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Consumer and fan expectations are forcing the NBA, the NHL, and Nike to see brand activism as good for business

Sat, 09/26/2020 - 9:10am  |  Clusterstock
Sports fans and consumers are now expecting brands to take a stance.
  • Consumers are quick to notice when brands don't take a stand in activism, especially in today's political climate. 
  • Players in major sports, including the NBA, NHL, and ATP, are ramping up activism by boycotting games as an act of solidarity for the Black Lives Matter movement.
  • Brands like Nike, Google, and Lyft are also more increasingly participating in activism, but some people believe their efforts are driven by marketing ploys rather than genuine empathy for social issues. 
  • Visit Business Insider's homepage for more stories.

So-called brand activism is evolving fast. When Colin Kaepernick first knelt during the US national anthem in 2016, professional football turned its back on him. Now, consumer and sports fan expectations are forcing brands to see activism as good for business.

According to a recent Nielsen survey, 72% of sports fans believe athletes are an important influence in the Black Lives Matter (BLM) movement. A whopping 59% expect athletes to engage personally with BLM activism.

In short, if brands aren't taking a stand (or a knee), consumers notice.

Sporting codes have woken up to the benefits of strategically targeting a younger, more racially-diverse demographic. As National Hockey League (NHL) executive vice president for social impact Kim Davis put it: "People understand that doing the right thing is also right for the business."

After the shooting of Jacob Blake by Kenosha police, however, that activism ramped up. Players from most major professional sports protested by refusing to play at all.

Brand activism cuts both ways

It began with local NBA team the Milwaukee Bucks, whose own player Sterling Brown had been brutally beaten by police in 2018. Having refused to take the court for a playoff game, the team's actions were picked up by social media and the no-play protest spread to other sports.

The backlash and praise were immediate, with the Bucks becoming the most mentioned brand on social media that week.

There were asymmetric effects for the team brand: a clear drop in brand sentiment from those who disagreed with their stand, and a surge of brand love driven by the backlash.

Whereas brands might once have avoided controversy, there is now a clear case for taking a stand — as the NHL discovered when it continued to play while other sports "went dark." The backlash from fans and players alike forced the cancellation of two days' play.

Similarly, the Association of Tennis Professionals (ATP) took a stand by not playing for one day after player Naomi Osaka threatened not to compete in the Western & Southern Open semifinals in Cincinnati. She explained: "Before I am an athlete, I am a black woman. And as a black woman I feel as though there are much more important matters at hand that need immediate attention, rather than watching me play tennis."

Osaka went on to win the US Open, and was praised for donning protective face masks with the names of seven black people killed by police. There was also criticism that a one-day break in play, without further commitment, did little to further the BLM cause.

But accusations of virtue signalling and woke washing put the ATP between a rock and a hard place. If tennis officials hadn't engaged in some way with the moment, they risked being called out for insensitivity (as were the NHL and some cricket teams).

In business we trust

It may not be surprising that brand activism is increasingly being driven by consumers demanding they take a stand (and condemning those who don't), as some studies now show businesses are more trusted than government.

We may be reaching a point where it is more surprising to consumers when brands don't take a stand on social issues than when they do.

In 2018, consumers responded extremely positively to Nike's now-iconic Black Lives Matter campaign with Colin Kaepernick. Now the brand has an established pro-social reputation, however, the response to recent anti-racism action has been more muted.

Nike's You Can't Stop Us campaign and its declaration of Juneteenth as an annual paid company holiday have been met with a positive but noticeably milder reaction from consumers.

Surprise is no longer a strategy

Nike was just one of many brands to declare Juneteenth a holiday in the US (along with Google, Lyft, The New York Times, JCPenney, the NFL, Tumblr, and Postmates). As our research suggests, such acts are simply not as surprising in 2020 as they once were.

As brand activism becomes more widespread, consumers' appreciation of it also becomes more sophisticated — to the point where it is a key component of brand loyalty.

However, while consumers expect brands to take a stand, many also believe social issues are used too often as a marketing ploy.

The challenge for brands is clear: Practice what you preach, make a real difference, pay more than lip service to causes. Staying relevant has never been harder.

Jessica Vredenburg, senior lecturer (assistant professor) in marketing, Auckland University of Technology; Amanda Spry, lecturer of marketing, RMIT University; Joya Kemper, lecturer in marketing, and Sommer Kapitan, senior lecturer in marketing, Auckland University of Technology

This article is republished from The Conversation under a Creative Commons license. Read the original article.

Read the original article on Business Insider

7 steps to successfully merge finances with your significant other

Sat, 09/26/2020 - 9:05am  |  Clusterstock
A compatible financial plan involves planning and setting goals for your future life together.
  • When it comes to combining finances with your significant other, it's critical to determine a budget and discuss your long-term financial goals.
  • Set goals early and often, and map out a plan that includes joint accounts for shared essentials and separate accounts for more "fun" purchases. 
  • You'll likely experience major life changes as the years go by, so regularly revisit your combined finances to reassess and adjust. 
  • Visit Business Insider's homepage for more stories.

I like to tell the story that on my first date with my now-husband, I decided I was really into him based on two topics in our meandering conversation: old limos with blue velvet interiors and spreadsheets. Little did I know, but that conversation would be an analogy for our discussions two years later while combining finances. 

I'm the free-spirit who enjoys buying cheap and quirky things that I don't mind losing when they wear out quickly or I get tired of them… Meanwhile, my husband Ryan is the finance guru who prefers to save up and buy something expensive that lasts — and then take damn good care of it to ensure that happens. How in the world were we going to make this work? 

"[W]e almost always marry our financial opposite," David Bach, author of "Smart Couples Finish Rich," told Forbes. "You're either born to save or you're born to spend, and financial opposites attract. That can lead to enormous power struggles and trust issues and regular fights." 

But it doesn't have to be that way. We have had our share of "discussions" (okay, sure, a few would be more accurately categorized as fights), but fast-forward three years and I'd say we've got a good routine going for us. And wonder of wonders, most of the time, combining finances is actually fun! But when we make our budget, set goals, and meet them, it often feels like we've summited a mountain to find a party in our honor. 

So, how did we get from there to successfully combining finances? We were older when we met and both had established careers, so we had the luxury of combining two good incomes. Not everyone has that. But these basic principles can help you start wherever you are.

Set goals for your happily ever after

We started with the big conversations. What do we want retirement to look like? What do we want our lives to be like between now and then? Are we having kids? In a lot of ways, this was taking advantage of the normal desire to plan our lives together, but we put numbers to everything and came up with workable financial plans. 

Take advantage of combined income right away

We'd just become DINKs (dual income, no kids) and wanted to take advantage of the excess income while it was new and focus on combining finances that way, too. Since our goals included providing for JJ+RW=4eva, we started by estimating what we'd need for retirement and putting as much as we could afford toward that goal. We both increased contributions to our 401(k)s and opened a brokerage account that would give us more flexibility if we wanted to retire early. Then we calculated how much we'd need in emergency savings and started adding to that as well. 

Focus on the essentials

Moving in together decreased our expenditures, so we mapped out our new reality with budget categories for the essentials. This sparked conversations that weren't nearly as fun as daydreaming about all the trips we'd take in retirement. Is Ryan's monthly haircut essential? What about my weekly lunches with friends? They sure seem essential to me. The electric bill was easy enough to agree on, but we went round and round about some of the categories. As a way to mitigate some of this, we moved on to step four. 

Focus on the fun

We each opened (or kept) individual accounts for "fun money," one of the ways we strayed away from couples finances. A portion of our paychecks are directly deposited into these accounts and we spend them however we like. Some of the contested categories for essentials (and an accompanying amount) were moved to this section. For instance, if either of us buys a meal when we're not dining together, it comes from fun money. 

Plan for "extra" money

Ryan gets bonuses through his company with some regularity, and I do side gigs of various sorts. Initially, we didn't factor these things into our budgets and disagreements arose about how to handle them. Eventually, we agreed on a percentage: 25% of any money outside of our normal paychecks goes to our individual accounts, and the remaining 75% goes to the joint account. We categorized the extra income as a "reward" of sorts, so it feels like that to the awardee. However, all that "extra" adds up, and we didn't want to fritter that away. 

Revisit regularly

In the last three years, we've had a kid and bought a bigger house, both of which come with plenty of ways to spend money. At least every six months, we look at the budget and recalibrate our categories. Are we overspending on dining out? (Not right now!) Have we finished paying off this item we bought on 0% financing? We also revisit when we need to make big decisions, like do we put our son in daycare part-time or full-time, or can we afford to do that remodel we've talked about? 

Have fun

We've had our fair share of fights about money, but overall, it's a fun way for us to connect. We use it as an opportunity to revisit our dreams, make new ones and accomplish goals together. 

Read the original article on Business Insider

Popular deepfake apps are making it easier than ever to make AI-powered manipulated videos — spawning new memes, and an increased potential for abuse

Sat, 09/26/2020 - 9:00am  |  Clusterstock
  • Making deepfake videos — which use AI to convincingly swap one person's face with another's — is easier than ever before.
  • While deepfakes were once the domain of sophisticated coders, new apps are democratizing the technology and making it accessible to wide swaths of people — and turning a profit while doing so.
  • The trend has spawned new memes on apps like TikTok and YouTube, as well as new concerns about their potential for abuse or misinformation, according to experts.
  • Deepfake app makers argue that making the technology more widely available could help educate people about how to spot the telltale signs of deepfakes.
  • Visit Business Insider's homepage for more stories.

Dozens of heads bob in unison over a techno beat, their facial expressions synchronizing to match the face of a TikTok star lip synching the lyrics. As she mouths the words, videos of Barack Obama, Vladimir Putin, Benedict Cumberbatch, an Easter Island head, and the clown from "It" follow along in perfect lock-step.

Unsurprisingly, the video isn't real — rather, it's an example of an AI-generated deepfake, and part of a meme that's sweeping platforms like TikTok and Instagram.

While deepfakes have typically been seen as sophisticated technology outside the reach of amateurs, new consumer-facing apps are making it increasingly easy to generate convincing lookalike videos that appear to show a person saying something that they never actually said.

So far, the arrival of these apps has spawned memes and social media trends that are mostly harmless — but experts warn that the increasing availability of the technology could spawn a misinformation crisis.


##huronarolera ##bellapoarch ##аниме ##anime ##аниметоп ##rek ##top ##tik_tok ##tiktok ##длявас ##fyp ##рекомендации ##рек ##топ ##р_е_к_о_м_и_н_д_а_ц_и_и

♬ оригинальный звук - Денис Анима New technology powers a deepfake explosion

Many of the latest deepfake memes were made using RefaceAI, a new app that has built its own machine learning frameworks that enable users to take a selfie and merge it with a target video or gif to create a deepfake. Unlike face masking tools found on apps like Snapchat, Reface generates an entirely new video using the twin inputs, CEO and cofounder Roman Mogylnyi told Business Insider.

"Before, making a deepfake video could take a week or more, and even then you wouldn't be satisfied with the results," Mogylnyi said. "It was a challenge for us ... we wanted people to have Hollywood level post production on their phone."

Reface was founded by a group of Ukrainian software engineers but is incorporated in the US. After piloting an early version of their technology as a web service last year, Reface debuted on the App Store and Google Play stores in January 2020.

Since then, it's popularity has skyrocketed. Memes made with Reface have been retweeted by Elon Musk and Britney Spears, and the app soared to the top of app store charts in more than 100 countries. It has been downloaded more than 42 million times, and has been used to make hundreds of millions of deepfake gifs and videos, according to Chief Business Officer Dima Shvets. 

—chrissy teigen (@chrissyteigen) August 26, 2020


Reface currently makes money through advertisements and premium subscriptions on its app, but its creators envision building an entire Reface platform similar to Snap's Bitmoji or Apple's Memoji that users could use to personalize their interactions and use across social media.

