What We're Watching
The FTC says the online mega-retailer has engaged in a “pattern of illegal conduct” that includes blocking competitors, inflating prices, crushing innovation, and reducing market quality.
In essence, the FTC claims that Amazon traps consumers and sellers in its orbit, dominating market share and exploiting its position to undermine independent sellers and reduce choice for consumers while also using its position to drive up prices. It also alleges that Amazon games its search results to push its own products.
Amazon denies the allegations and says the lawsuit would hurt businesses and consumers alike, sending prices higher and slowing delivery speeds. It’s ready to fight back, and as a company valued at roughly $1 trillion, it has the resources to do so.
Anyone looking for a quick resolution is going to be disappointed. Canada launched an antitrust investigation into Amazon in August 2020. That probe is ongoing, and the Competition Bureau has not said when it expects to complete its work, which would precede any further action.
In 2022, the Canadian government amended its Competition Act to introduce stiffer fines and penalties for businesses that violated the law. Under the new rules, businesses like Amazon could be on the hook for as much as 3% of their annual gross revenues worldwide if found to be abusing their dominant market position, which is a lot more than the previous cap of CA$10 million.
We’re keeping an eye on how the FTC and Competition Bureau lawsuits and investigations proceed, and whether Amazon adjusts any of its practices in the meantime. It’s doubtful they will. In 2022, in Canada, the company threatened to shutter Marketplace if the government strengthened competition regulations, though it didn’t go through with the plans.
The city has more than 1,868 migrants in shelters – a big jump from July and August, when numbers were in the 400-500 range.
In May, Title 42 expired. US officials expected a sharp, sudden rise in the number of immigrants entering the country from the southern border, and that is exactly what happened, though numbers later declined. The immigration policy had been in place since the Trump years, keeping hundreds of thousands of would-be newcomers, including some asylum-seekers, from entering the country.
The change prompted some states to ask the Biden administration for funds to help house migrants, but support has been insufficient. Now, as Politco reports, a broader battle over “NIMBYism” (not in my back yard) is playing out. Some officials, including Democrats, worry about how a rise in migration is affecting housing – many cities and states are already in crisis as shelters exceed capacity – and whether it might produce a local backlash. Massachusetts alone has upwards of 22,000 people in shelters, roughly half of whom are migrants. That’s a 100% rise since January.
National, state, and local support has been unable to keep up with the rise in newcomers, and migrants are finding themselves caught in the middle of a partisan political struggle ahead of the 2024 election. This comes as the US faces a growing housing crisis.
Meanwhile, in Canada, government under-funding and finger-pointing in this summer led to an emergency in which civil society groups and churches stepped up to feed and shelter migrants who were sleeping on the streets of Toronto. In September, the migrants moved to a shelter. The federal and Ontario governments eventually stepped up to offer funds to supporting asylum-seekers, refugees, and at-risk people. But the money won’t be enough for long, especially since Canada’s housing crisis shows no signs of abating.
With elections around the corner for both countries, leaders on both sides of the border will be under pressure to speedily address housing prices and growing shelter occupancy, particularly as migration picks up. We’re watching to see how national and local leaders navigate this growing crisis and fight to resist a local backlash.
One is fighting to keep his job; the other just resigned.
US House Speaker Kevin McCarthy is trying to navigate between the shoals of the Democrats and far-right Republicans. His hold on the speakership was tenuous from day one, but with a government shutdown looming, and a continuing resolution to keep it operating seemingly out of reach, at least for now, he’s facing a tough struggle to hold onto the gavel.
North of the border, House of Commons Speaker Anthony Rota resigned on Tuesday after welcoming Nazi war veteran Yaroslav Hunka to parliament, calling him “a Canadian hero” and “a Ukrainian hero” and thanking him for his service.
Hunka was in the visitor’s gallery during Volodymyr Zelensky’s speech to the joint session of parliament. Rota introduced Hunka as having fought against Russia during World War II, apparently unaware this meant he had fought for Nazi Germany. Rota apologized and took responsibility for the invitation before resigning.
On Wednesday, PM Justin Trudeau offered his own apology for the harm caused by Hunka’s visit. The House of Commons will choose a new speaker next Tuesday by secret ballot.
We’re watching to see if a new Canadian speaker can restore trust and authority to the speakership – and maybe a bit of decorum in the raucous House. By then, we’ll likely know whether McCarthy is close to getting his far-right caucus on side to pass the Senate-drafted continuing resolution and how long the US government shutdown – set to begin Saturday – will likely continue. Could this blow up and cost McCarthy his role as speaker?
Clayon Allen, US director for Eurasia Group, doesn’t think so. He says McCarthy “hasn’t lost his ability to govern the house,” though he’s facing the worst internal divisions and narrowest margin of control in “at least a decade.” While it’s “a bit of a parlor game in Washington to speculate about McCarthy’s downfall … the risk is somewhat overstated,” since his removal would require majority support, including all Democrats.
Joe Biden has big plans to supercharge the US electric vehicle industry. He wants half of all new cars sold in the US to be electric by 2030 as part of his bigger goal of putting the country on track to be carbon neutral by 2050.
But as admirable as it may be from a climate policy perspective, Biden’s EV agenda is also getting him in trouble with other policy priorities.
First, the unions. As we previously wrote, Biden this week joined the picket line with the United Auto Workers union, which is striking for the first time against all three major American automakers.
