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The World
The Treasury Department released details of Biden’s tax plan, which aims to raise as much as $2.5 trillion over 15 years to help finance the infrastructure proposal. That includes bumping the corporate tax rate to 28% from 21%, imposing a strict new minimum tax on global profits and cracking down on companies that try to move profits offshore. The plan also aims to stop big companies that are profitable but have no federal income tax liability from paying no taxes by imposing a 15% tax on the profits they report to investors. Such a change would affect about 45 corporations, because it would be limited to companies earning $2 billion or more per year. Biden further said he was open to compromise with Republicans on how to pay for the package, but insisted that inaction was unacceptable. (New York Times, Washington Post)
The U.S. proposed a new model for taxing multinational corporations, calling for the world’s biggest businesses to pay levies to national governments based on their sales in each country as part of a deal on a global minimum tax. In documents sent to the 135 countries negotiating international taxation at the OECD in Paris and obtained by the FT, the US Treasury laid out a plan that would apply to the global profits of the very largest companies, including big US technology groups, regardless of their physical presence in a given country. (Financial Times)
The IMF wants a pandemic wealth tax to support those hit hardest by the pandemic and tackle rapidly rising public debt. It urged advanced nations to consider temporary tax increases to provide targeted support for vulnerable households, including minorities, women and the low-paid. (The Times)
Out of all U.S. states, Iowa has the most structurally deficient bridges, 4,571 or 19.1% of its total bridges. Pennsylvania comes second on the list with 3,353 of its bridges falling into the same category, along with 2,374 in Illinois. West Virginia has the highest share of bridges classified as structurally deficient at 21% while Nevada has the lowest at just 1.4%. (Statista)
China’s military confirmed it had tracked a US warship as it traversed the Taiwan Strait, a move the US described as a routine freedom of navigation exercise and Beijing denounced as destabilizing to the region. It came on the same day that Taiwanese authorities said 15 Chinese military aircraft, including a dozen fighter jets, had crossed into their defence zone, and warned Beijing that the island would “defend ourselves to the very last day” if necessary. (South China Morning Post)
Microsoft and U.S. government officials are still working to understand how a network of suspected Chinese hacking groups carried out an unusually indiscriminate and far-reaching cyberattack on Microsoft email software. A leading theory: The suspected Chinese hackers mined troves of personal information acquired beforehand to carry out the attack. (Wall Street Journal)
As Myanmar edges ever closer to civil war, the country’s ambassador to Britain, who has spoken out again the military coup in his country, said he was barred from the embassy in London by officials loyal to the military junta: “They are refusing to let me inside.” (Washington Post, The Times)
Jailed Kremlin critic Navalny has two herniated disks and loss of feeling in his hands, his lawyers say. “So long as he is imprisoned, the Russian government is responsible for his health and well-being,” White House press secretary Jen Psaki said. (Washington Post)
The U.S. announced it would provide $235 million in aid to the Palestinians, restarting funding for the U.N. agency supporting refugees and restoring other assistance previously cut. Biden also promised to press for a two-state solution to the Israeli-Palestinian conflict. (Reuters, Times of Israel)
More than 60% of frontline healthcare workers say the pandemic has negatively impacted their mental health. About 13% of those surveyed reported accessing mental health services or medications. Those who didn't get help cited being too busy or unable to get time off work, feeling afraid or embarrassed or not being able to afford it. (Healthcare Dive, Kaiser Family Foundation)
Black adults are significantly more likely to encounter discrimination when receiving healthcare than White patients, according to a new Urban Institute study. While 10.6% of Black adults said they had experienced some form of discrimination, the number was even higher among low-income Black adults (14.5%) and Black women (13.1%). Just 3.6% of White adults say they have experienced some form of discrimination when seeking healthcare services. Among Latino adults, the rate was 4.5%. (Healthcare Dive)
Far more heart patients have used telehealth appointments in the Covid-19 era than before the pandemic, but cardiologists ordered fewer diagnostic tests and medications for remote patients than for those who saw their doctors in person. (Healthcare Dive, JAMA)
Evidence is mounting that a tiny subatomic particle seems to be disobeying the known laws of physics, a finding that would open a vast and tantalizing hole in our understanding of the universe. The problem has been: To date, scientists can’t account for a few key components of the universe, including a little thing called gravity. Clearly, something somewhere is off, but we have not been able to put our metaphorical finger on it for decades, and that means our basic understanding of everything around us is flawed. Perhaps, until now. This odd muon behavior “is a major hint that the universe contains unseen particles and forces beyond our current grasp.” Said Chris Polly, a physicist at the Fermi National Accelerator Laboratory, or Fermilab, in Batavia, IL, who has been working toward this finding for most of his career: “This is our Mars rover landing moment.” (New York Times, National Geographic)
Economy