The advancements are raising new concerns about abuse — and measures to stave it off

Experts have warned for years that deepfakes could pose a unique misinformation threat if they're weaponized to mislead people about the actions of an individual or public figure. As the technology becomes more widely available, those concerns are amplifying.

One of the earliest uses of deepfakes was to harass women by creating synthetic porn videos that grafted their faces onto sexually explicit content without their consent. It's also been used for political misinformation — a deepfake video that appeared to show Belgium's prime minister making false claims about COVID-19 went viral earlier this year before it was debunked.

Deepfake technology could be evolving too rapidly for public understanding to keep up, according to Nina Schick, author of a book titled Deepfakes: The Coming Infopocalypse

"Unfortunately, I think synthetic media is so fun, the technology is so nascent, it's such an area for growth and so much private investment is backing it that it will just explode and the ethical and moral considerations will be three steps behind," Schick told Business Insider.

Reface is already taking steps to counter potential misinformation, Mogylnyi said. It has pornography detection meant to automatically remove nudity. The app currently only lets people make deepfakes using gifs or 10-second videos, and Reface is building out digital watermarking for all videos before it expands the tools available to users.

"Currently, in my opinion, we're only giving users access to 10% of the technology's capabilities," Mogylnyi said.

He added that Reface has shared its API with companies like Facebook to help build tools to detect deepfakes, and that Reface is working on its own detection tool that would let people upload media to check whether it's synthetic.

That approach was echoed by Sergey Tokarev, a lead investor of Reface who feels the technology's promises outweigh its potential risks.

"No technology can be safe from misuse in a negative way. But does it mean that technology should not be developed?" Tokarev said. "My point is that all technologies should serve the world development and be used in good faith."

Startups are focusing on teaching people about deepfakes and how to spot them

Other startups dabbling in deepfake tech are choosing to deploy it through narrow avenues in order to avoid abuse. Kapwing, a San Francisco-based startup that makes video editing tools geared towards influencers, published a tutorial that links to the code to create a deepfake synced to one specific song that became popular on TikTok, without giving people tools to make a wider range of deepfakes. The video has been viewed more than 500,000 times.

"We've been very careful about our approach to this," Robert Martin, a strategist at Kapwing, told Business Insider. "I'm reluctant for us to do much more with this technology than what we've done here."

As deepfakes become more widespread, there could be a rise in "deepfake literacy," or people's general awareness of deepfakes and ability to spot the telltale quirks inherent in the videos. But future advances in technology could make deepfakes even more seamless — and, according to Schick, deepfakes becoming commonplace could reduce people's trust in real media.

"Everything can be fake, and everything can be denied" Schick said. "The democratization of this type of manipulation of media is just one step into the future, but I don't think we're ready for it."

Read the original article on Business Insider

I had to teach my NYU psych class to 360 students from a cell phone while trapped in an elevator with my kids. It went surprisingly well.

Sat, 09/26/2020 - 8:49am  |  Clusterstock
Jay Van Bavel with his children while stuck in the elevator of their apartment building.
  • Jay Van Bavel is a professor of psychology and neuroscience at New York University, which is currently following a hybrid learning model with both in-person classes and virtual instruction.
  • On Wednesday, he got stuck in the elevator of his apartment building with his two kids, just 10 minutes before his remote Introduction to Psychology course with over 300 students was about to start.
  • Van Bavel, who Tweeted about the ordeal, says he was able to give 50 minutes of his lecture before the elevator was fixed and he and his kids were freed.
  • Looking back, he's not sure why he didn't cancel: "It all seemed weirdly normal in the moment."
  • Visit Business Insider's homepage for more stories.

On September 23, I had to teach my afternoon Introduction to Psychology class today to over 300 students from my cell phone while I was trapped in my apartment building elevator with my two young kids. Even by the standards of 2020, this has to go down as the most stressful — and surreal — teaching experience of my life. 

Jay Van Bavel.

I'm currently teaching a huge Intro to Psychology class this fall. But given the risks of the pandemic as well as public health guidelines, I was forced to teach the class virtually. For whatever reason, the class was massively over-enrolled, with over 360 students from around the world joining me every few days to learn about the science of the mind.  

Moving such a massive course online has been a challenge. But others have it worse, and the students are smart and engaged, so the class has truly been a blast to teach. At least, it was a blast until this week.

The first problem is that the local schools in New York are closed, and I have limited child care.

I have to get my kids from the local daycare at 3 p.m. and race back to my apartment by 3:30 p.m. to teach the class. My 10-year-old son loves to crash my course and share his thoughts on the brain and perceptual illusions, but the students find it funny so I don't mind. 

This past Wednesday, I set up my computer, walked through the city to pick up my kids, and then we arrived back at my apartment building at 3:20 p.m. We hopped in the elevator, and I breathed a sigh of relief that I was going to make it to my class on time. Class was scheduled to start in 10 minutes. 

The elevator closed and started moving up. Then it quickly lurched to a halt and started dropping. I got that feeling in my stomach that happens when you're in a roller coaster and it starts falling. I realize we are suddenly trapped on the 3rd floor. 

But I used the call button in the elevator to contact the staff. They promised to contact a repairman from the elevator company to help us escape. OK, no need to panic.  

I started texting people to figure out what to do. My 8-year-old daughter started getting scared, which led my son to tease her about overreacting. He's normally a cool cucumber in any situation. But this led her to start crying.

Things were melting down pretty good at that point. But we rallied and calmed down. I gave them a hug. Things would be alright. 

It dawned on me that my students would be worried if I didn't show up for class.

But my internet reception was horrible (you know when it only has one bar of reception), and I wasn't high enough to access my WiFi either. 

After fumbling with my iPhone, I managed to login into my NYU Classes website to contact my students. Thankfully, I managed to login and send out an email announcement to the class by 3:28 p.m.

The subject line was: "Trapped in my elevator, will start class as soon as I'm rescued."

Jay Van Bavel's email to his psychology students.

By this point, a certain level of camaraderie had developed in the elevator. My kids and I  had a dawning recognition that we were all in this together and would pull through. I reminisced about the time I was stuck in the elevator with my son Jack five years ago, and we laughed about those old times. We also snapped a few selfies to remember the moment.

Before class started, the Van Bavel family took some selfies and kept calm.

But time passed. The kids got anxious. I started to worry about my poor students and how I would manage to finish the lecture on time. The mid-term was coming up the following week and there would be no time to make up the content.

After half an hour, I made an executive decision to try and teach from the friendly confines of the elevator. I desperately tried to get enough internet access to login into NYU Classes and access my Zoom link. 

But Zoom made this incredibly hard on my phone. They needed me to download an app and then login. In many ways, this was the biggest challenge of the entire ordeal. 

Eventually, I logged into my class. But the internet was so weak that I couldn't speak to the students. I logged out and logged in again using the phone link. I would just give the lecture over the phone without video or slides. It seemed like the only option. 

I was finally able to phone into my class. I could see there were over 200 students already in the room and they were just chatting, speculating about my new life in the elevator. They seemed strangely relaxed. Their lives seemed somehow fuller than our life in the elevator.

I spoke. They kept talking. I yelled my name. "HI, IT'S JAY! I'M ON THE CALL!" They heard and recognized me. The class was afoot! 

I could hear my students' collective surprise — especially once they realized I was still trapped in the elevator, and the class was still going forward. 

I could hear one student yelling to her roommate that her professor was trapped in an elevator. Others seemed excited to give this a try; apparently they'd never been taught from a professor stuck in an elevator before. It would give the class a fresh new twist. 

Then it dawned on me that I had no way of showing them my carefully crafted slides on the conscious and unconscious mind. They were on my computer, in my apartment.

I suddenly felt very alone. Would I be able to remember the lecture? Had I made a mistake by jumping on the call?

Then I just started talking about consciousness. It went surprisingly well for a stressed-out guy giving a lecture over his phone with no notes while trapped in an elevator with his kids. 

Sure, I lowered my standards. But I felt it was only fair under the circumstances. 

As I'm talking, I realized my kids are just staring at me with perplexed looks on their faces. They weren't horrified, but seemed bemused as I raised my voice to explain how we have many mental processes that operate outside our awareness.

After about 50 excruciatingly long minutes in the elevator, it jolted and then started to move. The doors opened. We could see our beautiful nondescript lobby and the sun beaming in from the front doors. We cautiously stepped out into freedom. 

I was able to catch the other elevator upstairs, boot up my laptop, and give the rest of the lecture from the now-seemingly-normal confines of my kitchen table.

 I'm not sure how this will play out my semester teaching evaluations — but at this point of 2020, who cares anyway.

For anyone wondering, why didn't I cancel my class? I don't know. It all seemed weirdly normal in the moment. Each step just seemed to logically follow the prior step. This is a lesson I'll cover in a later lecture on rationalization.

As I typed it all out, I'm now deeply aware of how absurd this was. With a little luck, I will not be teaching in elevators in the future.

Jay Van Bavel is an associate professor of psychology and neural science at at New York University, an affiliate at the Stern School of Business, and director of the Social Identity & Morality Lab. He completed his PhD at the University of Toronto and a postdoctoral fellowship at The Ohio State University before joining the faculty at NYU in 2010. Van Bavel has published over 100 academic publications and written research essays in The New York Times, BBC, Scientific American, and The Wall Street Journal. His research has been featured in TEDx and TED-Ed videos and he's consulted with the UN, EE, and WHO on issues related to his research. He coauthors a mentoring column, entitled Letters to Young Scientists, for Science Magazine. Connect with Van Bavel on Twitter, Facebook, and LinkedIn.

Read the original article on Business Insider

Tesla's new 'tabless' cell design is 'brilliant,' said a top battery researcher

Sat, 09/26/2020 - 8:42am  |  Clusterstock
Tesla new 4680 battery cell was revealed last week.
  • Tesla's new 4680 battery cell is an "A-plus" design according to Shirley Meng, a scientist from the University of California San Diego.
  • But she added that Tesla can't achieve is ambitious goals by itself — to get to ten terawatts of worldwide capacity, other players will be required.
  • "The world needs so many batteries," she said.
  • Visit Business Insider's homepage for more stories.

Tesla's Battery Day this week brought big news to the metallurgy and chemical-engineering worlds: the company had developed a new cylindrical battery cell, dubbed the "4680," that's much larger than the 2170 cells it's currently using.

While the 4680 cells remain at the prototyping stage and shouldn't enter mass production until 2022, CEO Elon Musk and his engineers are confident enough in the new form factor to start rethinking the design of Tesla's cars, with the 4680 cells becoming a structural feature.

In a nutshell, the new design does away with a "tab" that connects the battery cell and allows it to discharge and recharge energy. The bigger 4680 cell can handle more power, and Tesla maintains that it will be faster and cheaper to produce. And because it's larger than the 2170 cell, which is now arranged in elaborate packs that form the floor of Tesla's vehicles, the 4680 cell can add stiffness to the middle of a vehicle, subtracting a bunch of complicated parts in the process.

The technology itself impressed at least one expert.

"I give it an A-plus," said Shirley Meng, who studies nano-engineering and materials science at the University of California San Diego, where she is also the founding director of the college's Sustainable Power and Energy Center.

The tab-less design of the new Tesla cell is "brilliant," she said. "It's really an engineering achievement."

"The tab side used to be the weakest link," she explained. "Tesla gets a 10 out of 10 for handing this difficult issue."

The new battery cell is highly innovative The cells that that Tesla wants to replace have tabs, a design weakness.

Meng confessed that the 4680 design (so-named because of its 46-millimeter diameter and 80-millimeter length) had some aspects that eluded even her, a scientist who has been working in field for over a decade.

"I couldn't wrap my head around the pattern," she said of the cell's spiral internal structure. "But I look forward to studying it in more detail. And I hope there will be more testing coming out. Based on physics, they have a good point."

