Report: Facebook’s Privacy Lapses May Result in Record Fine

Facebook may be facing the biggest fine ever imposed by the U.S. Federal Trade Commission for privacy violations involving the personal information of its 2.2 billion users.

The FTC is considering hitting Facebook with a penalty that would top its previous record fine of $22.5 million, which it dealt to Google in 2012 for bypassing the privacy controls in Apple’s Safari browser, according to The Washington Post. The story published Friday cited three unidentified people familiar with the discussions.

In an automated response, the FTC said it was unable to comment, citing its closure due to the U.S. government shutdown. Facebook declined to comment.

The potential fine stems from an FTC investigation opened after revelations that data mining firm Cambridge Analytica had vacuumed up details about as many as 87 million Facebook users without their permission.

The FTC has been exploring whether that massive breakdown violated a settlement that Facebook reached in 2011 after government regulators had concluded the Menlo Park, California, company had repeatedly broken its privacy promises .

The FTC decree, which runs through 2031, requires Facebook to get its users’ consent to share their personal information in ways that aren’t allowed by their privacy settings.

Since the Cambridge Analytica erupted 10 months ago, Facebook has vowed to do a better job corralling its users’ data. Nevertheless, its controls have remained leaky. Just last month, the company acknowledged a software flaw had exposed the photos of about 7 million users to a wider audience than they had intended.

The FTC’s five commissioners have discussed fining Facebook but haven’t settled on the amount yet, according to the Post.

Facebook’s privacy problems are also under investigation in other countries and the target of a lawsuit filed last month by Washington, D.C., Attorney General Karl Racine.

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US Consumer Morale at Two-year Low; Factory Output Surges

U.S. consumer sentiment tumbled in early January to its lowest level since President Donald Trump was elected more than two years ago as a partial shutdown of the federal government and financial market

volatility stoked fears of a sharp deceleration in economic growth.

The drop in confidence reported by the University of Michigan on Friday was the clearest sign yet that the impasse in Washington over Trump’s demands for $5.7 billion to help build a wall on the U.S. border with Mexico was negatively affecting the economy.

Trump has touted high consumer confidence as an indication of the good job he is doing on the economy. While consumer sentiment remains relatively high, the gathering clouds over the economy could make households

more cautious about spending, leading to slower growth. Consumer spending accounts for more than two-thirds of the U.S. economy.

“This report on consumer sentiment is the first concrete evidence that the economy is going to fall and fall hard if Washington does not end the shutdown,” said Chris Rupkey, chief economist at MUFG in New York. “It is going to be hard to see real GDP growth of more than 1 to 1½ percent in the first quarter if the consumer goes on a buying strike.”

The longest government shutdown in U.S. history has left 800,000 government workers without paychecks. Private contractors working for many government agencies are also without wages.

The University of Michigan said its consumer sentiment index fell 7.7 percent to a reading of 90.7 this month, the lowest reading since October 2016 and the steepest drop since September 2015. Economists had forecast a reading of a 97.0.

The survey’s measure of current economic conditions decreased to 110.0 from a reading of 116.1 in December. Its measure of consumer expectations tumbled to a reading of 78.3, the lowest since October 2016, from 87.0 in late December.

Several factors

The University of Michigan attributed the decline in sentiment to “a host of issues including the partial government shutdown, the impact of tariffs, instabilities in financial markets, the global slowdown, and the lack of clarity about monetary policies.”

It said that half of the survey’s respondents “believed that these events would have a negative impact on Trump’s ability to focus on economic growth.”

Economists estimate the partial shutdown of the government, which started Dec. 22, is subtracting as much as two-tenths of a percentage point from quarterly GDP growth every week.

Other surveys have also shown an ebb in business sentiment.

“Sentiment among both households and businesses has been coming off the sugar highs, which were caused by tax cut hopes at the beginning of the Trump presidency,” said Harm Bandholz, chief U.S. economist at UniCredit in New York.

U.S. financial markets shrugged off the fall in sentiment, with investors focusing on another report Friday that showed manufacturing output had surged by the most in 10 months in December, and on hopes for progress in the U.S.-China trade row.

Stocks on Wall Street rallied, while the dollar rose against a basket of currencies and U.S. Treasury prices fell.

