News of the Day

The Biden administration said Monday it is approving a huge oil-drilling project on Alaska’s petroleum-rich North Slope.

The approval of ConocoPhillips’ big Willow drilling project by the Bureau of Land Management will allow three drill sites including up to 199 total wells. Two other drill sites proposed for the project will be denied. ConocoPhillips Chairman and CEO Ryan Lance called the order “the right decision for Alaska and our nation.” The Houston-based company will relinquish rights to about 68,000 acres of existing leases in the National Petroleum Reserve-Alaska.

The Willow project could produce up to 180,000 barrels of oil a day, create up to 2,500 jobs during construction and 300 long-term jobs, and generate billions of dollars in royalties and tax revenues for the federal, state and local governments, the company said.

The project, located in the federally designated National Petroleum Reserve-Alaska, enjoys widespread political support in the state. Alaska’s bipartisan congressional delegation met with Biden and his advisers in early March to plead their case for the project, and Alaska Native state lawmakers recently met with Haaland to urge support.

Sen. Lisa Murkowski, R-Alaska, said Monday the decision was “very good news for the country.”

“Not only will this mean jobs and revenue for Alaska, it will be resources that are needed for the country and for our friends and allies,” Murkowski said. “The administration listened to Alaska voices. They listened to the delegation as we pressed the case for energy security and national security.”

Fellow Republican Sen. Dan Sullivan said conditions attached to the project should not reduce Willow’s ability to produce up to 180,000 barrels of crude a day. But he said it was “infuriating” that Biden also had moved to prevent or limit oil drilling elsewhere in Alaska.

The Labor Department said Tuesday that the consumer price index, a broad measure of the price for everyday goods including gasoline, groceries and rents, rose 0.4% in February from the previous month. Prices climbed 6% on an annual basis.

Core prices – which strip out the more volatile measurements of food and energy – climbed 0.5% over the course of February, slightly faster than in January. On a 12-month basis, core prices are up 5.5%.

“February CPI data was a mixed bag, but the rise in core inflation shows we’re stuck on a plateau for now,” said Robert Frick, corporate economist with Navy Federal Credit Union. “Inflation should start moving strongly lower this spring and summer, especially as lower rent costs work themselves into the numbers.”

The report is the last before the Federal Reserve Bank’s next policy-setting meeting on March 21-22 and will have major implications for the U.S. central bank, which is tightening monetary policy at the fastest rate in decades as it tries to crush out-of-control inflation.

Officials have already approved eight straight rate increases, lifting the federal funds rate to a range of 4.5% to 4.75%, well into restrictive levels. In recent weeks, policymakers have indicated that rates may need to climb higher than previously anticipated in the face of hotter-than-expected economic data.

Depositors of the Silicon Valley Bank will have access to all of their money – following the bank’s failure on Friday – at no loss to American taxpayers, the Treasury Department, Federal Reserve, and the Federal Deposit Insurance Corporation (FDIC) said in a joint statement Sunday.

“Today we are taking decisive actions to protect the U.S. economy by strengthening public confidence in our banking system,” the joint statement read. “This step will ensure that the U.S. banking system continues to perform its vital roles of protecting deposits and providing access to credit to households and businesses in a manner that promotes strong and sustainable economic growth.”

The statement said Treasury Secretary Janet L. Yellen had approved actions enabling the FDIC to complete its resolution of SVB “in a manner that fully protects depositors.”

Depositors will have access to all of their money starting Monday, March 13. The taxpayer will bear no losses associated with the resolution of SVB.

Notably, the regulators’ statement also announced the shutdown of New York-based Signature Bank.

“We are also announcing a similar systemic risk exception for Signature Bank, New York, New York, which was closed today by its state chartering authority,” the joint statement read.

Any losses to the Deposit Insurance Fund to support uninsured depositors will be recovered by a special assessment on banks, as required by law.

The Federal Reserve said it would make additional funding available to “eligible depository institutions to help assure banks have the ability to meet the needs of all their depositors.”

Silicon Valley Bank, the nation’s 16th-largest bank, failed Friday after depositors hurried to withdraw money this week amid anxiety over the bank’s health. It was the second-biggest bank failure in U.S. history after the collapse of Washington Mutual in 2008.

