Marijuana remains partisan issue

Policy Watch

• • Financial sector teed up for a busy fall on Capitol Hill. The financial sector will be pushing for a number of initiatives this fall as lawmakers return to Congress. The number one concern is the need for a funding bill before the government runs out of money at the end of the month. Financial services lawmakers will also be focused on extending the Export-Import Bank and the National Flood Insurance Program. Given that there is little time to act, short-term extensions or small stopgap spending bills can be expected. Another major item on the docket is the administration’s plan to privatize Fannie Mae and Freddie Mac, which the Treasury and housing departments will discuss on Capitol Hill this week. The financial sector will also be closely watching U.S. Trade Representative Robert Lighthizer and his United States-Mexico-Canada Agreement working group, which is under increasing pressure to ratify the deal this year. Finally, House Financial Services Committee Chair Maxine Waters has lined up several hearings to investigate the financial sector on issues ranging from debt collection to crypto to climate change. [WaPo]

  • A brief breakdown of Big Tech antitrust issues. Amazon, Apple, Facebook and Google have become so prevalent in business and regulatory discussions they are commonly referred to as a group – Big Tech. But the fact remains that their business models differ and so do the antitrust arguments against them. Amazon has been under scrutiny for the preferential promotion Amazon products receive compared to third-party sellers and the requirements of third-party retailers to use Amazon services to sell on the platform. Apple is facing a similar inquiry into the favoring of Apple products in the App Store. Facebook has also been on Capitol Hill a number of times defending recent initiatives. Antitrust claims are looking into Facebook’s “defensive acquisitions” and the social media company recently paid $5 billion in fines over data use issues. Finally, Google has been accused of anticompetitive behavior for steering online searchers to its own products over others. Investigators are also looking at the terms Google imposes on cellphone makers for its Android software. [NYT]

  • Marijuana advocates divided in Congress. Nearly two-thirds of Americans support federal marijuana legalization, double the level of support two decades ago. Many democrats are also in support but are divided over how to address pressing issues. These include whether to focus on social justice issues or banking reform and the extent of legalization. On the issue of banking, the SAFE Banking Act, which allows banks to do business with cannabis companies, has moved onto the Senate after receiving bipartisan support in the House. Some policymakers argue that legislation should do more than just legalize the recreational drug and include social equity and criminal justice reform. While public support for legalization grows, any legislation faces a tough battle in Mitch McConnell’s Senate, who has shown no interest in helping marijuana companies do business. [Politico]

    Economic Indicators & News

  • Trump’s trade war is weighing on manufacturer spending plans. To the surprise and disappointment of many American manufacturers, the U.S.-China trade war, which began over a year ago, has not shown any signs of easing. Manufacturers are responding by slowing capital investment plans. This means lower sales for suppliers and less pay for workers, which contributes to slowing economic growth. Some companies, like defense contractor Astronics Corp., has chosen to look beyond the Trump-driven volatility saying, “We don’t update our forecast on a tweet-by-tweet basis”. Many manufacturers are hopeful Trump will mitigate trade tensions, especially heading into an election year. [WSJ]

  • The richer you are, the longer you live. According to a report by the Government Accountability Office, wealthier Americans are more likely to live into their 70s and 80s than poorer Americans. Life expectancy increased over the term of the study, but it has not increased uniformly across all income groups. Retirement savings, or a lack thereof, were found to contribute to the vast difference in life expectancy. Home ownership is also a contributing factor as lower-income households have even fewer assets to draw on in retirement. Senator Bernie Sanders and other policymakers have called for policies to reduce the wealth gap in America. [WaPo]