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U.S. federal budget deficit surpasses $3 trillion, Treasury says

Federal budget deficit exceeds $3 trillion

The U.S. federal budget deficit surpassed $3 trillion in the current fiscal year, nearly triple the 2019 gap and leaving the shortfall as a share of the economy on pace to be the largest since World War II.

August’s $200.1 billion deficit, which little changed from the same month in 2019, pushed the fiscal year’s total past $3 trillion, Treasury Department figures showed Friday. Last year, over the same 11 months, the nation’s budget shortfall was a little more than $1 trillion.

Spending so far this year has exceeded $6 trillion amid a massive government fiscal push to cushion Americans from the pandemic-related shutdown of the economy months ago. At the same time, revenue is slightly less than what it was in the first 11 months of fiscal 2019. The Congressional Budget Office projected earlier this month that the 2020 deficit would be 16 percent of gross domestic product, the biggest since 1945.

Receipts in August fell 2.1 percent from a year ago, while spending declined 1.2 percent, the Treasury’s report showed.

Outlays for the federal additional unemployment compensation program totaled $22.5 billion, compared with $73.4 billion a month earlier, after the $600 supplemental weekly jobless payments ended in July. Outlays for state unemployment benefits totaled $31.2 billion after $36.1 billion in July.

— Bloomberg News

Facebook fights Irish data transfer decision

Facebook sought to derail proposals by the Irish data protection watchdog that the tech giant warns could curb transfers of vast amounts of commercial data.

The social network giant said it sought a judicial review of the Irish Data Protection Commission’s preliminary decision that the company may have to halt trans-Atlantic data transfers using the most commonly used European Union tool still available to firms.

“A lack of safe, secure and legal international data transfers would have damaging consequences for the European economy,” Facebook said in a statement Friday. “We urge regulators to adopt a pragmatic and proportionate approach until a sustainable long-term solution can be reached.”

In an investigation into Facebook’s data transfers, the Irish authority told the company that standard contractual clauses “cannot in practice be used for EU-US data transfers,” according to a blog post by Facebook this week.

While the order isn’t final and will still need the backing of other E.U. data watchdogs, it could also put in doubt data transfers with the same tool by other tech firms under the Irish authority’s purview. The legal clash follows a shocking decision in July by the European Union’s top court to topple the privacy shield over fears E.U. citizens’ data isn’t safe once shipped to the United States.

— Bloomberg News

For the second time this month, Hyundai is telling some SUV owners to park outdoors because an electrical short in a computer could cause vehicles to catch fire. The Korean automaker is recalling about 180,000 Tucson SUVs in the United States from 2019 through 2021 to fix the problem. The company says corrosion can cause a short circuit in defective anti-lock brake circuit boards that can cause a fire even if engines are off.

The New York Stock Exchange has indicated that it will move its electronic trading systems out of New Jersey if the state implements a proposed tax on financial transactions, according to an internal memo seen by Reuters. The NYSE plans to announce that it will run one of its exchanges from a backup site in Chicago for a week as a sign of its intention to move out of New Jersey, according to the memo. A bill sponsored by assemblyman John McKeon, a Democrat, calls for a quarter-of-a-cent tax on stocks, options, futures and swaps trading via northern New Jersey electronic data centers.

U.S. consumer prices rose solidly in August, with the cost of used cars and trucks increasing by the most in more than 51 years as Americans shunned public transportation because of fears of contracting the coronavirus. The report from the Labor Department on Friday also showed a firming in underlying inflation pressures last month. But this will have no impact on monetary policy as the Federal Reserve last month put new emphasis on the labor market and less on worries about too-high inflation.

— From news services