Audit Rates, Recession Fears, and Solar Tariffs Pause

Tax Policy:

June 1: IRS tries to boost audit rates of wealthy

In conjunction with the release last week of its annual Data Book for 2021, which contains a wealth of statistics on examination rates, the IRS response to the COVID-19 pandemic, the provision of advance Child Tax Credits and Economic Impact Payments, along with the usual information on the number of returns processed, revenue collected and tax refunds issued, the IRS released a separate statement providing an update on its latest audit numbers, pointing to how it is increasing its audits of higher-income taxpayers.

"We audit high-income taxpayers more than any other category in the Internal Revenue Service. Taxpayers reflecting over $10 million of income are audited at a rate exceeding 7%. Taxpayers at the $25,000 level, which is primarily the Earned Income Tax Credit taxpayer, would be the only people we would look at, are audited at 1.1%. Those are correspondence audits." He blasted Syracuse University's TRAC report, and in turn, TRAC called on the IRS to release the latest numbers.

The release last week of the fiscal year 2021 Data Book, which covers the period from Oct. 1, 2020, to Sept. 30, 2021, and the additional statement from the IRS sheds light on the moves the IRS has been making to counter the argument that it is targeting lower-income taxpayers for audits. In a statement last week in conjunction with the Data Book release, Rettig also highlighted the hard work the agency had been performing to respond to the pandemic and the various forms of tax relief and stimulus payments delivered by the IRS. "During Fiscal Year 2021, the COVID-19 pandemic continued to present the IRS with some of the greatest challenges in our agency's history, and the way our employees responded illustrates the significant role that the IRS plays in the overall health of our country," Rettig said in a statement.

"The correspondence audit process is meant to create efficiency; however, these audits can present a host of challenges for our nation's most vulnerable taxpayers and have downstream consequences for taxpayers and the IRS," Collins wrote.

"The IRS should provide low-income taxpayers more direct access to personalized IRS service in an effort to increase low-income taxpayer audit participation, build trust, and engage and educate low-income taxpayers. Instead, low-income taxpayers generally experience difficulty reaching the IRS for assistance." Some of the complexities facing low-income taxpayers and efforts to get responses to correspondence audits include taxpayers claiming the EITC that requires factors like income, marital status, relationships to dependents, and children claimed.

Build Back Better Act/Spending Bill: 

June 3: Senators make last-ditch bid for Manchin’s backing

While Senate Majority Leader Charles Schumer is attempting to get Manchin on board with climate change and lower prescription drug price proposals, GOP lawmakers are trying to divert Manchin's attention toward bipartisan negotiations on gun control and energy legislation - anything to keep the pivotal senator out of the New York Democrat's office as much as possible. Schumer is privately trying to negotiate with Manchin on a budget bill that addresses climate change and lowers prescription drug prices all while anti-tax activists are running ads in West Virginia pressing him to reject proposed fiscal increases to fund such Democratic priorities.

A group of 26 House Democrats piled more pressure on Manchin and Schumer to strike a deal by penning a letter last month warning that constituents will see a spike in health insurance premiums unless Congress extends premium tax credit enhancements.

Schumer met with Manchin at least twice in his office before the Memorial Day recess, and the Democratic leader says he's not giving up on locking down Manchin's vote. Speaking at an AARP event in West Virginia on Tuesday, Manchin said Democrats must pass legislation to lower prescription drug prices before the midterm elections.

Manchin gave Democrats more cause for hope last week while attending the World Economic Forum in Davos, Switzerland, telling a panel "I believe there's an opportunity" to pass meaningful legislation to pay down the debt, reform prescription drug costs, and address climate change.

Jim Kessler, the executive vice president for policy at Third Way, a centrist Democratic think tank, said Manchin may want to cut a deal with Schumer because he recognizes his influence as the most pivotal vote in a 50-50 Senate isn't likely to last past the midterm elections.

Economic News/Policy: 

June 7: Persistent Inflation Puts Yellen in the Spotlight

At her confirmation hearing in early 2021, Treasury Secretary Janet L. Yellen told lawmakers that it was time to “act big” on a pandemic relief package, playing down concerns about deficits at a time of perpetually low-interest rates and warning that inaction could mean widespread economic “scarring.”

