Axios AM

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January 02, 2018

Good Tuesday morning, and welcome back.

1 big thing: Dire warning on risks of 2018

First look at a dire warning from one of the top analysts of global trends ... Ian Bremmer, president and founder of Eurasia Group, and Eurasia Group Chairman Cliff Kupchan are out this morning with their "Top Risks" report for 2018:

  • The big picture: "2018 doesn't feel good. Yes, markets are soaring and the economy isn't bad, but citizens are divided. Governments aren't doing much governing. And the global order is unraveling."
  • Why it matters: "In the 20 years since we started Eurasia Group, ... if we had to pick one year for a big unexpected crisis ... it feels like 2018. Sorry."
  • "Last year, we wrote that the world was entering a period of geopolitical recession. ... The world is now closer to geopolitical depression than to a reversion to past stability."

Among the risks that are worrying Bremmer and his colleagues:

  • China loves a vacuum: "China is setting international standards [on trade and investment, tech, values, and security] with less resistance than ever before."
  • Accidents: "It's impossible to ignore the risk of a major crisis today, because there are too many places where a misstep or misjudgment could provoke serious international conflict."
  • Global tech cold war: "Achieving dominance in emerging technologies is the world's most important battle for economic power."
  • Erosion of institutions: "Conflict will become more frequent, decision-making degraded, and internal chaos common."
  • "[T]his is a White House that's headed toward massive distraction from a Mueller investigation."

And maybe the most sobering of all: "The decline of U.S. influence in the world will accelerate in 2018."

2. Now that we have you freaked out ...

... Financial Times chief foreign affairs commentator Gideon Rachman gives "The case for optimism in 2018" (subscription):

  • "After a dismal run in world politics, it is certainly time to be reminded that there can be good, as well as bad, surprises. My own new year's resolution is to try to snap out of Trump and Brexit-induced gloom."
  • "In that spirit, I will predict that most of the big risks that currently worry pundits will not happen."
  • "There will not be a war on the Korean peninsula, nor will there be one in the South China Sea or in eastern Europe. The EU will not fall apart, Brexit negotiations will not break down and markets will not crash. By contrast, there will be big and positive change in the Middle East. And England will win the World Cup."

The super-big picture ... David Leonhardt, N.Y. Times Op-Ed columnist, reminds us in his "Wishes for 2018":

  • "It may be hard to believe in the United States, but 2017 was again the best year in history, based on the aggregate well-being of humanity. People have never before lived so long, so well or so freely.

3. Congressional to-do list​: everything

The congressional agenda includes immigration, a government spending bill, health care, and an expiring surveillance program, Axios' Caitlin Owens writes:

  • Once again, we're facing a shutdown if Congress doesn't pass a spending bill, this time by Jan. 19.
  • The Children's Health Insurance Program: Funding officially expired at the end of September, and it wasn't until December that Congress passed a short-term funding continuation (although states hadn't yet run out of money). But a longer-term solution still must be found, including ways to pay for it.
  • See the to-do list.

4. Iran regime protests meddling by "enemies"

Breaking ... After President Trump tweets that it's "TIME FOR CHANGE!" in Iran, the supreme leader accuses "enemies of Iran'" of meddling in the country.

Nine people were killed overnight as clashes between protesters and security forces continue in Iran for a sixth day, with the total number of reported deaths reaching at least 22, the BBC reports:

  • An 11-year-old boy was among those reported killed.
  • Hundreds of people have been arrested.

5. "Wave of optimism" sweeps business leaders

A headline for the White House to love, from the (not) "failing New York Times" ... "The Trump Effect: Business, Anticipating Less Regulation, Loosens Purse Strings":

  • "A wave of optimism has swept over American business leaders, and it is beginning to translate into the sort of investment in new plants, equipment and factory upgrades that bolsters economic growth, spurs job creation — and may finally raise wages significantly."
  • "While business leaders are eager for the tax cuts that take effect this year, the newfound confidence was initially inspired by the Trump administration's regulatory pullback, not so much because deregulation is saving companies money but because the administration has instilled a faith in business executives that new regulations are not coming."
  • But, but, but ... "Some businesses will essentially be able to get away with shortcuts that they could not have under a continuation of Obama-era policies."

