Mar 7, 2020

Axios AM

By Mike Allen
Mike Allen

⏰💨 Happy Saturday. Sorry, we spring ahead tonight!

  • Today's Smart Brevity™ count: 1,174 words ... 4½ minutes.

🗳️ Situational awareness ... It's official: Joe Biden won more delegates on Super Tuesday than Bernie Sanders.

  • AP has allocated more than 92% of delegates, and Biden has a commanding enough lead that Sanders can't catch up.

🍿 Tomorrow on "Axios on HBO" (6 p.m. ET/PT): Billie Jean King and other sports pioneers talk equity in athletics. See a clip.

1 big thing: Receding American dream

Illustration: Sarah Grillo/Axios

The American dream is moving further and further out of reach for millions.

  • Why it matters: That promise is essential to American identity — and its erosion will affect how we live, work and vote for decades to come, Erica Pandey and Courtenay Brown write for our "What Matters 2020" series.

What's happening: Buying a home or paying for college are increasingly unaffordable — and millennials, many of whom entered the job market at the height of the recession, are feeling the crunch.

  • The cost of higher education is ballooning. From 1978 to 2017, the Consumer Price Index grew fourfold, but the price of college increased 14-fold, according to research by Ana Hernández Kent, a policy analyst at the St. Louis Fed.
  • The price of homes is rising much faster than incomes. Per a study by real estate company Clever that looked at census data from 1960 to 2017, U.S. housing prices have skyrocketed 121%, while incomes have increased 29%.
  • And socioeconomic mobility is at an all-time low. As we've reported, fewer Americans are faring better than their parents did — and more are doing worse. Per a recent UPenn study, around 60% of people born in the 1940s did better than their parents, compared with 40% of those born in the 1980s.

Why we're still confident: Bright spots and reasons for optimism remain.

  • Americans are more entrepreneurial than ever before. There were 3.4 million applications to start businesses last year, a record number, per the U.S. Census Bureau.
  • The U.S. homeownership rate is back to pre-recession levels, despite the rising cost of homes. Around 65% of American families own homes. That's up from recession-era lows and mirrors the U.S. homeownership rate of much of the 20th century, says Mike Fratantoni, chief economist at the Mortgage Buyers Association.

The bottom line: "Sink or swim by your own strength is not applicable to this generation as it was with previous ones," Kent says. "The tide is much stronger."

2. Trump boots chief during guys' weekend
Mick Mulvaney, as White House budget director, briefs in 2017. Photo: Carlos Barria/Reuters

Acting White House chief of staff Mick Mulvaney was in Vegas on an annual trip with his brother and friends on Thursday when President Trump decided the time had come to replace him with Rep. Mark Meadows, Jonathan Swan and Alexi McCammond report.

  • Mulvaney tells Axios that he and the president had been talking since November about making the change, that Meadows is his longtime friend and that the transition is happening with his blessing.

Trump had vented about Mulvaney being out of town during the coronavirus crisis, according to two sources familiar with the discussions.

  • "Anybody who knows Donald Trump knows that if you're on a slippery slope you shouldn't leave town," said a source familiar with the situation.

Trump tweeted that Mulvaney "will become the United States Special Envoy for Northern Ireland. Thank you!"

  • The president views April 1 as transition to the "real" re-election season, said a senior White House official, and wanted key staff changes in place by then.

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3. 🦠 Coronavirus quick catch-up
The California National Guard's 129th Rescue Wing drops test kits to the Grand Princess cruise ship off California. Photo from video: California National Guard via AP

🚢 California officials are debating where to dock a cruise ship with 21 coronavirus cases aboard. (AP)

🎓 Stanford said last night that it'll move classes online for the final two weeks of the winter quarter. (L.A. Times)

🎥 South by Southwest — the film/music/tech convention that was to begin next Friday, and pumps $350 million into the Austin economy — was canceled.

4. Virus shows fragility of gig work
Spotted in Barcelona. Photo: Nacho Doce/Reuters

Many white-collar companies are asking employees to work from home during the virus crisis, but app-based gig companies are doing less to protect workers, Kia Kokalitcheva reports from S.F.

  • Why it matters: While engineers and business managers at companies like Uber and Lyft can bring their laptops home, that doesn't work for the independent contractors who ferry passengers, hot meals and groceries.

Sen. Mark Warner (D-Va.) sent letters to the CEOs of Uber, Lyft, DoorDash, GrubHub, Instacart and Postmates, urging them to set up health funds to compensate drivers who have to cut back their hours.

  • Uber and Lyft announced late yesterday that they will compensate drivers for up to 14 days if they're diagnosed with COVID-19 or put under quarantine by health authorities.
  • Instacart says that some of its "shoppers," who pick groceries, qualify for sick pay.
  • So far, companies have mainly distributed guidelines to drivers about keeping cars clean, washing their hands, and staying home if they feel sick.

Between the lines: One obstacle for these on-demand delivery companies is that providing sick leave and compensatory pay could make it harder to deny that their workers are employees — not just independent contractors.

Demand for delivery services seems to be growing as the virus spreads.

  • Instacart said Thursday that its sales this past week were 10 times higher than the prior week — and 20 times higher in states like California and Washington, where the largest numbers of cases have been reported.

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5. Online classes hurt offline pupils
Yeshiva played Worcester Polytechnic Institute at Johns Hopkins yesterday with a "No Spectators" sign outside. Photo: Terrance Williams/AP

K-12 schools weighing a shift to online learning in the shadow of the coronavirus are grappling with what to do about kids who don't have internet at home, tech rep0rter Margaret Harding McGill writes.

  • Why it matters: The "digital divide" between internet access haves and have-nots has long been an abstract public-policy debating point. But this public health crisis is bringing the issue home in a concrete way.

Government estimates of the number of U.S. households with school-age children who lack home internet access range from 6 million to 7 million.

6. 🎸 1 strong thing: Music City moment of grace
Volunteers work to clean up tornado damage in Cookeville, Tenn. Photo: Brett Carlsen/Getty Images

Keith Meacham, who has spent 25 years in the field of education and lives with her family in Nashville, writes for The Washington Post:

There was a quick camaraderie among the folks at the recreation center where the volunteer efforts were being staged. The place was without electricity, so a cheerful woman wearing a headlamp directed us to a long table covered in diapers of all sizes, baby food, new blankets and cans of Chef Boyardee. ...
As the morning wore on, we’d run out of canned goods, blankets and Ramen noodles, so we drove to Walmart to replenish supplies. By then, my sister and I had been promoted to "coordinators" — which made us chuckle — and we decided to post a photo on Instagram to mobilize our friends and bring in more supplies. ...
In the three hours we’d been organizing diapers into boxes by size, friends raised $1,350 in donations. Scrolling through my feed, usually heavy on staged table settings and #NoFilter sunsets, I noticed a different tenor in the posts from my Nashville Insta pals.

Keep reading for a "Music City moment of grace" — subscription (The Post, not the grace!)

Mike Allen

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