Thousands stuck in Colombia’s Caribbean amid migration surge

BOGOTA (Reuters) – Some 9,000 migrants are stranded in a Caribbean municipality in Colombia amid a surge of people passing through on their way to north America following the re-opening of international borders post-lockdown, the Colombian migration agency said.

The irregular migrants – who are mostly Haitians but also include Venezuelans and Cubans, as well as a number from African countries – are stuck in Necocli, in Colombia’s Antioquia province, migration agency director Juan Francisco Espinosa said in a virtual press conference.

“This is a recurring and historical phenomenon. Colombia is not the cause or the destination of this migration,” Espinosa said.

The migrants hope to pass from Necocli and on through the dangerous Darien Gap towards Panama and then onwards to north America, principally the United States or Canada, he added.

Though the region typically sees 30,000 migrants pass through in a normal year, Espinosa said just 4,000 people transited the region last year due to the impact of measures implemented by countries to control the spread of coronavirus.

However, with borders opening up, the level of migration in the region so far in 2021 has been much greater compared to the same period last year, Espinosa added.

“This year is presenting numbers that are absolutely alarming, where right now more than 25,000 irregular migrants have passed through this part of the country,” he said.

Some 74% of the more-than 25,000 migrants recorded passing through the region in 2021 are Haitian, a migration agency spokesman told Reuters.

Colombia reopened its land and river borders with Brazil, Ecuador, Peru and Panama in May, following a 14-month closure it used to try and curb the spread of the coronavirus pandemic.

The country opened its border with Venezuela in early June.

(Reporting by Oliver Griffin; Editing by Raissa Kasolowsky)

Canada border guards vote to strike days ahead of U.S. border reopening

By Moira Warburton

VANCOUVER (Reuters) – Canadian border guards and customs officials voted on Tuesday to go on strike just days ahead of the reopening of the border with the United States, unions representing the workers said, after working for three years without a contract.

A strike would slow down commercial traffic at the land border, the unions said, as well as impact international mail and collection of duties and taxes. But a spokesperson for the Canada Border Services Agency (CBSA) said 90% of employees have been identified as “essential” so will continue to work in the event of a strike.

Last week, Canada announced plans to reopen its border to fully vaccinated Americans on Aug. 9, and allowing international travelers starting on Sept. 7. The border has been shut for non-essential travel for more than 16 months because of the coronavirus pandemic.

The Public Service Alliance of Canada (PSAC) and the Customs and Immigration Union (CIU) said in a joint statement that strike action could begin as soon as Aug. 6 after 8,500 members voted in favor of the action. Contract talks reached an impasse in December 2020, the unions said.

“Taking strike action is always a last resort, but we’re grappling with systemic workplace harassment issues that must be addressed,” Mark Weber, CIU national president, said.

CBSA spokesperson Judith Gadbois said officers have proven their resilience since the beginning of the pandemic by helping to prevent the spread of the virus and its variants.

“We expect that our officers will continue to fulfill their duties with the highest level of integrity and professionalism.”

(Reporting by Moira Warburton in Vancouver; Additional reporting by Anna Mehler-Paperny in Toronto; editing by Grant McCool)

From ‘congratulations’ to ‘fully canceled’: California cafe owners hit roadblock

By Ann Saphir

(Reuters) – After more than a year of heavy losses at their two cafes in the San Francisco Bay Area, Amy and Chris Hillyard were relieved to get word in May that they’d been approved for a $381,000 grant from the U.S. Small Business Administration.

The money was from a fund earmarked by Congress for restaurants hurt by the economic fallout from the coronavirus pandemic, like the Hillyards’ Farley’s SF and Farley’s East operations.

Equal to their losses last year, it would let the couple pay back debt, hire new employees, expand opening hours, replace a broken freezer, buy tables and chairs for outdoor dining, and do all the other things Chris Hillyard says need to get done “to get back to normal and be ready for normal, come September,” when more workers might be expected to return to nearby office buildings.

Then, last month, the Hillyards learned they won’t get the money after all.

“We are back in a holding pattern” Chris Hillyard said. “It’s not a very fun place to be.”

Even after roughly $800 billion in aid from the federal Paycheck Protection Program (PPP) and nearly $30 billion more earmarked for hard-hit restaurants this year, small U.S. businesses face an uncertain outlook.

