fortune--2020-01-09--Democrats Get War Powers Resolution Approved and Plan Large Protests, But Are Still Largely Unable t

Democrats Get War Powers Resolution Approved and Plan Large Protests, But Are Still Largely Unable to Stop Trump on Iran

As President Donald Trump forges ahead with confusing but brawny messaging around his plans to continue military pressure on Iran, Democrats and anti-war protesters remain relatively powerless in their actions to prevent the impending march toward more conflict in the Middle East.
Congress, led by Democratic Speaker Nancy Pelosi, voted Thursday on a resolution to stymie Trump’s ability to take further military action in Iran without congressional approval, a vote that is at best symbolically potent and at worse pointless: The bill very likely will be squashed in the Senate and lacks the support in Congress to override a veto by the president.
Large anti-war protests are also planned around the nation Thursday evening (at least 250 in 42 states), which will certainly be a show of force and might even illicit some tweets from the President, but will unlikely do anything but galvanize those who are already against further action in Iran.
A call to publicize the march Wednesday evening featured speeches from presidential candidates and Senators Bernie Sanders (I-Vt.) and Elizabeth Warren (D-Mass.), but Rahna Epting, election program managing director at MoveOn, warned protesters that “this is a long-term campaign, and something we’ll need to do for a while in order to push this administration away from a march to war and an aggressive foreign policy and back towards progressive diplomacy.”
Holding the President accountable for war, she said, would likely best be done at the ballot box 10 months from now, adding that we still “need to make sure that those in Congress do everything they can to prevent him from escalating this and pull us back from the brink of war.”
Jamal Abdi of the National Iranian American Council agreed that “the best way to hold Trump accountable is in November,” and “while we’re going to do everything can on the Hill, it’s obviously going to be tough with a Republican Senate.”
On the Hill, Democratic talking points were also lackluster.
“We’re not hopeless,” former presidential candidate and California Congressman Eric Swalwell said on MSNBC Thursday afternoon. Swalwell once again stressed the “power of the ballot box” and said that Congress would continue to hold the president accountable by using subpoena power to get those associated with the Trump administration to testify on Iran.
Others focused on feelings. Senator Tim Kaine (D-Va.) told the press that the general attitude of the Trump administration toward Congress was “offensive.” According to Kaine, key administrators told senators and representatives that they did not need to consult with Congress before attacking and had a general “attitude of dismissiveness.”
On a call ahead of mass protests, Senator Warren stressed the importance of speaking up to say, “We do not want another war in the Middle East, we do not want another war with Iran,” and that “war with Iran would be bad for us bad for region and bad for the world.”
Sanders, meanwhile, cited his long term insistence that the Senate limit executive war powers, but did note that he’s been defeated in the past. Sanders chided both Democratic and Republican lawmakers for getting themselves into this current situation.
“I will be working to make sure we pass a War Powers Act which makes it clear that the constitution says it is I the Congress, not the President, who determines who goes to war,” he said. “I’m afraid Congress has forgot about that, under Republican and Democratic administrations.”
The Trump administration, meanwhile, has deployed key surrogates to fight against Pelosi by proposing a complete end to the War Powers Resolution, which was enacted in the midst of the Vietnam War in 1973 and requires Congress to approve of any war or act of war unless there is a national emergency “created by attack upon the United States, its territories or possessions, or its armed forces.”
The resolution is considered a key check of executive power by the legislative branch, but has proven to be relatively ineffective. Trump has the ability to veto legislation passed under the War Powers Act, and no Congress has ever been able to get the supermajority vote required to overturn a President’s veto and successfully stop war actions.
Still, Trump’s former national security adviser John Bolton tweeted Thursday that “the 1973 War Powers Resolution is unconstitutional. It reflects a fundamental misunderstanding of how the Constitution allocated foreign affairs authority between the President and Congress.” He concluded that “the Resolution should be repealed.”
Sarah Huckabee Sanders, the President’s former press secretary, took to Fox & Friends Thursday morning to add that she couldn’t “think of anything dumber” than authorizing Congress to declare war. “They can’t seem to manage to get much of anything done. I think the last thing we want to do is push powers into Congress’ hands and take them away from the President,” she said.
The Trump administration’s aggression against the act does show that there’s a bit of fear that Congress could be effective, at least in pushing public perception.
Two key Senate allies of Trump, Mike Lee (R-Utah) and Paul Ryan (R-Ky.), spoke out after a White House briefing on Iran.
“It was probably the worst briefing I’ve seen at least on a military issue in the nine years I’ve served in the United States Senate,” said Lee of the White House’s justification of the attacks. “I find this insulting and demeaning,” he added, saying he would vote with Democrats on the war powers resolution. “That briefing changed my mind.”
Ryan told the press that “today, this is Senator Lee and I saying we are not abdicating our duty.”
More must-read stories from Fortune:
—Donald Trump and the power of incumbency
—Congress confronts its powerlessness on Iran
—The wealthiest members of Congress—and how they made their millions
—USPS could privatize as early as next year
—2020 Crystal Ball: Predictions for the economy, politics, technology, and more
Get up to speed on your morning commute with Fortune’s CEO Daily newsletter.