A year and a half later, prices are soaring and interest rates are marching higher. As a result, Ms. Yellen's role in crafting and selling the $1.9 trillion American Rescue Plan, which Congress passed in March of last year, is being parsed amid an intensifying blame game to determine who is responsible for the highest rates of inflation in 40 years.

Ms. Yellen said in her opening statement on Tuesday that the Biden administration is working hard to address inflation. "We currently face macroeconomic challenges, including unacceptable levels of inflation as well as the headwinds associated with the disruptions caused by the pandemic's effect on supply chains, and the effects of supply-side disturbances to oil and food markets resulting from Russia's war in Ukraine," Ms. Yellen said, according to her prepared remarks.

For months, Ms. Yellen - and many other economists - talked about inflation as "Transitory," saying rising prices were the result of supply chain problems that would dissipate and "Base effects," which were making the monthly numbers look worse in comparison with prices that were depressed during the early days of the pandemic.

In an interview with The New York Times last June, Ms. Yellen said she believed that inflation expectations were in line with the Federal Reserve's 2 percent target and that while wages were increasing, she did not see a "Wage price spiral" on the horizon that could cause inflation to become entrenched.

Jerome H. Powell, the Fed chair, had just days earlier signaled that the Fed would stop using that word to describe inflation, showing that Ms. Yellen was not out of line with other key economic policymakers.

Mr. Summers said on CNN last week that Ms. Yellen had been echoing the views of most mainstream economists last year when she played down inflation and that those incorrect projections called for a rethinking of economic models.

June 5: Economy Week Ahead: Inflation in Focus

Tuesday: The U.S. trade deficit hit a record high in March, as demand from consumers and businesses fueled a surge in imports.

The trade gap in April is forecast to have narrowed for the first time since October 2021, with several factors likely at play, including supply-chain disruptions related to Covid-19 lockdowns in China and rising exports of both goods and services.

Thursday: The European Central Bank is expected to confirm plans to end a bond-purchase program and start raising interest rates this summer, to quell record-high inflation.

ECB President Christine Lagarde last month outlined the policy shift that would end an eight-year experiment with negative rates despite concerns about faltering economic growth amid fallout from the war in Ukraine.

Friday: Economists estimate that China’s consumer-price index edged higher in May because of rising pork prices and disruptions related to Covid-19 lockdowns, though overall inflation pressure in the country still appears muted.

Producer prices, a measure of factory-gate inflation, are forecast to have eased. The U.S. consumer-price index for May will offer the last major inflation reading before the Federal Reserve’s June 14-15 meeting.

It might not offer much comfort. Rising fuel prices and supply-chain disruptions related to Russia’s invasion of Ukraine are forecast to have kept headline inflation elevated. Core prices, which exclude sometimes-volatile food and energy prices, also likely remained well above the Fed’s comfort zone.

June 4: Economic Recession Fears Could Be Overblown

If there is a recession brewing in the United States, it would be news to Doug Johnson. Tesla chief Elon Musk and Lawrence Summers, a former treasury secretary, also have warned of a looming recession. The Federal Reserve's recent change of course on monetary policy is the biggest source of recession fears.

That's down from the 3.3 percent forecast in April, but far from a recession.

The war in Ukraine drove up the price of key global commodities, including wheat and oil, and increased the chances of a recession in Europe.

"Fears of declining economic activity this year will prove overblown unless new negative shocks materialize," Goldman Sachs economists concluded in a May 30 client note. The financial imbalances that often precede a recession are absent.

June 3: Corporate Executives Assess U.S. Economy as Clouds Form

Over the past week, business leaders have laid out in the starkest terms yet that a period of universal strength in the U.S. economy has given way to a muddled outlook in which a labor shortage, soaring stock markets, and a healthy consumer is no longer given.

Technology companies from Facebook parent Meta Platforms Inc. to Uber Technologies Inc. have sharply slowed hiring in recent weeks, and Elon Musk told staff at Tesla Inc. that he plans to cut 10% of its salaried jobs.