Many enterprises that were thriving before the pandemic are still hobbled.

At the same time, a widely predicted wave of bankruptcies has not materialized, with commercial bankruptcies in 2020 at their lowest level in five years and year-to-date filings lower still, according to data provider Epiq AACER.

Complicating the picture are regional discrepancies.

Some 35% of San Francisco Bay Area establishments like those of the Hillyards still report a large negative impact from the pandemic and more than 41% think it will take more than another six months to return to normal, a U.S. Census Bureau survey from mid-July shows. Meanwhile, in Atlanta, only 21% and 31%, respectively, of respondents reported the same concerns.

That suggests a genuine national recovery may be some ways off.

“The problem is for the economy, the pandemic has gone on longer than we thought, and it looks like different industries and different geographies have been affected very differently,” said Karen Dynan, an economics professor at Harvard University. “It’s just another reason that we are not going to see the economy go back to full employment overnight.”

NOT BACK TO NORMAL

Reuters has been following the Hillyards and their cafe business since March 2020, when they laid off their entire staff after California shut down all “non-essential” businesses. They reopened six weeks later with a PPP loan, got through the summer with help from donors like Golden State Warriors basketball star Stephen Curry, and pulled through the winter viral surge and renewed government curbs on business with a second PPP loan.

But despite the state’s decision to end all pandemic-era restrictions in mid-June, Farley’s in San Francisco is making only 70% of its pre-pandemic sales. Farley’s East in Oakland – the bigger operation of the two – is at just 40%, and any hope for improvement depends on how businesses manage their employees’ return to offices.

“I think the service sector that supported the downtown work community is one we should be worried about it,” Dynan said, because many businesses will likely allow at least some remote work in the post-pandemic period. “Breakfast places, lunch shops, dry cleaners, pharmacies downtown – they are just not going to see demand that’s as robust.”

The Hillyards have spent the $520,000 in federal aid they received, most of it on payroll for their 20 employees.

The latest grant the Hillyards were counting on was part of the $1.9 trillion pandemic relief package passed by Congress and signed by President Joe Biden in March, which included $28.6 billion for restaurants that lost money during the pandemic.

By the time the restaurant fund had run out, the owners of 278,000 restaurants had applied. Some 101,000 got grants ranging from as large as $10 million to as small as $1,000, critical support for one of the sectors hardest hit by the pandemic.

The Hillyards were relieved to be among them.

“Congratulations,” the May 18 email from the SBA read. “Your SBA Restaurant Revitalization Fund application has been approved.” It continued, “The SBA will now process the funding of this award directly to your Bank account within 3-7 business days from this notification.”

Weeks went by. The Hillyards made inquiries. “Be assured the award funds are reserved for those applications that have been fully approved and will be sent,” one SBA portal response reviewed by Reuters said.

On June 23, Chris Hillyard received another email from the SBA. “We regret to inform you that, due to recent court rulings, the SBA will not be able to disburse your Restaurant Revitalization Fund award,” it read.

A legal group founded by Stephen Miller and Mark Meadows, who held senior positions in former President Donald Trump’s White House, had sued the SBA in Texas, arguing that the Biden administration’s efforts to prioritize applicants on the basis of race and gender was unconstitutional.

On June 11, the court barred the SBA from handing out any more of the funds to priority applicants like Farley’s, which is majority woman-owned because of Amy Hillyard’s larger share in the business.

“In coming days … you will see the status of your application in SBA’s portal change to ‘fully canceled,'” the June 23 email said. Some 2,964 other restaurant owners got similar notices, SBA said. A spokesperson for the SBA said the agency was “frustrated” with the outcome and remains committed to helping disadvantaged businesses.

The Independent Restaurant Coalition, a U.S. trade group which lobbied to get the grant program into the pandemic relief bill in the first place, is now trying to convince Congress to replenish the program’s funds.

To the Hillyards, that’s cold comfort, even as the economy as a whole, despite the rising tide of COVID-19 infections, surges back to life. Their cafes continue to lose money each month.

“Everything is going back to normal – but our business is not back to normal, and it’s going to take us a lot longer to get there,” Chris Hillyard said.

