The wealthy fear that their tax cuts will end, while Senator Warren scares the bankers. New Yorkers wait on long lines for gas, the travel industry holds its breath and green car manufacturers face drooping sales.
Raising Taxes on the Wealthy
The non-partisan Congressional Budget Office (CBO) gave some political ammunition to President Obama on Thursday, bolstering his second-term promise to let some of the Bush-era tax cuts – those enjoyed by America’s wealthiest citizens – expire at the end of the year.
The CBO said that allowing tax rates to rise for the affluent would not retard economic growth in 2013 as many Republicans, including Speaker of the House John Boehner, maintain.
The disagreement on taxes looms as a major impediment for the president, who claims his victory has given him a mandate to implement his tax policies.
Global markets reacted to the uncertainty in Washington with selloffs; the Dow Jones Industrial Average fell another percentage point on Thursday after a 2.4 percent drop the day before.
Gas Rationing in New York
New York City and Long Island followed New Jersey’s lead today, imposing gasoline rationing to help deal with shortages and long lines at those gas stations not rendered inoperative by Superstorm Sandy. New York Mayor Michael Bloomberg said that only a quarter of his city’s gas stations were open for business.
Beginning Friday morning, drivers with license plate numbers ending in an odd number will be allowed to buy gas; on Saturday it will be drivers with plates that end in an even number. Buses, taxis, and commercial and emergency vehicles are exempt from the plan.
Police will be stationed at gas stations to enforce the new system. Fuel shortages, and thus rationing, are expected to last for several more weeks throughout the storm-battered area.
Shakeup in the Travel Industry
Online travel site Priceline is purchasing Kayak. While Priceline connects consumers to its own participating roster of airline, hotel and rental car companies, Kayak merely compares prices and refers its users to other travel agents and carriers.
According to Priceline President Jeffrey Boyd and Kayak CEO Steve Hafner, the $1.8 billion deal will allow Priceline and Kayak to combine forces. The deal will combine Priceline’s global reach and long-time expertise in the travel industry with Kayak’s leading technology and innovation.
Analysts wonder if Kayak will continue to refer customers to other travel agents now that it is owned by one, and suggest that the merger could change the way travelers book and pay for their flights, hotel rooms and rental cars.
Senator Warren’s Chance for a Senate Banking Seat
Elizabeth Warren, the newly elected Democratic Senator from Massachusetts, is already considered the banking industry’s top enemy because of her past work in crafting the Consumer Financial Protection Bureau, her oversight of the Troubled Asset Relief Program’s $700 billion worth of bailout funds and her public calls for the breakup of the big banks.
But with her electoral victory comes the possibility of a seat on the Senate’s powerful Banking Committee, a position that will give her even greater power to curb the excesses of Wall Street, increase government regulation and promote enforcement of the 2010 Dodd-Frank financial oversight law.
Green Car Makers Guardedly Optimistic
Manufacturers of so-called “green cars” are breathing a little easier in the wake of President Obama’s electoral victory, expecting that his administration will continue to support electric and hybrid technologies with federal subsidies and tax credits.
While sales of traditional internal-combustion vehicles have rebounded recently, electric cars are still struggling in the marketplace despite high fuel costs and federal tax incentives of up to $7500.
The Chevy Volt is expected to reach barely half its sales target for 2012, and sales of the Nissan Leaf in the first ten months of the year have declined from 2011 figures, prompting calls from manufacturers for even higher maximum tax credits for cash-strapped consumers.
Photo: Anton Oparin / Shutterstock.com
Bill “No Pay” Fay has lived a meager financial existence his entire life. He started writing/bragging about it in 2012, helping birth Debt.org into existence as the site’s original “Frugal Man.” Prior to that, he spent more than 30 years covering the high finance world of college and professional sports for major publications, including the Associated Press, New York Times and Sports Illustrated. His interest in sports has waned some, but he is as passionate as ever about not reaching for his wallet. Bill can be reached at [email protected].