fortune--2020-01-09--The House Just Approved a War Powers Resolution to Limit Trump’s Military Actions

Why This 20-Year-Old Apprentice at Bosch Chose to Work First and Get Her Degree Later

Reigniting a debate over who has the power to declare war, the Democratic-controlled House on Thursday approved a resolution asserting that President Donald Trump must seek approval from Congress before engaging in further military action against Iran.
The war powers resolution is not binding on the president and would not require his signature. But House Speaker Nancy Pelosi nonetheless insisted it “has real teeth” because “it is a statement of the Congress of the United States.”
The measure will “protect American lives and values” by limiting Trump’s military actions, Pelosi said. “The administration must de-escalate and must prevent further violence.”
The House passed the measure, 224-194, with almost no Republican support. A similar proposal by Sen. Tim Kaine, D-Va., faces an uphill fight in the GOP-run Senate. Kaine’s efforts received a boost Thursday as Republican Sen. Todd Young of Indiana, an ex-Marine, said he might support the war powers measure. Two other Republican senators said Wednesday they would back Kaine’s plan.
“We are members of a separate and distinct branch of government. It is our duty not to take anyone’s word for things as we are dealing with matters of life and death,” Young said, adding that he wished Trump administration officials had provided more intelligence information during a briefing Wednesday on a U.S. drone strike that killed a top Iranian general.
Pelosi, in announcing the House vote, called the killing of Gen. Qassem Soleimani “provocative and disproportionate.”
Louisiana Rep. Steve Scalise, the No. 2 House Republican, denounced the Democratic measure as little more than “a press release designed to attack President Trump,” while House Minority Leader Kevin McCarthy of California called it a ”meaningless vote” on a measure that will never be sent to the president or “limit his constitutional authority to defend the American people.”
The House vote came a day after the Trump administration briefed lawmakers on its actions in Iran. Democrats and several Republicans called the briefings inadequate, adding that officials did not provide enough details about why the attack was justified.
Vice President Mike Pence said Thursday that Soleimani “was traveling the region making plans to bring an attack against American personnel and American forces.” He said it was not possible to share full details of the intelligence with lawmakers.
“When it comes to intelligence we have to protect sources and methods, there’s only certain amount we can share with every member of Congress,” Pence said on ABC’s “Good Morning America.” “But those of us who have seen all the evidence know that there was a compelling case of imminent threat against American personnel.”
Trump said Thursday that he “had calls from numerous senators and numerous congressmen and women saying it was the greatest presentation they’ve ever had.”
Referring to criticism by GOP Sens. Mike Lee and Rand Paul, Trump said: “They want information that honestly I think is very hard to get. … It really had to do with sources and information that we had that really should remain at a very high level.”
Lee, a conservative from Utah, said the briefing by Secretary of State Mike Pompeo and other officials was “probably the worst briefing I’ve seen, at least on a military issue,” in the nine years he’s served in the Senate.
Paul, of Kentucky, said administration officials justified killing Soleimani based on the 2002 authorization of force in Iraq. “That is absurd. That’s an insult,” he said.
Pelosi scheduled the House vote after Iran retaliated for the Soleimani killing by launching missiles at two military bases in Iraq that house American troops. No casualties were reported.
The five-page resolution says “Congress hereby directs the President to terminate the use of United States Armed Forces to engage in hostilities in or against Iran or any part of its government or military” unless Congress declares war on that country or enacts legislation authorizing use of force to prevent an attack on the U.S. and its forces.
The resolution’s sponsor, freshman Rep. Elissa Slotkin, D-Mich., said it is intended to “make clear that if the president wants to take us to war, he must get authorization from Congress.”
If loved ones are going to be sent to fight in a protracted war, “the president owes the American people a public conversation about why, and for what ends,” said Slotkin, a former CIA analyst and Pentagon official who served in Iraq.
Members of Congress have a constitutional responsibility to uphold in authorizing use of military force, Slotkin said, adding, “We are owed concrete, specific details on strategy.”
Trump did not consult with congressional leaders ahead of the attack that killed the Iranian general and afterward sent Congress a notification explaining the rationale, but kept it classified.
Congress has allowed its war powers role to erode since the passage of Authorization for Use of Military Force in 2001 to fight terrorism after the 9/11 attacks, and passage of another AUMF for the invasion of Iraq in 2002.
Fallout from those votes deeply divided Congress and the nation, with many lawmakers, particularly Democrats, now saying they were mistakes. Yet Congress has been paralyzed on the question of whether to repeal or change those authorities.
Trump, facing one of the greatest tests of his presidency, said Wednesday that Iran appeared to be “standing down” and said the U.S. response would be to put in place new economic sanctions “until Iran changes its behavior.”
The strikes by Iran had pushed Tehran and Washington perilously close to all-out conflict and put the world’s attention on Trump as he weighed whether to respond with more military force.
Republicans have largely supported Trump’s actions, saying the president was well within his power to take out Iran’s architect of proxy operations against Americans in the Middle East. The U.S. considered Soleimani a terrorist.
Democrats were unconvinced that the threat posed by Soleimani was imminent or that other alternatives to the killing were pursued in good faith. By not disclosing many details of the threat, Trump was asking the American public to trust the very intelligence reports he has often disparaged, Democrats said.
He called Kaine’s resolution a “mechanism to force us to debate this.”
More must-read stories from Fortune:
—Donald Trump and the power of incumbency
—Congress confronts its powerlessness on Iran
—The wealthiest members of Congress—and how they made their millions
—USPS could privatize as early as next year
—2020 Crystal Ball: Predictions for the economy, politics, technology, and more
Get up to speed on your morning commute with Fortune’s CEO Daily newsletter.