(Reporting by Ann Saphir; Editing by Dan Burns and Paul Simao)

Fed’s Powell keeps to script on jobs recovery, feels heat on inflation front

By Howard Schneider

WASHINGTON (Reuters) – Federal Reserve Chair Jerome Powell on Wednesday pledged “powerful support” to complete the U.S. economic recovery from the coronavirus pandemic, but faced sharp questions from Republican lawmakers concerned about recent spikes in inflation.

In testimony to the U.S. House of Representatives Financial Services Committee, Powell said he is confident recent price hikes are associated with the country’s post-pandemic reopening and will fade, and that the Fed should stay focused on getting as many people back to work as possible.

Any move to reduce support for the economy, by first slowing the U.S. central bank’s $120 billion in monthly bond purchases, is “still a ways off,” Powell said, with millions of people who were working before the crisis still to be pulled back into the labor force.

“The high inflation readings are for a small group of goods and services directly tied to the reopening,” Powell testified, language that indicated he saw no need to rush the shift towards post-pandemic policy.

Representative Ann Wagner, a Republican from Missouri, challenged that conclusion, relaying what’s likely to be a refrain from lawmakers as long as inflation continues to rise: their constituents are getting worried.

At a prior hearing in February “you reiterated that price spikes were temporary. I can tell you that the families and businesses I represent are not feeling that these price spikes are temporary,” Wagner said.

“The incoming data have been higher than expected and hoped for but are still consistent” with a temporary bout of higher prices, Powell responded.

“It is housing, appliances, food prices, gas,” Wagner retorted, a sign of what could become growing political pressure on the Fed to get tougher on inflation if the spikes in prices continue.

Representative Anthony Gonzalez, a Republican from Ohio, took aim at a new Fed framework that aims to encourage higher employment by letting inflation run “moderately” above the central bank’s 2% target “for some time”

“How long is ‘some time’?” Gonzalez asked, arguing that the Fed’s current policies may be doing little to encourage employment at a time when employers are already posting record numbers of jobs.

“It depends,” Powell said, demonstrating the dilemma he faces if prices continue rising. “Right now inflation is well above 2%. … The question for the (Federal Open Market) Committee will be where does this leave us in six months.”

U.S. Treasury yields fell after the release of Powell’s prepared testimony earlier on Wednesday and remained lower even though prices of factory inputs rose at a higher-than-expected pace in June, an indication markets construed his comments as a sign the monetary taps will stay open.

Powell’s remarks were notable as well for excluding any mention of risks to the recovery from the coronavirus Delta variant, with the Fed chief saying the central bank expects strong upcoming job gains “as public health conditions continue to improve.”

The Fed’s June meeting saw officials begin a move towards post-pandemic policy, with some of them poised to tighten financial conditions sooner to ensure inflation remains contained. Renewed coronavirus-related risks, if they materialize, could push the Fed in the other direction of keeping support for the recovery in place longer in case household and business spending wane amid a rise in new infections.

Falling Treasury bond yields have indicated concern among investors about slowing U.S. economic growth, even as new data on prices this week showed consumers paying appreciably more for an array of goods and services, including appliances, fabric, beef and rent.

In a report to Congress last week, the Fed said that as the “extraordinary circumstances” of the reopening subside, “supply and demand should become better aligned, and inflation is widely expected to move down.”

RISING DELTA

While each month of high inflation makes it harder to stick to that conviction, Powell for now is keeping to the Fed’s core narrative of a job market that still needs massive help from the central bank to restore it to its pre-pandemic health and minimize the long-term damage from a historic, virus-driven calamity.

The Fed has said it will not reduce its bond-buying program absent “substantial further progress” in regaining the roughly 7.5 million jobs still missing since the onset of the pandemic in March 2020, a threshold policymakers feel will likely be met later this year.

That hinges, however, on continued reopening of the economy, recovery in the travel, leisure and other “social” industries devastated by the health crisis, and the willingness of currently unemployed or homebound individuals to fill the record number of jobs on offer.

When Powell last spoke about the economy at a news briefing after the end of the June 15-16 policy meeting, new daily coronavirus infections were falling toward recent lows, and the Fed dropped language from its policy statement that the pandemic “continues to weigh on the economy.”

Since then the Delta variant has pushed the seven-day moving average of cases from 11,000 to above 21,000, and health officials are concerned about the spread of the variant in parts of the country where vaccination rates are low. The numbers are more ominous globally.

