WELCOME BACK TO MORE DEBT
Welcome back to a new edition of The Weekender… where we have the latest on the new White House Chief of Staff and who locked in chairmanships in the House of Representatives. Plus, do you have credit card debt racking up? You are not alone—we have the breakdown. And, Microsoft announced an historic new deal, while the FDA announced a not-so-shocking COVID guideline. This and more in this week’s edition of The Weekender. Thank you for being here!
P.S. Strategic Elements is proud to announce Claire Simmons has been promoted to Senior Public Affairs Manager! Claire has made a big impact during her time at the firm, and we are excited to see what she accomplishes in the new role. Learn more about Claire:
Biden’s New Right Hand
Ron Klain, longtime advisor and current Chief of Staff to President Joe Biden, announced that he is preparing to step down in the coming weeks. Luckily, the Biden Administration has already found Klain’s successor: Jeff Zientz. Entering what’s been called the toughest job in Washington with more experience in the business world than political chops, Zientz has been described as a “master implementor” and as the Democrat’s “go-to Mr. Fix-It” for his managerial prowess. He led the Biden Administration’s pandemic response team as the White House’s COVID Response Czar and served in the Obama Administration as director of the National Economic Council and acting director of the Office of Management and Budget. He is also a co-founder of DC’s beloved bagel shop, Call Your Mother. Jeff Zients will fill the shoes left by Ron Klain, who served as long time Chief of Staff to Joe Biden during his tenure as the Vice President and worked on Joe Biden’s unsuccessful 1988 and 2008 presidential campaigns. He also worked as a top aide to Biden in the 1980s and 90s, while he served on the Senate Judiciary Committee. The transition from Klein’s political influence to Zeintz’s management expertise will need to be as smooth as possible for the Biden Administration as the President (likely) gears up for reelection. While the President remains the most powerful person in Washington, their chief of staff is at the center of how that power is wielded. The chief of staff determines the office’s legislative efficacy, political agenda-setting, messaging tactics, who gets a meeting with the President, and how and where the President spends his time. As the number one strategist, communicator, doer, and executor, the role of White House Chief of Staff is critical to the success of any administration – and time will tell if Zeintz is up to the task. Read more in Politico.
Stacks on Stacks on Stacks of Credit Card Debt
Debt is piling up – and it’s not just from the U.S. government… U.S. consumers are also piling on personal debt, with credit card balances on the rise. After a year of prices skyrocketing and interest rate hikes, Americans began relying on credit cards to help hold them over; but now many don’t have the money to make payments. Credit card balances are at an all-time high and annual percentage rates are up, which is totally a disaster for U.S. families. The nation’s collective credit card balance totals $925 billion, just below the historic record of $927 billion set in 2019. The Federal Reserve Bank of New York recently reported a 5% year-over-year increase in total credit card balances for the third quarter of 2022, which amounts to the largest surge in nearly 30 years. The average U.S. household carries $7,486 in credit card debt, making it harder for the average American to own a home and invest in building wealth. While wages are rising, consumer prices are climbing even higher. This leaves the rise in credit card debt more about survival than impulse purchases. Read more on Fox Business.
Committee Assignments are in: Lawmakers to Watch in the 118th
More House drama unfolded this week with the House Republican Steeing Committee handing out committee assignments. The Texas delegation undoubtedly took the crown for chairmanships as four Texans now chair some of the most powerful committees. Rep. Kay Granger took the gavel of the House Appropriations Committee and is the first GOP Woman ever to do so. Her Texas colleagues Rep. Jodey Arrington, Rep. McCaul, and Rep. Williams will chair the Budget Committee, Foreign Affairs Committee, and the Small Business Committee, respectively. These assignments were expected, but there were more than a few that made waves on the Hill. “McCarthy Hold-outs” saw wins after the Speaker promised to award high committee assignments during the speakership vote. The most notable include Rep. Chip Roy, who will now serve on the powerful Rules Committee, Rep. Perry, who will now serve on the Oversight Committee, and Rep. Boebert, who will also join the Oversight Committee. Likewise, to folks’ surprise, Rep. Santos, who is fighting numerous calls to resign after he was caught lying about his resume, secured two committee assignments, the Committee on Small Business and the Committee on Science, Space, and Technology. As for Democrats, Speaker McCarthy is vowing to keep Rep. Swalwell and Rep. Schiff off any select committees—because the Speaker doesn’t need the vote of the full House to do so. Committee assignments will undoubtedly affect the way the House runs during the next two years, and if the last few weeks are any indication, it’s going to be a session full of drama. Don’t worry, we will have the latest right here in The Weekender. Read more in the Texas Tribune.