On Thursday, President Joe Biden unveiled his new $6.8 trillion budget. In addition to more military spending, the White House maintains it will cut nearly $3 trillion from the deficit over the next decade. Taxes would also go up on the rich, in part, to fund new social programs for the middle and lower class.

His proposal falls into four main categories: deficit reduction, lower costs for families, protecting and strengthening Medicare and Social Security, and investing in America.

Republicans say it’s unnecessary to raise taxes as the president has suggested. The key, they say, is to cut spending.

“If you look at the revenue that’s coming into America today, it’s higher than any 50-year average. But our expenses are much higher and if you look since (Biden’s) been in office, the added $6 trillion, the 30 percent increase in discretionary spending, just in the last four years, that has been a real challenge and I think that’s where the real problem lies,” said House Speaker Kevin McCarthy when asked Wednesday about the president’s upcoming budget announcement.

As Congress argues over how to bring down the national debt, both sides agree something must be done. U.S. debt currently sits at $32 trillion and is expected to reach $50 trillion by 2030.

“In the next 10 years, Americans will pay $10.5 trillion in interest on our debt. Now to put that in perspective, since 1940 until today, America has only paid $9 trillion in interest. So the next 10 years, we’ll pay more than we paid the last 80 years,” said McCarthy.

Wisconsin’s top Republican said Wednesday that a plan put forward by Democratic Gov. Tony Evers and the Milwaukee Brewers to spend nearly $300 million in taxpayer money on improvements to the stadium where the team plays was likely dead in the GOP-controlled Legislature.

But Assembly Speaker Robin Vos said he hoped Republicans could devise a better deal that would look for a commitment from the team to remain in Milwaukee longer and not rely as heavily on money from a one-time budget surplus.

Under the Evers plan, in exchange for the state spending $290 million on repairs, the Brewers’ lease would be extended by 13 years, through 2043.

“I’m not sure the amount of time he’s asking the team to stay here is correct,” Vos told reporters. “I think the deal that he cut is not a very good one for the taxpayer.”

Earlier Wednesday, a coalition of Wisconsin business, tourism and health care leaders, former office holders and others announced that it is working to find a bipartisan solution to keep the Brewers in the state “for the next generation,” said the group’s leader, Omar Shaikh, a Milwaukee-area restaurant owner and developer.

 The Federal Reserve could increase the size of its interest rate hikes and raise borrowing costs to higher levels than previously projected if evidence continues to point to a robust economy and persistently high inflation, Chair Jerome Powell told a Senate panel Tuesday.

“The latest economic data have come in stronger than expected, which suggests that the ultimate level of interest rates is likely to be higher than previously anticipated,” Powell testified to the Senate Banking Committee. “If the totality of the data were to indicate that faster tightening is warranted, we would be prepared to increase the pace of rate hikes.”

Powell’s comments reflect a sharp change in the economic outlook since the Fed’s most recent policy meeting in early February. At that meeting, the central bank raised its key rate by just a quarter-point, downshifting after a half-point rise in December and four three-quarter-point hikes before that.

The Fed chair’s remarks Tuesday raised the real possibility that the Fed will increase its benchmark rate by a half-percentage point at its next meeting March 21-22. Over the past year, the central bank has raised its key rate, which affects many consumer and business loans, eight times.

At their forthcoming meeting, Fed officials will also issue updated forecasts for how high they expect their benchmark rate to ultimately reach. In December, they forecast that it would reach about 5.1% later this year. Powell’s latest remarks suggested that the Fed could raise it even higher. Futures pricing indicates that investors now expect it to rise a half-point further, to 5.6%.

State officials say Wisconsin has seen an upward trend in child labor complaints since 2018, while the U.S. Labor Department says its seen a 69 percent increase in cases of children being illegally employed during the same period.

The federal government is currently investigating over 600 cases of possible child labor exploitation. In the last fiscal year alone, the Department of Labor identified 835 companies operating in violation of child labor laws affecting 3,800 children, and saw a 26 percent increase in minors employed in hazardous occupations.

Violations can vary from children working more hours than allowed under law, to working with prohibited equipment or working in industries that they shouldn’t be.