Factory activity

The broad-based jump in manufacturing output in December reported by the Federal Reserve could allay fears of a sharp slowdown in factory activity.

Manufacturing activity, which accounts for about 12 percent of the economy, is slowing as some of the boost to capital spending from last year’s $1.5 trillion tax cut package fades.

In addition, a strong dollar and cooling growth in Europe and China are hurting exports. Lower oil prices are also slowing purchases of equipment for oil and gas well drilling.

Production at factories increased at a 2.3 percent annualized rate in the fourth quarter after expanding at a 3.7 percent pace in the July-September period. It increased 2.4 percent in 2018, the largest gain since 2012, after advancing 1.2 percent in 2017.

“While the manufacturing strength in December is a favorable signal for the economy, we should keep in mind that it came after soft results in earlier months,” said Daniel Silver, an economist at JPMorgan in New York. “A broad range of manufacturing surveys also have been weakening lately, so the strength in the manufacturing output in December may prove to be short-lived.”

Last month, motor vehicle production surged 4.7 percent after gaining 0.2 percent in November. Excluding motor vehicles and parts, manufacturing advanced a solid 0.8 percent last month after gaining 0.1 percent in November.

December’s surge in manufacturing output, together with a rise in mining production, offset a weather-related drop in utilities, leading to a 0.3 percent increase in industrial production. Industrial output rose 0.4 percent in November. It increased at a 3.8 percent rate in the fourth quarter after

notching a 4.7 percent gain in the third quarter.

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Technology Near for Real-Time TV Political Fact Checks

A Duke University team expects to have a product available for election year that will allow television networks to offer real-time fact checks onscreen when a politician makes a questionable claim during a speech or debate.

The mystery is whether any network will choose to use it.

The response to President Donald Trump’s Jan. 8 speech on border security illustrated how fact-checking is likely to be an issue over the next two years. Networks briefly considered not airing Trump live and several analysts contested some of his statements afterward, but nobody questioned him while he was speaking.

Duke already offers an app, developed by professor and Politifact founder Bill Adair, that directs users to online fact checks during political events. A similar product has been tested for television, but is still not complete.

The TV product would call on a database of research from Politifact, Factcheck.org and The Washington Post to point out false or misleading statements onscreen. For instance, Trump’s statement that 90 percent of the heroin that kills 300 Americans each week comes through the southern border would likely trigger an onscreen explanation that much of the drugs were smuggled through legal points of entry and wouldn’t be affected by a wall.

The Duke Tech & Check Cooperative conducted a focus group test in October, showing viewers portions of State of the Union speeches by Trump and predecessor Barack Obama with fact checks inserted. It was a big hit, Adair said.

“People really want onscreen fact checks,” he said. “There is a strong market for this and I think the TV networks will realize there’s a brand advantage to it.”

Networks mum

If that’s the case, the networks aren’t letting on. None of the broadcast or cable news divisions would discuss Duke’s product when contacted by The Associated Press, or their own philosophies on fact checking.

Network executives are likely to tread very carefully, both because of technical concerns about how it would work, the risk of getting something wrong or the suspicion that some viewers might consider the messages a political attack.

“It’s an incredibly difficult challenge,” said Mark Lukasiewicz, longtime NBC News executive who recently became dean of Hofstra University’s communications school.

Adair said the system will be automated. Mindful that many politicians repeat similar claims, the database will be triggered when code phrases that have been fact-checked before come up. An onscreen note would either explain that a claim is false or misleading and direct viewers to a website where they can find more information, or provide a succinct explanation of why it is being challenged. He envisions an average of one fact check popping up every two minutes. A network using the service would likely air the speech or debate on a delayed basis of about a minute.

Lukasiewicz said network executives would likely be wary of letting an outside vendor decide what goes on their screen. Adair said anyone who uses the system would be given veto power over what information is being displayed.

CNN and MSNBC have been most aggressive in using onscreen notes, called chyrons, to counter misleading statements by Trump, although neither did during the border speech. Among the post-speech analyses, Shepard Smith’s rapid-fire reality check on Fox broadcast during the three-minute pause before Democrats spoke was particularly effective. But critics like the liberal watchdog Media Matters for America said anyone who turned the coverage off when Trump stopped speaking was exposed to no questioning of his words.