That's because, she said, having that many contact locations inside the cells distributes power better, instead of having "all the electrons rushing through a little tab." By eliminating that weak point, the cell also offers better thermal management than the 2170 cell it should replace.

Meng also pointed out that the 4680 cell is highly innovative. "It's completely new as far as I know," she said. "Academic groups haven't been looking at this design. We usually don't talk about batteries of this scale."

10 terawatts of battery capacity The unique structure of the new 4680 cell uses a spiral design.

Tesla's goal for the new cell is to slash manufacturing costs by more than 50% while greatly increasing the power that cells can store. Musk and Tesla vice-president Drew Baglino said in a presentation that coming up with a new, better cell was the only way for the company to achieve an ambitious objective: produce three terawatts of battery capacity by 2023.

That's a lot — all of humanity uses about 18 terawatts of electricity — and Musk estimated that to replace all current transportation with electrically-powered vehicles, ten terawatts are in order.

"If we reach that scale, there will be many choices," Meng said of the various battery designs that are currently in use or being developed, including solid-state, which she called the "dream solution." 

She outlined a world where, if we make good progress, Tesla accounts for 2 to 3 terawatts and other manufacturers contribute an additional 2 to 3 terawatts — not quite enough to get to the ten-terawatt threshold. According to Meng, that means there should be plenty of room for other designs, including the sort of pouch-type packs that General Motors has developed to undergird its Ultium technology.

"The world needs so many batteries," she said.

Interestingly, for Meng, rising to the challenge isn't just about training a host of new battery-makers.

"We need more government and public support," she said. "It isn't just about more engineers. It's about our whole society transforming."

Read the original article on Business Insider

New York's transit system is in a financial crisis — but saving it is vital to the US economy, experts say

Sat, 09/26/2020 - 8:34am  |  Clusterstock
Experts say the consequences of a meltdown at the MTA could spread far beyond the New York metro area.
  • New York's transit agency, the Metropolitan Transportation Authority, says it needs $12 billion in emergency federal aid to fund itself through 2021. 
  • Subways and buses are vital to New York's $1.8 trillion economy — if the transit network fails, the entire region could suffer.
  • But that's not all. Experts, activists, and transit officials warn that not funding New York transit could deal a devastating blow to the nation's financial health and recovery.
  • Visit Business Insider's homepage for more stories.

New York's transit system is in a financial crisis, and to anyone outside of the New York metropolitan area, that probably sounds like someone else's problem. 

But experts disagree. Dependable, robust mass transit is vital to New York's economic health and recovery, and if the agency is left high and dry, many say the entire country's economy will suffer.  

Right now, the Metropolitan Transportation Authority — which runs New York's buses, subways, and commuter trains — needs billions in federal aid. It received close to $4 billion in March through the CARES Act, but that money dried up quickly. The May HEROES Act would have given the MTA and other transit agencies a fresh round of funding, but the package stalled in the Senate.

The MTA is pushing for another round of emergency federal aid to fund its subways, buses, and commuter trains.

As the MTA grapples with an increasingly dire financial outlook brought on by the pandemic, the agency is sounding the alarm about extreme cost-cutting measures it'll be forced to pursue without a lifeline from the federal government. 

But the cuts couldn't come at a worse time, according to transit advocates and policy experts. A deterioration of the subway, they say, would have a ripple effect throughout the country. 

Without emergency funding, the MTA might need to decimate service, cut jobs, and stall vital construction projects

At a board meeting in late August, the MTA warned it would need to slash service and table major infrastructure-improvement projects without $12 billion in emergency funding. The aid would carry the floundering agency through 2021 — without it, drastic changes, including job cuts, could come as soon as this fall

Under the doomsday plan, the agency would need to cut subway and bus service by up to 40%, leading wait times to balloon by up to eight minutes on subways and as much as 15 minutes on buses. An estimated 7,200 employees would lose their jobs. 

The city's commuter rails, tasked with transporting workers from nearby suburbs to New York's central business district, would suffer an even worse fate. The MTA said it may need to cut service in half, spacing Long Island Railroad and Metro-North trains at 60-minute or 120-minute intervals and possibly shutting down some routes entirely. 

Meanwhile, the MTA said not receiving the federal funding could pause projects from its $51.5 billion Capital Plan — a long-overdue investment into things like modernization, line expansions, and accessibility upgrades — scheduled for 2020 through 2024. 

With ridership in the gutter, the MTA may be forced to enact drastic cuts to service and spending.

The MTA itself, as part of its latest push for emergency tax dollars, has contended that its well-being is a national concern deserving of a federal solution. Data shows that in addition to the MTA's indirect financial impact, the agency directly does business with vendors from nearly every US state.

"Not only does investment in the MTA benefit New York City, the New York City business community, New York State and the tri-state region, but it also benefits the national interest," MTA Chairman and CEO Patrick J. Foye told Reuters recently. "It's in the national government's interest to fund this because of the importance of New York and the importance of the MTA to New York."

The proposed cuts reflect a severe financial crisis at New York's transit authority

The proposed cuts, unprecedented as they may be, reflect the severity of the financial crisis New York's transit system faces. The MTA was no stranger to financial distress before the pandemic hit, but in March, its ridership plummeted virtually overnight, decimating farebox revenues and sending the agency into free fall. 

Subway ridership dropped by 93% at the height of the outbreak in New York. And although straphangers have slowly returned to transit as the city has creaked open, ridership on subways had only reached around a quarter of normal levels in early September, and buses were still down 50%. The Long Island Railroad and Metro-North have also been slow to bounce back, now seeing approximately 25% and 20% of their typical weekday ridership levels, respectively. 

The MTA is seeking a fresh round of funding as it loses $200 million per week.

The MTA received $3.9 billion in funding through the CARES Act in March, but it blew through that money by late July. Now, with the agency hemorrhaging $200 million per week and no followup stimulus bill in sight, it's pleading for another infusion of cash.

The MTA is vital to New York's massive economy

A $12 billion allowance would be a drop in the bucket of any trillion-dollar stimulus package, and many experts and advocates say that, in this case, an ounce of prevention is worth a pound of cure. Saving New York's transit system from ruin, they say, is essential to clawing the city — and the nation at large — out of the current economic recession.

With its approximately $1.8 trillion GDP — comparable to that of Canada — the New York metropolitan area accounts for roughly 8% of the national economy, and the region's financial success is driven in large part by its robust transit system. In normal times, more than 3 million workers use the MTA and other smaller transit agencies to get to work each day across the New York region. Millions more take public transit for non-work-related trips. 

In normal times, more than 3 million people use transit each day to get to work in the New York region.

New York's strength lies in its density, multiple experts told Business Insider, and that's not possible without strong public transit. The city's jam-packed central business district only thrives because of its expansive transit system, which can shuttle vast numbers of people to lower Manhattan and between meetings. 

"The benefit of New York is that it's the only place where you have an abundance of face-to-face contact, and the reason it's possible is because of mass transit," Mitchell Moss, a professor of urban policy and planning at New York University, told Business Insider. "In Los Angeles, you might be able to have three physical face-to-face meetings a day. In New York, you can have eight."

Nicole Gelinas, a senior fellow at urban-policy think tank the Manhattan Institute, said although many white-collar workers have made due working remotely for months, Manhattan's ultra-high-density business district will remain an important driver of economic activity.

"The entire point of being in Manhattan was you can walk to meetings," she said. "You can have many, many meetings every day with your potential vendors, your customers, your competitors. So if you're going to try to recreate that in suburban office parks or work-at-home, you will see a less productive economy five years, 10 years from now."

The MTA helps New York draw on a vast workforce beyond just the city's five boroughs.

Another key to New York's prosperity is that it draws its workforce not just from within the city limits, but also from neighboring areas served by the MTA and other outfits. Of the roughly 2 million people who worked in Manhattan's central business district before COVID-19, more than 600,000 commuted from New Jersey, Long Island, Southwest Connecticut, or the Hudson Valley. The overwhelming majority took transit. 

Transit will only become more vital to the New York economy during this time of mass unemployment, multiple experts told Business Insider. Although the city's cost of living is high, its robust, low-cost system of subways and buses creates a low barrier of entry to the workforce. 

In other parts of the country, Gelinas said, one might need to spend thousands of dollars annually financing and maintaining a car just to get to work. In New York, you can commute on subways and buses for around $1,500 per year. 

MTA buses and subways are a huge driver of workforce participation in New York.

In 2018, Gelinas studied the importance of the MTA to workforce participation, determining that the subways "are both a cause and an effect of New York's labor-market boom."

"New York's mass transit system — especially its subways — has been a crucial factor for encouraging and enabling more of the residents in the city's historically poorer neighborhoods to work," Gelinas wrote. "Any sustained deterioration in subway services endangers this success story."

Experts warn of a "death spiral" if the MTA doesn't have the funds to maintain its system.

Abandoning or reducing capital projects, which the agency warned it would need to do without aid, could accelerate that deterioration. Multiple experts and activists warned of a "death spiral" — a vicious cycle of disrepair and disuse — that could hit the transit system if it winds up diminishing service too greatly. 

"If the system becomes far less useful and far less accessible, then it would lose more revenue," said Danny Pearlstein, policy and communications director for advocacy group Riders Alliance. "And so the MTA would find itself in an even worse position six months or a year from now. And so it might not be too long before there was no transit system."

The MTA's capital projects planned for 2020 through 2024 would spur more than $60 billion in economic activity, according to an independent study.

The MTA's capital endeavors constitute a significant source of economic activity for the region. The Partnership for New York City, an independent nonprofit organization, analyzed the MTA's capital investment plan for 2020 through 2024 and found it would create more than 57,000 jobs per year while spurring $62 billion in economic activity. 

In a recent report, the Regional Plan Association, a prominent tri-state area planning group, argued that Congress should preserve the New York region's transit investments as a way of protecting its infrastructure and putting people to work. The RPA argued that capital programs from the MTA and other regional transit agencies could be cornerstone components of a national stimulus package similar to the Works Progress Administration — a 1935 employment and infrastructure program under President Franklin D. Roosevelt, which created millions of jobs during the Great Depression. 

"It's essential that we continue that capital program to employ construction personnel and the other folks that make those things happen," said Brian Fritsch, a manager of advocacy campaigns at the organization. "If those things go away, it's really dire for the region economically."

The widespread ripple effects of the MTA's success or failure 

Experts, activists, and transit officials warn that the financial damage of not funding the MTA could spread far past the city and region.

In addition to propping up New York's massively important economy, the MTA contributes directly to economies across the country, according to a June report from watchdog group Reinvent Albany. From 2011 to 2018, the organization found that the MTA spent close to $8 billion on vendors in states outside of New York State, including $1.6 billion in New Jersey, $1.4 billion in Pennsylvania, and $797 million in California. During the period studied, the MTA spent money in all but three US states, as well as Puerto Rico and the US Virgin Islands. 

Advocates argue that funding the MTA benefits the country at large, and hope that aid will come through sooner rather than later.

Advocates hope that emergency aid for the MTA will make it into a reauthorization of the FAST Act a 2015 law that expires soon, but originally authorized $305 billion in transportation aid over fiscal years 2016 through 2020 or a bill to fund the federal government, both of which need congressional action by September 30.

But with negotiations surrounding a second coronavirus stimulus bill stalled — Democrats proposed nearly $16 billion for transit agencies in the May HEROES Act, but Republicans' latest plan included no such funding — the MTA and transit agencies across the country face an uncertain future. 

At a Wednesday board meeting, MTA officials said the agency may need to borrow $2.9 billion from the Federal Reserve for some short-term relief, on top of the $450 million it borrowed from the Fed in August. 

"There would be global economic impacts to the fact that people can't get to work in the financial and cultural capital of the United States," Pearlstein said. "There is literally no better investment in the nation's economic recovery than keeping New York humming [and] keeping riders able to quickly and reliably get around the city by the millions.

"It's a simple thing for Congress to send us $12 billion. Every other way out of this is far more complicated and painful."