fortune--2020-01-10--Boeing’s Ex-CEO Was Denied Severance, but Still Walked Away With About $80.7 Million

Jobs Report Pushes the Dow Above 29,000 For the First Time Ever—But Can ’ t Keep It There

Former Boeing Chief Executive Officer Dennis Muilenburg won’t get severance and must forfeit stock awards worth tens of millions of dollars after his botched handling of two deadly plane crashes ended a decades-long career at the company.
He forfeited unvested equity awards that could have been worth as much as $31 million if certain targets had been exceeded, Chicago-based Boeing said Friday in a regulatory filing. Muilenburg, 56, also won’t receive a bonus for 2019.
Still, he gets to keep awards and stock options that had already vested, along with his pension and deferred pay—totaling as much as $80.7 million, according to calculations by Bloomberg. By contrast, Boeing set aside $50 million to compensate the families of crash victims.
The loss of some awards and denial of severance sends a strong signal that the board lost confidence in the once-heralded CEO.
It was a swift fall for Muilenburg, whose 34-year career unraveled last year in the aftermath of the accidents involving the firm’s 737 Max jetliner, which killed 346 people. The crashes prompted a global flight ban of the aircraft, damaged the planemaker’s reputation, and lopped more than $50 billion off its market value.
“Dennis received the benefits to which he was contractually entitled,” Boeing said in an emailed statement. “We thank Dennis for his nearly 35 years of service.”
Lost confidence
Muilenburg tried for months to help the firm regain its footing. But directors lost confidence after he struggled to defend Boeing before U.S. lawmakers, failed to repair its relationship with the Federal Aviation Administration, and repeatedly underestimated the time needed to get the grounded airplanes back in operation.
In December, the company was publicly rebuked by FAA head Steve Dickson and also said it would temporarily halt production of the planes. Then came the embarrassing failure to dock its Starliner space capsule with the International Space Station. Days later, the board voted to dismiss Muilenburg.
David Calhoun, a General Electric veteran who has been on Boeing’s board for a decade, was named CEO effective Jan. 13. The board granted him $10.9 million in annual target compensation, and two other awards worth a combined $17 million, one of them tied to operational milestones that include a “full safe return to service of the 737 Max,” according to the filing.
Public-company executives typically don’t receive severance benefits if they’re fired because they violated the firm’s policy or broke laws. Terminations and resignations prompted by poor job performance or loss of confidence among directors, however, can fall in a gray area.
In such instances, boards sometimes strike bespoke deals with departing executives, allowing them to collect some or all of their severance and keep some of their previously granted stock awards—arrangements that can amount to tens of millions of dollars. In exchange, the executive typically must promise not to sue or publicly criticize the company.
But boards can also elect to withhold exit payments—a move that some may interpret as a public rebuke.
Previous awards
Muilenburg didn’t have a fixed-term employment agreement with Boeing, but he was entitled to receive a year’s salary and bonus and immediate vesting of his outstanding stock awards if he was laid off.
But he hardly left empty-handed. Boeing allowed him to keep some portions of previously granted awards, stock options and money he’s accumulated in his pension and deferred compensation account, which functions as super-sized 401(k).
