Rising food, gas costs threaten to slow economic recovery
WASHINGTON (AP) - Americans are paying more for food and gas, a trend that threatens to slow the economy at a crucial time.
So far, the spike in such necessities hasn't stopped businesses from stepping up hiring or slowed factory production, which rose in March for the ninth straight month. Still, higher gas prices have led some economists to lower their forecasts for growth for the January-March quarter.
Consumer prices rose 0.5 percent last month, the Labor Department said Friday. Nearly all of the gains came from pricier gas and food.
When taking out those two volatile categories, core inflation was relatively flat. But at the same time, employees are only seeing small, if any, pay increases.
"People have less money to spend on goods other than food and energy and that is going to cause the expansion to slow," said economist Joel Naroff of Naroff Economic Advisors.
Obama to hold town hall meeting in Reno on budget
RENO (AP) - President Barack Obama will hold a town hall meeting in Reno on Thursday to discuss his budget-deficit reduction plan.
The White House on Friday said Obama wants to speak directly to Americans about his vision for reducing the debt based on the values of "shared responsibility and prosperity."
The time and venue for the event were not immediately released. Obama will hold similar events Tuesday in Virginia and Wednesday in Palo Alto, Calif.
It will be Obama's first trip to Reno since becoming president. He made several campaign stops in Reno before he was elected president.
Nevada has been a key battleground state in recent presidential elections with Democratic and Republican candidates making visits. Both parties in the state boast early spots in the presidential nominating process.
House OKs plan to cut $6 trillion from federal spending, overhaul Medicare
WASHINGTON (AP) - In a prelude to a summer showdown with President Barack Obama, Republicans controlling the House pushed to passage on Friday a bold but politically dangerous budget blueprint to slash social safety net programs like food stamps and Medicaid and fundamentally restructure Medicare health care for the elderly.
The nonbinding plan lays out a fiscal vision cutting $6.2 trillion from yearly federal deficits over the coming decade and calls for transforming Medicare from a program in which the government directly pays medical bills into a voucher-like system that subsidizes purchases of private insurance plans
The GOP budget passed 235-193 with every Democrat voting "no." Obama said in an Associated Press interview that it would "make Medicare into a voucher program. That's something that we strongly object to."
The vote sets up the Republicans' next round of confrontation with Obama and Democrats over must-pass legislation to allow the government to borrow more money to finance its operations and obligations to holders of U.S. bonds. For the first time, Obama acknowledged that raising the debt limit is "not going to happen without some spending cuts" insisted upon by Republicans and some Democrats.
Under the House Republican plan approved Friday, deficits requiring the federal government to borrow more than 40 cents for every dollar it spends would be cut by the end of the decade to 8 cents of borrowing for every dollar spent.