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The World
President Biden’s American Families Plan will cost about $700 billion more than advertised because the White House underestimated the cost of its child-care and education policies, according to a new analysis by the Penn Wharton Budget Model. The plan, which includes child tax credits, paid leave and tuition-free community college, would boost government spending by $2.5 trillion over a decade, compared with the $1.8 trillion estimated by the White House, according to the widely used Penn model. (Bloomberg)
Still, the plan is supported by nearly 60% of voters. While just 1 in 4 Republicans back the package, they expressed more support for the proposal’s individual provisions. (Morning Consult)
The CDC says the U.S.'s record-low birth rate fell another 4% in 2020, marking the sixth year in a row that the number of births declined. A total of 3,604,201 babies were born last year in the U.S., Puerto Rico and the Northern Marianas. The figure is so low that you have to go all the way back to 1979 to beat it. (Los Angeles Times)
The U.S. backed a temporary suspension of intellectual property rights for Covid-19 vaccines in a move likely to enrage the pharmaceutical industry. U.S. Trade Representative Katherine Tai said that while the administration “believes strongly” in IP protections, it would support a waiver of those rules for vaccines. The move came amid growing consternation that low and middle-income countries were being left out after wealthy nations reached deals with vaccine makers. (Financial Times, STAT News)
Booster shots under development by Moderna helped improve immune responses against some variants among people given the company’s Covid-19 vaccine in an early study. (Wall Street Journal)
The Japanese government is considering an extension of the state of emergency for Tokyo and other major urban areas that was scheduled to end on May 11. (Reuters)
The Facebook Oversight Board voted against reinstating the account of former President Trump. But the board also instructed Facebook to review the decision in order to determine and justify a proportionate response within six months: "It is not permissible for Facebook to keep a user off the platform for an undefined period, with no criteria for when or whether the account will be restored," the board wrote. (Source Code)
Inside ‘Facebook Jail’: The secret rules that put users in the doghouse. (Wall Street Journal)
Study: Daily social media interactions on stories about Trump fell from ~49M in early Jan. to ~2M by March, thanks largely to no Trump tweets for media to cover. (Axios)
The U.S. is seen as a bigger threat to democracy than Russia or China, a new global poll finds. The poll finds support for democracy remains high even though citizens in democratic countries rate their governments’ handling of the Covid crisis less well than people in less democratic countries. Inequality is seen as the biggest threat to global democracy, but in the US the power of big tech companies is also seen as a challenge. The findings come in a poll commissioned by the Alliance of Democracies Foundation among 50,000 respondents in 53 countries. (The Guardian)
The top White House Asia official warned that any declaration that the U.S. would defend Taiwan from a Chinese attack would carry “significant downsides.” Kurt Campbell, the White House Asia tsar, said such a shift entailed risk: “The best way to maintain peace and stability is to send a really consolidated message that involves diplomacy, defense innovation and our own capabilities to the Chinese leadership, so they don’t contemplate some sort of ambitious, dangerous provocative set of steps in the future.” (Financial Times)
U.S. Defense Department officials said that close to 80,000 Russian troops remained near various strips of the country’s border with Ukraine, still the biggest force Russia has amassed there since Moscow annexed Crimea in 2014. (New York Times)
North Korea is facing one of the worst economic crises in its 73-year history, amid shortages of food and medicines and warnings of rising unemployment and homelessness. Observers with contacts inside the country believe worsening conditions are coinciding with a crackdown by a regime fearful of a repeat of the social upheaval that followed the famine. (The Guardian)
In Israel, Yesh Atid leader Yair Lapid and Yamina chairman Naftali Bennett intend to engage in marathon talks to form a unity government after President Reuven Rivlin announced that he is entrusting Lapid with the second mandate to form a government. Lapid and Bennett wanted to form a government as soon as possible and believe it can be done within a week. (Jerusalem Post)
Boris Johnson ordered two Royal Navy patrol vessels to sail to the Channel Islands amid fears that French fishing boats were preparing an imminent blockade of Jersey’s main port. In a marked escalation of tensions over post-Brexit fishing rights, Downing Street said the prime minister acted after intelligence suggested that a fleet of 60 boats was preparing to block access to Saint Helier. (The Times)
Scotland goes to the polls today in a vote that could eventually lead to a truly historic event: the crackup of the UK. The independence movement has gained momentum in the wake of Prime Minister Boris Johnson’s Brexit. However, a YouGov poll shows support for Scottish independence is at a standstill despite parties pushing for a second referendum being on course to surge at today’s election. (Washington Post, The Times)
Permitless carry of a handgun in Texas is nearly law, after the Senate OKs the bill. House Bill 1927 would nix the requirement for Texas residents to obtain a license to carry handguns if they’re not prohibited by state or federal law from possessing a gun. (Texas Tribune)
