in 2012, according to the Gallup report. Housing isn’t cheap, but some residents save money on utilities and transportation.
Others have reported improved mental health after moving there from the lifestyle and culture that centers around wildlife and nature.
11. New Zealand
Aerial View Of Auckland City’s skyline in New Zealand at sunrise.Jonathan Clark/Getty Images
According to some Americans who moved to New Zealand, housing costs are high, and buying options are limited. But work-life balance is better, and education and healthcare come at a lower cost.
Despite its high ranking, the report reveals that younger people living in New Zealand are significantly less happy than older residents. A separate list comparing young and older age groups in each country found that Kiwis 60 and older ranked in sixth place in happiness globally, while Kiwis under 30 ranked at 27.
10. Australia
The iconic Sydney Opera House in Australia. James D. Morgan/Getty Images
The Bernina Express train in Switzerland.Roberto Moiola/Getty Images
Switzerland was previously named the world’s best country by US News & World Report, and its business-friendly culture was a big part of the ranking.
Switzerland is a hub for raw materials like oil, and the country may also benefit from its historical stance of neutrality during international conflicts.
8. Luxembourg
The old town of Luxembourg City.Getty Images
Luxembourg is known for its rich history, tasty pastries, and fairytale aesthetic in some of its villages like Echternach.
According to an American student who moved there for grad school, the lower cost of tuition and cheaper healthcare necessities were a perk. Other notable factors included an efficient transportation system and a strong work-life balance that made a difference for her.
7. Norway
Oslo, Norway.Getty Images
Norway maintained a high ranking in the report, but it also experienced a drop in scores among younger age groups.
Amsterdam, the Netherlands.Mouneb Taim/Anadolu Agency via Getty Images
A large part of Dutch culture lies in the concept of “niksen,” or doing nothing. Dutch residents value relaxation and tend to be friendly and welcoming to others.
The country is also known for its transportation system and Dutch-style home mortgages that make it easier for some residents to buy property.
5. Israel
Israel.Nick Brundle Photography/Getty Images
Israel remained in the top five happiest countries in the world, moving down one ranking and 0.9 of a percentage point from last year. While the poll was taken before warfare in Gaza escalated, it was taken after the October 7 attack and hostage crisis.
With men and women joining the military at 18 years old, Israelis value living live in the present. The country also places high importance on community and family life, and less emphasis on work and status.
4. Sweden
Norrbro Bridge and the Royal Opera building in Stockholm, Sweden.Murat Taner/Getty Images
According to the Gallup report, older Swedish people are significantly happier than younger age groups in the country.
Seljalandsfoss waterfall in Iceland.Phillip Chow/Getty Images
Despite limited sunlight in the winters, Iceland managed to rank in the top three happiest countries for the second year in a row. While rent is rising in Iceland, it’s still cheaper than in other countries, and the cost of living is relatively low with healthcare heavily subsidized and nearly free.
2. Denmark
Copenhagen, Denmark. Alexander Spatari/Getty Images
Denmark is known for its “hygge” culture, which is the Danish concept of relaxing and enjoying simple comforts — the term is used in different settings to reinforce the idea of having fun.
The country is also known for its exceptional childcare, with Copenhagen ranked as one of the best places to raise children.
1. Finland
Market Square and Uspenski Orthodox Cathedral in Finland.Jon Hicks/Getty Images
Finland has a strong sense of democracy, and its public institutions and policies reinforce it.
Some attribute the high satisfaction of its residents to its welfare policy, which covers necessities for residents from “cradle to grave.” The policy offers free healthcare and free education from elementary school to college.
