The News Memo
Let's break down all the things you should know in the news this week.
+GetSmart (Where did the term "riding shotgun" originate?)
UK's Theresa May announced today (May 24) she will be quitting her role as prime minister, effective June 7. She said it was the "honour of my life" to serve as PM, and said it was a "deep regret" that she had not been able to deliver a successful Brexit deal. A new PM is expected before the end of July. The current Brexit exit date is October 31.
🕵️ Julian Assange was indicted by the US on 17 additional criminal charges Thur (May 23), for violating the Espionage Act by publishing the names of classified sources. Assange was indicted in April on one criminal charge for conspiring with former intelligence analyst Chelsea Manning to access the Pentagon network. The new charges put more pressure on Assange, whom the US is trying to extradite. He is currently serving jail time in the UK for skipping bail. Journalists and free-speech defenders are worried the new charges may have implications for journalists who often legally receive and reveal secret government information.
🗳️ India Elections: In an overwhelming victory, Prime Minister Narendra Modi was elected to a second 5-year term on Thur (May 23). The election of Modi, a strong Hindu nationalist, may continue to increase hostility and violence against the country’s Muslim minority population. Modi will face economic tests, as the country is facing growing unemployment and fears of a recession.
✏️ SAT Accommodations: Based on a WSJ analysis of 9,000 public schools, more students, especially in affluent areas, receive accommodations for standardized tests such as the SAT. ‘504’ designations are typically given to students with ADHD or other learning limitations to provide test-allowances such as separate rooms or extra time. The number of 504s granted more than tripled between 2000-2016. In wealthier areas, an average of 4.2% students receive the designation, compared to 1.2% in poorer areas. Typically, medical approval is required to obtain a 504. Wealthier families are often more aware of this requirement and financially able to afford it.
🚗 Ford announced it will cut 7,000 salaried jobs, or ~10% of its white-collared workforce, amid a broad restructuring plan. U.S demand for cars has fallen since its peak in 2016, and markets in Europe and China have cooled as of late, partly due to tougher emissions standards. Context: Other car companies, including GM and Volkswagen, have cut or are planning large cuts to their salaried workforce as they seek to trim costs to invest in burgeoning areas such as electric and autonomous vehicles.
Trump Says He Won’t Work With Democrats Until Investigations are Done
Walking out of a planned Wednesday meeting with Senate Majority Leader Chuck Schumer and Speaker of the House Nancy Pelosi on infrastructure, President Trump instead held an impromptu press conference in the Rose Garden.
“I walked into the room and I told Senator Schumer and Speaker Pelosi, ‘I want to do infrastructure. I want to do it more than you want to do it… but you know what? You can’t do it under these circumstances.’” Speaker Pelosi responded, saying, “I knew he was looking for a way out...we were expecting this.”
Both infrastructure and lowering prescription drug prices have been a bipartisan concern for democrats and republicans. During the heated press conference, Trump said Democrats need to “get these phony investigations over with.” A sign attached to the front of Trump's podium read, “No Collusion. No Obstruction” along with details from the Mueller Report.
A cohort of Democratic lawmakers are pushing for impeachment proceedings against President Trump, although Pelosi said Thursday (May 23) that Democrats were not on an impeachment path, and she urged Democrats to wait for the courts to finish with their rulings.
What to watch moving forward:
Nancy Pelosi will need to decide how to proceed. To not advance impeachment may frustrate her base, but she cautions Democrats away from moving too quickly to avoid motivating Trump voters before the 2020 election. If the investigations continue, it is likely Trump and the Democrats will struggle to strike any large bipartisan efforts.
Don McGahn, Trump's former White House Counsel, did not show up for a subpoenaed Congressional hearing on Tuesday (May 21). Trump argued that Don McGahn already testified for 30+ hours during Mueller’s special counsel investigation. The Justice Department’s Office of Legal Counsel has for decades maintained that Congress cannot compel testimonies from presidential advisers. The rationale behind these decisions lies in the separation of powers between the legislative and executive branches. If Congress can compel testimony from close presidential advisers, it could discourage private communication within the White House.
$16 B Aid Package to US Farmers as Trade Woes Continue; US Restricts Huawei Technologies
Context: Both countries have dug into their positions and are preparing for a long-term trade dispute. The trade war has put investors in a delicate situation as they try to navigate volatile and uncertain markets. US stock markets declined steeply this week.
Farm Aid Package
In the wake of higher tariffs, Trump announced on Thursday (May 23) a $16 billion aid package for US farmers to help offset the losses they have experienced with diminishing access to Chinese agricultural markets. Because the funds will be drawn from a US Department of Agricultural account, it won’t require congressional approval.
Trump signed an executive order on Wednesday (May 15) that is primarily thought to target Huawei Technologies. The order prohibits U.S. companies from using technology from “foreign adversaries” that pose a threat to national security. Further, the US Commerce Department announced a ban on US exports to Huawei without an approved license from Washington. The ban focuses on semiconductor chips and other technology.
For example, Google announced on Monday (May 20) that it would stop supplying its Android operating system for use in Huawei cell phones. In wake of the ban, however, a 90 day reprieve period was announced to give US firms time to work out the details of their business relationships with Chinese firms. It is expected that the ban will disrupt Huawei’s business, which receives roughly 50% of its semiconductor chips from the US. Huawei will continue to be a central point of debate in any future trade deal.
The WSJ also reported this week that the hiring of foreign nationals at US technology firms has slowed in recent months. Companies must get approval in order for foreign nationals (especially from China, Iran, and Russia) to work with sensitive technology such as semiconductor chips and telecommunication technology, as theoretically these workers can bring the production secrets back to their countries, which potentially compromises US security. In recent times, approvals for foreign nationals would take a few weeks, but now it is stretching to months. Because top tech talent is in short supply, US firms are worried that their talent pool will continue to shrink.
Trends: Millennials Lag Behind Previous Generations Financially
What’s going on?
Despite a growing economy and falling unemployment, Millennials lag financially at this point in their lives compared to every generation before them since the Great Depression. Millennials are those born between 1981-1996. Over 72 million American Millennials are in their 30s, and they are expected to surpass the number of Baby Boomers this year.
Currently, Millennials hold less wealth and property, have fewer children, and have lower marriage and fertility rates than previous generations at the same ages.
Some statistics on Millennials:
So why are Millennials behind?
Multiple factors play into why Millennials are lagging behind, but here are three that the Wall Street Journal notes as relevant:
The Great Recession
Some economists cite bad luck. Entering the workforce during a recession often yields lower earnings for life, as young adults have a slow start which makes it difficult to catch up. Further, few Millennials owned a home or were able to invest in the stock market after the Recession, failing to capture gains from the current decade-long expansion.
Manufacturing Job Loss
The loss of manufacturing jobs due to automation has created a lack of good-paying jobs, especially for those without college degrees. According to Pew Research Center, Millennials with college degrees make more than twice the amount of households headed by high-school graduates.
Millennials are the most educated generation ever (about 4 in 10 Millennials hold a college degrees), but with that degree comes a large cost. The average student loan debt among Millennials in 2017 was $10,600.
🐎 The term "riding shotgun" originates from a person riding next to a stagecoach driver
In the days of stagecoaches, the person sitting next to the driver was often called the “shotgun messenger,” as the person would hold a shotgun to protect the coach from bandits. Regular use of the term "riding shotgun" emerged in films at the beginning of the 20th century.
*The News Memo is edited by Madeline Krumel