Dec 12, 2019

Axios AM

🇬🇧 Good Thursday morning. It's Election Day in the U.K. — "Brexmas," as it's being called.

  • Smart Brevity™ count: 1,184 words ... 4½ minutes.
1 big thing: Wall Street bonuses shrink

Photo: Drew Angerer/Getty Images

Despite the surging stock market, New York officials estimate bonus payouts by Wall Street firms will shrink by at least 9% from last year — to about $25 billion, down from $27.5 billion, Axios' Courtenay Brown reports.

  • The smaller payouts reflect harder times for the banking industry, which is being hit by low interest rates, trade wars, political risk and volatile markets.
  • Why it matters: There's trickle-down effect for the tri-state economy. If you work at, say, Smith & Wollensky or a Connecticut Ferrari dealership, you could be in the same boat as the bankers.

Bonuses are typically handed out — or at least announced — this month through the beginning of next year.

  • The sums can be staggering. Some run to six or even seven figures, making up a third or more of an executive's annual compensation.

Another factor: More banks are opting for deferred forms of compensation, like stock instead of cash.

  • And banks have taken steps to curb excessive pay, industry experts say.
  • That's despite the fact that regulations proposed after the financial crisis that aimed to curb big bonuses, which were seen as tempting workers to take risks, never crossed the finish line.

By the numbers: The average bonus paid to Wall Street employees in New York City was $153,700 in 2018 — a decline of 17% from the prior year, despite an upturn in the broader industry's profits. Fewer dollars were spread among a larger number of people.

  • Per New York City data, the average compensation for a Wall Streeter was more than $422,000 in 2017, the latest figures available. That's five times higher than what the average private-sector worker made.
  • Last year, bonuses alone were double the average salary of the rest of New York City's workforce.

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2. ⚖️ Senate eyes quick trial

House Judiciary Chairman Jerry Nadler opens the markup of the articles of impeachment yesterday. Photo: J. Scott Applewhite/AP

"Senate Republicans are coalescing around a strategy of holding a short impeachment trial early next year that would include no witnesses," the WashPost reports.

  • Why it matters: That "could clash with President Trump’s desire to stage a public defense of his actions toward Ukraine that would include testimony the White House believes would damage its political rivals."

"Several GOP senators ... said it would be better to limit the trial and quickly vote to acquit Trump, rather than engage in what could become a political circus," per the Post.

  • "The emerging Senate GOP plan would provide sufficient time, possibly two weeks, for both the House impeachment managers and Trump's attorneys to make their arguments before a vote on the president’s fate."

🥊 Sen. Lindsey Graham (R-S.C.) told Axios' Alayna Treene: "I'm not in the camp of calling a bunch of witnesses. ... I think as an American, the best thing we do is deep-six this thing."

  • Many Senate Rs told Treene that they trust Majority Leader Mitch McConnell's judgment on whether to accelerate the vote.
3. Census' hard-to-count communities
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Data: AP analysis of Census Bureau data; Map: Andrew Witherspoon/Axios

About a quarter of the U.S. population lives in areas likely to be difficult for the census to accurately count next year, Axios' Stef Kight and Courtenay Brown write.

  • Unauthorized immigrant populations, large minority populations, non-traditional households, lots of young children, poverty and lack of internet access can all lead to undercounting.
  • 86% of Detroit's population lives in hard-to-count areas — the highest of any city due to the tens of thousands of abandoned homes there.

Why it matters: "Hard to count" often translates to underrepresentation. The 2020 census will be the basis for allocating political power and government funding for the next decade.

4. Jersey shooter had links to hate group

Orthodox Jewish men carry the casket of Mindel Ferencz, co-owner of the grocery store, outside a Brooklyn synagogue. Photo: Mark Lennihan/AP

"An assailant involved in the prolonged firefight in Jersey City, N.J., that left six people dead, including one police officer, was linked on Wednesday to the Black Hebrew Israelite movement, and had published anti-Semitic posts online," report the N.Y. Times' Michael Gold and Ali Watkins.

  • "The Black Hebrew Israelites, which has no connection with mainstream Judaism, has been described as a hate group by the Southern Poverty Law Center."

"There is no question that this is a hate crime," Jersey City Mayor Steven Fulop told reporters. "And anti-Semitism should be called out aggressively and firmly — immediately — for what it is."