Read the original article on Business Insider

BMW's most iconic sports car wears a wild grille and starts at $69,900 — check out the brand-new M3

Sat, 09/26/2020 - 8:34am  |  Clusterstock
2021 BMW M3 and M4.
  • BMW just unveiled the brand-new 2021 M3 and M4.
  • In Competition guise, the cars make 503 horsepower.
  • You can get the non-Competition models with a six-speed manual, though.
  • BMW will launch the M3 and M4 in March 2021 with a starting price of $69,900 for the M3 sedan and $71,800 for the M4 coupe.
  • Visit Business Insider's homepage for more stories.

First things first. Yes, the new M3 and M4 wear the big grille. Much like death or taxes, the big grille — this diptych of doom — is inescapable. But, hopefully, the high-horsepower engines and option for a six-speed manual make an attractive enough trade-off for you to get into BMW's latest rides, unveiled on Tuesday.

As a quick recap, the M3 was historically the performance-version of the 3 Series. It came as a coupe, convertible, or sedan. Then BMW sectioned off the 3 Series coupe to become the 4 Series. So now we have the M3 and M4. 

The new M3 and M4 mark the current sixth generation of the 3 Series, internally called the G80 and the G82 for the 4 Series. (More numbers were, obviously, necessary.) More importantly, both use BMW's 3.0-liter, twin-turbo straight-six engine that produces 473 horsepower in the regular models and 503 horsepower in the higher-performance Competition models, according to a company press release.

The M3 sedan will start at $69,900 and the M3 Competition sedan will start at $72,800. The M4 coupe will start at $74,700 and the M4 Competition coupe will start at $74,700. BMW also notes that a $995 destination fee will apply to all pricing.

The cars will be launched globally in March 2021. Keep reading to see them both.

BMW just unveiled its new 2021 M3 and M4 sports cars. 2021 BMW M4. The M3 is the sedan version, the M4 the couple. They're powered by the same engine. 2021 BMW M4. That engine would be a 3.0-liter, twin-turbocharged straight-six. 2021 BMW M4. It produces a claimed 473 horsepower and 406 pound-feet of torque in regular guise. 2021 BMW M4. For the sportier Competition models, BMW's claimed output climbs to to 503 horsepower and 479 pound-feet of torque. 2021 BMW M4. There are two screens: a 12.3-inch information display and a 10.25-inch center touchscreen. 2021 BMW M4. The M3 sedan offers easier access to the rear seats, a draw for those who utilize the second row more. 2021 BMW M4. M Sport seats have big side bolsters that help hold you in place under hard cornering. 2021 BMW M4. On the Competition models, the quad-exhaust pipes are black chrome. 2021 BMW M4. BMW says the giant front grille improves cooling for the engine. 2021 BMW M4. The M4 coupe is the two-door version. 2021 BMW M3. The M3 used to be both a two- and four-door model, but a few years ago BMW turned the 3 Series coupe into the 4 Series. So here we are. 2021 BMW M3. If you put the car into Sport or Sport+ mode, the exhaust note will get louder. 2021 BMW M3. Four cars will be available at the global launch next March. 2021 BMW M3. They will include the rear-wheel drive M3 and M4, mated to six-speed manual transmissions (!). 2021 BMW M3. And the M3 and M4 Competition editions with an eight-speed automatic transmission. 2021 BMW M3. By the way, just LOOK AT this interior. 2021 BMW M3. Next summer will bring the xDrive all-wheel drive Competition models. 2021 BMW M3. The M3 sedan will start at $69,900. The M3 Competition sedan will start at $72,800. 2021 BMW M3 and M4. The M4 coupe will start at $71,800. The M4 Competition coupe will start at $74,700. 2021 BMW M3. BMW reminds us to apply the $995 destination fee to all prices. 2021 BMW M3. And as my parting gift to you, here's another look at that GIANT GRILLE. You can't look away, can you? 2021 BMW M3. Read the original article on Business Insider

'Divided We Fall' author David French on why America could come apart, the loss of free speech culture, and how Trump could be the GOP's new Reagan

Sat, 09/26/2020 - 8:17am  |  Clusterstock
A woman wearing a "Black Antifa" shirt holds a rainbow flag across from people holding a Trump flag at Freedom Plaza near a Proud Boys rally on July 6, 2019 in Washington, DC.

David French is a Senior Editor at The Dispatch, which launched in 2019 and describes itself as providing "fact-based conservative news." French is also a columnist for Time magazine, and previously spent four years as a writer at the conservative magazine National Review. 

A principled social conservative, free speech advocate, lawyer, and Iraq War veteran, French was an early Never Trumper. His new book, "Divided We Fall: America's Secession Threat and How to Restore Our Nation," was released this week.

From his home in Tennessee, French spoke via Skype with with Business Insider Columnist Anthony L. Fisher about the book, the fraying of free speech principles on both the left and right, the redefining of racism, and why he thinks the US is in such danger of literally coming apart. 

This interview has been edited for style, length, and clarity.

You've got a chapter on acceptable discourse and the moving of the Overton window. Can you talk a little bit about how you think that window has changed in recent years on the left and the right? 

For those people that don't know what the Overton window is, it is a term for the bounds of acceptable discourse. That there is a window that reflects where acceptable discourse happens in the US. There's an Overton window that exists on the right, and one on the left. And you can't go out of your window. What that means is in some areas, the two sides just can't really speak anymore. The possibility of compromise is often completely squelched because the very act of engaging in a compromise moves you out of your window and moves you out of your tribe. And you're sort of cast into the outer darkness. 

One of the areas where the Overton window has moved on the left is gender identity. Arguments or discussions that you might have five years ago, in parts of the left, you can not have anymore. On the right, one of the areas where I say the Overton window has moved a ton is in arguments around gun rights and gun control. The right's activists and the base used to be far more divided about things like gun rights. But now there is a stampede towards a further and further libertarian position on gun rights. And so what ends up happening is the two sides just can't even connect at all on these really important cultural issues. 

One counter-argument is these are people just holding true to their principles. If you're on the left and you believe that there are innumerable numbers of genders, then to argue otherwise is to engage in bigotry. And if you're on the right and you're for certain gun regulations, you'd basically consign yourself to being a RINO (Republican In Name Only). But the activists on both sides would argue that they're the principled ones, they're not the squishes. 

A lot of times if you're talking about politics, someone will say so-and-so is divisive. What they mean by divisive is that they disagree with me. So the argument in my book isn't, "Can't we all just agree?" The argument is we can hold two convictions at the same time. You can hold a specific conviction about gender identity. At the same time you can hold a particular conviction about pluralism and free speech, rather than treat a discussion as outside of the Overton window, where you cannot have it. You can have the moral conviction and yet engage, extend, expand the Overton window to where you can engage with people on the opposite side of the aisle. 

That's the key issue here. It isn't can't we all be more politically moderate — in the sense of sort of joining around a center-right or center-left vision of the United States. It's can we create a country in which all of these really diverse communities — some of them centered around real convictions that might be on the far-right or the far-left — can't we have a country and a culture that accommodates that? 

That's where I get back to Federalist Number 10, James Madison's early vision of American pluralism in both the dedication to individual liberty, and also to communal self-governance. Federalism, in other words. The most relevant government should be the government closest to you. And right now the most relevant government in many people's lives is the government farthest from them, the federal government. 

Losing the culture of free speech

In your writing and on your Twitter feed, I've long found you to be a pretty fair operator when it comes to the principle of freedom of speech. But in the chapter on losing free speech culture, you don't really mention the right-wing threats to free speech, particularly the bans on Palestinian activism or the Trump campaign's frivolous lawsuits against media outlets. 

In the book I spent a lot of time talking about the attacks on Colin Kaepernick and the kneeling NFL players. To me, that was one of the most salient examples of how the right tried to exert its own cancel culture. And I juxtapose it with the right's support for James Damore, the software engineer at Google who put out a libertarian-influenced document about how Google could increase diversity without engaging in, for example, gender discrimination. He made some arguments about why there might be fewer women in the hiring pools. If you're at all familiar with conservative or libertarian thought regarding diversity, and regarding the reasons why there are disparities in the workplace, it would have read as a pretty anodyne document. But he was fired and conservatives said, "Look, that's cancel culture. Look at the intolerance of the left."

And then you have a situation where a football player kneels quietly, doesn't hurt anybody, and a few others do as well. And the President of the United States thunders, "Fire them!" And rather than saying, "No, that's cancel culture. We need to support a culture of free speech," thousands and thousands and thousands of people at those rallies and millions of people online cheered, "Yes, fire them." 

One of the points that I make is you're not part of the solution if you're going to find reasons to punish your political opponents for their speech and reasons to protect the political speech of your friends. I can have my core convictions regarding foreign policy, regarding domestic policy, regarding cultural issues like abortion or gender identity. But the instant I try to shut off or close down the body politic to my opponents, that's the instant that we began to unacceptably raise the stakes of political conflict in this country where what's at stake is not just the policy position, but the very structure of our constitutional republic itself. 

In a current like corporate or academic situation, do you think even the mainstream conservative beliefs on abortion or guns could be discussed without generating tremendous controversy or HR complaints? 

In some places, no, they can't be discussed without generating tremendous controversy. But here's the thing: this is not new. We kind of have a recency bias that if it's beyond the memory of Twitter, it didn't happen. But I was in law school from 1991 to 1994. And the blowback on campus for just conventional social conservative positions was enormous. In some easy, much worse than it is now for conservative students. It's just that nobody really knew about it because nobody was tweeting it with a hashtag. Now we the instant national access of social media, when we can find out within minutes,whether some kid had a MAGA hat knocked off their head in Des Moines. But in ideologically monolithic communities, a lot of this hostility to dissent is not all that new. We're more aware of it, but it's not new. 

Defining, and undefining, racism

This is a quote from your book: "The essence of bigotry is to look at the color of a person's skin, and on that basis alone, make malicious judgments about their character or worth." Over the past few months, the work of antiracist writers like Ibram X. Kendi and Robin DiAngelo have argued differently, that race is paramount and to ignore skin color is in fact, racist. Do you think the Overton window has moved to the point that the definition of racism has been irrevocably changed in American culture? 

No, it's splitting. The Overton window on the right does not have room for the Kendi or DiAngelo definition of racism. If you start walking around in certain right-wing circles waving Robin Di Angelo's book and talking about white fragility in the terms that she does, nobody's listening to you. And similarly if you walk into some spaces in the left and you say, "A person of any race can be a bigot. A person of any race can be a racist," they will flat out deny that because their definition of racism is fundamentally different. 

As I wrote in the book, Sarah Jeong was hired by The New York Times as part of the editorial board. A lot of her earlier tweets came out that were just viciously denigrating of white people. My position was that those tweets are racist. And calling them racist doesn't mean that the racism of that person is of the same magnitude and danger of the racism say of a member of the alt-right. It's a matter of degree, not of kind. And I had a lot of people write back to me and respond to me and say, "No, that's not racism. Racism has to be connected to either present or historical power to be called racism." Well, that's not the definition that most people grew up with. And it's one of the ways in which I point out that we're beginning to live in these separate communities where a word like racism doesn't have the same meaning in Brooklyn as it has in Franklin, Tennessee, for example. And that's only been exacerbated in the last several months. 

This is sort of the very downstream effect of clustering, and like-minded communities separating from each other geographically. It means that we learned to talk to each other and we don't learn to talk outside of each other. And what happens is we lose a common language. One of the things I've tried to do, especially in my writings on race, is to bridge that gap by trying to shed the conversation as much as possible of these various buzzwords that don't have a common meaning anymore. 

Pens and pencils are placed on the ground near a sign with the portraits of late Charlie Hebdo editor Stephane Charbonnier (aka Charb), late French cartoonists Georges Wolinski, Bernard Verlhac (aka Tignous) and Jean Cabut (aka Cabu) on the Place de la Republique (Republic Square) in Paris on January 8, 2015, following an attack on the offices of the French satirical newspaper Charlie Hebdo in Paris on January 7 by armed gunmen which left 12 dead.