It was an unprecedented move for a sitting president, meant to reinforce his image as “Union Joe” ahead of the 2024 elections. As he knows, winning the industrial Midwest will be important if he wants to win the White House again.
But part of the reason the UAW is on strike in the first place is because of the rapid rise of the EV industry, which generally requires less human labor and is so far led by non-unionized companies like Tesla, where UAW leaders say the labor standards are lower. To UAW workers, a bigger EV industry looks like a threat to their job security.
Second, China policy. One obstacle to greater uptake of EVs in the US is that they’re still more expensive to buy than comparable gas-powered cars. To solve that problem, the Biden administration has provided $7,500 subsidies to consumers who purchase EVs from specific automakers.
But there’s a catch — starting next year, that subsidy won’t apply to any EVs made with components supplied by US rivals. And the country that happens to produce EV batteries most cheaply is (you guessed it) also Washington’s number one rival: China!
Ford, for example, has staked its EV future on a new $2 billion plant that will make batteries with technology licensed from China. The factory is a crucial part of the company’s strategy to compete in the EV market, and it would also help the Biden administration meet those ambitious EV targets.
But China hawks in Washington say using Chinese technology in an American EV factory is a self-own. After all, what good is it to meet the Biden administration's stated objective of “bringing supply chains home” if that means bringing China into the house?
Ford’s crosstown rival GM, wary of losing ground to Ford in the EV race, has picked up this argument, lobbying the administration to adopt the strictest possible interpretation of the subsidy restrictions, according to the Wall Street Journal.
All of this puts Union Joe, Green Joe, and China Hawk Joe in a three-way squabble: People can’t buy EVs unless they are cheaper, but they can’t get cheaper (for now) without Chinese technology, but they can’t get Chinese technology without tripping up the policy of NOT using Chinese technology.
The German government on Wednesday announced that authorities will start conducting “flexible spot checks” on border crossings from Poland and the Czech Republic to address an influx of asylum-seekers who have sought to enter the country in recent months.
This comes after Berlin recently joined Italy’s right-wing government in declaring that both countries had reached the “limits of [their] capacity” to take in migrants.
For context, around 204,00 migrants – mostly from Syria, Afghanistan, Turkey, and across Africa – requested asylum in Germany within the first eight months of this year, a 77% jump from the same period in 2022.
But why is the center-left government of Chancellor Olaf Scholz toughening its stance?
This comes just weeks before Germans in Bavaria and Hesse head to the polls in regional elections, and polls show that tough-on-migrant messages are resonating with voters.
In Bavaria, for instance, Germany’s second most populous state, Scholz’s Social Democratic Party is polling at just 9%. Meanwhile, nationally, messaging about border safeguarding has been a boon for the far-right Alternative for Germany Party, now second in an average of national polls.
Facing growing pressure to crack down on asylum-seekers has also brought Berlin head-to-head with Warsaw: At a rally in Bavaria over the weekend, Scholz took aim at Polish officials who had allegedly issued EU visas to Asian and African nationals in exchange for bribes.
Most of the world thinks of the Maldives as either a dream vacation spot or one of the first countries likely to slip beneath the waves as climate change raises sea levels.
But the governments of China and India think of the Maldives as a strategic prize in their intensifying competition with one another.
That’s because this nation of 520,000 people spread across nearly 1,200 coral islands spanning 35,000 square miles of the Indian Ocean straddles East-West shipping lines of vital interest to both countries.
On Saturday, voters in the Maldives will head to the polls for a second-round presidential runoff featuring President Ibrahim Mohamed Solih, who has favored closer ties with India, and opposition candidate Mohamed Muizzu, who argues for better ties with China. Both countries have invested hundreds of millions in infrastructure projects across the archipelago nation in hopes of boosting their influence with its government.
This weekend’s election is just the latest chapter in a long-running story of great-power competition.
Both candidates say they favor good relations with both giant neighbors, but Muizzu has scored political points by accusing Solih of inviting Indian forces onto Maldives territory. For now, Muizzu is favored to win.
As autoworkers walk picket lines in 21 states, President Joe Biden and former President Donald Trump are both in Michigan, the heart of the American auto industry, trying to woo union workers. Both men hope to win support from voters in Michigan, Wisconsin, and Pennsylvania, three states with large numbers of union members that proved decisive in both the 2016 election of Trump and the 2020 election of Biden. That’s where the similarity in their messages ends.
On Tuesday, Biden told members of the United Auto Workers, a powerful labor union, that he stands with them in their fight with automakers for better pay and working conditions. This evening in a Detroit suburb, Trump will tell union members that Biden is lying to them about their true enemy: It’s not their employers who are cheating them but the leaders of their unions, who are in league with woke liberals and a fake environmental agenda that will kill their jobs, allowing foreign countries (mainly China) to take advantage of America and its workers.Meanwhile, 2,300 miles away in Simi Valley, California, Florida Gov. Ron DeSantis, entrepreneur Vivek Ramaswamy, former Vice President Mike Pence, former South Carolina Gov. Nikki Haley, South Carolina Sen. Tim Scott, former New Jersey Gov. Chris Christie, and North Dakota Gov. Doug Burgum will debate before the diminishing number of Republican voters still looking for a Trump GOP alternative. The debate begins Wednesday at 9 p.m. ET and will air live on the FOX Business and Univision cable networks.