“There’s a lot of discussion and talk about a recession coming, but if you look at our building or been on an airplane recently you’d never notice it,” Bob Nelson, a senior vice president at Costco Wholesale Corp., told analysts recently. The retailer said sales rose 10.8% during the most recent quarter. Still, business leaders say they are increasingly preparing for a new normal in which companies' fortunes start to splinter as inflation persists and consumer budgets tighten.

Streaming company Netflix Inc. said last month it was cutting about 150 employees amid slowing revenue growth and a shrinking subscriber base. Even some tech companies that continue to thrive are more cautious.

Intel Corp. expects to hire thousands of employees in the coming years, said Christy Pambianchi, the chip maker's chief people officer, as the company opens new manufacturing facilities to help meet surging demand for semiconductors.

"While there might be some noise in the labor-market dynamics, I don't think it'll change the backdrop against which we've been trying to hire or retain our folks." Still, the U.S. labor market had been "Very, very, very tight," Ms. Pambianchi said, and over time it may "Just get a little more in balance." Marriott is among hospitality companies that say they are struggling to find enough workers to fill hourly roles.

June 3: Is ‘Greedflation’ Rewriting Economics, or Do Old Rules Still Apply?

There are few good things about living through a period with the highest inflation in four decades, but here’s one: It’s a chance to re-examine what happens in an economy that’s gone haywire.

Since prices started to escalate a year ago, politicians and economists have seized on inflation to tell their preferred story about what went wrong, and what policies would bring it back into line. 

“There’s simply a lot of cash out there,” said Joe Brusuelas, chief economist for the accounting firm RSM US, referring to the several trillion dollars in pandemic stimulus that’s filtered into the economy since early 2020. “The competition for those goods is up and that’s sending prices up, whether we’re talking about getting a Nissan Sentra or a seat on an American Airlines flight.”

The White House and progressive organizations, however, say wait a minute: This time is different. In a time of extraordinary disruption, they contend, increasingly dominant corporations are taking the opportunity to jack up prices more than they otherwise could, which is squeezing consumers and supercharging inflation.

Congressional Democrats have run with the idea, introducing bills that would impose a temporary "Excess profits tax" on companies that charge prices they deem unreasonably high, or simply ban those high prices altogether.

"In the inflationary environment, everybody knows that prices are increasing," said Z. John Zhang, a professor of marketing at the Wharton School at the University of Pennsylvania who has studied pricing strategy.

Even if high prices aren't able to increase supply and the shortage remains, an Economics 101 class might still teach that price is the best way to allocate scarce resources - or at least, that it's better than the government price controls or rationing. Fast price increases spell trouble, but moderate price gains can lead to higher wages and job growth. For now, the stakes are more about the public understanding of inflation, rather than the government intervening to keep empanada prices low.

June 3: Hiring Remains Strong Even as Fed Tries to Cool Economy

The Labor Department reported Friday that employers added 390,000 jobs, the 17th straight monthly gain. The unemployment rate was 3.6 percent for the third straight month, a touch away from a half-century low. At the same time, the labor force grew by 330,000 people, and the share of adults employed or looking for work continued to edge closer to pre-pandemic levels.

The share of people who have looked for work in the past four weeks or are temporarily laid off.

The continued job gains are among many indications of a vibrant economy. Reports from the nation’s largest banks show checking accounts are still above 2019 levels for nearly all income groups. New bankruptcies and debt-collection proceedings are both at their lowest levels since tracking began in 1999.

Yet those encouraging trends have been at odds with the generally sour national mood, dominated by inflation concerns. U.S. consumer sentiment declined in early May to the lowest since 2011, according to the University of Michigan.

And with a potential change in the economic cycle, economic security is not evenly distributed among households. If tightening financial conditions prompt businesses to downsize, research shows that "Last hired" workers will typically be the "First fired" - and that Black and Hispanic workers and those with less education are particularly vulnerable.

A broad range of economists and policymakers, including Jerome H. Powell, the Fed chair, stress that more modest wage gains, when paired with milder prices, will be more sustainable for all workers, who are also consumers, in the long run.