Complicated, cumbersome

“There is a responsibility to not just be a blind portal and just let things go unchallenged,” said David Bohrman, a former CNN Washington bureau chief who consulted on MSNBC’s 2016 election coverage. “The goal is a good one. The execution is a challenge.”

A technical junkie, Bohrman said he explored different approaches for real-time TV fact-checking while at CNN, but they ultimately proved too complicated and cumbersome.

For networks, an incorrect onscreen fact-check would be a public relations disaster. Politicians also make many statements that a critic might question but isn’t necessarily factually incorrect. For example, Trump’s contention that there is a “crisis” at the southern border: Is that a fact or matter of interpretation?

Rest assured, people will be watching. Very carefully.

Even Tim Graham, director of media analysis at the conservative Media Research Center, concedes that “we all understand that President Trump has a casual approach to factivity.”

But conservatives are deeply suspicious that Trump’s words are being watched more carefully than those of Democrats. They will notice and take offense if Trump is corrected on the air much more than his rivals, he said, no matter if Trump actually makes more false or misleading statements.

“People aren’t going to trust you,” he said, “because they know what the objective is. The objective is to ruin the president.”

Adair stressed that his product is nonpartisan. He believes television networks will catch on at some point because they will realize that their viewers want quick fact-checking.

“Anyone who criticizes will get criticized for criticizing,” Bohrman said. “But the reality is we may be able to help the viewers.”

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US House to Probe Report Trump Directed Lawyer to Lie to Congress

The Democratic chairmen of two House committees pledged Friday to investigate a report that President Donald Trump directed his personal attorney to lie to Congress about negotiations over a real estate project in Moscow during the 2016 election.

House Intelligence Committee Chairman Adam Schiff, D-Calif., said “we will do what’s necessary to find out if it’s true.” He said the allegation that Trump directed Michael Cohen to lie in his 2017 testimony to Congress “in an effort to curtail the investigation and cover up his business dealings with Russia is among the most serious to date.”

The chairman of the House Judiciary Committee, Rep. Jerrold Nadler of New York, said directing a subordinate to lie to Congress is a federal crime.

“The @HouseJudiciary Committee’s job is to get to the bottom of it, and we will do that work,” Nadler tweeted.

The report by BuzzFeed News, citing two unnamed law enforcement officials, says that Trump directed Cohen to lie to Congress and that Cohen regularly briefed Trump and his family on the Moscow project — even as Trump said he had no business dealings with Russia.

The Associated Press has not independently confirmed the BuzzFeed report.

An adviser to Cohen, Lanny Davis, declined to comment on the substance of the article, saying that he and Cohen wouldn’t answer questions out of respect for special counsel Robert Mueller’s Russia probe. Mueller is investigating Russia meddling in the election and contacts with the Trump campaign.

The BuzzFeed story says that Cohen told Mueller that Trump personally instructed him to lie about the timing of the project in order to obscure Trump’s involvement.

Trump’s lawyer, Rudy Giuliani, scoffed at the report, saying in a statement, “If you believe Cohen I can get you a good all cash deal on the Brooklyn Bridge.”

Cohen pleaded guilty in November to lying to Congress in 2017 to cover up that he was negotiating the real estate deal in Moscow on Trump’s behalf during the heat of his presidential campaign. The charge was brought by Mueller and was the result of his cooperation with that probe.

Cohen was recently sentenced to three years in prison after pleading guilty to tax crimes, bank fraud and campaign violations. He is scheduled to testify before the House Oversight and Reform Committee February 7.

The report comes as House Democrats have promised a thorough look into Trump’s ties to Russia. Though House Speaker Nancy Pelosi has discouraged any talk of impeachment in the early days of her new majority, some senior Democrats said that if the BuzzFeed report is true, Trump’s actions could rise to that level.

“If the @BuzzFeed story is true, President Trump must resign or be impeached,” tweeted Texas Rep. Joaquin Castro, a member of the House intelligence panel.

Rhode Island Rep. David Cicilline, a member of the House Judiciary Committee, tweeted that if Trump directed Cohen to lie, “that is obstruction of justice. Period. Full stop.”

