Jan 2, 2020

Axios AM

By Mike Allen
Mike Allen

Happy Thursday! Wishing you and yours the 2020 of your dreams.

  • Today's Smart Brevity™ count: 1,173 words ... 4½ minutes.
1 big thing: States will be battlegrounds for 2020 tech fights

Illustration: Sarah Grillo/Axios

The tech industry's most consequential policy fights in 2020 will play out in the states, not Washington, Axios' Kim Hart and Margaret Harding McGill write.

  • Why it matters: Momentum on a range of tech issues, from online privacy to regulating the gig economy, has stalled in D.C. amid impeachment and the presidential election. State leaders and legislators are filling the void. 

Policy fights that have shifted to the states.

  1. Privacy: California's landmark consumer privacy law took effect yesterday, and other state legislatures are considering their own privacy efforts amid a stalled attempt in Congress on a bipartisan national law. Industry watchers expect to see privacy legislation come up in New York, Washington and Illinois in 2020.
  2. Net neutrality: California and Vermont are facing litigation over their attempts to impose their own net neutrality regulations after the FCC repealed the Obama-era open-internet rules. New York Gov. Andrew Cuomo said he intends to advance statewide net neutrality legislation.
  3. Gig-economy labor: California is starting to implement a new law that codifies a state Supreme Court ruling making it hard for companies to treat gig economy workers as independent contractors rather than employees. New Jersey recently fined Uber for allegedly misclassifying drivers as independent contractors and not employees.
  4. Facial recognition: California has a three-year ban on police departments using facial recognition on body cam footage, and the cities of San Francisco and Berkeley have banned the use of the technology by local government. Boston suburbs Brookline and Somerville have also implemented bans.
  5. Home-sharing: Legislatures in some states, including Tennessee and Arizona, have passed laws placing restrictions on short-term-rental sites like Airbnb.

On antitrust, there may well be federal action. The Justice Department and FTC have both opened competition probes into major tech companies. But the states are throwing their own weight around as well.

  • Attorneys general from 50 states and territories, led by Texas, launched a joint antitrust investigation into Google.
  • New York is leading a coalition of 47 states investigating Facebook.
  • New York and California are leading the multi-state effort to block the T-Mobile-Sprint merger, which was blessed by federal regulators.

What to watch: Cities are also asserting their power on these issues and, in the process, either fighting or trying to shape state-level laws that often preempt city-level ordinances.

  • Cities are taking the lead on regulating e-bikes and e-scooters, and ride-hailing firms like Uber and Lyft.

Between the lines: The major players would much prefer national rules, to forestall a patchwork of different state laws.

  • The bottom line: States will be the focus of corporate lobbying while Washington is distracted.

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2. Trump's missing ingredient: fear
Satellite view of U.S. embassy compound in Baghdad (top half of pic). Smoke rises from gate (center, across street from reddish structure). Photo: Maxar Technologies via AP

Neither Iran nor North Korea — the twin war threats we told you about yesterday — seem to fear President Trump, "precisely the critique he leveled at Barack Obama," the N.Y. Times' David E. Sanger writes:

  • Why it matters: "Both the Iranians and the North Koreans seem to sense the vulnerability of a president under impeachment and facing re-election, even if they are often clumsy as they try to play those events to their advantage."
  • The big picture: While the showdown with Iranian-backed protesters in Baghdad "seemed to be under control, it played to Mr. Trump’s longtime worry that American diplomats and troops in the Middle East are easy targets and his longtime position that the United States must pull back from the region."
3. 📈 Long view of the markets
Expand chart
Data: LPL Research, Bloomberg, Ned Davis Research. Reproduced from LPL Research. Table: Axios Visuals

This was a good — but not the best — decade for the stock market, Axios' Dion Rabouin writes.

4. Pics du jour: 82nd Airborne deploys

750 Army infantry soldiers from the 82nd Airborne Division's Immediate Response Force deployed from Fort Bragg, N.C., to Kuwait, after the embassy attack in Iraq, with 4,000 more expected this week, Military Times reported.

  • Here's what it looked like:
Photo: Melissa Sue Gerrits/The Fayetteville Observer via AP

Above: Equipment is loaded onto a C-17 transport at Fort Bragg yesterday.

Below: Soldiers board a C-17.