Powell is scheduled to appear before the U.S. Senate Banking Committee at 9:30 a.m. (1330 GMT) on Thursday.

(Reporting by Howard Schneider; Editing by Dan Burns, Andrea Ricci and Paul Simao)

EU holds up Hungary’s recovery money in rule-of-law standoff

By Gabriela Baczynska

BRUSSELS (Reuters) -The European Union’s executive missed its own deadline to sign off on billions of euros in economic recovery aid to Hungary, delaying its decision in an attempt to win rule-of-law concessions from Budapest.

Hungary is set to receive 7.2 billion euros in EU stimulus funds meant to kickstart economic growth mauled by the coronavirus pandemic.

The funds will start flowing once the Brussels-based European Commission accepts national plans on how to spend them to ensure digital and green transitions, among others goals.

However, the Commission is using the money as leverage to push Hungary on its observance of the rule of law, an area where the increasingly authoritarian Prime Minister Viktor Orban has clashed with the EU.

A spokeswoman for the Commission said on Monday it was still analyzing the plan Budapest submitted and might propose a longer delay should it consider “months rather than days” were still needed to decide on it.

While the spokeswoman declined to give detail, the bloc’s Economics Commissioner Paolo Gentiloni said last week: “We are working on aspects to do with the respect for the rule of law.”

The Hungarian Prime Minister’s office said in a statement to state news agency MTI that talks with the Commission had been close to completion but that after Hungary’s law banning from schools materials seen as promoting homosexuality was passed, the European Commission came forward with what they said were “absurd demands”.

“The ideologically motivated political attacks obviously slow down the acceptance of the plan which was formulated earlier, in professional consultations,” the PM’s office said.

It added that talks were continuing with the Commission.

The Commission has long wanted Hungary to improve its public procurement process to combat “systemic irregularities” – or fraud.

Orban has also infuriated many of his EU peers in recent weeks with a new legislation that bans from schools materials seen as promoting homosexuality, the latest in a series of laws seen as discriminatory and restricting people’s rights.

Budapest has clashed with the EU on multiple occasions over Orban’s treatment of migrants and gay people, as well as the tightening of curbs around the freedom of media, academics and judges.

Orban portrays himself as a crusader for what he says are traditional Catholic values under pressure from the liberal West.

COVID-19 cases worsen in Latin America, no end in sight – health agency

By Anthony Boadle

BRASILIA (Reuters) -Cases of COVID-19 may be declining in North America but in most of Latin America and the Caribbean the end to the coronavirus pandemic “remains a distant future,” the Pan American Health Organization (PAHO) said on Wednesday.

While infections in the United States, Canada and Mexico are falling, in Latin America and the Caribbean cases are rising and vaccination is lagging badly. Only one in ten people have been fully vaccinated, which PAHO director Carissa Etienne called “an unacceptable situation.”

“While we are seeing some reprieve from the virus in countries in the Northern Hemisphere, for most countries in our region, the end remains a distant future,” she said.

Noting that the hurricane season in the Caribbean is arriving at a time when outbreaks are worsening, Etienne urged countries to outfit hospitals and expand shelters to reduce the potential for transmission. Social distancing and proper ventilation become difficult during storms, she said.

The highly transmissible Delta variant has already been detected in a dozen countries in the Americas, but so far community transmission has been limited, said PAHO viral disease advisor Jairo Mendez.

However, it has been found in Argentina, Brazil, Canada, Chile, Peru, the United States and Mexico, where it has spread in Mexico City, according to PAHO.

Given the presence of such variants, countries in the region should step up vigilance and consider the need to limit travel or even close borders, PAHO health emergencies director Ciro Ugarte said.

According to a Reuters tally, there have been at least 37,441,000 reported infections and 1,272,000 confirmed deaths caused by COVID-19 in Latin America and the Caribbean so far, one third more than in Asia and Africa combined.

(Reporting by Anthony BoadleEditing by Sonya Hepinstall)

Money is cheap, let’s spend it -White House $6 trillion budget message

By Andrea Shalal, Jarrett Renshaw and Jeff Mason

WASHINGTON (Reuters) -The White House on Friday unveiled a $6 trillion budget proposal that would ramp up spending on infrastructure, education and combating climate change, arguing it makes good fiscal sense to invest now, when the cost of borrowing is cheap, and reduce deficits later.