Another missing element of the workforce is recent immigrants. Goldman Sachs researchers said recently that because of visa restrictions and health protocols during 2020 and 2021, the total number of workers was about 1.6 million below where it would be otherwise.

June 2: Fed’s Lael Brainard Says Too Soon to Say If Pace of Rate Increases Can Slow

Ms. Brainard, who serves as an influential member of the Fed's policy leadership team, said the next several months of data on price pressures and economic activity would be important in determining whether the Fed continued to raise rates in September by a half percentage point or by the more traditional quarter-point increment. 

"If we are seeing a deceleration in the monthly prints, it might make sense to be proceeding at a slightly slower pace." Separately, Cleveland Fed President Loretta Mester said Thursday the central bank could encounter greater financial market volatility and higher unemployment in its quest to push down inflation.

An additional half-percentage-point increase in rates beyond that would push them to the highest level reached during the Fed's 2015-18 interval of increases. Before the Fed slows its pace of tightening, Ms. Brainard said she wanted to see "a string of decelerating inflation data to feel more confident" that price pressures were moderating.

Fed Vice Chairwoman Lael Brainard Consumer prices rose 6.3% in April from a year earlier, slowing from 6.6% in March, as measured by the Commerce Department's personal consumption expenditures price index, which is the Fed's preferred gauge.

In recent weeks, a few regional Fed presidents have said they would support pressing ahead with an aggressive pace of rate increases in September if monthly inflation readings remain elevated. Atlanta Fed President Raphael Bostic has said he might support taking a break from tightening at the September meeting to assess the impact of the Fed's moves to that point.

June 2: Why a May jobs slowdown may not be bad news for Biden

While a slowdown in job gains doesn't often signal good news for a president suffering poor approval ratings amid high inflation, or his party, it may not be that bad for President Biden. Economists expect the Labor Department's jobs report to show a gain of 350,000 jobs in May and a slight decline in the unemployment rate to 3.5 percent, according to consensus projections.

The U.S. has gained more than 8.5 million jobs since Biden took office, but high inflation has strained household budgets and driven deep dissatisfaction with the president's economic agenda. A slight decline in job growth may not be bad news for Biden, who has laid out a plan to combat inflation if it means the U.S. economy is slowing to a more sustainable pace. There were roughly two open jobs for each unemployed American in April as businesses scrambled to fill near-record numbers of vacant jobs, according to Labor Department data released Wednesday.

Higher labor force participation would give businesses more options to fill open jobs without continuously raising wages.

"Between the war in Ukraine and the Federal Reserve tightening a lot, I've been expecting to see a slowdown in jobs and we really haven't seen it yet," said Matthew Darling, an employment policy fellow at the Niskanen Center, a nonpartisan think tank.

June 1: In shift, the White House starts to talk up the economy

President Biden and his administration have shifted gears toward a month-long campaign to talk up the economy to show the White House is prioritizing inflation by pushing the positives about what it has delivered - but the plan may come with some risk. The effort spanning the month of June will see Biden and his aides traveling the country to promote the White House's economic strategy and Biden will deliver remarks on the May jobs report this Friday.

Biden acknowledged that the Federal Reserve "Has a primary responsibility to control inflation," making goods like gas more affordable for families during what the White House is labeling a "Transition period." He also once again linked reducing the federal deficit to lowering price pressures, a relationship many economists believe has weakened in recent decades.

The historically right-leaning pro-business lobbying group the U.S. Chamber of Commerce applauded Biden's renewed focus on inflation on Tuesday but suggested other tools to combat inflation such as cutting tariffs.

Biden and multiple aides have in recent days highlighted a report that the U.S. economy may grow faster than China's economy for the first time in nearly 50 years.

"Under Biden, inflation and gas prices have only gone up and families are struggling to afford basic needs as a result," Republican National Committee Chairwoman Ronna McDaniel said in a statement. "Despite what Biden and the Democrats say, the economy is declining steadily on their watch as families can't afford everything from gas to groceries."

Biden in Japan last week disputed the idea that a recession is inevitable for the U.S. economy, but he acknowledged lowering prices would not happen overnight.