William Barr, Trump’s nominee for attorney general, said at his Senate confirmation hearing Tuesday that a president or anyone else who directs a witness to lie is illegally obstructing an investigation. That statement attracted attention given Barr’s expansive views of presidential powers and his belief that presidents can’t be scrutinized by prosecutors for acts the Constitution allows them to take.

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Pelosi Delays Afghan Trip After Trump Leaks Travel Plans

U.S. House Speaker Nancy Pelosi cancelled plans Friday to fly commercially to Afghanistan after her office said President Donald Trump announced the sensitive travel plans, significantly increasing the security threat on the ground according to a State Department assessment.

A spokesperson for Pelosi’s office said in a statement “the administration had leaked the commercial travel plans as well.”

Trump revoked the use of a military plane for Pelosi and Democratic members of Congress’ planned trip to Afghanistan and Brussels late Thursday, the latest maneuver in a bitter political battle over the longest government shutdown in U.S. history.

In a letter to the speaker of the House, the president denied Pelosi and members of Congress the use of a military plane to meet with NATO allies in Brussels and U.S. troops in Afghanistan, writing “in light of the 800,000 great American workers not receiving pay, I am sure you would agree that postponing this public relations event is totally appropriate.”

 

A spokesperson for Pelosi’s office said the trip would have provided “critical national security and intelligence briefings” as well as served as an opportunity for Pelosi to thank the troops.

The speaker’s office said “in light of the grave threats caused by the president’s action, the delegation has decided to postpone the trip so as not to endanger our troops or security personnel.”

The president’s letter did not directly address Pelosi’s call Wednesday for Trump to delay his scheduled Jan. 29 State of the Union address until government funding is restored and the shutdown ends.

 

“This is completely inappropriate by the president,” House Intelligence Committee Chairman Adam Schiff told reporters outside Pelosi’s office Thursday. “We’re not going to allow the president of the United States to tell the Congress it can’t fulfill its oversight responsibilities.”

The back-and-forth between the White House and the speaker of the House meant there is no end in sight for a partial federal government shutdown, which will soon enter its fifth week. The shutdown was triggered by a standoff between Democrats and Republicans over funding for construction of a wall along the U.S.-Mexican border.

“While many Democrats in the House and Senate would like to make a deal, Speaker Pelosi won’t let them negotiate,” Trump said in a speech at the Defense Department. “Hopefully, Democrat lawmakers will step forward to do what is right for our country, and what’s right for our country is border security at the strongest level.”

 

Democrats insist they will negotiate stronger, more effective border security measures once the government reopens, but that a border wall would be wasteful, ineffective and a blight on America’s image.

 

Pelosi, the top-ranking congressional Democrat, said Trump’s “insistence on the wall is a luxury we can no longer afford.”

Later Thursday, Trump also canceled a planned trip by a U.S. delegation to the World Economic Forum in Davos, Switzerland.  The delegation, consisting  of Treasury Secretary Steve Mnuchin, Secretary of State Mike Pompeo, Secretary of Commerce Wilbur Ross, U.S. trade representative Robert Lighthizer and assistant to the president Chris Liddell, was scheduled to travel next week.

White House Press Secretary Sarah Sanders said the president wanted to make sure “his team can assist as needed” during the government shutdown.

Hundreds of thousands of federal workers missed a paycheck last week and are set to miss another next week.

 

“Not only are these workers not paid, they are not appreciated by this administration,” said Pelosi, who leads the Democratic majority in the House of Representatives. “We should respect what they do for their country.”

 

Pelosi’s move on the State of the Union drew sharp criticism from Senate Republicans.

 

“By disinviting POTUS for SOTU, Pelosi erased any pretext for her unwillingness to negotiate an end to the shutdown. It is personal, petty, and vindictive,” Senator John Cornyn from Texas tweeted Thursday.

 

Trump has called for more than $5 billion in taxpayer funding for the wall, while Democrats have offered $1.3 billion in new money for border security, but none specifically for a wall.

 

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EU Wants to Exclude Agriculture From Trade Talks With US

The European Union insisted Friday that agriculture be kept out of the EU-U.S. trade negotiations, despite Washington’s wishes to include the vast sector, and said any overall deal will be limited in scope.

The EU Commission announced its pro posals for a negotiating mandate from the 28 member states and said that the EU negotiations will be “strictly focused on the removal of tariffs on industrial goods, excluding agricultural products.”

