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The Week in Business: Recession Fears Meet a Farce Over … Greenland?
What a bizarre week. This newsletter will read like a parody, but it is all real. Is it time yet for school to start again? — Charlotte Cowles
What’s Up? (Aug. 18–24)
A Wobbly Economy and the Greenland Folly
Are we headed for a recession? No one can be sure, but the warning signs are piling up and President Trump has been so erratic that I’m going to need extra space this week to parse his antics. First: He said on Tuesday that he was mulling “various tax reductions,” which were quickly panned as giveaways to wealthy investors. He reversed course on Wednesday, the same day that the Congressional Budget Office reported that the federal budget deficit was shooting up much faster than expected, to $1 trillion for the 2020 fiscal year, owing largely to Mr. Trump’s 2017 tax cuts. Also of concern: Recent reports of job gains have been overly rosy. The Labor Department retroactively reduced its estimate of employment growth by as much as half a million jobs for a period covering 2018 and early 2019.
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And then there’s the is-this-even-real-life-anymore cherry on top of this head-spinning week: Mr. Trump’s suggestion that the United States buy Greenland from the Danes disintegrated into a full-blown diplomatic meltdown when Denmark’s prime minister called the notion “absurd.” The president retaliated by calling her “nasty”and canceled a state visit to Denmark — not a great look ahead of a Group of 7 summit in France. China, which stands to gain from an unstable America, announced retaliatory tariffs on United States imports on Friday, sending global markets down. And when the Federal Reserve chair Jerome H. Powell suggested on Friday that the central bank could only do so much to counteract the damage of the trade war, Mr. Trump lashed back, calling him the “enemy.”
Facebook’s Lose-Lose
Republicans have long accused Facebook of filtering right-wing voices and content. In an attempt to put the matter to rest, the company invited Jon Kyl, the former Republican senator from Arizona, to investigate the allegations, and he released his report on Tuesday. The inquiry could not substantiate that partisan bias exists in Facebook’s algorithms, but still, no one was satisfied. Republicans in Congress dismissed the results as “a smokescreen,” while Democrats slammed Facebook for entertaining the complaints in the first place.
What’s Next? (Aug. 25–31)
Meeting of the Minds
Mr. Trump will have a tête-à-tête with Britain’s new prime minister, Boris Johnson, this weekend at the Group of 7 meeting in Biarritz. They are expected to discuss Britain’s impending departure from the European Union, set for Oct. 31. While both leaders are outspoken proponents of Brexit, the meeting will be a tightrope walk for Mr. Johnson, who is not known for his subtlety. Foremost, he needs Mr. Trump’s blessing for a trade deal with the United States, which would soften Brexit’s inevitable blow to his country’s economy. But he also can’t appear too friendly, as Mr. Trump is deeply unpopular in Britain as well as the rest of Europe.
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Epstein Accusers’ Day in Court
The death of Jeffrey Epstein, the financier accused of sex trafficking, leaves behind a messy court battle. Since his suicide in prison on Aug. 10, at least six women have filed lawsuits in New York seeking compensation from Mr. Epstein’s estate for what they say is the damage caused by years of sexual abuse. A judge has invited his accusers to speak at a hearing where the court will consider next steps.
Digging to China
The Tesla chief executive Elon Musk is taking his subterranean business, the Boring Company, to China. The enterprise specializes in tunneling and infrastructure — or more specifically, high-speed electric pods that transport people underground — which is a cool idea in theory but still has a long way to go in practice. Mr. Musk founded the company in 2016, citing his frustration with the traffic in Los Angeles. In Shanghai on Thursday, he is expected to outline further details of the Boring Company’s expansion during his trip to the World Artificial Intelligence Conference.
What Else?
As if this week wasn’t strange enough already, the chief executive of the e-commerce giant Overstock.com resigned after disclosing details about his romantic relationship with an imprisoned Russian intelligence agent. Speaking of infiltration: 22 towns in Texas joined the long list of United States cities that have fallen victim to cyberattacks that hijack municipal systems and hold them for ransom. And on a more somber note, David Koch, the multibillionaire who funded a libertarian agenda that reshaped American politics, died this week at 79.
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