Higher gas prices siphon off some earnings: Americans earned and spent more in March, but much of the extra money went toward more expensive gasoline. Personal incomes rose 0.5% last month and consumer spending increased 0.6%, the Commerce Department reported today. But after adjusting for inflation, spending rose a modest 0.2% and after-tax incomes were essentially flat. Consumer spending had been expected to post solid gains this year, helped by stronger employment growth and a 2 percentage-point cut in Social Security payroll taxes. But Americans are paying more for gas, prompting economists to scale back their growth forecasts. The national average at the pump today was $3.90 a gallon—31 cents higher than a month ago and more than $1 higher than what consumers paid a year ago.
Embarrassing incidents prompt the move: The Federal Aviation Administration is shaking up the management of the nation’s air traffic control system following embarrassing incidents of controllers sleeping on the job and making errors. The FAA says it has appointed new managers to oversee the operation of airport towers and regional radar centers that handle planes flying at high altitudes as well as approaches and departures. The previous managers are being reassigned. The agency also is reassessing midlevel managers’ performance. A team of experts is examining several of the agency’s more complex facilities, including radar centers in Cleveland and Ronkonkoma, N.Y. An air traffic controller was suspended in Cleveland for watching a movie at work, and a whistleblower complained that controllers at the New York center routinely took naps during late night breaks.