Global Trade:

June 7: U.S. Imports Slowed in April, Shrinking Trade Deficit From Record

The U.S. trade deficit narrowed in April as imports fell sharply, reflecting a moderating appetite for foreign goods and materials from American consumers and businesses. The trade gap in goods and services fell to 19.1% in April from the prior month to a seasonally adjusted $87.1 billion, the Commerce Department said Tuesday, retreating from March's record $107.7 billion deficit.

Imports fell 3.4% to $339.7 billion, the first month-on-month decline since July last year, driven by a drop in clothing, household goods, toys, pharmaceutical products, and finished metals. Exports continued their upward trend in recent months, rising 3.5% to $252.6 billion.

65 billion 2019 '20 0 20 40 60 80 100 $120 billion Economists polled by The Wall Street Journal had estimated a trade deficit of $89.4 billion for April.

Consumer demand for goods and services remained solid in April despite high inflation in the U.S. While oil prices on the global markets continue to rise amid concerns of shortages caused by tightening sanctions against Moscow, the price of Brent crude had fallen to as low as $100 a barrel in early April from a high of nearly $130 in early March, according to Wall Street Journal data.

The trade deficit had fluctuated for years between $40 billion and $50 billion a month.

Energy and Environmental Policy/News:

June 6: Biden to Pause New Solar Tariffs as White House Aims to Encourage Adoption

The Biden administration on Monday is set to announce a two-year pause on imposing any new tariffs on the solar industry, following an outcry from importers who have complained the levies are threatening broader adoption of solar energy in the United States. The decision is a victory for domestic solar installers, who said the tariffs would put at risk the Biden administration's goal of significantly cutting carbon emissions by the end of the decade.

The Commerce Department had been considering whether to impose the tariffs as part of a trade case that accused Chinese solar companies of trying to get around existing levies by moving their operations out of China and into other countries. American solar companies have said that the prospect of more - and retroactive - tariffs were already having a chilling effect on imports. Groups such as the Solar Energy Industries Association have been lobbying the White House against the tariffs and on Monday welcomed the news that the administration would pause any new levies.

"Today's actions protect existing solar jobs, will lead to increased employment in the solar industry, and foster a robust solar manufacturing base here at home," Abigail Ross Hopper, president, and chief executive of the Solar Energy Industries Association, said in an emailed statement. "During the two-year tariff suspension window," she said, "The U.S. solar industry can return to rapid deployment while the Defense Production Act helps grow American solar manufacturing."

June 3: The End of Energy Free Trade

Russia's attack on Ukraine is redrawing the world's energy map, ushering in a new era in which the flow of fossil fuels is influenced by geopolitical rivalries as much as supply and demand. Three likely axes of energy influence are emerging: the U.S. and other Western nations, which have used their massive economic and purchasing power as a political weapon; China and large emerging nations such as India, Turkey, and Vietnam, which have rebuffed Western pressure and continued doing business with Russia; and Saudi Arabia and other Middle Eastern oil-producing nations, which have sought to maintain neutrality, and may stand to gain market share in the years to come.

Mr. Freeman, who is now a senior fellow at Brown University, said Europe can never again trust Russia to be its primary energy provider, and that even if sanctions are lifted, countries are proposing costly new infrastructure and endorsing long-term alternative supply contracts that will lock in the new energy map.

Ms. Yellen advocated for "Friend-shoring" supply chains of critical raw materials by deepening trade ties with "a group of countries that have a strong adherence to a set of norms and values." Trade flows are already being redirected as Western energy companies pull out of Russia and shippers, lenders and insurers refuse to touch Russian exports.

Increased demand coupled with Western energy sanctions against Russia that will cut its output may lead to physical shortages of global oil, according to Joseph McMonigle, secretary-general of the Saudi Arabia-based International Energy Forum.

Losing its nearest and largest market will cost Russia billions of dollars in energy revenues every year. Some Russian energy officials privately concede Russia will be unable to dodge prolonged Western energy sanctions.

June 2: House Republicans unveil energy, climate strategy

House Republicans are launching a new energy and climate strategy as the party seeks to win over voters ahead of the midterm elections, though green groups have immediately criticized the plans as insufficient. Rep. Garret Graves, who leads the House GOP's task force on energy, climate, and conservation, told reporters Thursday that the plans being unveiled by the party are guided by affordability, emissions reduction, and energy security.