An Annual Covid-19 Vaccine May Be on the Horizon
Is COVID becoming the new flu? Food and Drug Administration (FDA) officials have proposed a plan for annual COVID boosters. The FDA will only offer bivalent doses for primary and booster shots to simplify the vaccine process, a strategy used with the flu. This could include streamlining the vaccine composition, immunization schedules, and periodic updates of COVID-19 vaccines. In the proposed plan, officials would choose the annual vaccine’s composition each June, targeted to fight whatever variant is circulating. Experts have mixed responses on the plan. The meeting to discuss the country’s vaccine strategy was on Thursday, with details not yet provided on which doses should be offered and on what schedule. Read more in the New York Times.
Microsoft Replaces Humans with AI
Less than a week after Microsoft announced it will lay off 10,000 workers, citing dampened software demand, the company will invest $10 billion into OpenAI, the artificial intelligence (AI) system behind the attention-grabbing ChatGPT. ChatGPT, the AI which can hold conversations, write essays, and piece together computer code, falls under the category of generative AI, meaning that the AI generates novel content instead of applying existing data or content at the appropriate time. This means that generative AI can produce new ideas (though, at this time, human creativity still reigns supreme) rather than following a predetermined process as computers have historically done. While automation has overtaken a plethora of jobs (look no further than the self-checkout lines in your local grocery store), the underlying assumption by most was that jobs requiring a high level of education, skill, or creativity were considered safe from being replaced by machines. In 2023, that assumption may no longer be a safe bet. No singular technology in modern memory has had the capacity to wipe out massive swaths of jobs from all tiers of labor skillset or corporate chain height. While it is no surprise that AI, which could theoretically earn an MBA from an Ivy League school, is being used by high schoolers to complete their homework, the possibility of that same digital tool robbing generations of people of gainful employment in their future is certainly not something to be trifled with lightly. Read more in Ad Age.
INTERNATIONAL SPOTLIGHT
Germany Weighs in with Heavy Trucks… Finally
We have the latest on Russia’s war against Ukraine as the one-year mark approaches, and it is getting weapon heavy. Poland officially requested to send its German-made Leopard 2 tanks to Ukraine. Germany requires it must approve before a country decides to re-export German-made tanks. German officials say they will not block Poland or other allies if asked to send their supply of tanks. If Germany agrees to the Polish request, it will end a tense standoff between Germany, a hesitant supplier of military hardware to Ukraine, and Poland, a leading advocate within the European Union of arming Ukraine. This would be a relief for many as it was speculated that Poland would disregard Germany’s re-export license requirements–damaging NATO unity and Polish-German relations. You may ask, what are Leopard 2 tanks, and what’s the big deal? Germany introduced the tanks during the Cold War, and since then, around 17 countries have used them. The tanks hold a 120mm smoothbore gun, two light machine guns, night-vision capabilities, and a laser range finder. The Leopard 2 is important to Ukraine as they have offensive capabilities due to their mobile artillery firepower that is more lethal than the Soviet-era tanks that Ukraine has been using. Read more on CNBC.
DATA POINTS
- 2.9%: The 4th Quarter growth in U.S. Gross Domestic Product. The economic growth exceeded most forecasters’ expectations.
- 12,000: The number of jobs that Google’s parent company, Alphabet, decided to cut. This is about 6% of its workforce and the company’s largest round of layoffs to date.
- 220 million: The amount of people in Pakistan who were left without power Monday morning after a countrywide outage. Power in some cities has been restored, but many others remain impacted.
- $16 billion: The amount that the hedge fund firm, Citadel, made in profits for its clients last year, outperforming the rest of the industry and eclipsing one of history’s most successful financial plays.
- 11: The number of people killed at a mass shooting over the weekend at a dance studio in Monterey Park, California. Nine more people were injured from the attack and the suspect was found dead from a self-inflicted gunshot wound.
- 80%: The percentage of cities that saw a drop in the number of police officers and government employees from 2020 5o 2021. In cities with over 1 million people, the number of sown officers dropped twice as fast as the national average.
- $2 billion: The amount Avatar: The Way of Water topped at the box office over the weekend, becoming the sixth movie in history to reach the milestone. The director, James Cameron, is responsible for three of those six-Avatar, Titanic, and Avatar 2.
- 100,000: The number of people who took to the streets in Tel Aviv, Israel, to protest the policies of Prime Minister Benjamin Netanyahu’s newly sworn-in governing coalition. The government is proposing reforms to overhaul the judicial system, which would weaken the country’s separation of powers.
FEATURED TWEET
The Doomsday Clock was moved to 90 seconds to midnight today, Jan. 24, the closest it's ever been.
The Doomsday Clock is a decades-long project of the Bulletin of the Atomic Scientists featuring a clock face where midnight represents Armageddon. https://t.co/uG9vmchRXK pic.twitter.com/IFM1gmIjjT
— USA TODAY Graphics (@usatgraphics) January 24, 2023