The awards were worth about $33.7 million as of Friday’s close, assuming the company tops certain performance thresholds. His options would net him $18.5 million if he exercised them and immediately sold the shares. And his pension and deferred pay amounted to $28.5 million as of Dec. 31.
In all, it adds up to about $80.7 million.
Boeing also disclosed that Kevin McAllister, who led the firm’s commercial airplanes division until he was fired on Oct. 22, had to give up awards and dividends worth approximately $52.9 million. But he did receive $14.8 million to make him whole for a pension benefit he forfeited when he left GE.
More must-read stories from Fortune:
—Greenpeace ranks China’s tech giants on renewable energy
—Facebook deepfake video ban may set off ‘cat and mouse’ game
—Why there are so many scooters in Los Angeles
—What a $1,000 investment in 10 top stocks a decade ago would be worth today
—Missile strike vs. cyberattack: How Iran retaliates
Catch up with Data Sheet, Fortune’s daily digest on the business of tech.


fortune--2020-01-10--There’s Been a Troubling Rise in Alcohol Related Deaths. But Why?

This is the web version of Brainstorm Health Daily, Fortune’s daily newsletter on the top health care news. To get it delivered daily to your in-box, sign up here.
Happy Friday, readers.
A new study published in the journal Alcoholism: Clinical & Experimental Research raises significant questions about deaths related to excess drinking.
Here’s the long and short of it: “The number of alcohol‐related deaths per year among people aged 16 [and over] doubled from 35,914 to 72,558 [between 1999 and 2017], and the rate increased 50.9% from 16.9 to 25.5 per 100,000,” according to the researchers from the NIH’s institute that focuses on alcohol abuse.
There’s more—just two years ago, ” 2.6% of roughly 2.8 million deaths in the United States involved alcohol,” according to the study.
A lot of this is linked to liver disease and overdoses, the researchers say. And certain demographics are affected much more deeply than others, including men between the ages of 45 and 74 and Alaskan natives.
This is one of those fundamental problems of a lack of data and how certain health scourges may affect one group disproportionately over another. As the study authors themselves say, it’s something to keep a serious eye on.
Have a great weekend, and read on for the day’s news.
Sy Mukherjee
sayak.mukherjee@fortune.com
@the_sy_guy
DIGITAL HEALTH
Another study suggests AI could be useful in scanning medical images. A study published in the journal Lancet finds that artificial intelligence could be an overall benefit for sussing out disease in prostate cancer patients. We've been keeping a record of (and a critical eye towards) these studies—but the clear pattern to date seems to be that radiology is one of the more promising avenues for our robot overlords in medicine. (The Lancet)
INDICATIONS
The AbbVie Allergan deal is in its final stages. FiercePharma reports that AbbVie is on the verge of locking up its deal to buy Botox maker Allergan (at least when it comes to EU antitrust concerns). A few key assets may be on the chopping block—including the experimental risankizumab and the rare disease, cystic fibrosis treatment Zenpep. At this point, though, it seems like the deal is going to sail through. (FiercePharma)
THE BIG PICTURE
Vaping-related deaths rise to 57, and illnesses continue to spike. The Centers for Disease Control (CDC) reported on Thursday that vaping-related illnesses had spiked to more than 2,600, including 57 deaths, with the "vitamin E acetate" compound as the "chemical" of concern among many of the cases. (Reuters)
REQUIRED READING
The Pros and Cons of Sharing Your Salary, by Kristen Bellstrom
Why CEOs are Pessimistic About 2020 Business Outlook, by Susie Gharib
Facebook's Political Ad Policy Puts the Burden on Users, Not Candidates, by Alyssa Newcomb
Sign up for other Fortune newsletters.


