Axios Markets

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September 06, 2023

🎾 Good morning, readers. Hope you've reconciled yourselves to the approach of autumn. (We haven't. We're soaking up some great tennis at the U.S. Open.)

  • Today's newsletter is 1,155 words, a 4.5-minute read.

1 big thing: The White House wants to stay out of it

Illustration of President Biden exiting the frame of two overlapping speech bubbles

Photo illustration: Sarah Grillo/Axios. Photo: Drew Angerer/Getty Images)

The White House prefers to keep out of labor negotiations, acting Labor Secretary Julie Su tells Emily in an interview.

Why it matters: With the possibility of another economy-shaking strike on the horizon — now it's auto workers; earlier this summer it was UPS — the Biden administration's stance on unions is an important factor in talks, whether they're at the table or not.

State of play: As Su explains, the idea is to refrain from meddling in a process that the pro-labor administration believes in. "Our stance is stay out, respect the parties unless asked, or unless there's some reason why we believe that that we could be helpful," she says.

  • "This president and I really believe in the collective bargaining process, which is premised on the parties coming together, sitting down, negotiating, grappling with hard things, and coming to resolution."
  • That's what ultimately played out in talks between the Teamsters union and UPS earlier this summer — the White House stayed out of those negotiations, even as industry groups asked them to get involved.

The big picture: A president getting involved in a labor battle can mean a lot of different things, depending on the politics of a given administration and the stakes in the labor battle itself. For example, the White House could...

  • Sit at the negotiating table or even force a contract through over worker objections, using federal law. That might happen in a case where the White House is, by law, required to get involved. Like with the rail workers last year.
  • Sit at the table, when asked. That's what happened earlier this year when Su helped negotiate a contract at the West Coast ports.
  • Order workers back to the job. If a strike or a lockout happens in an economically crucial industry, a president can declare an emergency and put an end to it. That's what happened in 2002 when President George W. Bush invoked the emergency provisions of the Taft-Hartley Act to reopen the West Coast ports during a tense period.

Zoom in: Staying out of talks doesn't mean staying away entirely. The administration stays in touch with the parties when it comes to these big labor disputes.

  • Biden has assigned a point person at the White House, Gene Sperling, to keep in touch with the parties in the auto worker talks.
  • Sperling isn't at the negotiating table, Su emphasized. He is acting as the administration point person on questions that come up, like around any federal investments in clean energy — there's a lot to keep track of stemming from the Inflation Reduction Act.

What to watch: The current UAW contract ends on Sept. 14, and industry insiders say a strike is a real possibility.

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2. Catch up quick

🚀 Musk borrowed $1 billion from SpaceX, WSJ reports. (WSJ)

🎥 Warner Bros. Discovery expects earnings hit as Hollywood strikes bite. (Axios)

📦 U.S. antitrust suit against Amazon is expected this month. (WSJ)

3. SpaceX's high-stakes dominance

🚀 Successful rocket launches in 2023, by country
Data: Ill-Defined Space; Chart: Jared Whalen/Axios

SpaceX is empowering other companies and nations to reach their goals in space — but it could also pose major challenges to those same entities, Axios' Miriam Kramer writes.

Why it matters: Elon Musk's company, which operates a fleet of satellites and provides launch services, is dominating the industry.

  • "There is no doubt" that SpaceX is the most important company in the space industry, Chad Anderson of Space Capital, a VC firm focusing on space tech, tells Axios. "Who is even second? It doesn't even matter who's second, [SpaceX is] so far ahead."

What's happening: The company has already launched 62 missions this year, far surpassing any other company or nation.

  • SpaceX also operates the largest fleet of satellites in orbit today —thousands of internet-beaming Starlink spacecraft that provide internet connectivity around the globe.

The intrigue: SpaceX's competitors are being forced into the uncomfortable position of relying on its fleet of rockets.

  • Competitors like OneWeb are attempting to build mega constellations — hundreds or thousands of satellites that work together — which could compete with Starlink, and they're buying rides to space aboard SpaceX rockets.
  • SpaceX is even eating into the small satellite launch market, driving down costs and undercutting other companies like Rocket Lab who are offering dedicated missions for small satellites.

Between the lines: NASA and the U.S. government are also increasingly reliant on SpaceX.

  • The company is the only U.S. entity currently able to send astronauts to orbit.
  • Musk himself also holds diplomatic sway. SpaceX's satellites have been crucial for warfighting in Ukraine, raising further questions about the power the company holds.

The big question: Whether SpaceX's dominance will abate as new rockets come online, and as other companies build megaconstellations that could eat into Starlink's first-mover advantage.

Go deeper

4. This gender gap is at a record low

U.S. labor force participation rate, by gender
Data: FRED, BLS; Chart: Simran Parwani/Axios

Women are closing in on men in the workplace, Emily writes.

Why it matters: For decades, a far higher share of men worked than women. Now that gender gap is the narrowest it's ever been, according to the latest data from the Bureau of Labor Statistics.

The big picture: Women are crushing it in the labor market right now — their return to work from the pandemic has been faster than men's.

  • The gender pay gap is also the narrowest on record.
  • A big part of this is the rise of remote and flexible work, which has enabled a record number of women with young children to enter or remain in the workforce.

What to watch: The so-called child care cliff. COVID-era funding for child care runs out this month, and many predict this could put some daycares out of business or force them to raise fees.

  • That could push some parents — particularly mothers — out of the workforce, and back home to look after kids.

The bottom line: For all the viral chatter about "lazy girls," women are working harder than ever.

5. Oil's 2023 high

Data: FactSet; Chart: Axios Visuals
Data: FactSet; Chart: Axios Visuals

Oil prices climbed to their highest level of the year Tuesday, Matt writes.

Why it matters: The rise came after Saudi Arabia and Russia — the second and third largest global producers — announced at 9am ET that they're both extending their voluntary cuts in oil production through the end of 2023.

  • Prices are up more than 25% from the lowest levels of the year.

The cuts took roughly 1.3 million barrels per day off the global market.

Between the lines: The production cuts are mostly about China.

  • China is the largest buyer of both Saudi and Russian crude oil — and its struggling economy means it will consume fewer barrels.

Yes, but: The decision to keep the oil market tight also has political implications, as it further links Saudi Arabia — once a stalwart U.S. strategic ally — with American adversaries Russia and China.

What to watch: How much the higher crude oil prices feed through to U.S. gasoline prices — already at the highest level this year — and potentially reinvigorate broader price pressures as well.

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Today's Axios Markets was edited by Kate Marino and copy edited by Mickey Meece.