5. "Basic and fundamental errors" in Russia probe

Senate Judiciary Committee Chairman Lindsey Graham holds up a copy of the Steele dossier during yesterday's hearing. Photo: Win McNamee/Getty Images

Republican and Democratic senators used the Justice Department inspector general's report on the origins of the Russia investigation to support their views that it was a legitimate probe or a badly bungled farce, AP reports.

  • Inspector General Michael Horowitz testified before the Senate Judiciary Committee about his findings that while the FBI had a legitimate basis to launch the investigation and was not motivated by political bias in doing so, there were major flaws in how that investigation was conducted.
  • Why it matters: The hearing was the latest reflection of Washington's intense politicization.

Horowitz concluded that there was a proper basis to open the investigation and that that decision did not appear motivated by political bias.

  • Still, his opening statement was overwhelmingly critical of the investigation, and he returned time and again throughout the hearing to serious problems that he said underscored the need for policy changes.
  • The most serious problems, he said, concerned FBI applications for court approval to eavesdrop on former Trump campaign aide Carter Page. He rebuked officials up and down the chain of command for failing to update judges as they learned new information that undercut some of their original assertions.
6. Bloomberg makes local friends

Bloomberg in San Francisco yesterday. Photo: Eric Risberg/AP

Mike Bloomberg's spending on the 2020 election is going well beyond Mike Bloomberg.

  • Bloomberg will donate $10 million this week "to defend vulnerable Democratic House members against paid Republican attacks on their support for impeachment proceedings," the WashPost reported.
  • Why it matters: We're told Bloomberg sees House Democrats as a counterweight to President Trump — the reason he was the biggest outside individual spender on Democrats during the 2018 midterms.

Bloomberg is also giving $5 million to Stacey Abrams' voter-protection efforts.

Between the lines: The most likely path for Bloomberg depends on a brokered convention, where superdelegates — political insiders — would be vital.

  • So it's smart of him to use his biggest advantage — unlimited wealth — to curry favor with elected officials.
  • And his spending on state and local caucuses gives his presidential candidacy a rationale beyond himself.
7. Michelle Obama's bestselling year

Photo: Nicholas Kamm/AFP via Getty Images

Michelle Obama's memoir, "Becoming," will mark one year — 52 weeks — on the New York Times hardcover nonfiction bestseller list on Dec. 22.

  • She'll be #4 on the list, two spots ahead of Anonymous, whose "A Warning" ranks for the third week.
  • Mrs. Obama's 19-hour audio version (which she read herself) marks 13 months on the N.Y. Times audio list.

Between the pages: The former first lady's blockbuster sets a high bar for her uber-competitive husband, who has been working hard on his own big book.

8. Azar vs. Verma is a draw

Photo: Alex Wong/Getty Images

HHS Secretary Alex Azar and Centers for Medicare and Medicaid Services Administrator Seema Verma both still have their jobs after a meeting at the White House last night, report Axios' Jonathan Swan and Caitlin Owens.

  • There's been a constant stream of news reports about the two's toxic relationship.

The bottom line: The pair's scorched-earth tactics have made it hard to imagine them having a productive working future, but both have strong allies — and enemies — inside the administration, making it equally difficult to predict whether either will be forced out.

9. TIME's other honors
Courtesy TIME

TIME named climate activist Greta Thunberg as its youngest-ever Person of the Year yesterday (see her cover), but it also expanded its honors for the first time to recognize influential people across a range of categories.

10. 1 ⚾ thing: Humidors for ballparks
Construction yesterday at the new Texas Rangers stadium in Arlington, Texas. Photo: LM Otero/AP

A four-person committee of scientists told Major League Baseball that balls this year had less drag on average than in previous seasons, contributing to a power surge that resulted in a record number of home runs, AP's Jake Seiner reports.

  • The committee says it did not find evidence that MLB intentionally juiced balls. Inconsistencies were due to "manufacturing variability."
  • The balls are hand-sewn at Rawlings' factory in Costa Rica.

Scientists recommended MLB consider installing humidors at all 30 ballparks "to reduce the variability in storage conditions" and install atmospheric tracking systems in each stadium.

  • MLB plans to accept the recommendations.

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