Team Biden’s statement of intent
When the president-elect introduced his proposed economic team, he summarized their vision: “Given a fair shot and equal chance, there’s nothing beyond the capacity of the American people.” As word has leaked of his nominees, their backgrounds suggested that the incoming administration’s focus would be on workers and income inequality. Yesterday, they backed this up in their own words.
“We were raised to respect the dignity of work,” Vice President-elect Kamala Harris said. Then, Mr. Biden’s economic brain trust emphasized their personal experiences with the plight of workers, sure to be a major theme in the administration’s early days:
- Growing up in “working-class Brooklyn” forever marked the Treasury secretary nominee Janet Yellen, who pledged to run “an institution that wakes up every morning thinking about” people’s jobs, paychecks, struggles, hopes and dignity.
- The deputy Treasury secretary pick, Wally Adeyemo, said his immigrant parents instilled in him a sense of responsibility to “the country that gave us so many opportunities.” He promised to work “to ensure that everyone has the fair chance they deserve.”
- “Budgets are not abstractions,” proclaimed Neera Tanden, prospective director of the Office of Management and Budget. “I’m here today because of social programs. Because of budgetary choices.”
- Cecilia Rouse, the nominee for chair of the Council of Economic Advisers, said that a spike in unemployment while she was in college made it “impossible to separate what we were learning in the classroom from what I knew was going on in towns across the country,” leaving her “drawn to study the labor market in all of its dimensions.”
- The other appointees for the C.E.A. highlighted memories of parental unemployment and the importance of unions. “Security, union benefits, a place in the neighborhood, a place in the middle class” is what a job at Boeing meant to Heather Boushey’s father. Jared Bernstein said his mother’s proudest moment wasn’t when he got a Ph.D. but when he got a union card.
Behind the rhetoric, securing aid for workers will be difficult, if the long partisan standoff over economic stimulus package is any indication. When he takes office, Mr. Biden will try to balance Republican accusations of a socialist takeover with criticism from progressive Democrats that he is embracing capitalism too closely. That debate is neatly captured by the nomination of Ms. Tanden, who faces a tough confirmation battle with critics on both the right and the left.
A variation on “America First.” Mr. Biden told The Times’s Tom Friedman, “I want to make sure we’re going to fight like hell by investing in America first.” Although this echoes President Trump’s policy branding, in Mr. Biden’s case it means huge government investment in research into energy, biotech and A.I., as well as infrastructure. At the same time, his foreign policy instincts have traces of his predecessor’s anti-globalization stance: There’s a recognition that Americans increasingly feel “the gains from globalization and our economic system needed to be shared more widely,” Nathan Sheets, an Obama-era Treasury Department official, told The Wall Street Journal.
- This might lead to tensions within his team. Mr. Biden told Tom that he wouldn’t immediately lift the 25 percent tariffs that Mr. Trump imposed on Chinese goods. Ms. Yellen has been openly skeptical of tariffs.
HERE’S WHAT’S HAPPENING
Britain approves Pfizer’s Covid-19 vaccine. The country became the first in the West to authorize a coronavirus vaccine. (Russia and China didn’t wait for large-scale trials.) Britain will begin vaccinations next week, starting in nursing homes.
Centrist senators present a compromise stimulus plan. A bipartisan group unveiled a $908 billion package to break the political logjam. But Senate Republicans are working on a far smaller proposal that is unlikely to win Democratic support, while Democratic leaders are pushing for more spending.
SoftBank reportedly winds down its stock options trade. The Japanese tech investor is letting options expire — mostly by the end of the month — after investors complained about its risky multibillion-dollar strategy, Bloomberg reports. SoftBank will retain stock investments in Big Tech companies like Amazon and Facebook.
Salesforce clinches a $27.7 billion deal for Slack. The acquisition, Salesforce’s biggest, is the latest in a wave of workplace software takeovers. But Salesforce investors may be unhappy with the hefty deal premium: Its shares are down in premarket trading. (Slack’s are up nearly 50 percent since reports of the deal emerged.)
President Trump threatens defense cash to attack a tech legal shield. In two tweets, Mr. Trump said he would veto a $1 trillion funding bill unless Congress eliminated Section 230 of the Communications Decency Act, which protects online platforms from legal liability for content posted by users.
Fresh from selling itself, Kind buys another
Just weeks after agreeing to be acquired by Mars, the snack maker Kind will announce today a $400 million deal to buy a like-minded food company, Nature’s Bakery. Kind’s strategy is to turn itself into a “health and wellness platform,” amassing a range of products it makes or acquires. That plan was in place when Mars was only a minority investor, and “our partners at Mars wants us to continue,” the Kind founder and C.E.O. Daniel Lubetzky told DealBook.