EU Trade Chief Cecilia Malmstrom also said that she is preparing a target list of American products it will hit with punitive tariffs if the Trump administration goes through with its threat to impose duties on European auto imports.

Last July, during a period of heightened tensions over trade, U.S. President Donald Trump and EU Commission President Jean-Claude Juncker agreed to start talks meant to achieve “zero tariffs” and “zero subsidies” on non-automotive industrial goods.

With the U.S. criticizing the Europeans for allegedly dragging their feet in the talks, Malmstrom said “the EU is committed to upholding its side of the agreement reached by the two Presidents.”

Any agreement would fall well short of the scope of the free trade deal that had been discussed in recent years — but paused in 2016 after Trump slammed such wide-ranging international deals as unfair to the U.S.

Instead, Malmstrom said, the deal both sides are now looking at could be concluded “quite quickly. We could finalize this and it would be beneficial to all of us.”

 

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Tesla Plans 7 Percent Staff Cut, Says Bumpy Road Ahead

Electric car and solar panel maker Tesla said Friday it plans to cut its staff by about 7 percent.

“The road ahead is very difficult,” the company’s founder and CEO Elon Musk said in an email to employees posted on the company’s website.

He said Tesla Inc. hopes to post a “tiny profit” in the current quarter but that after expanding its workforce by 30 percent last year, it cannot support that size of staff.

Musk said in a tweet in October that Tesla had 45,000 employees. A 7 percent cut would involve laying off about 3,150 people.

Tesla’s shares tumbled earlier this month after it cut vehicle prices by $2,000 and announced fourth-quarter sales figures that fell short of Wall Street estimates.

“Our products are too expensive for most people,” Musk said in the memo to Tesla staff saying the company has to “work harder.”

“Tesla has only been producing cars for about a decade and we’re up against massive, entrenched competitors,” he said.

The company says it delivered over 245,000 electric cars and SUVs last year, nearly as many as all previous years combined. But its 2018 production fell far short of a goal set nearly three years ago of manufacturing 500,000 vehicles for the year. That goal was announced in May of 2016 based on advance orders for its mid-range Model 3, which sells for $44,000.

Musk said Tesla plans to ramp up production of the Model 3, “as we need to reach more customers who can afford our vehicles.”

“Attempting to build affordable clean energy products at scale necessarily requires extreme effort and relentless creativity,” he said in the memo, “but succeeding in our mission is essential to ensure that the future is good, so we must do everything we can to advance the cause.”

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Watchdog: Thousands More Children May Have Been Separated

Thousands more migrant children may have been split from their families than the Trump administration previously reported, in part because officials were stepping up family separations long before the border policy that prompted international outrage last spring, a government watchdog said Thursday.

It’s unclear just how many family separations occurred at the U.S.-Mexico border; immigration officials are allowed under longstanding policy to separate families under certain circumstances. Health and Human Services, the agency tasked with caring for migrant children, did not adequately track them until after a judge ruled that children must be reunited with their families, according to the report by the agency’s inspector general.

Ann Maxwell, assistant inspector general for evaluations, said the number of children removed from their parents was certainly larger than the 2,737 listed by the government in court documents. Those documents chronicled separations that took place as parents were criminally prosecuted for illegally entering the country under President Donald Trump’s “zero tolerance” policy.

“It’s certainly more,” Maxwell said. “But precisely how much more is unknown.”

Maxwell said investigators didn’t have specific numbers, but that Health and Human Services staff had estimated the tally to be in the thousands.

Lee Gelernt, an American Civil Liberties Union attorney who sued on behalf of a mother separated from her son, said the separation policy “was a cruel disaster from the start. This report reaffirms that the government never had a clear picture of how many children it ripped from their parents.”

Most of the tens of thousands of children who come into government custody cross the border alone. But the report found that in late 2016, 0.3 percent of children turned over to Health and Human Services had crossed with a parent and were separated. By the summer of 2017, that percentage had grown to 3.6 percent, officials said. The watchdog did not give exact numbers, but the total number of migrant children who passed through the agency’s care during the 2017 budget year was 40,810. The separated children had already been released to sponsors, who are generally parents or other close relatives.