Talking about power and bigotry, I'm reminded of a sentiment that emerged after the Charlie Hebdo shootings, when journalists were cowering under their desks in fear for their lives. Though the magazine had lampooned Islam and other religions, at that moment, it was the terrorists who had the power. 

Power is both contextual and historical. There are people who belong to historically marginalized groups, but in a given context, may have a ton of power. But that doesn't change the fact that they're historically marginalized, that they belong to a group that's historically marginalized, and that many other members of that same group are historically marginalized. 

Senator Tim Scott of South Carolina has given pretty powerful personal testimony of his experiences. On one hand, he's one of 100 senators in the United States Senate. He has an enormous amount of power. On the other hand, he has been in contexts that somebody like me, a suburban white guy from Tennessee, is rarely going to experience, like some of the dangers from unexpected encounters with police, or unnecessarily hostile encounters with police. In that circumstance, the historical weight of America's past sins comes down on him, even though he's a senator. Power is both rooted in history and rooted in present context. So in the very moment of the Charlie Hebdo massacre, the most powerful people in that room were the terrorists. 

It reminds me of something my commander told me in Iraq. He was talking about a village that would otherwise be allied with us, but it was under the control of Al-Qaeda And he said something that I'll never forget: "In a room of a hundred people, what do you call the one man in there with a gun? A majority." 

How America comes apart

There's a fictitious interlude in the middle of the book that deals with Calexit and Texit, the secessions of California and Texas, which brings about the dissolution of the country. And it seems frighteningly believable. 

It feels like the coming Supreme Court confirmation hearings could be one of those triggering events. 

I think we're on a cycle of continual escalation. Now, I'm not saying that we're on the verge of dissolving, but I did write those fictional scenarios for a very specific purpose. I wanted to take the conversation out of the sort of rarefied air of "This study says this" and "This study says that," and explore how the things I talked about [in the book] would look like in the real world. 

Imagine you've got a pile of wood of dry wood, and you're just throwing more and more kerosene on it. If somebody comes around with the match, the whole thing can go up. What's happening is every single new cycle, if there's a choice to escalate and punch the other side in the mouth, or de-escalate and seek compromise, time and again, we're seeing escalation. And sometimes the escalation, oddly enough, is based on the presumption of the escalation of the other side. 

A lot of Republicans said in 2016, "If we're close to an election, don't have a hearing and a vote on a Supreme Court nominee." Flat out. It wasn't conditioned on when there's divided government. It was flat out. Rubio said if a Republican was president, I would say the same thing. Lindsey Graham said after the primary starts, we should put a hold on nominations. Ted Cruz said we haven't done this in 80 years, referring to this exact situation. I can go down the line with Republicans who said flat out they wouldn't do this. And then the time comes to keep your promise, in a time of extreme national volatility and anger, and you say, no, because I can't trust the Democrats' word, so therefore I'm not going to keep my word. 

So you have this preemptive escalation based on the expectation of the anger and failure of the other side and it puts you in a sort of a doom loop of escalation. If you believe that there's no cost to polarization, that people get angry but at the end of the day, they're going to swallow their defeat, take their lumps, and move on. 

My argument is that's ahistorical nonsense, that there is nothing so unique about the United States of America that you can't push people to want to leave this place to dissolve it. In fact, we were born into disillusion. We were born in a separation. The majority and the more powerful, more wealthy side of the British empire, pushed the colonists. The colonists were smaller and less powerful, but they said, "We're going to risk conflict with a world superpower to get out of this." And they did it for good reasons, for individual liberty. In 1861, the South did it for evil reasons. But in 1861, you had a geographically contiguous, relatively powerful, sub-part of the US that completely turned its back on the democratic process. 

I just think we don't have a better human nature than we had before. We don't have a greater willingness to swallow injustice than we had before. And if we keep pushing people and pushing people and pushing people, you cannot assume that they won't break. That's one of the reasons why I wrote the book and wrote the scenarios. I want people to have those scenarios in their mind as they're walking through politics. Not just, "Will my policy be enacted," but "Will this approach that I'm taking help divide or unite this country that we love. 

The Justice Department just designated several cities, including New York, as anarchist-run and threatened to cut off federal funding. It's one thing for Trump and his hardcore followers to fan the flames of the culture war. As a lawyer and conservative, what do you make of the Attorney General Bill Barr participating in something like this?

The Trump funding threat is just flat out unlawful. It just is. And in a functioning body politic, an attorney general would say, "Mr. President, this is unlawful. I'm not going to participate in it. And I'll resign if you make me." But we're not in a very well-functioning body politic right now. And, and the priority for all too many people is, am I punching the other side in the mouth? So there's a lot of applause for things like this unlawful executive order, because it's punching the other side of the mouth. 

Now in all likelihood, if there's any concrete action taken beyond the Department of Justice designation, the City of New York can go straight into court and get an injunction. But why do we need to rely exclusively on the courts, which are now increasingly in contention, to protect the constitution? Everybody swears the oath who is in government. Each one of them has an independent obligation to uphold the oath. And calling New York an anarchic jurisdiction, is it just laughable. There might be areas in which they're having difficulty maintaining order, but a city of what, eight million, nine million people? Anarchist jurisdiction? 

It's laughable, but it's red meat for a certain part of the base. The part of the base that actually controls the GOP right now. And they love it. It's owning the libs, it's fighting back, it's punching back twice as hard. It's all of the dysfunctions rolled into one of these actions that sort of encapsulates our dysfunction. 

There's no Evan McMullin this year. There isn't even a Gary Johnson. What does a principled, right-of-center voter like yourself do in 2020? 

Well, I'm definitely not voting for Donald Trump. I think the two viable options for conservatives who've said no to Trump, that's vote third party or vote for Joe Biden. I prefer the third party option for a very specific reason, and that is, I don't agree with Joe Biden's agenda. 

So if hundreds of thousands of conservatives vote for Joe Biden, those are just numbers in his ledger. They're not divided out as to not supporting Biden's agenda, but opposing Trump. And Democrats would rightfully look at that vote total and say, "That's for us. That's for our agenda. That's for Biden." 

One of the virtues of the third party vote or write-in is it's a quantifiable way of saying, "I don't agree with either of these people." And there is an X number of people who will vote in this election who are alienated from this binary choice. And I think that's an important metric. When you're talking about me, until 2016, when I didn't vote for either Hillary Clinton or Biden, I'd never not voted Republican. I voted for every Republican nominee. So I'm the kind of vote that they should feel like they don't even have to work for. As a staunch social conservative, I should be the easiest vote in the world. 

So when you're removing votes like mine from the ledger, it's a concrete loss for a GOP nominee. I'm a typical Republican voter and a typical Republican voter is withholding his vote, that's minus one in the Trump column. And by adding a third party vote, it's a plus one in the column of alienated Americans who are deeply dissatisfied with what the two parties have become. 

The GOP after Trump

After the election, Trump is either an ex-president or soon-to-be a lame duck. What comes after next? What's the Republican party after Trump?

There's three options. One: He wins. And then the Republican Party after Trump, barring a total disaster beyond what we've seen in 2020, you're talking about a party remade in his image in much the same way that the party was remade in Ronald Reagan's image after his successful two terms. If Trump wins. the bond between him and the GOP base will be doubly cemented because he's even more of an underdog this time than last time. It would be seen as an extraordinary triumph. 

Two: If it's a very narrow loss, it's still a Trumpy party. Maybe not as much devotion to Trump, the man, but I think a lot of devotion still to that nationalist populist outlook. Because the idea would be that either he was the right message but the wrong messenger, which the non-Trump family heirs in the party will say. Then the Trump family heirs would say, he had the right message and was the right messenger. He was stabbed in the back by those darn Never Trumpers in the media. 

And the last one is if he loses decisively, all bets are off. Every part of the Republican coalition would have an opportunity to vie for control, including the changing Reaganite wing, the nationalist populist wing, all the various strands of the Republican coalition would be fighting for dominance. And we wouldn't know who won until the primaries are decided in 2024. 

That hurt my head hearing you cite Reagan. Because that means there could potentially be quarter-century of Trumpism ahead. 

That's an awful thought. The dedication of one of our two great political parties to a nationalist pugilist style that has no regard for personal character, I think would be disastrous for our country. 

Read the original article on Business Insider

Wall Street economists are getting fed up with the government’s inability to agree upon more stimulus

Sat, 09/26/2020 - 8:15am  |  Clusterstock
  • Wall Street is finally accepting diminished chances for a near-term stimulus deal, and firms' latest GDP forecasts reflect growing pessimism toward the economy's chances without fresh aid.
  • Goldman Sachs halved its GDP growth forecast to 3% on Wednesday. JPMorgan followed suit one day after, cutting its estimate to 2.5% from 3.5%.
  • Morgan Stanley and Bank of America trimmed their expectations earlier in the month. All four of the Wall Street giants cited an absence of new fiscal relief for their gloomier outlooks.
  • Still, some hope for a spending package emerged Thursday. Treasury Secretary Steven Mnuchin said new stimulus is "still needed," and top Democrats rolled out a new $2.4 trillion proposal that could be voted on as early as next week.
  • Visit the Business Insider homepage for more stories.

With the US economic recovery slowing and stimulus still stuck in a legislative deadlock, Wall Street is finally throwing in the towel.

Major banks recently lowered their forecasts for near-term economic growth, accepting that the fiscal aid their previous estimates relied on is unlikely to arrive. Firms' economists held out through stalled negotiations and major disagreements over the month expecting Democrats and Republicans to eventually meet in the middle. Yet recent events all but entirely dashed hopes for a spending package.

The death of Justice Ruth Bader Ginsburg shocked the country and immediately shifted Republicans' focus to confirming a replacement on the Supreme Court. Legislators on both sides of the aisle also rushed to compromise on a stopgap spending measure to avoid an October 1 shutdown deadline. In a matter of days, priorities pivoted from economic relief spending to other pressing matters.

Read more: 'Classic signs of euphoric sentiment': Famed economist David Rosenberg warns that Snowflake-led IPO mania is inflating a market bubble that could soon pop

In a spate of notes adjusting gross domestic product projections, banks unanimously cited the absence of stimulus for their more bearish outlooks.

Bank of America was among the first to officially lower its fourth-quarter estimate. The firm's forecast fell to 3% from 5% in a September 11 note, with economists deeming the stimulus deadlock as a "speed bump" for the nation's rebound.

Morgan Stanley followed suit days later, removing proactive stimulus from its base-case scenario. The bank previously estimated that a package including $1.5 trillion to $2 trillion in relief spending would bring growth back to its pre-pandemic levels by the second quarter of 2021.

Failure to pass such a deal pushes that timing back to the end of next year, the bank said in a mid-September note. Morgan Stanley's 9.3% growth expectation remains one of the highest among major banks, according to data compiled by Bloomberg.

Read more: GOLDMAN SACHS: Buy these 21 stocks on track for years of market-beating growth that could make them future giants — even rivals to the FAANGs

Goldman Sachs and JPMorgan are the latest Wall Street giants to accept gloomier projections. The former halved its fourth-quarter growth estimate to 3% on Wednesday. The lack of stimulus will most heavily weigh on households' disposable income and drag consumer spending lower through the end of the year, the team led by Jan Hatzius wrote.

JPMorgan's economists trimmed the firm's fourth-quarter projection to 2.5% from 3.5% on Thursday. An inability to pass new aid will prompt a contraction in disposable income heading into 2021, the bank said.

Waning odds of a new stimulus measure arrive as economic indicators warn of a stagnating recovery. New US jobless claims unexpectedly jumped to 870,000 for the week ended September 20, landing well above the consensus estimate of 840,000 filings. August retail sales similarly missed expectations after climbing only 0.6% through the month. With CARES Act funds largely exhausted, the country's economic bounce-back is set to head into the new year with little support.

