Apparently not satisfied with access to its users’ call history, text messaging data, and online conversations, Facebook has reportedly asked major Wall Street firms like JPMorgan Chase and Wells Fargo to hand over their customers’ sensitive financial data as part of the social media giant’s ongoing attempt to become “a platform where people buy and sell goods and services.”
And according to the Wall Street Journal—which first reported on Facebook’s plans on Monday—the social media behemoth isn’t the only tech company that wants access to Americans’ financial data. Google and Amazon have also “asked banks to share data if they join with them, in order to provide basic banking services on applications such as Google Assistant and Alexa,” the Journal pointed out, citing anonymous sources familiar with the companies’ ambitions. Continue reading →
“Mulvaney is only interested in obtaining views from his inner circle, and has no interest in hearing the perspectives of those who work with struggling American families,” says the board’s ousted chair
Mick Mulvaney press conference about President Donald Trump’s budget plan. Screenshot: YouTube
Mick Mulvaney, acting director of the Consumer Financial Protection Bureau (CFPB), disbanded the Consumer Advisory Board (CAB) on Wednesday in what critics are calling just his latest in a series of moves to “quietly sabotage” the agency.
“Everyone on the board has been fired,” said Judith Fox, a professor of consumer law at Notre Dame Law School and three-year member of CAB—a group of 25 economic and financal experts that the watchdog agency is legally required to meet with at least twice a year. Continue reading →
“The United Nations says that when people are denied the access to basic human services—like electric power, like water, like food, like appropriate medical care—it is like a violation of human rights.”
Rally for Puerto Rico hurricane relief at the Capitol. Screenshot: YouTube
San Juan Mayor Carmen Yulin Cruz tore into the Trump administration’s response to the ongoing catastrophe on Puerto Rico following Hurricane Maria and denounced the president’s “total neglect.”
Her comments to MSNBC on Sunday follow a Harvard study estimating that the death toll as a result of the storm was in the range of 793 to 8,498 and deeming the original official estimate of 64 excess deaths “a substantial underestimate.” Continue reading →
Environmental advocates on Friday responded with outrage to confirmation from the White House that President Donald Trump has ordered Energy Secretary Rick Perry to plot what’s being called an “unprecedented intervention” by the federal government to bail out financially strapped coal and nuclear power plants that can’t compete with the renewable energy sector.
“This is an outrageous ploy to force American taxpayers to bail out coal and nuclear executives who have made bad decisions by investing in dirty and dangerous energy resources,” declared Mary Anne Hitt, director of the Sierra Club’s Beyond Coal campaign. Continue reading →
“Any oil company or bank that supports drilling in the Arctic National Wildlife Refuge…would be associated with trampling on human rights, destroying one of the world’s last remaining intact wild places, and contributing to the climate crisis.”
Investors and indigenous people alike appealed to oil and gas companies on Monday, demanding that they end efforts to drill for fossil fuels in the Arctic National Wildlife Refuge. (Photo: Alaska Region USFWS/Flickr/cc)
An indigenous group was joined by investors controlling trillions of dollars in assets on Monday as they called for fossil fuel companies and the banks that fund them to end efforts to drill in the Arctic National Wildlife Refuge—making clear that harming the protected land is bad for business as well as destructive to indigenous groups’ land and the environment.
“We strongly urge banks and oil and gas companies to honor their fiduciary duty to investors and refuse to engage in drilling in the Arctic Refuge,” the investors wrote. “We, as investors, encourage expanding support for the wide range of clean energy solutions and sustainable industries in Alaska, instead of helping to destroy this natural wonder.” Continue reading →
Female environmentalists occupied one of JPMorgan Chase’s bank lobbies in Seattle to demand divestment from fossil fuels. (Photo: @350_Seattle/Twitter)
With JPMorgan Chase’s annual shareholder meeting set to take place in Texas next week, 350.org Seattle and five other environmental groups organized a demonstration to protest the bank’s ongoing investment in fossil fuels, particularly tar sands.
Climate groups applauded HSBC’s announcement that it is moving away from fossil fuels. (Photo: ItzaFineDay/flickr/cc)
In another signal that “the era of fossil fuels is coming to a close,” Europe’s biggest bank, HSBC, announced Friday that it will no longer fund oil or gas projects in the Arctic, tar sands projects, or most coal projects.
The move was cheered by climate campaigners on social media, who said, “This is huge,” and called it “incredible news.”
The tariffs are meant to address two problems: intellectual property theft by China and a steep and persistent trade deficit.
As an economist and expert in international trade, I don’t see how the proposed tariffs will resolve either one. In fact, it’s more likely that they will create two new problems by hurting both consumers and businesses.
IP theft and trade deficits
The administration formally justified its tariffs by invoking Section 301 of the Trade Act of 1974, which allows the president to impose tariffs on countries in violation of international trade deals.
Intellectual property theft has been a major complaint of American companies doing business in China for decades. Sometimes this theft occurs through illicit means, such as industrial espionage. It also occurs through legal channels, such as when U.S. companies are forced to form a joint venture with a Chinese business. In other cases, technology transfers are a precondition of doing business in China.
The other problem that has long irked the president is the significant trade deficit. Since the U.S. normalized trade relations with China in 2000, the deficit ballooned from less than $84 billion to over $375 billion in 2017.
This “China shock” of cheap goods has caused considerable disruption in the U.S. economy. The labor market has been surprisingly slow to adjust, leading affected workers to earn far less money over a lifetime.
The wrong solutions
It remains to be seen, however, whether the tariffs will alleviate either problem.
The administration’s calculation seems to be that China will back down on intellectual property theft if faced with less access to U.S. markets.
But China is less dependent on U.S. trade now than it was a decade ago, making its economy resilient to these sorts of punitive measures. The U.S. accounted for 18.4 percent of Chinese exports in 2016, down from 21 percent in 2006.
The U.S. likely would have better luck resolving this problem at the WTO, which China joined in 2001 and must abide by its rulings. The best part about a WTO ruling is that it would affect all of China’s exports, not just those to the U.S.
The U.S. personal savings rate has fallen steadily since the late 1970s. At the same time, the government has run persistently large budget deficits, both of which have increased the level of borrowing in the U.S. economy.
As a result, foreign investment, particularly from China, has become increasingly critical to financing U.S. economic growth. This is great news in terms of helping Americans buy cheap Chinese goods and the government finance its budget deficit. But all that foreign cash going into the financial market isn’t being used to buy the stuff Americans are producing, like Harley Davidson motorcycles and Iowa corn.
This results in lower exports and a higher trade deficit. Tariffs will not change this reality.
Two new problems
While the full details of the tariffs have yet to be released, it’s clear they’ll cause at least two immediate problems.
One is that U.S. consumers will be hurt. The typical consumer has about $260 in extra purchasing power as a result of trade with China. Those benefits, which disproportionately go toward working-class Americans, will fall due to the U.S. tariffs, as American importers will pass some of their increased costs along to consumers.
Particularly vulnerable to Chinese retaliation are the pork and soybean industries, which are concentrated in the Trump-friendly Midwest. This list could grow if a trade war with China escalates.
A broader concern is that, by acting unilaterally, the Trump administration is undermining the broader system that has facilitated the growth of international trade and adjudicated grievances between countries since World War II.
While far from perfect, organizations such as the WTO have limited the scope of trade wars since the chaos of the 1930s. Failing to uphold these institutions could have major consequences in the future.
When the Trump administration took office early last year, hundreds of staffers from lobbying firms, conservative think tanks and Trump campaign groups began pouring into the very agencies they once lobbied or whose work they once opposed.