"We are aggressively pursuing meeting this global energy demand spike with U.S. resources. That means U.S. innovation, it means U.S. renewable energy technologies and, yes, it means conventional energy sources like oil and gas," Graves said.

Republicans have long argued that the United States' regulatory system makes its fossil fuels less harmful than those in other countries, though climate advocates have called for widespread reductions in fossil fuel use to prevent global warming.

"This would be laughable as a climate agenda in 2022 except there is absolutely nothing funny about the climate crisis or Congressional Republicans' obstruction of desperately needed solutions in the name of lining the pockets of their corporate allies and big oil polluters who fund their campaigns," said Tiernan Sittenfeld, senior vice president of government affairs at the League of Conservation Voters.

On a national level, many Republicans have shunned the climate issue, with Republicans having no climate plan as part of their 2016 or 2020 election platforms.

"One of the objectives here is being very clear to the American public that we recognize there's an energy crisis and we recognize the causes of this energy crisis," he said.

June 2: OPEC+ announces a 50 percent increase in oil output for July and August

OPEC+ nations on Thursday agreed to increase oil output by about 50 percent for the next two months after initially standing by a 400,000-barrel release. Ministers announced an agreement to increase output in July and August by 648,000 barrels a day in July and August.

Gas prices in the U.S. saw another spike heading into the Memorial Day holiday, while across the Atlantic, European Union members reached an agreement on banning Russian oil imports in response to the country's invasion of Ukraine.

Russia, a member of the OPEC+ bloc of oil-producing countries that are aligned with OPEC but not members, has also seen its production fall amid international sanctions. Russia is the world's third-largest oil producer, behind the U.S. and Saudi Arabia.

White House press secretary Karin Jean-Pierre said in a statement Thursday that the U.S. “welcomes” the news. "This announcement accelerates the end of the current quota arrangement that has been in place since July of last year and brings forward the monthly production increase that was previously planned to take place in September," she said.

Saudi officials argued in May an increase would have no effect.

June 1: Biden Administration to Cut Costs for Wind and Solar Energy Projects

The Biden administration said on Wednesday it would cut in half the amount it charges companies to build wind and solar projects on federal lands, a move designed to encourage the development of renewable energy. "Clean energy projects on public lands have an important role to play in reducing our nation's greenhouse gas emissions and lowering costs for families," Deb Haaland, the interior secretary, said in a statement.

Representative Mike Levin, Democrat of California, who has sponsored legislation to expedite renewable energy development, applauded the move. "As Americans continue to face worsening effects of the climate crisis and rising energy bills, it's paramount that we strengthen our clean energy independence to reduce greenhouse gas emissions and lower energy costs," he said in a statement.

Last month, the administration canceled three oil and gas lease sales in the Gulf of Mexico and off the coast of Alaska, prompting Republican lawmakers to criticize the new renewable energy policies as harmful to energy-producing states.

President Biden has pledged to cut greenhouse gases generated by the United States roughly in half by 2030. Legislation to accomplish that is frozen on Capitol Hill. As a result, the administration is focused on more limited executive actions that could spur clean energy and reduce the use of oil, gas, and coal - the burning of which produces the carbon dioxide and other gases that are dangerously heating the planet.

In a report to Congress in April, the Interior Department said it was on track to approve 48 wind, solar, and geothermal energy projects with the capacity to produce an estimated 31,827 megawatts of electricity, enough to power roughly 9.5 million homes, by the end of the fiscal 2025 budget cycle.

ICYMI: 

June 4: Abbott's Shuttered Baby Formula Factory In Michigan To Begin Production Again

Abbott Nutrition resumed production at its shuttered Sturgis, Mich., baby formula factory on Saturday, offering hope that a nationwide shortage that had left parents scrambling to find sustenance for their children could ease in the coming weeks.

"We understand the urgent need for formula and our top priority is getting high-quality, safe formula into the hands of families across America," Abbott said in a statement.