Still, some hope for a near-term deal emerged Thursday. Treasury Secretary Steven Mnuchin told the Senate Banking Committee he and House Speaker Nancy Pelosi continue to negotiate on new aid, adding that additional stimulus is "still needed."

Read more: US Investing Championship hopeful Tomas Claro hauled in a 409.1% return through August. Here's the unique trading strategy he's leveraging — and 3 stocks he's holding.

At the same time, Pelosi and top Democrats rolled out a new $2.4 trillion stimulus proposal that would lift the economy through aid for families, airlines, and restaurants. The sum sits above the $1.5 trillion target the White House previously set as its maximum and below Democrats' initial plans for a $3.4 trillion bill. A vote on the measure could take place as soon as next week.

Passage of a new stimulus package would likely invigorate the stock market and revive some of Wall Street's faltering optimism. Yet time is of the essence. The CARES Act's economic impact was somewhat delayed as Americans waited for economic relief checks to arrive and businesses applied for Paycheck Protection Program loans. Even if a multitrillion-dollar measure is passed before October, fourth-quarter growth may be doomed to match banks' newly weakened forecasts.

Now read more markets coverage from Markets Insider and Business Insider:

Northwestern Mutual's chief strategist told us the 6 market drivers he's watching most closely amid the volatility — and broke down where he's putting his money over the next 9-12 months

US new-home sales surge to fastest pace since 2006 as housing market shines through pandemic

US can stage 'full recovery' by end of 2020 with blockbuster 4th quarter, St. Louis Fed president says

Read the original article on Business Insider

Private-equity recruiting backs off — Barclays trading rout — Alts gatekeepers

Sat, 09/26/2020 - 8:07am  |  Clusterstock


Recruiting for private-equity associates is looking a whole lot different this year. As Reed Alexander and Casey Sullivan reported, private-equity firms and headhunters are backing off from going after young investment bankers in their first few weeks on the job — and setting brand new timelines for the ultra-competitive process.

It's a big reversal after years of one-upping to nab top talent out of investment banks. PE associate recruiting had started in mid-September last year, marking its earliest-ever kickoff. 

Speaking of recruiting, we've also assembled an interactive database of Wall Street recruiters that you can browse by specialty. You can check it out here: 

Search top Wall Street headhunters for banking, hedge funds, and private equity

More below on the hiring track record of Wells Fargo's CEO; a big trading loss at Barclays; what Facebook is paying in rent in its huge new NYC office (and what that says about the ailing leasing market); and a roundup of the gatekeepers who decide which private-markets investments are making their way into the hands of wealth-management clients. 

If you're not yet a newsletter subscriber, you can sign up here to get your daily dose of the stories dominating banking, business, and big deals.

How Wells Fargo CEO Charlie Scharf, who's under fire for his 'limited' Black talent remark, filled the bank's top ranks with white men from his JPMorgan days

Charlie Scharf, the chief executive of Wells Fargo, was appointed to his post in late 2019.

Wells Fargo Chief Executive Charlie Scharf apologized on Wednesday for remarks revealed in a Reuters report that showed he believes there is a dearth of Black talent to recruit. 

Scharf has been shaking the bank up with new hires since he joined Wells as CEO in October 2019. Rebecca Ungarino took a look at this unique chance to transform the firm's management team — and how the roles wound up being filled. 

A Barclays trading desk lost more than $60 million this year amid a bloodbath in distressed assets

The logo of Barclays is seen on the top of one of its branch in Madrid

Barclays' distressed-credit team has had a difficult stretch in 2020. That comes as sell-side distressed trading in general has taken a bath amid the upheaval from Covid-19, even as fixed-income trading numbers have been off the charts in aggregate. Alex Morrell revealed what's dragging on performance.

The CEO of Refinitiv says flexible working has boosted productivity and is here to stay at the $27 billion data giant

David Craig, Refinitiv CEO

While many financial firms are still sorting out what their long-term plans are, one of the largest data providers to the Street is fully embracing flexible working. 

In a conversation with Dan DeFrancesco, Refinitiv CEO David Craig shared that his company has seen a 20-30% increase in productivity on core operational areas since remote work began.

"It's not going back to normal because I think attitudes have been changed," Craig told us. 

How much Facebook is paying for its giant new office in New York 

Rendering of Farley Building.

Office landlords are lowering rents and sweetening leasing deals to convince tenants to take space. The concessions show just how hard it is to get companies to jump in on office deals right now. 

Look no further than Facebook's blockbuster lease at the Farley Building on Manhattan's West Side, where sources say the social media giant was able to secure a 9% discount on the deal. Dan Geiger has all the details. 

Meet the gatekeepers of alternative investments at the largest wealth-management firms

For Wall Street firms with big wealth businesses, an enormous amount of due diligence is required when allowing more exotic investments into the hands of financial advisers' clients.

Here's a look at nine people at firm like UBS, Merrill Lynch, and Wells Fargo shaping who's investing in red-hot private markets.

  • Read the full memo Goldman Sachs just sent announcing a leadership shakeup in its powerhouse M&A group
  • Snowflake's mega IPO resulted in more than $100 million in fees for investment banks. Here's how much Goldman Sachs, Morgan Stanley, and 8 other banks each made.
Real estate
  • Demand for lab space is booming, and real-estate giant JLL just hired a new life-sciences expert to lean into the opportunity
  • Giant mall owner Brookfield Properties is ditching its worst locations and redeveloping what's left into 'mini cities' that blend shopping with residential space
Hedge funds
  • Nasdaq follows the NYSE in publicly opposing SEC's proposal to drastically limit visibility into money managers' investments
  • Meet the former Goldman Sachs MD who has an ambitious plan to boost the number of women overseeing funds at big money managers
  • A fintech that pairs small-business borrowers with lenders just launched data-driven matchmaking aimed at reinvigorating the space after a pandemic-induced slump
  • A compliance startup that helps early-stage companies close deals with incumbents just raised a $10 million Series A from Canapi Ventures, Bain Capital, and NYCA
  • Here's the 10-slide pitch deck that payments startup dLocal used to raise $200 million from General Atlantic at a $1.2 billion valuation
Legal newsProfessional servicesOdd lots
  • A former Esquire exec is suing Hearst, alleging age and gender discrimination.
  • 'It's like being in a sci-fi nightmare film': Whole Foods employees say Amazon workers are crowding stores, ignoring virus protocols, and hounding them for help as online orders surge
Read the original article on Business Insider

California's ban of gas-powered cars by 2035 looks great for Tesla, but could distract the young automaker from its best chance to grow

Sat, 09/26/2020 - 8:03am  |  Clusterstock
California Gov. Gavin Newsom signed an executive order banning the sale of gas-powered cars by 2035, on the hood of a Ford Mustang Mach-E.

When California Gov. Gavin Newsom announced last week that the state would ban new sales of internal-combustion engines after 2035, the obvious and immediate reaction was, "This has to be great news for Tesla!"

And it is great news for America's dominant electric-vehicle manufacturer, which currently makes almost all its cars in the Golden State. Prior to the coronavirus pandemic, Tesla was on track to sell nearly 50,000 vehicles in California through the second quarter. A combination of heavily taxed gasoline and perks for zero-emission vehicles has given Left Coasters ample reason to go electric.

California accounts for about 11% of all new vehicle sales in the US, so even though the 2035 ICE ban is a long way off — and might not be politically feasible, long term, as it was formulated as an executive order, not legislation — it has the attention of the auto industry.

"Ford is proud to be the only American automaker to stand with California for reduced greenhouse gas emissions," Jim Farley, Ford's soon-to-be-new CEO, said in a tweet. "We want to leave a better world to the next generation." (Ford, Volkswagen, BMW, and Honda joined California is a 2019 dispute with the Trump administration EPA over fuel-economy standards.)

For Tesla, an ideal position isn't actually ideal for capturing future market growth outside the US At Tesla's recent Battery Day, Musk recently said the company needs to sell 20 million vehicles annually to displace enough ICE vehicles from the global fleet to mitigate global warming.

But Tesla has a big lead already, which will only get bigger as the company pushes toward selling a million vehicles a year. That milestone would secure fully half of the California market — not a terribly far-fetched development, as Tesla wants to build a new factory in Texas to cover the US east of the Mississippi and a new plant in Germany, freeing up its California facility to supply the US western region by itself.

In a research note published after Newsom's announcement, Morgan Stanley analysis Adam Jonas noted that Tesla is the automaker best-positioned to benefit from an ICE ban. However, the next decade-and-a-half could be tricky for Tesla to negotiate in its home state.

For starters, the overall new-vehicle market in the US isn't going to grow. In fact, it isn't clear that Tesla's considerable sales have displaced sales of gas-powered vehicles, or whether the company has simply created a sort of parallel market in EV sales — in effect creating new market share that it can dominate. 

And depending on what happens with urban development and auto ownership in California, vehicle sales there could instead decline. Meanwhile, Tesla's Fremont factory lacks the capacity to continue to dominate demand in California, as that demand shifts to electric. (Fremont can build around 400,000 vehicles every year, but about two million new cars and trucks are sold in the state annually.) 

This presents a dilemma for CEO Elon Musk and his 17-year-old company: build a second car plant in the West to capture more of California, or expand instead in the market where major-league growth is more likely to happen. That would be China.

Tesla is already operating the sole remaining vehicle assembly plant in California. Adding another facility in the heavily regulated state would be expensive and time-consuming, a contrast with Tesla's new plant in China, which went from a hole in the ground to rolling out vehicles in 15 months. 

Musk recently said that Tesla needs to sell 20 million vehicles annually to displace enough ICE vehicles from the global fleet to mitigate global warming, so the options are to either take over huge chunks of the US and European markets, or to go after lower-hanging growth in China. 

More competition in California than Tesla has ever faced before Ford hopes the Mustang Mach-E will improve its California sales.

Mind you, Tesla stands to grow a more profitable business if a state as big as California helps to create a semi-captive market for the company's vehicles. Many of Tesla's most affluent customers live in the Golden State, and they should be important long-term as the automaker works to generate consistent, double-digit margins.

But then again, 15 years isn't tomorrow, and if Tesla is distracted by picking up market share in California, it could fall off the pace in China. Tesla has more money in the bank than ever before, but the extra billions aren't enough to expand on two continents simultaneously.

That's the risk. Fortunately, Tesla is no longer going it alone. Both Ford and GM are moving aggressively to introduce EVs, and both carmakers see California as a growth opportunity for them, given their historic sales weakness in the Golden State. The top two US automakers control 30% of the total US market, but in California, their Japanese competitors own almost half the yearly sales.

But GM, in particular, is ahead of the Japanese carmakers on an EV master plan, aiming to launch 22 new vehicles by 2023 (and forming an alliance in the US with Honda to share costs). So Tesla doesn't have to take needless risks because other major automakers are taking aim at California. Tesla has already done its work in the state and can shift to attacking new opportunities (and it already is, by building a Cybertruck plant in Texas and going after GM and Ford's bread-and-butter, pickups).

In the end, if California follows through on its 2035 mandate, Tesla could be looking at a discipline challenge. It would be hard to pass up California, given that much of the value of Tesla's brand — and its $395-billion market capitalization — is thanks to many happy Californians buying Teslas and broadcasting their zero-emissions ethos to the world. That's the main reason that Tesla gets away with spending almost nothing on advertising.

But as tempting as California is, it isn't where the serious growth is. And competition in the state could be ferocious. These are good challenges to have, but before we argue that Newsom's initiative is the best thing that ever happened to Tesla, we have to consider that Tesla now belongs to more than just one US state.