6. Energy and climate issues to watch in '18

Washington isn't even close to a coherent strategy on energy and climate change, Axios' Amy Harder writes in her weekly "Harder Line" energy column. What she's watching this year:

  • Oil prices are projected to be hovering higher this year than in previous years. One big question is whether oil companies will boost their investments and ward off a supply crunch — and subsequently much higher prices — in a few years, as the International Energy Agency has been warning for at least a year.
  • Saudi Aramco would be the world's biggest initial public offering ever. The state-owned oil giant in Saudi Arabia, the biggest oil-producing company in the world, has said it's sticking with its plans to sell up to 5% of its shares this year.
  • Drill down.

7. How democracy could become more fragile

It's not often that Big Tech calls for more government action. But two top Microsoft executives — Brad Smith, president and chief legal officer, and Carol Ann Browne, director of executive communications — write in a tech trends forecast out today:

  • "2018 will be a year when democratic governments can either work together to safeguard electoral processes or face a future where democracy is more fragile."
  • "[T]his needs to include work to protect campaigns from hacking, address social media issues, ensure the integrity of voting results, and protect vital census processes."
  • "While technology companies have a high responsibility to help, there is no substitute for the effective and unified voices of democratic governments themselves."
  • See Microsoft's "Top 10 Tech Issues for 2018."

8. Tracking power

Gretchen Carlson, former Fox News anchor and 1989 Miss America, was named chairwoman of the Miss America Organization's board of directors yesterday, AP reports:

  • "The new leadership comes less than two weeks after leaked emails surfaced showing CEO Sam Haskell and others disparaging the appearance, intellect and sex lives of former Miss Americas. Haskell resigned Dec. 23."
  • "The selection of Carlson marks the first time a former pageant winner has served as the leader of the nearly 100-year-old organization."
  • Why it matters, via N.Y. Times: "Carlson, ... whose harassment lawsuit against the Fox chairman Roger Ailes led to his departure in July 2016, will be expected to lead the pageant through its own harassment scandal."

9. New streaming network for left

David Bohrman, former Current TV president and former CNN Washington bureau chief, is launching a video service aimed at progressives, the Political Voices Network (PVN), Axios' Sara Fischer scoops:

  • On-air talent includes Stephanie Miller and Bill Press.
  • PVN, available at, launches in the second quarter, and plans to air more than 20 hours a day of live political news and insight.
  • The network will be both advertising and subscription-based, offering a $10 membership that provides access to extra content and discounts for live events and more.
  • Bohrman plans to hire roughly 18 employees for launch. The effort is currently self-funded, but he is seeking a seed round in the $3 million to $5 million range.
  • Why it matters: Bohrman argues there has been a vacancy of progressive voices in the video space compared to the right.
  • On the left, he sees only The Young Turks as a competitor, compared to many more video-streaming options on the right, like Glenn Beck's The Blaze, One American News Network (OANN), Newsmax, Rush Limbaugh, Mark Levin's CRTV, and more.
  • More consumers are looking for streaming options for news and sports, two topics that are mostly still watched live. Bohrman says he is interested in expanding to sports.
  • PVN will be carried on Apple TV, Roku and Amazon Prime.

10. 1 fun thing

"S-E-C! S-E-C!" ... Alabama vs. Georgia for national college championship next Monday — AP's Ralph Russo looks ahead:

  • "Alabama and Georgia won their College Football Playoff semifinals [yesterday] and will meet in the national championship [on Monday] in Atlanta, the home of the Southeastern Conference title game." (The Georgia Bulldogs are reigning champs.)
  • "The fourth-ranked Crimson Tide smothered No. 1 Clemson 24-6 in their Sugar Bowl rubber match after the third-ranked Bulldogs won the first overtime in Rose Bowl history, a wild 54-48 victory that eliminated No. 2 Oklahoma and Heisman Trophy winner Baker Mayfield."
  • "The irony of the SEC monopolizing this national championship game is that the league is not regarded as the clear-cut best in college football this season."
  • Vegas line, via ESPN: "Alabama opened as a four-point favorite over Georgia for next week's College Football Playoff championship game."