fortune--2020-01-10--Experts Question Amazon’s Warning About Honey, PayPal’s E-Commerce Shopping Tool

PayPal Holdings made a big bet in November with its $4 billion acquisition of Honey, a web browser extension that helps online shoppers find the lowest prices. Now Amazon is warning customers not to use the tool.
Shortly before Christmas, Amazon said Honey posed a security risk, which was reported Thursday by Wired. The warning perplexed some online shopping experts since the tool has been available for several years and Amazon makes no similar warnings about other browser extensions such as price tracker camelcamelcamel.com.
“Amazon’s fight against Honey while letting a dozen other tools go on is confusing,” said Juozas Kaziukenas, founder of New York e-commerce research firm Marketplace Pulse. “I don’t buy their security risk message. They just want Honey and PayPal to be squashed.”
There is no love lost between Amazon and PayPal, which spun off from e-commerce competitor EBay in 2015. Amazon has its own online payments service that competes with PayPal and doesn’t allow PayPal payments on its site.
PayPal executives were surprised by the Amazon warning about Honey and are communicating with Amazon to resolve it, according to a person familiar with the situation, who requested anonymity to discuss an internal matter. One possibility for PayPal: alerting federal antitrust regulators since the Honey warning could be interpreted as Amazon using its size and clout to harm a competitor. Regulators have encouraged Amazon rivals to provide information about potential anticompetitive practices.
If PayPal thinks Amazon’s warning is unwarranted, it can accuse Amazon of deceptive practices, requiring Amazon to explain why it did so.
“As markets become more concentrated and firms grow larger, we are seeing more attempts to protect market positions and eliminate rivals through deceptive practices,” said Diana Moss, president of the American Antitrust Institute.
Just before Christmas, banners started popping up on Amazon that told shoppers to be cautious when using Honey, calling it “a security risk” and “to keep your data private and secure, uninstall this extension immediately.”
“Our extension is not—and has never been—a security risk and is safe to use,” a Honey spokesperson said. “We have a team dedicated to ensuring the security of our users’ information and we regularly engage expert third-party security firms to assess our security protections. If ever an individual or independent researcher contacts us about a potential vulnerability, we engage with that person to understand and remedy the issue (if there is one).”
Los Angeles-based Honey has more than 17 million users, who use the extension to save money at Amazon and other online retailers.
Amazon shoppers using Honey could be less inclined to follow Amazon suggestions, which don’t always direct shoppers to the lowest-priced product since it considers other factors such as shipping speed. Honey’s use could undermine Amazon’s own algorithm, diminishing the company’s power of suggestion over its shoppers. Amazon has been accused of favoring its own products over competitors, which the company disputes.
In an emailed statement, an Amazon spokeswoman said: “Our goal is to warn customers about browser extensions that collect personal shopping data without their knowledge or consent such as customer name, shipping and/or billing address and payment method from the checkout page.”
More must-read stories from Fortune:
—Greenpeace ranks China’s tech giants on renewable energy
—Facebook deepfake video ban may set off ‘cat and mouse’ game
—Why there are so many scooters in Los Angeles
—What a $1,000 investment in 10 top stocks a decade ago would be worth today
—Missile strike vs. cyberattack: How Iran retaliates
Catch up with Data Sheet, Fortune’s daily digest on the business of tech.


fortune--2020-01-10--Jobs Report Pushes the Dow Above 29,000 For the First Time Ever—But Can’t Keep It There

Boeing ’ s Ex-CEO Was Denied Severance , but Still Walked Away With About $ 80.7 Million

