May 12, 2022
Happy Thursday. Smart Brevity™ count: 1,159 words ... 4½ mins. Edited by Zachary Basu.
⚡ Situational awareness: A nearly $1 billion settlement has been reached in a class-action lawsuit by families of victims of last year's condo collapse in Surfside, Fla. Keep reading.
⚖️ At 8 a.m. ET today, please join Axios' Ashley Gold and Margaret Talev for an event about tech's antitrust debate. Guests include Rep. Pramila Jayapal (D-Wash.), Rep. Eric Swalwell (D-Calif.) and FTC Commissioner Noah J. Phillips. Register here to attend virtually, or in-person in D.C.
1 big thing: Roe economics
Legalizing abortion was one of the most meaningful economic policies of the past 50 years for women, Axios Markets co-writer Emily Peck reports:
- Abortion access allows young women to delay becoming mothers, making it more likely that they will attend and finish college and start careers, a host of studies have found.
Why it matters: If Roe v. Wade goes away, some of that progress will likely be reversed, which could slow economic growth more broadly.
- Treasury Secretary Janet Yellen, a labor economist, said during Senate testimony this week that eliminating a woman's right to seek an abortion would have "very damaging effects on the economy and would set women back decades."
Caitlin Knowles Myers — an economist at Middlebury College who's a leading scholar on this issue — summarized the scholarship in an amicus brief filed by 154 economists to the Supreme Court last year:
- Legalization increased women's labor force participation, particularly Black women.
- Young Black women who used abortion to delay motherhood for one year realized a 10% increase in wages later in their careers.
The other side: Opponents argue abortion is morally wrong, and that no benefits outweigh those costs.
2. ✈️ Airfare inflation = the new used-car inflation
The latest inflation data included a number that was shocking, though not exactly surprising to anyone who has been booking their summer travel lately, Axios chief economic correspondent Neil Irwin writes:
- Airfares rose 18.6% in April, the most on record for a single month. That accounted for about a quarter of the overall surge in core inflation last month.
Why it matters: A challenge with interpreting inflation data is determining what to "look through" as a mere one-time adjustment, and when to show more alarm.
- The experience of the last year shows the risks of being too willing to brush off high inflation just because one or two categories are disproportionately responsible.
- It would be a mistake to brush off the elevated April inflation just because so much of it was due to one sector facing unique issues, as many commentators did this time a year ago when used car prices spiked.
State of play: The causes of surging airfare are straightforward. Jet fuel prices have been rising, leading airlines to raise their prices. There are pilot and other staffing shortages, constraining the operators' ability to add more routes.
- Financially flush consumers are ready to spend whatever it takes to book their vacations and business travel.
- Limited supply plus strong demand = booming prices.
Between the lines: The problem with the current inflationary moment isn't that some prices are rising for idiosyncratic reasons. It's that inflation has become so broad-based that the markets with idiosyncratic issues — like April airfares, or used car prices last spring — drag inflation up from already-high levels.
- Over time, you would expect these weird shocks to be symmetrical, with deflationary surprises that offset inflationary surprises. But the nature of our current economy is that the surprises are all cutting in the same direction.
In other words, the problem is not just that airfare prices rose by 19%. The issue is that airfare prices rose a lot on top of many other things rising by an uncomfortably high 0.4% or 0.5% — and no prices falling by double-digits.
3. 🇫🇮 Finland embraces NATO bid
Finland's president and prime minister announced this morning they support an immediate application for NATO membership — a historic decision that will transform the landscape of European security forever, Axios' Zachary Basu reports.
- Why it matters: The news — soon to be followed by a similar announcement from Sweden — sets in motion a process that will double the length of NATO's borders with Russia, and culminate in the alliance's ninth enlargement since its founding in 1949.
It's Vladimir Putin's worst nightmare — but one triggered entirely by his own decision to invade Ukraine.
- Asked yesterday if Putin would view the forthcoming announcement as provocative, Finland's President Sauli Niinistö said: "My response would be that you caused this. Look at the mirror."
4. 📷 1,000 words
A drone's-eye view of a sand sculpture on a beach in Gaza City reading Shireen Abu Akleh — for the Al Jazeera correspondent who was killed yesterday in an Israeli raid in the occupied West Bank.
- Her unflinching coverage from the Palestinian territories was known to millions of viewers.
5. 😷 COVID deaths rise again
Waning immunity and low booster uptake mean a growing share of COVID deaths are among the vaccinated, Axios' Tina Reed and Kavya Beheraj report.
- The increase in deaths follows several weeks of declines — but still comes nowhere close to the thousands of deaths the U.S. was recording months ago.
Increasingly transmissible Omicron variants have generally not appeared to cause more serious illness. But some people are still dying.
6. 🍊 Wildfires torch O.C. mansions
A wildfire erupted yesterday afternoon in coastal Southern California and raced through coastal bluffs of multimillion-dollar Orange County mansions, burning at least 20 homes, AP reports.
- The fire in Laguna Niguel was relatively small — about 200 acres. But the wind drove embers into palm trees, attics and dense, dry brush on slopes and steep canyons that hadn't burned for decades.
The flames were fanned by gusty ocean winds, but were dying down last night. No injuries were reported.
7. U.S. overdose deaths hit record
The National Center for Health Statistics said at least 107,622 people died from overdoses in 2021— a record, and major increase from 93,655 deaths in 2020.
- A growing number of deaths involve fentanyl, which is often mixed with other drugs, and the stimulant methamphetamine, Axios' Adriel Bettelheim writes.
8. 🍅 The future of ketchup
- Why it matters: Consumer product companies are busy trying to reduce packaging-related waste and pollution — because so much of it winds up in the earth's oceans and landfills, and consumers are very concerned about the problem.
Kraft Heinz is working with Pulpex, a sustainable packaging technology company, to craft a recyclable bottle made from "100% sustainably sourced wood pulp."
- Heinz aims to be "the first sauce brand to provide consumers this choice in their purchasing decisions," said Rashida La Lande, Kraft Heinz's chief sustainability and corporate affairs officer.
Current Heinz bottles are made from glass and plastic.
- The company wants "to make all packaging globally recyclable, reusable or compostable by 2025."
📬 Invite your friends to sign up here to get their daily essentials — Axios AM, PM and Finish Line.