Economy
Google relaxes its work-from-home rules to let more staff work remotely. Alphabet Chief Executive Sundar Pichai said the company envisions that about 20% of staff would work from home on a permanent basis, while another 20% of staff would shift to new offices. The remaining 60% of staff will work from their current location. (Wall Street Journal)
Follow-up analysis to yesterday’s study, Why Working From Home Will Stick: In very broad strokes, it turns out that the best rule of WFH thumb is just to think 50/40. About half the people can work from home, and the typical plan for those people involves two workdays a week at home (or 40% of the week). "Business leaders often mention concerns around workplace culture, motivation, and innovation as important reasons to bring workers onsite three or more days per week," the study says. But there are also clear benefits to having a day or two of offsite work every week, across practically every category. In fact, the researchers found a lot of people would even take pay cuts to WFH two or three days a week going forward. (Protocol, National Bureau of Research)
Real-estate companies are transforming suburban residences and retail spaces into offices. They are offering these workers a nearby alternative: furnished office space, bookable by the day or month and within walking distance from home. (Wall Street Journal)
The record 21.2% increase in Americans' personal income in March was notable not only for its rise but for its causes and outcomes. The Bureau of Economic Analysis pointed out that the personal income increase "largely reflected an increase in government social benefits." But rather than spend, most Americans chose to put the money away, with the U.S. personal savings rate jumping to 27.6%, edging back toward the all-time high set in April 2020. (Axios)
SPAC regulation may be on the horizon: The number of SPACs forming and filing for initial public offerings has slowed down dramatically in recent weeks, amid heightened scrutiny from the SEC and increased likelihood of new regulations. Of particular interest to regulators are how SPACs set sales projections for pre-revenue companies and whether they are categorizing warrants for future share purchases as assets or liabilities. (Crunchbase)
The U.S. equity risk premium, the extra return investors can expect for buying US stocks instead of risk-free government bonds, has fallen to its lowest levels of the past decade by some measures, as the fiery stock market rally stretches valuations. Investment strategists have pointed to the indicator to justify a more cautious approach to US equities, which set a record high last week. (Financial Times)
Amazon CEO Jeff Bezos this week sold nearly $2 billion worth of shares in his company, while Peloton stock shed $4 billion in market value in 1 day over its treadmill debacle. (CNBC, CNBC-2)
From shield to sword: How the ESG imperative is growing in private equity. In the few short years since environmental, social and governance (ESG) investing first appeared on the scene, the private equity industry has tended to view it defensively – something “good to do” in addition to a fund’s normal business of buying and shepherding companies. Now it is becoming a competitive weapon, in Europe especially. (Private Equity News)
Technology
Insurance firm Lemonade Inc. is turning to social media channels to communicate with individual investors, a group that has demonstrated its influence by driving up certain companies’ shares. The market frenzy has forced finance executives and investor-relations professionals to take a closer look at their shareholder base and find new ways to connect with investors. (Wall Street Journal)
The New York Times said it added 301,000 new digital-only subscribers last quarter, its slowest quarter for digital subscriber growth in over a year. However, a record 44% of The Times’ new digital subscribers came from non-core news products, like cooking, games and audio, last quarter. Typically, the percentage of new subscribers from non-news products hovers around 25-35%. (Axios)
A Federal Appeals court ruled that Snap can't use Section 230 to get out of a lawsuit, meaning a Section 230 Supreme Court case could be coming soon. (Protocol)
A researcher detailed a Peloton API bug that let anyone access private account info, which initially went unpatched until a reporter contacted Peloton. (TechCrunch)
The Untold Story of How Jeff Bezos Beat the Tabloids: When a gossip rag went after the CEO, he retaliated with the brutal, brilliant efficiency he used to build his business empire. In an exclusive excerpt from the new book Amazon Unbound comes an unrivaled tale of money, sex, and power. (Bloomberg Businessweek)
Smart Links
Pent-up U.S. travel demand poised to trigger a 30% surge in jet-fuel use. (Bloomberg)
New York was the worst-performing global luxury market in 1Q21. (Mansion Global)
Broadway shows to return Sept. 14. (Wall Street Journal)
Flu has disappeared worldwide during the pandemic. (Scientific American)
70% of U.S. social media users never or rarely post or share about political, social issues. (Pew Research Center)
Sally Ride, the first U.S. woman in space, will be honored on a quarter from the U.S. Mint. (Scientific American)
Want to go to space? Bidding on Blue Origin is now open. (Blue Origin)
Live Events
Today, 1 pm ET: What's Next for U.S.-Taiwan Economic Relations? Speakers: Evan A. Feigenbaum is vice president for studies at the Carnegie Endowment for International Peace & Kharis Templeman is Research Fellow at the Hoover Institution, where he manages the Project on Taiwan in the Indo-Pacific, and a lecturer at Stanford’s Center for East Asian Studies. (Stanford University)