AltAusterity Digest #21 November 2-8, 2017

The state of Wisconsin has joined with more than two dozen other states in calling for a balanced budget amendment to the U.S. Constitution. Supporters of Assembly Joint Resolution 21 want to use the U.S. Constitution to legally entrench a balanced budget at the federal level, citing the unsustainable levels of government debt in the U.S., currently standing at over $20 trillion. Article V of the Constitution allows for a convention to be held if two-thirds of the states – 34 – call for amendments. To take effect, amendments must be approved by three-quarters – 38 – states. If the measure is approved Wisconsin will be the 28th state to call for a convention.

Research from the Child Poverty Action Group (CPAG) and the Institute for Public Policy Research (IPPR) in Scotland has revealed that cuts to the Universal Credit program will put 700,000 additional children into poverty. Universal credit is a bundle of several benefits into a single payment. Universal credit is a form a workfare, which allows eligible persons to work, while still maintaining a certain proportion of benefits. In addition to the cuts, there has been widespread criticism of the universal credit scheme due to delays in payments of up to 6-weeks. The report calls for the UK Chancellor Philip Hammond to deal with the issue in next month’s budget.

In the run-up to an election season next spring, Ontario Premier Kathleen Wynne has rolled out a new $155-million “seniors’ strategy.” The program involves an informational website for seniors to access relevant information, a residential construction program to update “naturally occurring” retirement communities, and an addition of 5,000 new long-term care beds. Despite this additional spending, Finance Minister Charles Sousa confirmed the next fiscal update would still involve a balanced budget.

President of the Federal Reserve Bank of New York, William C. Dudley is planning to retire next year. Dudley has overseen the NY Fed since the financial crisis. Shortly after his retirement announcement on Monday, Dudley warned against the de-regulatory policy that is being rolled-out under the Trump administration. Mr. Dudley warned against broad changes to the Dodd-Frank Act, especially regarding reserve capital, used so that banks can absorb unexpected losses.

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