Read the original article on Business Insider

US stocks see 3rd-biggest outflow in history as investors flee tech

Sat, 09/26/2020 - 7:50am  |  Clusterstock
  • Extreme times call for extreme moves, Bank of America said on Friday as it detailed investment-fund flows into and out of key market sectors.
  • Bank of America said US stocks had suffered their third-largest outflow of funds, with investors pulling $25.8 billion out of equities in the past week.
  • Technology stocks, which have led the market lower since the stock market hit record highs on September 2, suffered their biggest fund-flow redemption since June 2019, according to Bank of America.
  • The September stock-market correction is part of a "topping process," but don't expect a big bearish move as the Federal Reserve continues to implement easy monetary policies, the firm said.
  • Visit Business Insider's homepage for more stories.

Investors, skittish about rising COVID-19 cases and a lack of additional fiscal stimulus from Congress, pulled funds out of US stocks at the third-fastest pace ever over the past week, Bank of America said in a Friday note.

Investors pulled $25.8 billion out of US stocks, with much of that, $11.6 billion, coming from large-cap stocks, Bank of America said.

Technology stocks, which have led the market lower since their September 2 record high, saw $1 billion in outflows, representing the fastest pace of outflows since June 2019, the firm said.

The fund-flow activity is part of a September "topping process," but that doesn't mean investors should expect a big bear move in stocks, partly because monetary policy from the Federal Reserve remains easy, and partly because there's no irrational exuberance across Wall Street, Bank of America said.

Read more: 'Classic signs of euphoric sentiment': Famed economist David Rosenberg warns that Snowflake-led IPO mania is inflating a market bubble that could soon pop

Bank of America's Bull & Bear Indicator fell in recent weeks to 3.8 from 3.9, well below the "greed" reading often associated with a top-heavy market.

Instead, Bank of America said, the stock-market correction is "healthy rather than dangerous."

Areas of froth, like tech and the SPAC space, are being unwound, which could lead the market to experience "heavy" trading through October and into year-end, the firm said.

What it comes down to in terms of gauging whether the stock market is due for a nasty sell-off is the credit markets. As long as spreads don't widen significantly and the corporate-bond exchange-traded fund LQD holds the $130-to-$132 price level, Wall Street is "not a bear story" in the fourth quarter, Bank of America said.

Read more: Sunil Thakor's global stock fund has returned more than 500% to investors since 2009 by precisely targeting high-growth companies. He explains how he finds long-term winners in a 'sweet spot' that minimizes risk.

The LQD ETF on Friday traded 3% above the $130 level, which also coincides with its 200-day moving average. Traders will look to that level for support if the market does indeed show extended signs of weakness.

Meanwhile, investors shouldn't expect a march to record highs after this correction without an additional round of monetary and fiscal stimulus from the Fed and Congress, Bank of America said.

"With the biggest fiscal stimulus behind us and without explicit MMT hard for policy to catalyze big upside for stocks and credit next 6 months given starting valuations," the note said.

Read more: Bruce Petersen spent 18 years in the retail industry before amassing a real estate portfolio with nearly 1000 units. Here's the investing strategy he's using that's 'head and shoulders better' than a traditional approach.

Read the original article on Business Insider

Inside South Africa's Multi-Million Dollar Seafood Industry

Fri, 09/25/2020 - 10:15pm  |  Timbuktu Chronicles
From the Smithsonian:Abalone, a large sea snail native to the Western Cape, is a popular local delicacy. To meet demand, the seafood industry created abalone farms which gross $50 million annually.

Homemade Fish Meal from Kosamo Kenya

Fri, 09/25/2020 - 2:59pm  |  Timbuktu Chronicles
From A Growing Culture: Growing up on his family farm, John and his 11 siblings helped his parents with a variety of tasks. Typical days included plowing, planting, and tending to the livestock. John’s favorite activity was heading down to the marsh with his father and uncle. Here, they fished using traditional spears and baskets, catching mudfish and other varieties. However, the spears were too dangerous for a young boy, so John would watch from the shore. Always curious, he often wondered how the fish fed themselves in the muddy marshes (he was used to feeding the livestock his family kept). As he grew older, his questions increased. He began to wonder: Could he create his own fish meal and raise fish on his property? Once he was old enough, he began experimenting to find out.

THE INNOVATION: After some trial and error, John successfully developed a fish meal formula. He combines a variety of dried plants and herbs–including spinach, amaranth leaves and seeds, and sukuma wiki (hearty greens such as kale and collard greens). Then, he mixes in cow dung, packages it in sacks, and throws it into his pond for the fish to feed on. Although the fish grow slowly on this fish meal, they are healthy and as tasty as the lake fish...[more]

10 things in tech you need to know today

Fri, 09/25/2020 - 2:54am  |  Clusterstock
Facebook CEO Mark Zuckerberg testifying social-distance style before a House Judiciary subcommittee in July 2020

Good morning! This is the tech news you need to know this Friday. Sign up here to get this email in your inbox every morning.

  1. Amazon's smart home security division Ring has unveiled a camera drone that launches if sensors detect a potential home break-in. The new Always Home Cam is an autonomous drone that can fly around inside your home to give you a perspective of any room you want when you're not in, per The Verge. 
  2. Amazon announced Luna, a free video game streaming service that lets you play hit games on your phone, computer, and other streaming devices, on Thursday. For $5.99 per month, players can subscribe to the Luna+ channel, which will grant them access to dozens of games, including hit titles like "Control," and "Resident Evil 7." 
  3. The Senate plans to subpoena the CEOs of Facebook, Google, and Twitter to testify before Congress next month. The committee is holding a hearing on Oct. 1 that's meant to address Section 230, a law that shields social media companies from being held liable for the content of users' posts.
  4. Facebook issued a warning about Russian 'hack-and-leak' operations ahead of the 2020 election. In the last presidential election, Russian government operatives working to elect Donald Trump created fake news outlets to disseminate emails stolen from the Hillary Clinton campaign.
  5. Spotify, Epic Games, and Match Group have allied to take on Apple in the raging App Store war. The app developers have banded together to create a non-profit called the Coalition for App Fairness over claims Apple's practices are anti-competitive. 
  6. Facebook's former director of monetization says Facebook intentionally made its product as addictive as cigarettes — and now he fears it could cause 'civil war.' Former Facebook director Tim Kendall lashed out at the company's business model during testimony before Congress, saying Facebook's focus on driving engagement outweighs its consideration of potential harms.
  7. Facebook's policy chief said Europe is too fragmented to produce a Facebook or Google to rival the US and China. Former UK deputy prime minister Nick Clegg said the reason there hasn't been a European tech success to rival Facebook or Google is because the EU has failed to create a "digital single market."
  8. Palantir could be valued at as much as $22 billion in its trading debut. The data-mining-software company is eschewing the traditional IPO route and going public through a direct listing which could value shares at around $10 a-piece, per the WSJ.
  9. Spotify founder Daniel Ek is investing over $1 billion of his own money into European startups to push Silicon Valley from the center of the tech world. Ek plans to invest in risky early stage companies working in health care, education, machine learning, biotechnology, material sciences and energy.
  10. How $10 billion Tencent-backed Brazilian challenger bank Nubank grew its customers from 5 million to 30 million in 18 months. Nubank, founded in 2013, has raised $1.4 billion to-date and is one of the most valuable and well funded private tech startups in South America

Have an Amazon Alexa device? Now you can hear 10 Things in Tech each morning. Just search for "Business Insider" in your Alexa's flash briefing settings.

Read the original article on Business Insider

Coronavirus response coordinator Dr. Deborah Birx reportedly says she is 'distressed' at direction of White House COVID-19 task force

Fri, 09/25/2020 - 2:39am  |  Clusterstock
White House Coronavirus response coordinator Dr. Deborah Birx speaks during a news conference in the Rose Garden of the White House
  • US COVID-19 response coordinator Dr. Deborah Birx told those close to her that she is "distressed" at the direction of the White House coronavirus task force and is weighing if she will remain with the team, CNN reported Wednesday.
  • The White House coronavirus expert told people close to her that she felt her role was diminished after neuroradiologist Dr. Scott Atlas joined the task force.
  • "The president has found somebody who matches what he wants to believe," a source close to Birx told CNN. "There is no doubt that she feels that her role has been diminished."
  • Atlas denied the report during a news conference Wednesday evening, saying Birx "speaks for herself but that's a completely false story and she denied it today."
  • Another source close to Birx told CNN that the White House coronavirus expert is unlikely to leave her position on the task force but said there is some "frustration" in her day-to-day work.
  • Visit Business Insider's homepage for more stories.

Coronavirus expert Dr. Deborah Birx told people she is "distressed" at the direction of the White House coronavirus task force and is weighing how much longer she'll remain in the position, CNN reported Wednesday.

Birx, who serves on the White House coronavirus task force, reportedly felt her role became "diminished" after neuroradiologist Dr. Scott Atlas joined the task force, according to the CNN report.

"The president has found somebody who matches what he wants to believe," a source close to Birx told CNN. "There is no doubt that she feels that her role has been diminished." The source added that Birx believes Atlas could be feeding Trump misleading information on the coronavirus, specifically around mask-wearing and its role in preventing coronavirus spread.

At a press conference Wednesday evening, Atlas denied there being any tensions in his relationship with Birx, saying she "speaks for herself but that's a completely false story and she denied it today."

"It's completely false," he told White House reporters.

White House spokesman Judd Deere told CNN in a statement that Birx plays an equal part on the task force.

"All of the medical experts in the administration are working together around the clock to carry out the President's No. 1 priority: protecting the health and safety of the American people and defeating this virus from China," Deere said. "President Trump relies on the advice and counsel of all of his top health officials every day and any suggestion that their role is being diminished is just false."

Another source close to Birx told CNN that the White House coronavirus expert is unlikely to leave her position on the task force, but said there is some "frustration" in her day-to-day work.

"She is a good soldier," the source told CNN. "I don't think she's going anywhere."

James Glassman, who previously worked with the State Department and a friend of Birx, told CNN that Birx is more focused on "just getting the job done."

"Dr. Birx is out in the states with the most trouble, telling them the right things about masks and distancing and going back to school," Glassman told CNN. "She's ignoring the nonsense from Scott Atlas and just getting the job done — just as I've seen her do, fighting AIDS for the past 15 years."

Read the original article on Business Insider

If Trump bypassed the FDA on a COVID-19 vaccine it could 'upend' the traditional approval structure and erode the public's trust in the executive agency, expert says

Fri, 09/25/2020 - 2:20am  |  Clusterstock
A photo illustration show a syringe. Argentina was selected to test a vaccine against COVID-19, it is estimated that the clinical phases will begin in August.
  • President Donald Trump suggested that the White House could bypass the US Food and Drug Administration on approving a coronavirus vaccine. 
  • Marc Sanchez, an FDA attorney, and consultant, said the remark was an "unfortunate attempt to increase the pressure on the FDA."
  • Sanchez said doing that would erode public trust in the agency and in a vaccine. 
  • Visit Business Insider's homepage for more stories.

President Donald Trump suggested on Wednesday that the White House could bypass the US Food and Drug Administration on approving a coronavirus vaccine.

Marc Sanchez, an FDA attorney and consultant, said doing so would not only "upend" the FDA's structure but erode the public's trust in the agency to roll out a safe and vaccine on its own.

Sanchez said the comment was an "unfortunate attempt to increase the pressure on the FDA."

"FDA has historically been slower than its counterparts around the world in approving novel medical devices and drugs, taking seriously the role of protecting public health and safety over speedy approvals," Sanchez said. 

The FDA announced stricter protocols when it came to approving an emergency coronavirus vaccine, and FDA commissioner Dr. Stephen Hahn made a promise that the "FDA will not authorize or approve a vaccine that we would not feel comfortable giving to our families."

"FDA will not authorize or approve any Covid-19 vaccine before it has met the agency's rigorous expectations for safety and effectiveness," Hahn told the Senate Health Committee. "Decisions to authorize or approve any such vaccine or therapeutic will be made by the dedicated career staff at FDA, through our thorough review processes, and science will guide our decisions."