Federal officials last week announced new efforts to combat the rise in child labor exploitation through a partnership between the U.S. Department of Labor and U.S. Department of Health and Human Services. They also called on Congress to increase financial penalties for child labor violations and to boost funding for enforcement of child labor laws.

Wisconsin food, forestry and agriculture product exports set a record in 2022, according to U.S. Census trade data. Exports were shipped to 142 countries totaling nearly $4.22 billion, a 7% increase from the previous record in 2021.

U.S. Census data shows that d​airy product exports totaled $617 million, up 32% from 2021, the highest level on record and more than $100 million above the previous record year in 2014. Crop products, including grains, wood and vegetables increased more than 5% to $2.82 billion, a 10-year high. Meat products declined 2% to $782 million.​In total, U.S. agricultural exports exceeded $220 billion in 2022, up 10% from the year prior. Wisconsin now ranks 12th in the nation for agricultural exports.

“This record-breaking year again presents an opportunity to strengthen our state as a leader in agricultural exports,” said DATCP Secretary Randy Romanski. “Building off of last year, this momentum, the investments of Governor Evers, and the work of DATCP’s International Agribusiness Center positions Wisconsin agribusinesses well for the next year.”

The latest release of U.S. Census data shows that post-pandemic demand is driving export growth in several markets as logistics challenges decrease. Wisconsin’s top five markets, making up more than two-thirds of total exports, are Canada, China, Mexico, Korea and Japan. Canada, Mexico and Korea showed double-digit increases in 2022, while Japan remained unchanged from 2021.

University of Wisconsin System President Jay Rothman will propose a 5% tuition increase for the next academic year, he told the state Assembly’s higher education committee Thursday.

Rothman will present the idea later this month to members of the Board of Regents, who will weigh whether to implement the change. If passed, it would be the first time the UW System has raised tuition for in-state undergraduates since 2013.

Republican lawmakers passed legislation a decade ago freezing tuition for UW System state students. While the Legislature returned tuition-setting authority to the regents in 2021, the board chose to keep the freeze in place for the 2022-23 school year, instead relying on federal pandemic relief funds to cover costs.

A tuition increase would bring in about $38 million per year in revenue, Rothman estimated.

The 5% increase would be under last year’s inflation rate, Rothman said. He added that he’s “extraordinarily sensitive” to ensuring that UW System tuition remains affordable, citing the new Wisconsin Tuition Promise, which will waive the costs of tuition and fees that remain after receiving financial aid for in-state students from low-income families.

It currently costs in-state undergraduates about $8,000 to $11,000 to attend a four-year UW System school, without accounting for additional fees and living expenses. UW-Madison has the highest resident tuition among the system’s 13 universities.

Wisconsin Republican legislative leaders downplayed the state’s record budget surplus Wednesday, even as Democratic Gov. Tony Evers has pushed for massive spending increases on K-12 education, tax cuts and funding for local governments.

Assembly Speaker Robin Vos cautioned that much of the state’s projected $7 billion surplus is one-time money that he said shouldn’t be used to fund new programs or ongoing expenses. Evers has proposed a range of uses for the money, from subsidizing repairs at the Milwaukee Brewers’ stadium to creating a three-month paid leave program for most workers.

“We do not have anywhere near the money that Gov. Evers spoke about yesterday,” Vos said at a Wisconsin Counties Association event as he tried to temper expectations for what local governments would receive in the budget.

At the same event on Tuesday, Evers promised tax cuts for the middle class and additional funding for local governments — plans that Vos said relied on “phony math.”

Vos said Republicans would tie more funding for local governments to requirements on how it could be spent.

He and Republican Senate Majority Leader Devin LeMahieu, who together lead the GOP-controlled Legislature, advocated for using the surplus to enact tax cuts for payers at all income levels. Co-chairs of the Legislature’s powerful budget-writing committee said Tuesday that LeMahieu’s plan for a flat income tax rate was unlikely to be included in the budget, but Republicans view such a tax as a long-term goal.

Vos cited estimates that the state’s recurring revenue will increase by $1.2 billion over the next two years. He told county officials that about 75% of that money would be needed to continue funding Medicaid programs and wage increases for prison guards that Evers supported with federal pandemic aid.