The plant will prioritize the production of EleCare, a specialty amino acid-based formula for children with multiple allergies before it ramps up production of its mainstream products. The FDA on Saturday said that it "Is continuing to work diligently to ensure the safe resumption of production of infant formula" at Abbott Nutrition's Sturgis facility.

Inspectors found Cronobacter sakazakii bacteria on environmental samples they took outside the main formula production area. Even with Operation Fly Formula bringing in millions of bottles from Australia, the United Kingdom, and Germany, data research firm IRI reported that store inventories were still slightly worse in recent weeks when compared with the beginning of May. Parents continue to report difficulty finding the formula they need, with some driving long distances and others paying a premium to buy it online. Abbott said the EleCare product could reach stores in about 16 days, but it could take weeks for the formula made in Sturgis to fully reach shelves because of the time required for the formula to be dried and safety-tested.

June 3: Biden responds to Musk's concerns about the economy: ‘Lots of luck on his trip to the moon

President Biden on Friday shrugged off Elon Musk's pessimistic outlook on the economy, wishing the Tesla and SpaceX founder "Lots of luck on his trip to the moon."

Musk reportedly wrote in an email to Tesla executives that he has a "Superbad feeling" about the economy and that the company would need to slash 10 percent of its workforce. Biden was asked to respond to Musk's comments after giving remarks on the May jobs report from Delaware.

The president pointed to new investments in electric vehicles from Ford that will create 6,000 new union jobs, as well as investments from Chrysler in electric vehicles and Intel in developing computer chips at a new factory. "So, you know, lots of luck on his trip to the moon," Biden said.

"Thanks, Mr. President!" Musk responded on Twitter, linking to a story about NASA choosing SpaceX to take Americans to the moon.

The relationship between Musk and the White House has been tense at times. The White House frequently touts investments in electric vehicles and cleaner energy, but infrequently mentions Tesla, something Musk has taken note of.

For Fun: 

June 6: Astrophysicists Create “Time Machine” Simulations To Observe the Lifecycle of Ancestor Galaxy Cities

Now, for the first time, researchers have created simulations that directly recreate the full life cycle of some of the largest collections of galaxies observed in the distant universe 11 billion years ago, reports a new study published on June 2, 2022, in the journal Nature Astronomy. Cosmological simulations are crucial to studying how the universe became the shape it is today, but many do not typically match what astronomers observe through telescopes.

Constrained cosmological simulations, on the other hand, are designed to directly reproduce the structures we actually observe in the universe. Most existing simulations of this kind have been applied to our local universe, meaning close to Earth, but never for observations of the distant universe.

A team of researchers, led by Kavli Institute for the Physics and Mathematics of the Universe Project Researcher and first author Metin Ata and Project Assistant Professor Khee-Gan Lee, were interested in distant structures like massive galaxy protoclusters, which are ancestors of present-day galaxy clusters before they could clump under their own gravity.

Because light from the distant universe is only reaching Earth now, the galaxies telescopes observe today are a snapshot of the past. Another important reason why the researchers created these simulations was to test the standard model of cosmology, that is used to describe the physics of the universe.

June 2: Biotech company says the woman received 3D printed ear made from her own cells

A 20-year-old woman is the first to receive a 3D-printed ear implant made from her own cells. 3DBio Therapeutics says the ear matures over time and develops the characteristics of a human ear, including flexibility, elasticity, and a typical "Look and feel."

Doctors say they have successfully transplanted a 3D-printed ear implant made from human cells onto a patient who was born with microtia, a rare birth defect in which the outer ear is deformed.

A 20-year-old woman from Mexico who was born with microtia received the ear implant in March. The cells were then mixed with a collagen-based bio-ink that was then shaped by a 3D-bioprinter into an implant, known as AuriNovo, mirroring the size and shape of the patient's opposite ear.

"This study will allow us to investigate the safety and aesthetic properties of this new procedure for ear reconstruction using the patient's own cartilage cells. My hope is that AuriNovo will one day become the standard of care replacing the current surgical methods for ear reconstruction requiring the harvesting of rib cartilage or the use of porous polyethylene implants," Bonilla said. The defect can also result in hearing loss due to abnormalities of the ear canal or middle ear.