Focus on the economy
Kamala Harris is expected to deliver a detailed economic speech on Wednesday in which she will seek to position herself as a champion for the middle class, entrepreneurs and consumers, and a fighter against business bad actors.
The speech carries great weight: Harris is polling closely with Donald Trump, who on Tuesday spoke about his vision for a “new American industrialism.” Polls show many undecided voters want to hear more about Harris’ plans.
Harris will likely try to differentiate herself from Trump on the economy. She is expected to claim she is not bound by ideology and will seek to allay concerns that she is too progressive, especially as business leaders worry about her stance on antitrust. Her speech is expected to highlight her record as California’s attorney general and vice president of mobilizing public-private partnerships to protect consumers and help small businesses.
In recent weeks, she has promised to help homebuyers, raise taxes on big corporations and high-income earners and cut taxes on small businesses. In contrast, she is expected to say on Wednesday that Trump is focused on improving the economy for the top 1% of society.
Trump continues to lag behind when it comes to voters’ perceptions of the economy. He may have received a political boost from the Federal Reserve’s cut in borrowing costs last week, as recent polls have shown, but overall, Americans still seem to favor him on this issue. Consumers remain concerned about the job market and their financial situation.
Speaking in Georgia on Tuesday, Trump called Harris a “communist” and unveiled an economic plan packed with carrots and sticks, including both familiar issues, such as a pledge to impose huge tariffs on importers that clash with Republican free traders, and new ones, such as giving foreign companies access to federal lands to bring production (and create jobs) to the United States.
But neither candidate has detailed their economic policies, and that could change with Harris expected to release a roughly 80-page document soon.
In other political news, West Virginia independent Sen. Joe Manchin, who is not seeking reelection, said he would not support Harris after she supported abolishing the Senate filibuster to support abortion rights legislation.
What’s going on?
Caroline Ellison was sentenced to two years in prison for the FTX fraud. Ellison, a former top adviser to Sam Bankman-Freed and his on-again, off-again girlfriend, was a key witness for the prosecution, but the judge said she couldn’t be sentenced any longer. Meanwhile, Bankman-Freed is being held in the same Brooklyn prison as music mogul Sean Combs, who was indicted on charges of fraud conspiracy and sex trafficking.
OpenAI has reportedly proposed huge data centers to the Biden administration. According to Bloomberg, ChatGPT’s parent company has submitted documents touting the economic and national security benefits of building 5 gigawatt centers across the U.S. (Five gigawatts is roughly the equivalent of five nuclear reactors.) This is part of OpenAI’s efforts to upgrade AI infrastructure around the world, but building such huge data centers would be difficult.
The FBI is said to be investigating a Chinese venture capital firm. According to the Financial Times, the FBI is looking into whether Horn Capital, which has invested in 360 US startups, obtained trade secrets that could benefit its Beijing-based parent company or Chinese authorities.
Silicon Valley’s divided approach to politics
There has been a lot of attention on Silicon Valley’s role in the election, and how Elon Musk and others on the right are supporting Donald Trump.
But the campaign also highlights the very different approaches to politics taken by two other tech billionaires, Laurene Powell Jobs and Mark Zuckerberg, Theodore Schleifer of The New York Times writes in Dealbook.
Powell Jobs is one of Kamala Harris’ best friends and was instrumental in her presidential campaign. The widow of Apple co-founder Steve Jobs, Powell Jobs is a billionaire investor and philanthropist, and the two have been in a relationship for 20 years. Powell Jobs donated $500 to Harris’ first campaign for San Francisco District Attorney in 2003, and has donated millions to organizations supporting her presidential bid. The two are part of the same Silicon Valley elite, and Powell Jobs helped raise Harris’ profile.
Powell Jobs played a role in pressuring President Biden to forego reelection, with one of her top advisers circulating to other donors research showing Biden’s disastrous debate performance and the president’s very slim chances of reelection.
Ms. Powell Jobs and Ms. Harris were in close contact as the vice president was planning her moves, and some have predicted that Ms. Powell Jobs could play some role in the administration or behind the scenes if Ms. Harris wins.
Zuckerberg, meanwhile, wants nothing to do with elections. The Meta CEO once leaned toward liberal politics, but now says he regrets many of those activities, and he and his company have backed away from them after years of harsh criticism from lawmakers on both sides of the aisle. The rethinking also extends to his Bill Gates-inspired philanthropy, where Zuckerberg believes openly political causes are ineffective.
Getting involved in politics would only increase scrutiny of his company, and Mr. Zuckerberg views both parties as anti-technology after years of hostility in Washington.
While he is not close to Harris, he has been working to repair his relationship with Trump, having two one-on-one calls with the former president this summer.
To be fair, Powell Jobs and Zuckerberg have different motivations and pressures. Powell Jobs is an individual who works for himself and can support whoever he wants, including his friends. Zuckerberg runs a trillion-dollar tech giant that is subject to political pressure from around the world, and backing a personal project could well make that even more difficult.
