Feb 26, 2020

Axios AM

Good Wednesday morning. It's Ash Wednesday, the first day of Lent.

  • Today's Smart Brevity™ count: 1,397 words ... 5 minutes.
1 big thing: America braces for a coronavirus outbreak
Graphic: Reuters

U.S. public-health officials' warnings about the coronavirus are increasingly urgent, with one top CDC official asking the public yesterday "to prepare for the expectation that this might be bad," Axios health care editor Sam Baker writes.

  • Reality check: While other administration officials, including President Trump, were more subdued in their assessments, the virus spreads quickly, and has already spread to many countries, making it likely to start spreading here, too.

Where it stands: Cases are now piling up across Asia and into the Middle East, where it’s also spreading locally, even from people who weren’t exposed in China.

  • As the virus spreads and as American travelers can encounter it in more places, the risk of a pandemic rises.
  • So far, though, there are only about 50 confirmed cases of coronavirus inside the U.S., and most of those people were exposed to the virus abroad.

You don't need to start panicking about the virus.

  • The best ways to avoid getting the coronavirus are the same things you’d do to avoid getting the flu: Wash your hands, and stay away from work, school or other crowded places if you’re sick.
  • If a pandemic does begin in the U.S., some businesses may want to embrace telework; schools may ultimately need to cancel classes; and local governments may want to reschedule large events, the CDC’s Nancy Messonnier said.

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2. Work goes remote in the face of virus

Illustration: Sarah Grillo/Axios

The coronavirus has already forced millions to work from home in China, and as the outbreak goes global, remote work could become a vital public health strategy, Bryan Walsh writes in his Axios Future newsletter, which returns today.

  • Why it matters: Businesses should be ready to "replace in-person meetings with video or telephone conferences and can increase teleworking options," Dr. Nancy Messonnier, spokesperson for the CDC's coronavirus response, told reporters.

What's happening: The videoconferencing company Zoom has been one of the few stocks to rise even as fears about the coronavirus pull down the market.

  • In China, Alibaba's collaboration platform DingTalk became the most-downloaded free iOS app in the country in early February.
  • In Hong Kong, where classes are suspended until at least March 2, schools are experimenting with creating an interactive educational experience for homebound students using Zoom, according to the South China Morning Post.

📱 Sign up for Bryan Walsh's debut issue of Axios Future, out this afternoon.

3. Dem brawl leaves Sanders in command
Photo: Win McNamee/Getty Images

A new urgency permeated the performance of nearly every Democrat during the South Carolina debate last night, as Bernie Sanders threatens to run away with an insurmountable delegate lead after Super Tuesday, six days from now.

  • Mike Bloomberg had a better outing than his first debate, steadying him as he heads into the Tuesday contests that will determine his viability.

Our top takeaways, narrated by Axios' Zach Basu:

1. The usually reticent Joe Biden, who has vowed to win Saturday's South Carolina primary, barked at moderators for cutting into his time.

  • And he took aim at Sanders, Bloomberg and Tom Steyer, who has poured millions into ads in South Carolina.

2. Pete Buttigieg spoke pointedly about racial justice and policing, an issue that he said he approaches "with humility."

  • He was the first in several debates to acknowledge the all-white field: "I'm conscious of the fact that there are seven white people on this stage talking about racial justice."

3. Elizabeth Warren, who saw a bump in national polling after her breakout debate performance last week, clearly saw her critical treatment of Bloomberg as her best shot to save her campaign.

  • "The core of the Democratic Party will never trust him," Warren argued.

4. Establishment Democrats have been sounding the alarm about how a ticket led by Sanders, a democratic socialist, will affect down-ballot races in the moderate districts that helped Democrats take the House in 2018. That concern manifested on the debate stage for the first time.

  • Bloomberg said: "Donald Trump and the House and the Senate and some of the state houses will all go red, and then between gerrymandering and appointing judges for the next 20 or 30 years we’re going to live with this catastrophe."

5. The dominant attack line against Sanders this week from Republicans — and even some Democrats — was his praise for Cuban dictator Fidel Castro's literacy program.

  • The senator didn't disavow the comments, arguing it is possible to condemn authoritarianism while acknowledging good things those governments may have done.

Between the lines: The coronavirus; the humanitarian catastrophe in Idlib, Syria; and President Trump and the rule of law — all massive global storylines — received little to no attention at the debate.

