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Here’s what you need to know
Joe Biden got to work. The newly inaugurated 46th US president signed a flurry of executive orders to undo his predecessor’s policies. He also has an ambitious climate plan and a science-based Covid-19 response.
A UK-EU diplomatic spat. Britain is refusing to give full diplomatic status to the EU ambassador in London, where the bloc has maintained a mission after Brexit.
The UK lockdown doesn’t seem to be working. Researchers warned that the renewed restrictions have had limited impact on Covid-19 cases, perhaps partly due to a more transmissible variant. Separately, EU heads will urge a faster vaccine rollout at a summit today.
Twitter locked China’s US embassy account. The firm’s action was in response to a tweet that promoted Beijing’s repressive policies in Xinjiang. Separately, Beijing sanctioned 28 officials from the Trump administration.
Investors sent US stocks soaring… Buoyed by hopes of more federal spending and a stronger pandemic effort, the Nasdaq and S&P 500 made bigger gains than on any inauguration since 1937.
…and Chinese money sent Hong Kong stocks surging. Record amounts of cross-border inflows from the mainland fueled a big rally in the city’s benchmark index, as the Chinese social media app WeChat recorded a spike in interest in Hong Kong stocks.
What to watch for
Intel is set to post its Q4 earnings today. With a new CEO and a new or revised strategy to come, Intel, which has stopped making political contributions, is one of a growing number of major companies cribbing from IBM.
IBM doesn’t donate to political parties, candidates, or causes. Ever.
If you’ve got a US portfolio or retirement account, you’re probably invested in a number of different S&P 500 firms. Unlike IBM, many if not most of these corporations have established themselves as big contributors to individual candidates. In light of the violence at the US Capitol and some members of Congress voting against certifying the presidential election results on Jan. 6, many of these companies have announced changes of heart. While it’s still illegal to contribute directly to federal campaigns, political action committees, or PACs, have long been recipients of major Wall Street donor dollars.
Now, 37 companies, which comprise 16.9% of the S&P’s total value, have stopped contributions to representatives who backed now-former President Donald Trump’s evidence-free effort to overturn the election. Another 95 companies worth 19% of the index’s total value have stopped political contributions altogether. IBM and Intel could soon find themselves among crowded ranks.
Charting Biden and the fight for $15 minimum wage
The newly inaugurated president’s $1.9 trillion economic aid package includes a measure that would double the national average minimum wage to $15 an hour. In an early test of his commitment to building a coalition across the aisle, Biden’s gambit has been quelled by Republican lawmakers in the past. Still, success in Florida and the looming specter of Covid-19 over the labor market have given him cause for optimism.
With $15 an hour the standard in New York, California, Massachusetts, Michigan, and Florida, 40% of the US labor force now lives under what would be Biden’s minimum mark. After decades of debate, Republican obstinance, and research, it seems the US could finally be on the verge of a substantial change to the minimum wage, which respected economists have argued would have a negligible impact on employment while raising quality of life.
Hong Kong’s freedom fighters were watching US riots
With its sophisticated fundraising and digital partnerships across the globe, Hong Kong’s protest has helped elevate the issue to the top of countries’ foreign policy agendas, and scored victories like US legislation from the Trump administration supporting Hong Kong and a path to UK citizenship for millions of Hong Kongers.
In turn, many in Hong Kong saw Trump as “the lesser of two evils” as the US elections approached. Some were persuaded by his baseless claims of election fraud. Then the Capitol riot happened. Now, as Trump retreats into a world replete with financial and legal trials ahead, some in the protest movement worry their alignment with the US election’s losing side may belie a rift within the movement and a larger misunderstanding of American politics.
Hong Kong’s activists are fighting against, as they see it, the Chinese Communist Party’s authoritarian rule. Rioters in the US were acting on behalf of a leader with authoritarian tendencies. How does a movement fighting for democracy square its support for a leader who’s actively trying to dismantle it? How does a movement resisting authoritarian rule justify advocating for a political figure with deeply authoritarian instincts?
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