Photo: Melissa Sue Gerrits/The Fayetteville Observer via AP

And in Kuwait, Marines in the Special Purpose Marine Air-Ground Task Force-Crisis Response-Central Command (SPMAGTF-CR-CC) deploy to Iraq:

Marine Corps photo by Sgt. Robert G. Gavaldon via AP
5. Bernie's record
Emerson Limberger and Marion Limberger at a Sanders rally on New Year's Eve in Des Moines. Photo: Stephen Maturen/Getty Images

Bernie Sanders announced that he pulled in $34.5 million during 2019's last three months, the biggest single quarter for any 2020 Dem so far this cycle.

Other early-bird announcements:

  • Pete Buttigieg: $24.7 million, capping off a $76 million haul for the year.
  • Andrew Yang: $16.5 million, with $1.3 million from New Year's Eve alone.

🚨 Flashback to Dec. 27: "Elizabeth Warren’s campaign told supporters in an email ... that, so far, it has raised just over $17 million in the fourth quarter." (CNBC)

6. 🏀 David Stern built NBA into global power
At the NBA draft in New York on June 19, 1984, NBA commissioner David Stern is flanked by No. 1 pick Hakeem Olajuwon (right), to the Houston Rockets, and No. 2 pick Sam Bowie, to the Portland Trail Blazers. Photo: Marty Lederhandler/AP

Former NBA commissioner David Stern, who died yesterday at 77, unquestionably is why the league is so successful today, AP basketball writer Tim Reynolds reports.

  • Why he mattered: He was the NBA's commissioner for exactly 30 years — from Feb. 1, 1984, through Feb. 1, 2014 — and turned a league that was having its biggest games shown on tape delay into the multibillion-dollar global juggernaut that it is today.
  • Stern took the league from 23 to 30 teams, built a bridge to China, and championed the birth of the WNBA and NBA TV.

Magic Johnson said: "David Stern was such a history maker. When I announced in 1991 I had HIV, people thought they could get the virus from shaking my hand."

  • "When David allowed me to play in the 1992 All Star Game in Orlando and then play for the Olympic Dream Team, we were able to change the world."
7. Boeing to further automate flying
Boeing's manufacturing line in Renton, Wash. Photo: Ted S. Warren/AP

Boeing plans to transfer "more control of aircraft from pilots to computers after two crashes exposed flaws in an automated system on its 737 MAX," the Wall Street Journal's Andy Pasztor and Andrew Tangel report (subscription).

  • Why it matters: "[S]uch changes ... seek to address the fact that average pilots may not react to problems ... as quickly or proficiently as designers traditionally assumed."
8. AI beats radiologists

"Google Health has developed a system that can identify breast cancer more accurately than radiologists," the Financial Times reports (subscription).

  • "In a paper published in the scientific journal Nature, experts from Google Health, Alphabet’s DeepMind unit, and U.K. and U.S. universities showed the AI model reduced both false positives, in which patients are wrongly told they have cancer, as well as" misses.
  • Why it matters: "Screening mammograms is known to be imperfect, failing to detect about one in five breast cancers, according to the American Cancer Society."

"But doctors still beat the machines in some cases," the Wall Street Journal notes.

9. 🇨🇭 Trump to meet elite

President Trump plans to head to Davos, Switzerland, later this month for the World Economic Forum after skipping last year because of the shutdown, CNN reports.

  • The administration will attend in force: A White House press release yesterday announced that the delegation will be led by Treasury Secretary Steven Mnuchin, and will include Jared Kushner and Ivanka Trump, Commerce Secretary Wilbur Ross, Labor Secretary Eugene Scalia, Transportation Secretary Elaine Chao, Trade Representative Robert Lighthizer, and Chris Liddell, deputy chief of staff for policy coordination.

🎰 First look: CES — the largest tech event in the world, in Vegas next week — will welcome Ross, Chao and Energy Secretary Dan Brouillette, along with more than 150 government officials from the U.S., Europe and Asia.

10. 1 fun thing
Photo: Eduardo Munoz Alvarez/Getty Images

New Year's Day polar-bear plunges have become a global phenomenon.

  • Swimmers wearing Santa hats and other costumes braved 40-degree water for the Coney Island plunge off Brooklyn (above), which dates to 1903.
  • Other plunges: Boston (its 117th year) ... North Beach, Md. ... La Jolla, Calif. ... Charlottetown, Prince Edward Island, Canada ... Perth, Ontario, Canada ... Vancouver, British Columbia, Canada (100 years, with one swimmer plunging every year starting when she was 3) ... The Hague, Netherlands ... South Queensferry, Scotland ... Gdansk, Poland (Baltic Sea) ... and Germany (Berlin Seals Association).

Plunge in.

Mike Allen

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