He added: "FDA will not permit any pressure from anyone to change that."

However, during the news conference at the White House on Wednesday, Trump erroneously cast any delay in releasing a COVID-19 vaccine to the public as "a political move."

"That has to be approved by the White House. We may or may not approve it," Trump said. "Why would they be adding great length to the process?"

Sanchez told Business Insider that he is not aware of whether the president is able to make such a move. But said that considering that the FDA is an executive agency, he supposed "there could be a situation where President Trump revoked this delegation and makes a decision directly," which "would totally upend not only the FDA structure but how we think of executive agencies generally."

"FDA relies on public trust, and the FDA staff I have worked with and befriended in over a decade of practice understand this keenly," Sanchez said. "It is terrible to think of FDA losing that trust."

He added that the independence of the agency is critical so that people can remain confident in the vaccine and the overall quality of the agency.

The coronavirus disease (COVID-19) vaccine test in Thailand

Sanchez drew on the contentious reputation of the Centers for Disease Control and Prevention, which has recently been embroiled in public disputes with the Trump administration over health guidelines and recommendations amid the coronavirus pandemic.

"There's this core public trust, and we have that in the FDA. Part of that core trust is that its independent, and that independence is rooted in science and public health, protecting public health through good science," he said, adding that he thinks the CDC has failed to establish such independence and reliance on "pure science."

Sanchez highlighted that the FDA work with hydroxychloroquine, and how despite political pressure they still based their rulings on scientific information. 

He explained that FDA approval for vaccines in many cases gets more scrutiny than other drugs because they affect essentially the entire population. He said the organization goes through multiple steps from clinical work in several different phases to do a risk-benefit analysis and evaluate the safety and efficacy of a vaccine.

"Normally that process would take years and we're talking about it in a non-pandemic, a non-priority drug. It's a very long process to go through," Sanchez said. "Obviously, we're trying to truncate that process in the interest of public health, but not trying to take shortcuts in a way that introduce new risk or upset that balance of risk and benefit."

He added, however, that the political commentary and focus on a vaccine, including claims by Trump to have one ready before the election, has added some degree of pressure to researchers, who would normally do their work without any rush.

"Now we have the management themselves receiving political pressure that then kind of continues to push down. So I think that's principally what we've seen or can see happen is ordinary reviewers being told to hurry their work or to produce a result more quickly," he said. "And so I think that's part of that public trust element that we've got to make sure that they continue to do the work aware of the pandemic and the public health need for this, but not making a decision or rushing their work to make mistakes."

Read the original article on Business Insider

Louisville police arrest the state lawmaker who authored 'Breonna's Law,' during a second night protests over the lack of charges related to Breonna Taylor's death

Fri, 09/25/2020 - 12:32am  |  Clusterstock
LOUISVILLE, KENTUCKY - SEPTEMBER 24: Demonstrators march through the streets on September 24, 2020 in Louisville, Kentucky. A Kentucky grand jury indicted one police officer involved in the shooting of Breonna Taylor with three counts of wanton endangerment. No officers were indicted on charges in connection to Taylor's death.
  • Police in Louisville, Kentucky, arrested a state lawmaker, Rep. Attica Scott, who had introduced legislation to ban "no-knock" warrants following the police killing of Breonna Taylor.
  • Scott was arrested near the First Unitarian Church in downtown Louisville, where protesters were seeking refuge following a 9 p.m. curfew.
  • It was the second night of protests after Kentucky Attorney General Daniel Cameron declined to pursue charges related to the killing of Taylor.
  • One officer, Brett Hankison, who was fired over his role in the raid, was charged with wanton endangerment for shooting into a neighbors' apartment.
  • Visit Business Insider's homepage for more stories.

Police in Louisville arrested a Kentucky state lawmaker on Thursday during protests against impunity for the police officers who killed Breonna Taylor.

Rep. Attica Scott, a Democrat who introduced legislation — dubbed "Breonna's Law" — to ban "no-knock" warrants, was charged with first-degree rioting and failure to disperse, local TV station WDRB reported. Police also arrested Shameka Parrish-Wright, a local organizer with The Bail Project.

—State Representative Josie Raymond (@RepJosieRaymond) September 25, 2020

Scott was one of several people arrested while seeking refuge at the First Unitarian Church in downtown Louisville following a 9 p.m. local curfew that is in effect through the weekend.

The church had welcomed protesters, declaring itself a sanctuary for those demanding justice for Taylor, a 26-year-old Black woman fatally shot by Louisville Metro Police Department officers in March.

—Ryan Van Velzer (@RyanVanVelzer) September 25, 2020


Following the arrests, police were reportedly in talks with activists over a negotiated exit from the church.

It is the second consecutive night of protests in Louisville after Kentucky Attorney General Daniel Cameron, a Republican, announced Wednesday that no officer would be charged in relation to Taylor's killing.

One officer, Brett Hankison, who was fired over his role in the raid, was charged with wanton endangerment for shooting into a neighbors' apartment.

Officers had raided Taylor's apartment searching for drugs, with some eyewitnesses testifying that they broke down the door to her apartment without first announcing themselves. Taylor's boyfriend, believing a home invasion was in process, fired a shot, prompting a stream of bullets from police, wounding him and killing Taylor.

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Fox News won a court case by 'persuasively' arguing that no 'reasonable viewer' takes Tucker Carlson seriously

Thu, 09/24/2020 - 11:42pm  |  Clusterstock
Tucker Carlson.
  • A federal judge dismissed a lawsuit against Fox News this week after lawyers for the network argued that no "reasonable viewer" would take the network's primetime star Tucker Carlson seriously.
  • The former Playboy model Karen McDougal filed a defamation suit against Fox alleging that Carlson slandered her during a December 2018 episode of his show, "Tucker Carlson Tonight."
  • The network asked a judge to dismiss the case by arguing that "Carlson's statements were not statements of fact and that she failed adequately to allege actual malice."
  • The judge agreed with Fox's premise, adding that the network "persuasively argues ... that given Mr. Carlson's reputation, any reasonable viewer 'arrive[s] with an appropriate amount of skepticism' about the statements he makes."
  • Carlson has a long history of making racist and controversial statements during his tenure as a primetime host on Fox News and has lost several advertisers because of it.
  • Visit Business Insider's homepage for more stories.

A federal judge dismissed a lawsuit against Fox News this week after lawyers for the network argued that no "reasonable viewer" takes the primetime host Tucker Carlson seriously, according to a new court filing.

The case was brought by the former Playboy model Karen McDougal, who said Carlson defamed her on his show, "Tucker Carlson Tonight," by saying she extorted President Donald Trump "out of approximately $150,000 in exchange for her silence about an alleged affair" between them.

The Fox News Network in turn asked a federal judge to toss out McDougal's case by arguing that "Carlson's statements were not statements of fact and that she failed adequately to allege actual malice."

McDougal said two of Carlson's statements during a December 10, 2018 episode of his show were defamatory, according to Thursday's ruling by US District Judge Mary Kay Vyskocil:

  • Carlson's claim that McDougal "approached Donald Trump and threatened to ruin his career and humiliate his family if he doesn't give them money."
  • Carlson's claim that McDougal's actions amounted to "'a classic case of extortion,' which is a crime."

Fox News countered McDougal's allegations by arguing that Carlson "cannot be understood to have been stating facts, but instead that he was delivering an opinion using hyperbole for effect," the ruling said. "Defendant submits that the use of that word or an accusation of extortion, absente more, is simply 'loose, figurative, or hyperbolic language' that does not give rise to a defamation claim."

The judge agreed with Fox's premise, adding that the network "persuasively argues ... that given Mr. Carlson's reputation, any reasonable viewer 'arrive[s] with an appropriate amount of skepticism' about the statements he makes."

"This 'general tenor' of the show should then inform a viewer that he is not 'stating actual facts' about the topics he discusses and is instead engaging in 'exaggeration' and 'non-literal commentary,'" the ruling said.

McDougal made headlines in 2018 after it surfaced that Trump's longtime lawyer and fixer, Michael Cohen, arranged for American Media Inc., the owner of the tabloid The National Enquirer, to pay her $150,000 to buy her story alleging that she had an affair with Trump in 2006. AMI never published McDougal's story after purchasing it in order to shield Trump in the weeks before the 2016 election, a practice known as "catch and kill."

Carlson, meanwhile, has made several racist and controversial statements during his tenure as one of Fox News' biggest primetime stars.

Last year, after a mass shooting in El Paso, Texas, in which the suspect wrote a manifesto about a "Hispanic invasion of Texas," Carlson argued that white supremacy was a "hoax" and "not a real problem."

In December 2018, Carlson claimed that immigrants would make the US "poorer and dirtier." Nearly three dozen advertisers cut ties with Carlson's show after his comments. Three months later, the host again found himself in hot water when tapes surfaced featuring him describing women as "primitive" and saying they "just need to be quiet," comparing them to dogs, and defending the convicted pedophile Warren Jeffs.

Carlson refused to apologize for his resurfaced remarks and invited those who disagreed with him to appear on his show. In June, as nationwide protests erupted following the police killing of George Floyd, the host said the demonstrations were "definitely not about Black lives," and warned viewers to "remember that when they come for you."

Carlson saw another exodus of advertisers following his remarks about the protests.

"Karen McDougal's lawsuit attempted to silence spirited opinion commentary on matters of public concern," Fox News Media said in a statement after Thursday's ruling. "The court today held that the First Amendment plainly prohibits such efforts to stifle free speech. The decision is a victory not just for FOX News Media, but for all defenders of the First Amendment."

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A voting advocacy group recorded over 40,000 new voter registrations in the 2 days after the death of Ruth Bader Ginsburg

Thu, 09/24/2020 - 11:27pm  |  Clusterstock
Supreme Court Justice Ruth Bader Ginsburg.
  • Voter registration spiked following the death of Supreme Court Justice Ruth Bader Ginsburg. 
  •, a nonprofit that allows people to register through its website, told Business Insider that they had 40,771 new voter registrations on the Saturday and Sunday following Ginsburg's death.
  • That's a 68% increase from the prior Saturday and Sunday. 
  • Visit Business Insider's homepage for more stories.

After the death of Supreme Court Justice Ruth Bader Ginsburg last week, voter registration surged according to voting advocacy groups., a nonprofit that allows people to register through its website, told Business Insider that they had 40,771 new voter registrations on the Saturday and Sunday following Ginsburg's death. That's a 68% increase from the prior Saturday and Sunday.

Ginsburg died on Friday at the age of 87 due to complications from metastatic pancreatic cancer. 

"I do think that the passing of Ruth Bader Ginsburg has galvanized eligible voters, in particular, who understand the role of the Supreme Court and are concerned about the future of civil rights," Carolyn DeWittpresident of Rock the Vote, told CNBC.

Her death prompted a battle between Republicans and Democrats on who gets to nominate a new justice to fill her seat. Ginsburg's death came just weeks before the November elections, and Democrats argued it would only be fair to wait until after Election Day, while many Republicans said they'd vote on a nominee before the election. Trump has said he plans to nominate a justice on Saturday. also saw a 118% increase in registration verifications the weekend following Ginsburg's death compared to the previous weekend. A total of 139,046 registration verifications were recorded this past Saturday and Sunday. Additionally, the group reported that 35,288 mail ballot requests on Saturday and Sunday, a 42% increase from the prior weekend.

In a tweet, DeWitt also said the Rock the Vote saw an increase in general web traffic following Ginsburg's death. 

"We're running 10x our 2016 NVRD front-end server amount to accommodate the increased traffic to register to vote. Proud of our team," DeWitt said. 

A poll from Morning Consult indicated that the importance of the Supreme Court increased for Democratic voters after Ginsburg's death. Three out of five democrats surveyed or 60% now say that the Supreme Court as a "very important" issue compared to only 48% prior to her death. For Republicans, about 54% said the Supreme Court is a "very important" issue for them. 

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