JPMorgan CEO Jamie Dimon warned in his annual letter that the U.S. and European banking sectors are being surpassed in scale by shadow banks and fintech rivals. Dimon is asking for a "level playing field." Or, put another way, a loosening of capital requirements on banks and/or greater regulatory oversight of fintech. He added that China lacks clear path to global dominance. (Axios, Nikkei Asian Review)
Global venture investments reached a record $125 billion in 1Q21, a 50% increase quarter over quarter and a whopping 94% increase year over year. Meanwhile, mega-rounds drove last quarter's U.S. VC activity, accounting for 64% of total funding. The number of mega-rounds rose from 102 in Q4 2020 to 184 in Q1 2021. (Crunchbase, Axios)
Amazon’s closely watched union election in Alabama had voter turnout of about 55%, and the public vote tally is expected to begin as early as this afternoon. (Reuters)
China creates its own digital currency: A thousand years ago, when money meant coins, China invented paper currency. Now the Chinese government is minting cash digitally, in a re-imagination of money that could shake a pillar of American power. It might seem money is already virtual, as credit cards and payment apps such as Apple Pay in the U.S. and WeChat in China eliminate the need for bills or coins. But those are just ways to move money electronically. China is turning legal tender itself into computer code. China’s version of a digital currency is controlled by its central bank, which will issue the new electronic money. It is expected to give China’s government vast new tools to monitor both its economy and its people. By design, the digital yuan will negate one of bitcoin’s major draws: anonymity for the user. Beijing is also positioning the digital yuan for international use and designing it to be untethered to the global financial system, where the U.S. dollar has been king since World War II. China is embracing digitization in many forms, including money, in a bid to gain more centralized control while getting a head start on technologies of the future that it regards as up for grabs. Digitized money could reorder the fundamentals of finance the way Amazon disrupted retailing and Uber rattled taxi systems. (Wall Street Journal)
Peter Thiel calls bitcoin a “Chinese financial weapon” that might be used to undercut the US dollar's reserve currency status (Bloomberg)
Technology
With the exception of YouTube and Reddit, most social media platforms show little growth since 2019: YouTube and Facebook continue to dominate the online landscape, with 81% and 69%, respectively, reporting ever using these sites. And YouTube and Reddit were the only two platforms measured that saw statistically significant growth since 2019. 40% of adults say they ever use Instagram and about three-in-ten report using Pinterest or LinkedIn. 25% say they use Snapchat, and similar shares report being users of Twitter or WhatsApp. TikTok is used by 21% of Americans. Certain sites or apps, most notably Instagram, Snapchat and TikTok have an especially strong following among young adults. A majority of 18- to 29-year-olds say they use Instagram (71%) or Snapchat (65%), while roughly half say the same for TikTok. (Pew Research Center)
At the same time, the Pew study highlights just what a poor business YouTube is from the point of view of its owner, Google. Consider that last year, YouTube’s ad revenue totaled $19.8 billion. That’s about a quarter of Facebook’s ad revenue and less than Netflix makes from subscriptions. Even worse, Google probably keeps little more than half of that amount, as it has to split ad revenue with creators. Meanwhile, YouTube faces growing competition from apps like Instagram and TikTok. (The Information)
A sign that the world is reopening: Uber needs drivers. The ride-hailing firm said today it was launching a $250 million “driver stimulus” to “welcome existing drivers back to Uber and ensure first-time drivers do well as they learn the ropes.” (The Information)
Twitter held talks to acquire Clubhouse at a valuation of $4 billion, but discussions are no longer underway. Online education startup MasterClass is raising a new round of funding that values the 6-year-old company at $2.5 billion. Patreon was valued at $4 billion in its most recent fundraising round, led by Tiger Global Management. (Bloomberg, Axios, Wall Street Journal)
Twitch will now ban users who harass members of its community — even when that harassment takes place off Twitch. The streaming platform announced a major expansion of its off-service misconduct policy that allows it to take action against users who mistreat people regardless of where it happens, whether it’s offline or on another social platform. (The Verge)
Smart Links
Here’s a list of colleges that will require students to be vaccinated against Covid-19. (Chronicle of Higher Ed)
Applications boom, admit rates plummet: Prestige college admissions get a little crazier in the pandemic. (Washington Post)
How the pandemic pummeled the world’s most famous shopping streets. (Quartz)
St. Louis elects its first Black woman as mayor. (St. Louis Post-Dispatch)
Boston Fed's Jim Cunha talks crypto, identity and central bank digital currencies. (PYMTS.com)
DoorDash drivers game algorithm to increase pay. (Bloomberg)
Why ranking employees by performance backfires; ‘forced distribution’ model is an outdated idea that should be scrapped. (Financial Times)
Live Events
Today, 9 am ET: Follow-on to New START: Problems and Dilemmas. Dr. Alexei Arbatov will discuss strategic arms control and the recent extension of the New Strategic Arms Reduction Treaty (New START) between Russia and the U.S. Arbatov is the head of the Center for International Security at the Primakov National Research Institute of World Economy and International Relations. Arbatov is a former scholar in residence and the chair of the Carnegie Moscow Center’s Nonproliferation Program. (Register: Harvard Kennedy School)