2019年11月11日 星期一

DealBook: Running the Numbers on Elizabeth Warren’s Wealth Tax

Her policy would make it much harder for people to remain multibillionaires into old age. Here's what that would look like for Bill Gates and others.
November 11, 2019
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  Veasey Conway for The New York Times
What Elizabeth Warren’s wealth tax would do
If you’ve wondered what material effect Senator Elizabeth Warren’s proposed tax increases for the wealthy would have, look no further than the estimates by two economists who advised her, Patricia Cohen of the NYT writes.
• “If her wealth tax had been in effect since 1982, for example, Mr. Gates, who had made his first billion dollars by 1987, would have had $13.9 billion in 2018 instead of $97 billion.”
• “As for the 400 people who made it to Forbes magazine’s list of the country’s wealthiest people, each would have an average worth of $3.1 billion, down from the current $7.2 billion.”
“What an annual wealth tax of 6 percent does is that it makes it harder to stay a multibillionaire at age 70, 90, etc.,” Gabriel Zucman, who has advised Ms. Warren, told the NYT. “It makes wealth circulate.”
“Whether you think that is a feature or a bug depends on how you think wealth is best created and distributed,” Ms. Cohen writes:
• “For fans, it is a long-overdue effort to rebalance an economic system that has lavished outsize riches and political power on a tiny band of winners.”
• “For critics, it represents an ill-conceived and impractical attempt to redirect the rewards earned by the most productive and inventive entrepreneurs, investors and business leaders.”
More: The NY Editorial Board argues that billionaires who are warning that higher taxes would lead to lower growth “have their facts backward.”
Today’s DealBook Briefing was written by Andrew Ross Sorkin, Gregory Schmidt and Jamie Condliffe.
More detail, and concern, about the Aramco I.P.O.
The world’s largest oil company took another step on its lengthy path to a stock market listing on Saturday by releasing its 658-page prospectus about the offering, Stanley Reed of the NYT reports.
Here are the key points we’ve learned, if you don’t have time for 600-plus pages:
• The company will announce a final price for its shares on Dec. 5.
• Trading is expected to start in mid-December.
• Up to 0.5 percent of the company’s shares would be set aside for individual investors.
• But the number available to institutional investors will depend on the deals that are struck.
The prospectus underscored some of the risks associated with investments in the I.P.O.:
• With only a small percentage of the company’s shares likely to be publicly traded, the company will be able to largely do as it wishes, analysts say.
• Aramco’s prospectus acknowledged that “terrorism and armed conflict,” like the recent drone attacks on its facilities, could harm its share price in the future. (The recent attack dented its profits.)
• And the company acknowledged that growth in demand for oil has been slower than global economic growth in recent years.
But Aramco says it “is committed to delivering sustainable and growing dividends to its shareholders” through ups and downs in oil prices.
Jeff Bezos
Jeff Bezos  Isaiah Downing/Reuters
Does Jeff Bezos want an N.F.L. team?
E-commerce giant? Check. Newspaper? Yep. Space exploration company? Affirmative. For the billionaire who has everything, how about owning … an N.F.L. team? That’s what a report by CBS Sports suggests that Jeff Bezos may be planning to do.
• “Jeff Bezos has interest in purchasing an N.F.L. team and has become close with several current owners,” CBS Sports reports, citing unidentified sources.
• Mr. Bezos has spent “considerable time around owners, including Washington’s Dan Snyder,” the reports adds.
• “Powerful owners like Jerry Jones believe he would be a great addition to the N.F.L.,” it adds.
One small hitch: No teams are currently for sale. “Though the Seattle Seahawks will be sold at some point following the death of Paul Allen last year,” CBS adds, and lawsuits mounting against the Broncos’ owner, Pat Bowlen, could mean that that team goes up for sale before too long, too.
Bernard Tyson of Kaiser Permanente dies at 60
The chairman and C.E.O. of the nonprofit health care provider died unexpectedly on Sunday in his sleep, CNN reports. He was 60.
Mr. Tyson became C.E.O. of Kaiser in 2013 after working there for almost 30 years. He held roles in hospital and health plan operations before leading the company, and championed accessible health care, racial justice and workplace diversity.
The company’s revenue increased during his tenure to $79.7 billion last year from $53 billion in the year he became C.E.O. Membership in its insurance plans also increased.
“Bernard was an exceptional colleague, a passionate leader, and an honorable man,” Edward Pei, a director of Kaiser Permanente, said in a statement. “We will greatly miss him.”
The National Union of Healthcare Workers postponed a five-day strike by 4,000 mental health professionals in response to Mr. Tyson’s death.
Kaiser has named Gregory Adams, currently the executive vice president and group president of the company, as interim chairman and C.E.O.
  Lindsey Wasson/Reuters
Boeing aims to move 737 Max victim lawsuits abroad
When asked by Congress last month if Boeing was working to get lawsuits related to the crash of Lion Air Flight 610 transferred to Indonesia from the U.S., its C.E.O., Dennis Muilenburg, said: “I’m just not familiar with the details of that.” But David Gelles of the NYT reports that his company’s lawyers certainly seem to be planning to use that approach.
• “In at least six court filings and in-person appearances over the last year, Boeing has made it clear that it is prepared to seek a transfer of the cases out of the United States.”
• “Such a move would most likely save Boeing many millions of dollars in damages and limit how much information about the crash the company has to make public.”
• “The company indicated that even if it does settle the cases in the United States, it expects to compensate families at a level that reflects costs in Jakarta, not Chicago.”
• “Lawyers for the families said such a strategy devalues Indonesian lives.”
• “The company did not reply to questions about whether Mr. Muilenburg had been briefed on the legal strategy.”