The first comprehensive budget offered by Democratic President Joe Biden faces strong opposition from Republican lawmakers, who want to tamp down U.S. government spending and reject his plans to hike taxes on the rich and big corporations.

Biden’s plan for fiscal year 2022 calls for $6.01 trillion in spending and $4.17 trillion in revenues, a 36.6% increase from 2019 outlays, before the coronavirus pandemic bumped up spending. It projects a $1.84 trillion deficit, a sharp decrease from the past two years because of the COVID-19 pandemic, but up from 2019’s $984 billion.

White House officials said the Biden’s $4 trillion plans to address historic U.S. inequality, climate chance and provide four more years of free public education would be completely paid for in 15 years, with tax increases starting to chip away at deficits after 2030.

Cecilia Rouse, the chair of Biden’s Council of Economic Advisers, says Biden’s plan is front loaded and that the administration was willing to live with budget deficits amid low-interest rates to make significant investments in the nation’s economy. She projected a drop in deficits by over $2 trillion in the following years.

“That is a sharp departure from unpaid tax cuts under the prior administration that seriously worsened our long-term fiscal problem,” she said. “The most important test of our fiscal health is real interest payments on the debt. That’s what tells us whether debt is burdening our economy and crowding out other investments.”

Rouse said the economy could see short-term inflation spikes, fueled by the sharp growth in the economy, but added she expected it to settle down to an annual rate of around 2% over time.

Increased investment would boost U.S. economic growth, with the current conservative White House forecast calling for 2% gross domestic product growth in 2031, compared with the Federal Reserve’s estimate of 1.8%.

Biden’s first full spending outline since taking office in January serves as the fiscal blueprint for his political priorities, and is likely to kick off months of difficult negotiations with Congress, which needs to approve most of the spending.

Republicans’ opposition is growing to much of Biden’s push to spend more to revamp the U.S. economy, as they argue it could fuel inflation and tamp down corporate competitiveness.

Biden has tussled with Republicans over the price of his initiatives, recovery from the pandemic and improvement of roads and bridges. No Republicans voted for his $1.9 trillion stimulus bill, but some touted its benefits later, drawing some chiding from the president.

U.S. Treasury Secretary Janet Yellen said on Thursday that the budget would push U.S. debt above the size of the U.S. economy but would not contribute to inflationary pressures.

(Reporting by Jeff Mason and Andrea Shalal; Editing by Peter Cooney, Heather Timmons and Steve Orlofsky)

U.S. Attorney General Garland expands resources to combat hate crimes

By Sarah N. Lynch

WASHINGTON (Reuters) – U.S. Attorney General Merrick Garland on Thursday directed the Justice Department to expand funding and other resources to states and municipalities to help track and investigate hate crimes, and ordered prosecutors to step up both criminal and civil investigations into hate incidents.

In a memo to Justice Department employees, Garland said that Associate Attorney General Vanita Gupta will assign someone to coordinate and serve as a central “hub” on hate crimes by working with prosecutors, law enforcement and community groups to ensure there are adequate resources to investigate and track hate crimes.

“Hate crimes and other bias-related incidents instill fear across entire communities and undermine the principles upon which our democracy stands,” Garland said in his memo.

“All people in this country should be able to live without fear of being attacked or harassed because of where they are from, what they look like, whom they love, or how they worship.”

Garland’s memo comes at a time when Asian Americans have faced an increase in attacks and racist encounters since the start of the coronavirus pandemic, when then-President Donald Trump first started blaming the virus on China.

Earlier this month, President Joe Biden signed into law the COVID-19 Hate Crimes Act, which designates a Justice Department employee to expedite a review of hate crimes reported to police during the pandemic.

In March, Garland announced he was launching a 30-day expedited review to explore ways the department could improve efforts to prosecute hate crimes and collect better data.

Thursday’s memo implements some requirements in the law, as well as some recommendations from the prior review.

Garland’s memo on Thursday also designates an official who will be tasked with expediting the review of hate crimes and calls on U.S. Attorneys offices to assign local criminal and civil prosecutors to serve as civil rights coordinators.

“Acts of hate do not always rise to the level of federal hate crimes, but such hate incidents still have a destructive effect on our communities. Federal civil statutes sometimes provide remedies when federal hate crime statutes do not,” Garland wrote.