The inspector general did not say why the children had been separated before the zero-tolerance policy. Immigration officials are allowed to take a child from a parent in certain cases — serious criminal charges against a parent, concerns over the health and welfare of a child or medical concerns. That policy has long been in place.

Katie Waldman, a spokeswoman for Homeland Security, said the report reinforced what officials have long said. “For more than a decade it was and continues to be standard for apprehended minors to be separated when the adult is not the parent or legal guardian, the child’s safety is at risk” or there’s a record of a “serious criminal activity by the adult,” she said.

In some cases, however, Homeland Security officials said a parent had a criminal history but did not offer details on the crimes, the watchdog reported.

The number of families coming across the border has grown even as overall illegal border crossings have decreased dramatically compared with historic trends. Over the past three months, families made up the majority of Border Patrol arrests.

The Administration for Children and Families, the division under Health and Human Services that manages the care of unaccompanied minors, said it generally agreed with the findings and noted the report did not find that the agency lost track of children under its care. It also noted new policies were in place to help track newly separated children. And the court never instructed officials to determine the number of children separated before the June 26 ruling.

Last spring, then-Attorney General Jeff Sessions said anyone caught crossing the border illegally would be criminally prosecuted. Families were brought into custody by U.S. Border patrol officials, then their parents taken to criminal court. If the parents were gone longer than 72 hours — the length of time Border Patrol is allowed to hold children — the children were transferred to the custody of Health and Human Services.

The practice prompted an outcry, with church groups and lawmakers calling the separations inhumane. Trump ordered an end to the separations on June 20. At the time, a federal judge who was already hearing the case of a mother separated from her son ruled that children must be reunited with their parents. Since the court order, 118 children have been separated.

Despite “considerable” effort by Health and Human Services to locate all the children placed in its care, the report said officials were still finding new cases as long as five months after the judge’s order requiring reunifications.

“There is even less visibility for separated children who fall outside the court case,” investigators concluded.

They said it’s not clear the system put in place to track separated children is good enough. And the lack of detail from immigration authorities continues to be an issue.

The border remains a crucible for the Trump administration, with a partial government shutdown that has dragged on nearly a month over the president’s demand for $5.7 billion for a border wall that congressional Democrats are unwilling to provide.

The inspector general’s office was also looking into other aspects of the separations, including the health and mental well-being of the children who had been separated. It expects to have other reports on the topic.

Democratic Rep. Bennie Thompson of Mississippi, chairman of the House Homeland Security Committee, said he would hold the government accountable in the matter. “The Trump administration, with its unique blend of incompetence, cruelty, and disregard for basic decency, misled the American public on one of its most heinous policies to date,” he said in a statement.

 

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Gloomy Davos: Plenty of Crises, Few World Leaders

An array of crises will keep several world leaders away from the annual World Economic Forum (WEF) in Davos next week, which takes place against a backdrop of deepening gloom over the global economic and political outlook.

Anxieties over trade disputes, fractious international relations, Brexit and a growth slowdown that some fear could tip the world economy into recession are set to dominate the Jan. 22-25 Alpine meeting.

The WEF’s own Global Risks Report set the tone this week with a stark warning of looming economic headwinds, in part because of geopolitical tensions among major powers.

​No Trump, Macron or May

Some 3,000 business, government and civil society figures are scheduled to gather in the snow-blanketed ski resort, but among them are only three leaders of the Group of Seven most industrialized countries: Japanese Prime Minister Shinzo Abe, German Chancellor Angela Merkel and Italian Premier Giuseppe Conte.

Donald Trump, who stole the Davos limelight last year with a rare appearance by a sitting U.S. president, pulled out of this year’s event as he grapples with a partial U.S. government shutdown.

On Thursday, the White House said Trump had also canceled his delegation’s trip to Davos because of the shutdown, now in its 27th day. Treasury Secretary Steven Mnuchin and Secretary of State Mike Pompeo had been expected to lead the U.S. team, according to two senior administration officials.

French President Emmanuel Macron is also skipping the meeting as he seeks to respond to the “yellow vest” protests, while British Prime Minister Theresa May battles to find a consensus on Brexit.