Streaming is a seismic shift in entertainment
With the arrival of Disney Plus tomorrow, the streaming industry — now a decade old — continues its rise to dominance, writes Brooks Barnes in the NYT.
• The number of streaming subscribers around the world reached 613 million last year, surpassing the number of cable subscribers (556 million) for the first time.
• One in five adults in the U.S. will have cut the cord by 2020.
“Nowadays in Los Angeles, the executives, agents and producers involved in streaming are the ones with the swagger,” Mr. Barnes adds, “leaving people in cable to experience the reversal of fortune that claimed the magazine business.”
But the debut of Disney Plus could change everything, Mr. Barnes writes. Netflix is spending billions to defend its turf against Disney, and WarnerMedia and NBCUniversal have copied the Disney playbook with their own streaming services.
And not everyone will emerge victorious, writes the WSJ. The field is crowded with so many existing players — Netflix, Hulu, Amazon Prime Video, CBS All Access and ESPN+, among others — and some will invariably fail.
More: Netflix, HBO and cable giants are stepping up efforts to crack down on password sharing. Kevin Mayer, a veteran deal maker for Disney, is getting a public test as the executive launching Disney Plus.
McKinsey faces a criminal inquiry over its bankruptcy work
The global consulting firm McKinsey & Company is said to be facing a federal criminal investigation into its conduct advising bankrupt companies, Mary Williams Walsh and Emily Flitter report in the NYT, citing unnamed sources.
Prosecutors are trying to determine whether McKinsey, which advises many of the world’s largest and most powerful institutions, used its influence over insolvent companies “by quietly steering valuable assets to itself or favoring its own clients over other creditors,” Ms. Walsh and Ms. Flitter write.
The firm received an inquiry from the U.S. Attorney’s Office in Manhattan last year, according to McKinsey’s North America chairman, who also said that he had addressed it.
But investigators are still interested. In the past two weeks they have conducted interviews about McKinsey’s actions in the bankruptcies of at least two companies, one of the sources said. And another investigation is underway by the Office of the United States Trustee, a division of the Justice Department that polices the conduct of companies in the bankruptcy system.
“Neither investigation will necessarily result in legal action against the firm or its executives,” Ms. Walsh and Ms. Flitter write. “But a criminal case would represent a blow to McKinsey’s reputation.”
Why the Fed is talking about climate change
U.S. monetary-policy makers have been slow to create a concerted climate change research program because they are wary of weighing in on a highly politicized issue. But that’s starting to change, Jeanna Smialek of the NYT reports.
The San Francisco Fed held the system’s first climate change conference last week. “It is partly a sign that the central bank is ready to talk about a global economic agenda item — and partly a recognition that the risks are too important for the authorities to ignore,” Ms. Smialek writes.
• Power outages could shut down the electronic payment system and increase the demand for cash — which the Fed manages.
• Damage from droughts and floods could come at a heavy cost to insurers or banks whose customers struggle to make payments.
“By participating more actively in climate-related research and practice, the Federal Reserve can be more effective in supporting a strong economy and a stable financial system,” Lael Brainard, a member of the Fed’s board in Washington, said in prepared remarks at the conference.
Revolving door
Viacom and CBS reportedly plan to reshuffle the leadership of their creative operations in advance of the expected closing of their merger in early December.
The speed read
• Blackstone plans to take a majority stake in MagicLab, the parent company of the dating app Bumble, valuing the company at about $3 billion. (Reuters)
• The activist investor Carl Icahn cut his holdings in the oil and gas producer Occidental by nearly a third. He has recently opposed the company’s $38 billion acquisition of Anadarko Petroleum. (Reuters)
• WeWork was reportedly “wrestling” with the S.E.C. over a financial metric that the regulator deemed to be misleading just before it scrapped its I.P.O. And the company, its former C.E.O. and SoftBank are being sued by minority shareholders over the botched I.P.O. (WSJ, Reuters)
Politics and policy
• What Joe Biden actually did in Ukraine supports one of his central qualifications for his presidential run: eight years of diplomacy as President Barack Obama’s No. 2. (NYT)
• Nikki Haley, the former U.N. ambassador, says in a new book that she resisted efforts by John Kelly and Rex Tillerson to enlist her in circumventing President Trump’s policies. (NYT)
• How voters turned Virginia from deep red to solid blue. (NYT)
• President Trump said that there was no agreement for the U.S. and China to roll back tariffs as part of a trade deal, adding that Chinese officials “want to make a deal a lot more than I do.” (WSJ)
• New York State regulators will investigate whether the algorithm used by Apple Card to determine the creditworthiness of applicants is biased against women. (NYT)
• Facebook took down Breitbart posts that claimed to have named the whistle-blower who set off the impeachment inquiry into President Trump. (NYT)
• How a hack that took control of one man’s phone number led to him losing $24 million worth of cryptocurrency. (WSJ)
• Recent revelations in India show that the threat from NSO Group’s spyware to activists and journalists isn’t limited to autocratic governments. (NYT)
• Child abusers run rampant on services provided by Big Tech companies, according to a new Times investigation. (NYT)
Best of the rest
• Instagram is willing to pay for some celebrities’ video production costs — as long as they avoid politics. (Bloomberg)
• A sharp fall in Hong Kong’s stock market came amid a strike by anti-government protesters and disruptions to the city’s transport networks. (FT)
• Hotter weather is fueling efforts to create a commercial wine industry in Denmark, Norway and Sweden. (NYT)
• With medical bills skyrocketing, hospitals across the country are increasingly suing patients for unpaid bills. (NYT)
• Investors are feeling better about the economy, but the yield curve has already predicted a recession — one usually follows, even if its signal changes later. (NYT)
Thanks for reading! We’ll see you tomorrow.
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