Media center at Charleston debate. Photo: Matt Rourke/AP

🗞️ P.S. ... The Boston Globe endorsed Warren, calling her "a leader with the qualifications, the track record, and the tenacity to ... advance a progressive agenda."

4. New data: Where real businesses are growing, shrinking
Expand chart
Reproduced from Center for American Progress. Chart: Axios Visuals

Southern rural areas have seen the highest levels of business deaths since the Great Recession, with African American communities bearing the brunt of economic decline, Axios' Kim Hart, author of Axios Cities, writes from a new report by the progressive Center for American Progress.

  • Small businesses in the South and rural middle America have been battered by growing consolidation in the agriculture industry, leading to communities being dominated by a single company.

Some pockets of rural America are seeing business growth, even though it pales in comparison to larger cities:

  • Graying America communities are generally recreation-dependent. These communities are located in large states such as Florida, Texas and California.
  • Many Hispanic centers are mining-dependent, especially in the oil and gas industry.
  • Mormon enclaves in Utah have large youth populations and less population loss than other rural communities.

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5. Tech can't remember what to do in a down market
Currency traders work in Seoul, South Korea. Photo: Ahn Young-joon/AP

Wall Street's two-day coronavirus crash is a wake-up call for Silicon Valley, Axios managing editor Scott Rosenberg writes from the Bay Area.

  • Tech has been booming for so long the industry barely remembers what a down market feels like — and most companies are ill-prepared for one.

A coronavirus-triggered recession could affect tech in unexpected ways.

  • The industry is highly dependent on international collaboration, cross-border supply chains and global consumer demand, all of which are threatened by the prospect of a pandemic.
  • But a shelter-in-place mentality could prove a boon to videoconferencing, e-commerce, and other tech-driven trends that let lives go on with less direct human contact.

A market retreat could also reshape the inside-the-Beltway critique of Big Tech.

  • Arguments for tough new regulations based on the industry's power might look different in a world where tech giants' stock had been battered and their spending cut, on everything from lobbying to acquisitions.
  • 20 years ago, a new wave of companies (including Google, founded 1998, Salesforce, founded 1999, and Facebook, founded 2004) germinated while the giants of the era froze in place or withered.

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6. Iger departure stuns Hollywood

Photo: Valerie Macon/AFP via Getty Images

In a move that shocked the media industry, Bob Iger said yesterday that he would step down from his role as CEO of the Walt Disney Company after leading the entertainment giant to unprecedented success during his 15-year run, Axios media trends expert Sara Fischer writes.

  • Why it matters: Iger is credited with having successfully led Disney through a series of risky but highly successful acquisitions that not only solidified the company's entertainment dominance, but also reshaped the entire media landscape.

During his tenure, Disney successfully turned around its animation and studio businesses — and added huge names like Marvel, Pixar, Lucasfilm and 21st Century Fox to its portfolio.

  • It also launched its foray into the streaming era through the creation of Netflix rival, Disney+.
7. Scoop: Pro-Trump group plans post-Super Tuesday blitz on Democrats
Sen. Elizabeth Warren speaks to Sen. Bernie Sanders after last night's debate in Charleston. Photo: Jonathan Ernst/Reuters

Pro-Trump super PAC America First Action is preparing to unleash a series of targeted, swing-state attacks on the Democrats most likely to face President Trump after Super Tuesday, Axios' Alayna Treene reports.

  • The group has been tracking favorable/unfavorable ratings for Dem candidates in Florida, Georgia, Michigan, North Carolina, Ohio and Pennsylvania — on the theory that if Trump wins each of these six states he would win re-election.
  • The spending isn't expected to begin until it's clearer who the Democratic nominee will be, whether that's after Super Tuesday or in July at the Democratic National Convention.

The attacks will be targeted to specific audiences in each state, based on rich data gathered beginning last August. The super PAC has pulled together about 500 pages of research on four of the five candidates, with about 300 pages on Buttigieg, given his shorter record.

  • The onslaught will come in the form of high-dollar digital and TV ad buys and mailers, one of the people familiar with the strategy said.

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8. 1 fun thing
Photo: Profiles in History via AP

This is the original artwork for a "Flash Gordon" comic strip published in 1934.

  • The pencil-and-ink drawing by Alex Raymond will be auctioned March 31, AP reports.

Why it matters: The series quickly grew in influence, spawning movies and inspiring later science-fiction hits.

  • "Flash Gordon" was commissioned as a competitor to the Buck Rogers series.

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