​No Xi, either

Outside the G7, the leaders of Russia and India are shunning Davos, while China —whose president, Xi Jinping, was the first Chinese leader to attend the elite gathering in 2017 to offer a vigorous defense of free trade — is sending Xi’s deputy instead.

That will leave the likes of British Finance Minister Philip Hammond, Chinese Vice President Wang Qishan and a host of central bankers with the task of trying to reassure business chiefs.

“Davos will be dominated by a high level of anxiety about stock markets, a slowdown in growth and international politics,” said Nariman Behravesh, chief economist at IHS Markit. “The leadership presence is lower than last year but those who are going … will be seeking to impart a sense of confidence and calm business and investors’ nerves.”

​Forum still has its glitz

Before the U.S. cancellation, a Trump administration official had said the U.S. delegation would also discuss the importance of reforming institutions such as the World Trade Organization, the International Monetary Fund and the World Bank.

Trump has harshly criticized globalization and questioned U.S. participation in multilateral institutions such as the WTO, calling for a revamp of international trade rules.

Davos watchers said the absence of so many top leaders this year did not mean the glitzy forum had lost its status as a global stage for top politicians to present their agendas.

“Abe is going to Davos not just as Japanese prime minister but also as chair of the G20. It will be a perfect opportunity to lay the groundwork of upcoming G20 meetings,” said a Japanese government source familiar with international affairs.

“Of course there may be inconveniences such as missing opportunities to hold bilateral meetings, but that won’t undermine the importance of Davos,” he said.

A Chinese official who has attended Davos regularly but will not go this year said China had never expected to make progress at the meeting on the trade dispute with the United States. 

“It’s just an occasion for making a policy statement,” he said.

​Networking opportunities

The low turnout among major Western leaders may also give more prominence to political personalities who may otherwise be upstaged. Davos will be the first major international outing for Brazilian President Jair Bolsonaro, elected on a wave of anti-establishment and conservative nationalism also seen elsewhere.

He said on Twitter he would present “a different Brazil, free of ideological ties and widespread corruption.”

For business chiefs, the value of Davos lies not so much in the public sessions but in the networking and deal-making opportunities on the sidelines of the main conference.

“It’s the best place to pitch for ideas, build connections and get your brand known,” said Chen Linchevski, chief executive of Precognize, an Israel-based start-up developing software that prevents technical or quality failures at manufacturing plants.

“It’s the kind of place where in a few days you meet people you wouldn’t easily meet otherwise,” said Linchevski, who is paying 50,000 Swiss francs ($50,495) to attend the event.

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State Department May Ask to Scrap Another Obama Climate Order

The U.S. State Department said in a report released Thursday by the investigative arm of Congress that it may recommend President Donald Trump revoke an Obama-era order directing federal agencies to consider climate change in international development programs.

Such a move would deepen the Trump administration’s already broad rejection of former President Barack Obama’s policies on global warming, which Trump has repeatedly suggested is not as serious as scientists claim.

In the 2014 executive order, Obama directed the State Department and other agencies to factor climate resilience into development programs to help vulnerable populations around the world protect themselves from the effects of droughts, floods and storms exacerbated by climate change.

Order weakened

The State Department said in the General Accountability Office, or GAO, report published Thursday that its foreign assistance and budget bureaus “will begin working with stakeholders to consider whether to recommend that the Secretary (Mike Pompeo) ask the president to rescind” the order.

The State Department’s comment came in response to a GAO recommendation that it improve guidance to foreign bureaus on the geopolitical risks of climate change.

The GAO report said the State Department has identified migration of vulnerable populations in countries that face conflicts as a risk of climate change, but that Obama’s executive order has in effect been weakened because missions are not assessing the risks.

Unusual response

The State Department said “it does not oppose” the GAO’s recommendation. But if Trump reverses Obama’s executive order, it would not be required to improve the guidance.

The State Department’s response to the GAO was a highly unusual way for a federal department to signal potential policy initiatives, said a GAO official, who spoke on condition of anonymity.

Trump has made reversing Obama-era executive orders and regulations on climate a priority since his early weeks in office, mainly as a way of reducing the regulatory burden on the oil, gas and coal industries.

The GAO report was commissioned by Democratic Senators Sheldon Whitehouse and Dianne Feinstein and others.

The State Department and the White House did not immediately respond to a request for comment. 

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