John Ydstie

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While there are many signs that the American economy is picking up steam, in much of the European Union, the opposite is true. Austerity programs aimed at reducing national debts have been blamed for crushing growth and sending unemployment in the eurozone nations to a record high of 12 percent.

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NPR's business news starts with some of the shine off the stock market.

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The top executives of Apple faced tough questions today on Capitol Hill. They came at a hearing about Apple's alleged avoidance of billions of dollars in U.S. income taxes. Yesterday, Senate investigators released a study describing how the maker of the iPhone, iPad and Mac computers used subsidiaries based in Ireland to avoid income taxes on a big chunk of its global profits.

Giant technology firm Apple is paying billions of dollars less than it should in U.S. taxes each year, according to a report by the Senate Permanent Subcommittee on Investigations. In a hearing Tuesday in Washington, D.C., Apple CEO Tim Cook will defend the company.

The subcommittee's report says Apple avoids the tax payments mainly by shifting profits to three subsidiary companies in Ireland. The investigation found Apple is taking advantage of technicalities in U.S. and Irish tax laws to avoid paying any tax on a huge portion of its profits.

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Japan's economy is finally getting a lift. The stock market is soaring there. Companies like Toyota and Sony are seeing a surge in profits. And today, Japan's government reported the economy grew a three-and-a-half percent annual rate in the first three months of the year, a significant improvement.

The government's employment report for April comes out Friday. It's an important measure of the economy's health and the advance signals have been mixed. One report this week showed layoffs falling to a five-year low, but another suggests disappointing jobs creation.

At least one sector is providing some positive news for the job market: housing.

Consumer advocates call them "debt" traps. The banks that offer them call them direct-deposit advances and describe them as available funds for short-term emergencies.

But the cash advances have many of the negative characteristics of payday loans. And on Thursday, U.S. bank regulators took a step toward protecting consumers from the risks they pose. The regulators proposed standards for "deposit-advance products."

Currency traders were stunned last week by aggressive action from Japan's central bank. The Bank of Japan embarked on a bond-buying program that, by one measure, is twice the size of the extraordinary moves by Ben Bernanke and the Federal Reserve in the United States. The BOJ's move is an effort to shock the Japanese economy out of more than a decade of sluggish growth and deflation.

On the second day since Cyprus reopened its banks, depositors continue to face restrictions on getting at their money. ATM withdrawals are limited to 300 euros a day, and there are limits on how much cash travelers can take abroad.

Amid Washington's dysfunction, one issue has united some liberal Democrats and conservative Republicans: a common concern that "too big to fail" is alive and well.

Despite the Dodd-Frank financial reforms, these lawmakers believe the nation's largest banks still pose a threat to the economy and that the government will step in to bail them out if they get in trouble.

The stock market's long climb from its recession bottom has some people concerned it may be a bubble about to burst — a bubble artificially pumped up by the Federal Reserve's easy-money policy. That's led to calls — even from within the Fed — for an end to the central bank's extraordinary efforts to keep interest rates low.

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Jack Lew, President Obama's pick for Treasury secretary, appears headed toward confirmation by the full Senate. He fared well during his confirmation hearing at the Senate Finance Committee yesterday.

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Outgoing Treasury Secretary Timothy Geithner has had a bruising four years. He took office when the U.S. economy was plunging into the worst recession since the Great Depression.

Nominating Jack Lew as Geithner's successor Thursday, President Obama praised his departing Treasury secretary for helping to get the economy back on track.

Businesses complained that the uncertainty surrounding the "fiscal cliff" froze their decisions about hiring and expanding, which hurt the economy. Washington has now managed half a deal, which settles tax issues, at least for the time being. But has that removed enough uncertainty to boost some business hiring and investment?

The U.S. economy was a bit of a disappointment in 2012. During the early months of the year, job creation was surprisingly strong, but by the end of the year, uncertainty about the election and the "fiscal cliff" slowed the economy's forward motion. So will 2013 look any better?

Mark Zandi of Moody's Analytics says that while Washington likely will steer us away from the fiscal cliff at the last minute, some elements of the deal will be a drag on the economy early in 2013.

The Federal Reserve continued to keep its foot on the accelerator in 2012, using unusual tactics to try to boost economic growth. But there's disagreement among economists about whether the Fed's policies were effective or whether the risks to the economy outweighed the rewards.

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The Republican plan to avert the "fiscal cliff" that the White House rejected Monday includes at least one element that's likely to produce controversy: a proposal that would, among other things, affect the cost of living adjustment for Social Security.

As negotiations continue in Washington over a plan to avoid the fiscal cliff — that combination of tax hikes and spending cuts scheduled for Jan. 1 — one big sticking point is whether to raise tax rates for high-income Americans.

Congress and the White House constructed the cliff last year, thinking it would force them to focus on solving the deficit problem. But they're still battling over what approach makes the most sense.

"No substantive progress has been made." That's what House Speaker John Boehner had to say Thursday about efforts to avoid automatic spending cuts and tax increases at year's end.

The administration's lead negotiator, Treasury Secretary Tim Geithner, met with congressional leaders from both sides of the aisle Thursday, looking for an agreement on the hazard Congress and the White House created last year to focus their minds on deficit reduction.

The White House and Congress continue to work on a deal that avoids the fiscal cliff and cuts deficits in the long run. One of the biggest hurdles is President Obama's proposal to raise tax rates for the wealthy.

Republicans think a better course would be to raise revenue by closing loopholes and limiting deductions for high-income people. The question is, could that method raise enough money.

A second term means some new Cabinet appointments for President Obama, including at the Treasury. After four pretty grueling years, Secretary Timothy Geithner has made it clear he will be leaving Washington.

White House press secretary Jay Carney said last week that Geithner would be staying on through the inauguration. He's also expected to be a "key participant" in "fiscal cliff" negotiations.

Now that the election is over, Washington is transfixed by the fiscal cliff, the automatic tax increases and spending cuts due to take effect Jan. 1 if nothing is done.

The sudden shock could seriously damage the economy.

But some Democrats and policy analysts are suggesting that going over the fiscal cliff could help break the political logjam.

With the election over, attention in Washington has turned to the nation's debt and deficit challenges — most immediately the looming fiscal cliff. That's the $600 billion worth of expiring tax breaks and automatic spending cuts set to start taking effect Jan. 1.

The president and Congress agreed to those automatic measures to force themselves to find a more palatable compromise to rein in deficits. On Wednesday, there was an attempt to jump-start that process.

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