The Labor Department’s jobs report for December was a so-so-affair, strong enough the Dow Jones Industrial Average briefly up above 29,000 for the first time. And just a little too meh to keep it there.
December nonfarm payrolls increased by 145,000 last month, below the 160,000 consensus figure economists had forecast. The unemployment rate held firm at a 50-year low of 3.5%. Average hourly earnings rose 2.9% year over year, which was also below the 3.1% forecast by economists.
The Dow closed down 0.5% at 28,823.77 while the S&P 500 fell 0.3% to 3,265.35. In short, investors are content to keep the stock indexes close to record highs, even with a slightly disappointing jobs report and following several days of a U.S.-Iran crisis that the stock market mostly shrugged off.
New jobs in December may not have matched the impressive gains in the previous few months, but there was little in the data to indicate that the Federal Reserve would consider changing course, economists said.
“In general, there was mostly good news,” says Ben Ayers, senior economist at Nationwide. “Job growth did slow a little and wage growth was a little disappointing. In fact, for the past six months we haven’t seen much of an upward push on wages. But there’s probably not much reason to change interest rates for some time.”
For all of 2019, the Labor Department said, payroll employment rose by 2.1 million, down from a gain of 2.7 million in 2018. And while last year may not have been one of the strongest in terms of job growth, it marked the ninth straight year in which the U.S. economy added at least 2 million new jobs.
Ayers noted that 2018’s gain in new jobs was particularly strong because it followed the changes to tax laws that Congress passed in late 2017. “The 2.1 million new jobs that we saw in 2019 is more in line with the trend that the economy was seeing before that one-time tax bump,” he says.
In other words, as the Dow continues its slow, steady march toward 30,000, it’s going to need some more positive news. But given the market’s resilience in the past several months in the face of a U.S.-China trade war, Brexit drama and fears of a recession ahead, the Dow may well get there soon enough.
As investors plot out their investment strategies for 2020, there are still plenty of uncertainties: the threat of geopolitical crises flaring up, the upcoming Presidential election, and the continued uncertainties surrounding Brexit and trade tensions. But on the whole, many people are starting the new year with a sense of cautious bullishness.
“Even though there are a lot of reasons to be concerned about the economy and the markets, 2020 is setting up to be a potentially good year for equities again,” says Jimmy Lee, CEO of the Wealth Consulting Group, an investment advisory firm.
The sense of caution that has accompanied the stock rally in the past year has also kept it from overheating. During and even after the abrupt stock selloff in the final months of 2018, many investors pulled money out of the stock market.
“That correction spooked a lot of people and sent a lot money out of the stock market, so many retail investors missed out on the rally last year,” Lee says. “So if there’s a lot of nervousness and trepidation among retail investors about the stock market, it can actually be a good sign. When the market gets heated up with a lot of retail investor money, they typically invest at the top. And we haven’t seen that yet.”
If and when the Dow does reach the 30,000 mark, it’s unlikely to be a dot-com-like mania that pushes it there. Rather, it could be the same old recipe we saw last year: One part strong-but-not-great economy, one part caution in the face of uncertainty. Mix well together, then repeat.
More must-read stories from Fortune:
—How Nissan-Renault became a ‘masquerade of an alliance,’ according to Ghosn
—Investors see a 2020 recession coming—but think they’ll make money
—As investors shrug off Iran concerns, analysts find the complacency ‘disconcerting’
—Laws meant to close down tax havens and shut loopholes could have opposite effect
—What a $1,000 investment in 10 top stocks a decade ago would be worth today
Subscribe to Fortune’s forthcoming Bull Sheet for no-nonsense finance news and analysis daily.


fortune--2020-01-10--Carlos Ghosn’s Net Worth Takes a Hit as Escape, Life on the Run Prove Costly

