Economics in the News – Dec. 1-7, 2025
Economics impacts our lives every day. Below are some of the top storylines from this past week related to economics.
o It was announced that Michael and Susan Dell will donate $6.25 billion to build on the initiative of “Trump Accounts” created as part of the One Big Beautiful Bill Act. Under the initiative, each child born between 2025 and 2028 will receive a $1,000 account, while the Dells want to expand the effort to fund accounts for children aged 10 and under.
The “Trump Accounts” accounts add to parents’ efforts to save for their child’s future, and effectively provide them with free cash that’s automatically seeded by the US Treasury. They will be invested in low-cost index funds and be locked up until the child turns 18 years old. However, financial advisors encourage parents to take the accounts, they also caution that parents shouldn’t be too quick to ditch more established plans such as 529 plans, custodial brokerage accounts and Roth IRA accounts. One reason is that “Trump accounts” can only be invested in US equity index funds, while traditional accounts have more flexibility in terms of investment options. In addition to maximum contributions being much lower for the “Trump Accounts,” there can also be downsides from a tax standpoint. [Bloomberg]
o Online sports betting has gained popularity after many states have legalized it over the last several years. But, as states want to further increase tax revenue, they are finding that full online casinos – slot machines, poker and blackjack – are a better bet. Only seven states have legalized online casinos, while 30 states have legalized online sports gambling.
For example, Pennsylvania received $1.05 billion in taxes from digital casinos last year, compared to $188 million from sportsbook apps. The Commonwealth taxes online slot machines at a higher rate than it does sports bets, taxing online slots at a 50 percent clip. In addition, the seven states that legalized online casinos collected $2.1 billion last year from gambling apps. Meanwhile, the 30 states with legalized online sports betting generated $2.9 billion in tax revenue. [The New York Times]
o Netflix announced that it intended to acquire Warner Bros. Discovery’s studio and streaming business. The cash-and-stock deal is valued at $82.7 billion. It would need approval from federal regulators, as well as regulators in Europe. Under the deal, Discovery would separate its cable unit for popular channels, such as CNN, TNT and Discovery.
The deal would send ripple effects through Hollywood, as Netflix has more than 300 million subscribers making it the world’s largest subscription-based streaming service. The addition of Warner Bros. Discovery would add to the pressure already on theater owners and smaller studios in the entertainment industry. Paramount announced a hostile takeover bid for Warner Bros. Discovery, offering $30 per share in cash to shareholders – a $108 billion valuation. [The New York Times]
o Debit card users may soon get some of the reward perks offered to credit card users. Several businesses, including Southwest Airlines, United Airlines, and Wyndham Hotels and Resorts. Those companies have launched debit cards in which users can accumulate points and miles. Rewards have not traditionally been a perk of debit cards because it does not make economic sense for banks.
Companies in financial technology, such as Venmo and Klarna, are looking to cater to consumers who choose not to use debit by leaning on merchant-funded offers. In addition, opening a debit card with an airline or hotel means opening and depositing into a checking account offered by those companies. The majority of the rewards-earning debit cards come with fees associated with them and the reward programs are not as robust as credit cards. [The Wall Street Journal]
o As baby boomers are aging, the need for caregivers is soaring. However, a shortage of workers is worsening due to budget cuts and President Donald Trump’s policies on immigration. In addition, compensation is low compared to other industries, as the median salary was around $35,000 last year.
In the next decade, spending on home health is projected to double, while the number of openings in the industry is expected to climb by 17 percent. In addition, the costs associated is quickly increasing, with at-home care climbing seven percent and the prices for nursing homes climbing four percent. [The Washington Post]