(Reporting by Sarah N. Lynch; Editing by Marguerita Choy)

Biden plans action to thwart construction supply issues

By Andrea Shalal and Trevor Hunnicutt

CLEVELAND (Reuters) -President Joe Biden said on Thursday he will soon take action to ease U.S. supply pressures in construction materials, eliminate transportation bottlenecks and stop anti-competitive practices in the economy.

“In the coming weeks, my administration will take steps to combat these supply pressures, starting with the construction materials and transportation bottlenecks, and building off the work we’re doing on computer chips,” Biden said in a speech at Cuyahoga Community College in Ohio.

“We’re also announcing new initiatives to combat anticompetitive practices that hurt small businesses and families.”

Biden, a Democrat eager to build on the U.S. economic recovery from the coronavirus pandemic, delivered the speech as he works to sell trillions in new spending on infrastructure, manufacturing subsidies, childcare and other investments.

The president will release a budget plan on Friday for fiscal-year 2022 that Treasury Secretary Janet Yellen said will push U.S. debt above the size of the national economy but not contribute to inflationary pressures.

Republicans object to Biden’s main plans to help pay for the extra spending: tax hikes on high-income earners and the biggest corporations.

The spending could help push down lingering unemployment following a pandemic that killed hundreds of thousands of Americans and put millions more out of work.

But signs of higher inflation from gasoline to lumber, and lingering shortages of supplies like computer chips, have threatened to derail that recovery by making critical goods and labor more expensive or hard to come by.

The Biden administration has been eager to head off suggestions that its spending polices could exacerbate rising prices and spark inflation that could worsen economic inequality.

“Now, as our economy recovers, there’s gonna be some bumps in the road,” Biden said. “You can’t reboot a global economy like flipping on a light switch. There’s gonna be ups and downs in jobs and economic reports. There’s going to be supply-chain issues – price distortions on the way back to a stable and steady growth.”

(Reporting by Andrea Shalal and Trevor Hunnicutt; Editing by Peter Cooney)

New York lifts mask requirements for the vaccinated, California waits

By Jonathan Allen and Barbara Goldberg

NEW YORK (Reuters) -New York state this week will drop face mask requirements in most public spaces for people vaccinated against COVID-19, conforming with the latest U.S. Centers for Disease Control and Prevention guidance, Governor Andrew Cuomo said on Monday.

In California, Governor Gavin Newsom said his state would keep its mask order in place for another month, despite the CDC’s new recommendations.

Cuomo and Newsom, both Democrats, have drawn criticism for their handling of the coronavirus pandemic. Newsom faces a Republican-led recall election.

New Jersey Governor Phil Murphy, also a Democrat, said he would lift mask restrictions outdoors but keep in place a mandate to wear them indoors. Murphy said schools would be required to provide full-time, in-person classroom instruction again in the fall.

On Saturday, the CDC said students in schools across the United States wear masks for the 2020-2021 academic year because not all will be inoculated.

New York will still order public transportation riders to wear face coverings and mandate them in schools and some other communal settings, Cuomo said, adding: “Unvaccinated people should continue to wear a mask.”

Cuomo said New York health officials decided to lift the mask order after reviewing the CDC’s new guidance. Some 52 percent of New York adults have been fully inoculated and 61.8 percent had received at least one shot as of Monday.

Cuomo, speaking to reporters at Radio City Music Hall, said it would be up to each business or venue how they should determine vaccination status

“I’m sure when people are coming into Radio City Music Hall, they are going to ask, ‘I’m sitting next to someone. I don’t know who they are. Are you sure they were vaccinated?'” he said. “That’s why it’s on the operator’s best interest to say ‘Yes! They had a card and they were checked when they walked in the door.'”

The three-term governor said he expected that some New Yorkers might keep wearing masks as a precaution after this week’s rule change.

Cuomo, 63, has resisted calls to resign in the face of probes by the state attorney general and legislature over accusations of sexual harassment, his office’s reporting of nursing home deaths and his use of staff members and resources in the writing of a book on his handling of the pandemic.

(Reporting by Jonathan Allen and Barbara Goldberg in New York and Dan Whitcomb in Los Angeles; editing by Jonathan Oatis and David Gregorio)