Related news: In a guest essay for The New York Times, Facebook co-founder and Democratic donor Chris Hughes explains Silicon Valley’s rightward shift against Trump and his policies.
Regulators could rewrite Visa’s business model
The Justice Department’s lawsuit against Visa is the latest in a broad effort to reform antitrust enforcement in the United States and lays out a wide range of claims against the financial giant. It accuses the payments giant of maintaining its monopoly primarily by charging or threatening to charge high fees to merchants who also use other payment networks to process debit card transactions.
Now that the Department of Justice has clarified its position on the case, DealBook’s Lauren Hirsch has a few more questions about it.
What impact will this have on Visa’s business? Visa has called the lawsuit “meritless” and said it will defend itself “vigorously.” The Justice Department has not yet decided what it will ask Visa to do to settle the case. One likely action would be to block Visa from entering into such deals, antitrust experts told DealBook, which could change how Visa interacts with retailers and card issuers.
The impact of changing that relationship is not easy to quantify — it depends on how much Visa may or may not overcharge — but the Justice Department noted how lucrative such deals are for Visa, given its 83 percent profit margin on the U.S. debit card business.
What will Visa’s total damages be? If Visa processes government credit cards, the government could seek monetary damages against it. It could also spark a surge in plaintiff lawsuits under federal antitrust law that could triple damage awards.
Visa will likely try to settle those lawsuits, but the legal battles could drag on for years. In June, a federal district judge rejected a $30 billion antitrust settlement related to lawsuits dating back to 2005.
How does this affect Capital One’s planned acquisition of Discover Financial Services? The $35.3 billion deal has been under regulatory review since it was announced in February. Capital One and Discover have said the deal could create a stronger competitor to Visa and MasterCard, and the Justice Department’s lawsuit could bolster that argument.
A similar argument didn’t sway regulators during JetBlue’s attempt to buy Spirit, but financial industry advocates were quick to jump on it.Visa’s lawsuit “seems like an odd use of limited resources at a time when multiple regulators, including the Department of Justice, are simultaneously scrutinizing the Capital One-Discover merger,” Jessica Melgin of the Competitive Enterprise Institute, a libertarian think tank, said of Tuesday’s move.
Inside the star-studded Clinton Global Initiative
Midtown Manhattan has been in chaos for the past two days as the city hosted conferences and meetings bringing together prominent figures from the political and business worlds.
Of those events, which included the United Nations General Assembly and Climate Week in New York, the biggest may have been the Clinton Global Initiative, organized by Bill, Hillary and Chelsea Clinton.
Consider the giant trucks loaded with sand that lined up at the Midtown Hilton where Clinton met, as President Biden, whom Bill Clinton described as a man of “extraordinary decency, goodness and grace,” made a surprise appearance to be presented with the Clinton Global Citizen Award on Monday afternoon.
The conference was attended by some of the biggest names in business and philanthropy, including pharmaceutical giant GSK CEO Emma Walmsley, billionaire investor and philanthropist Laurene Powell Jobs and venture capitalist Chris Sacca.
One of the most memorable moments of the event was a speech by José Andrés, chef and founder of the nonprofit World Central Kitchen, who spoke about the war in Gaza and the seven aid workers killed in Israeli airstrikes while delivering food to Palestinians. “I was supposed to be there,” he said. “I was tired, so I wasn’t there.”
But Andres added that “in humanity’s worst moments, the best of humanity comes out.” He explained that when he was in Israel, several Israelis approached him and said, “Jose, I have another passport. I want to go to Gaza to show solidarity with the Palestinian people.” He also recalled one Palestinian woman telling him, “If I can go to Israel, I will go to tell them I don’t have anything against them.”
“These are the voices of humanity,” Andres said.
Speed Read
Bargain Deals
Wiz broke off talks to sell itself to Google this summer, but is now reportedly in talks to sell part of its existing stake at a valuation of up to $20 billion. (Bloomberg)
UniCredit CEO Andrea Orsel said on Wednesday the Italian bank’s bid to acquire a 21 percent stake in Commerzbank should not be seen as a takeover bid and that it was not seeking a board seat at the German lender. (ANSA)
Elections, politics, policies
Kyrsten Sinema, an independent senator from Arizona, said she wants to work in the private sector after her term ends. “That’s where the money is going to come from,” she said. (Business Insider)
“Hollywood is en masse supporting California’s AI safety bill” (The Verge)
Best remaining
“Argentina Abolishes Rent Control; Now the Market is Booming.” (WSJ)
Hall of Fame quarterback Brett Favre revealed he had been diagnosed with Parkinson’s disease during a congressional hearing (The Athletic)
Let us know what you think. Email your comments and suggestions to dealbook@nytimes.com.