A family affair. Nature’s Bakery was founded in 2011 by the father-and-son team of Dave and Sam Marson. The company, which sold a minority stake to private equity firm VMG Partners in 2016, now offers “plant-based, nut-free and dairy-free” products in retailers like Costco and Target. Nature’s Bakery will keep its supply chain separate from Kind’s, to ensure its products stay nut-free.
Preserving the culture. The Nature’s Bakery deal, and Kind’s takeover before it, are the latest in a string of acquisitions by big food brands of smaller, upstart rivals with cultures that are hard to replicate at large corporations. These large acquirers have sought to avoid past stumbles in similar deals, when they swallowed brands whole or confused consumers by pumping out new iterations of niche products too quickly. That has meant creating stand-alone units to manage younger, hipper brands: Hershey, for example, runs several through Amplify Snack Brands, the parent of SkinnyPop, which it acquired in 2018.
- Kind, which will operate independently within Mars, plans a hands-off management approach with Nature’s Bakery, while still offering the benefits of the global distribution might of the maker of M&M’s and Snickers. “We want to create a culture where we really empower our partners for them to decide what’s best for their brands,” Mr. Lubetzky said.
“We are definitely not going to launch a hostile takeover. If somebody said it would be a good idea to merge with Tesla, we would have this conversation.”
— Tesla and SpaceX C.E.O. Elon Musk, in an interview after accepting a lifetime achievement award from Axel Springer.
Cocoa cases raise bitter questions
Could an American corporation abet child slavery by doing business with suspect suppliers abroad, and should it be held liable if it does? Those were among the thorny questions raised yesterday at a Supreme Court hearing on cases against Cargill and Nestlé U.S.A. brought by Malians who were forced into child slavery on cocoa farms in Ivory Coast.
“Many of your arguments lead to results that are pretty hard to take,” Justice Samuel Alito said after the companies’ lawyer argued that, under the Alien Tort Statute, they can’t be held liable for human rights violations based on business relationships with farmers abroad. The justice wondered how far that argument went, asking if it extended to a business that “surreptitiously hires agents” to kidnap and enslave children, ensuring “bargain prices” on cocoa or coffee. But allowing such suits isn’t straightforward, either.
“They know that’s where the cheap beans come from,” the Malians’ counsel argued. He said that the corporations set up a supply chain known to be tainted by human rights violations, while other companies sourced responsibly and paid more. Justice Stephen Breyer responded to the allegation philosophically, saying that it described businesses that operate “blinking” or with “open eyes.” Speaking over the lawyer’s protestations, the justice wondered who should be responsible for stopping this sort of thing.
It is one of the big questions of the era. Governments, companies, investors and shoppers increasingly agonize about the responsibilities and relationships created by consumption. Notably, The Cocoa Barometer, a report by N.G.O.s and trade unions released yesterday, supplied one possible answer, calling on governments of major consuming nations to pass laws that hold companies accountable for human rights abuses in their supply chains.
THE SPEED READ
- Airbnb is seeking a valuation of nearly $35 billion in its I.P.O. (NYT)
- The online health care arm of JD.com raised $3.5 billion in its Hong Kong I.P.O. (Bloomberg)
- A bipartisan commission said that Congress should give the Federal Trade Commission more power over mergers involving foreign buyers. (WSJ)
Politics and policy
- Geoffrey Berman, the former U.S. attorney for Manhattan fired by President Trump in June, will join the law firm Fried Frank as the head of its white-collar defense practice. (NYT)
- President Trump has considered pre-emptive pardons for three of his children, his son-in-law Jared Kushner, and Rudy Giuliani. Separately, the Justice Department is investigating a potential bribery scheme involving pardon seekers. (NYT)
- The European Central Bank’s top economist reportedly called banks and investors after policy meetings to offer clarifications, breaking with tradition. (WSJ)
- Amazon is joining a broad shift away from Intel’s computer chips. (NYT)
- Hewlett Packard Enterprise is moving its headquarters to Houston, the latest Silicon Valley company to decenter from California. (CNBC)
Best of the rest
- More than 40 American corporate giants — including Amazon, Citigroup and Ford — are urging Congress to support President-elect Joe Biden’s plan for the U.S. rejoin the Paris climate accord. (WSJ)
- “Reinventing Workers for the Post-Covid Economy” (NYT)
- The arc of women’s work attire during the pandemic: from blazers to “coatigans.” (NYT)
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