Life on the run is proving expensive for Carlos Ghosn.
The cost of his escape included $14 million in forfeited bail money while the operation that saw him celebrate New Year’s Eve in Beirut could have cost $15 million or more.
That includes $350,000 for the private jet that spirited the former auto executive from Osaka to Istanbul and millions of dollars for his multicountry extraction that would have taken a team of as many as 25 people half a year to plan, according to a private security expert who said he wasn’t involved and asked not to be identified given the nature of the operation.
Such outflows have seen Ghosn’s fortune shrink by 40% since he was arrested more than a year ago at Tokyo’s Haneda Airport, according to estimates by the Bloomberg Billionaires Index. His fortune is now calculated to be about $70 million, down from around $120 million at the time of his first court appearance a year ago.
‘Mission impossible’
In fiery, freewheeling form at a two-and-a-half hour press conference in Beirut on Wednesday, Ghosn, 65, repeatedly proclaimed his innocence against allegations he understated his income and raided corporate resources for personal gain, accused Japanese prosecutors, government officials and Nissan Motor Co. executives of conspiring to topple him, and insisted he would clear his name.
“I am used to what you call mission impossible,” he said in response to questions from the assembled reporters. “You can expect me in the next weeks to take some initiatives to tell you how I’m going to clear my name.”
That might include a tell-all book. Ghosn plans to publish the story of his arrest, according to a report by Japanese public broadcaster NHK.
His downfall has already seen him lose millions in payouts. Last year, Nissan canceled retirement and stock-linked compensation and Renault SA said he won’t benefit from a non-compete agreement he signed in 2015 and stock-based payments that were conditional on his staying at the company. Many of the charges against him center on retirement payments, totaling more than $140 million, which he hadn’t yet received.
French investigations
That may be just the start. French investigations examining the possible misuse by Ghosn of Renault’s money to host lavish parties and pay consulting fees are at a preliminary stage. The former auto executive also agreed to pay $1 million to settle a civil complaint from the U.S. Securities and Exchange Commission, which said he failed to properly disclose potential retirement payments, without admitting or denying wrongdoing.
At his press conference, Ghosn claimed he had done nothing untoward in hosting an event at the Palace of Versailles. Regarding the SEC fine, Ghosn’s lawyers said previously, “We are pleased to have resolved this matter in the U.S. with no findings or admission of wrongdoing.”
Ghosn’s U.S. law firm, Paul Weiss Rifkind Wharton & Garrison LLP, declined to comment on Bloomberg’s wealth estimates or on the SEC settlement. Ghosn’s Lebanese lawyer also declined to comment.
Nissan is looking at bringing legal action against Ghosn in Lebanon, people familiar with the company’s plans said, to recover money it claims he used improperly. The carmaker is trying to evict him from the pink villa in Beirut to which he still has access. Nissan purchased it for $8.75 million, renovated it and furnished it for him, according to a person familiar with the matter.
“Ghosn’s flight will not affect Nissan’s basic policy of holding him responsible for the serious misconduct uncovered by the internal investigation,” the Yokohama-based automakeer said on Tuesday.
Read: Carlos Ghosn is now a fugitive in exile. Here are his legal options, according to experts
Authorities may be looking to seize some of his assets. In Switzerland, where Ghosn reportedly banks with Julius Baer Group Ltd., Swiss authorities received a legal-aid request from the Tokyo District Attorney’s Office a year ago, a spokeswoman for the agency that received the notice said. It examined the request before forwarding it to the Zurich prosecutor’s office in March. A spokesman for the Zurich prosecutor’s office declined to comment on the nature of the request or what they are doing with it.
At Japan’s request, Interpol issued a so-called Red Notice in Ghosn’s name, making it known to other law enforcement authorities that the country considers him a fugitive. Lebanese prosecutors have issued a travel ban for Ghosn and took his French passport, Lebanon’s justice minister, Albert Sarhan, said in an interview.
It’s not clear if any of Ghosn’s assets have been seized. In criminal court cases in Japan, a defendant’s assets cannot be confiscated until a court verdict is reached, according to Taichi Yoshikai, a law professor at Kokushikan University. Assets can only be frozen if they are linked to certain types of offenses, related mainly to organized crime, and a judge determines that they are likely to be seized in case of a guilty verdict, he added.There are exceptions in civil cases, but it’s unclear how this will be applied when a defendant is overseas, he said.
Wealth assumptions
The Tokyo District Public Prosecutors Office, which rarely makes public comments, posted an English-language statement on its website Thursday saying Ghosn had only himself to blame for his strict bail conditions. It vowed to bring him to justice in Japan. Ghosn had been “propagating both within Japan and internationally false information on Japan’s legal system and its practice,” Justice Minister Masako Mori said.
Renault declined to comment.
Bloomberg’s calculation of Ghosn’s net worth assumes none of his assets at the time of his arrest – which included shares in Renault and Nissan now valued at about $60 million – have been seized or sold.
Even if that is the case, the costs that come with being the world’s most famous runaway will continue to be formidable. Legal bills for fugitive Malaysian financier Jho Low came to $15 million, according to an October deal with U.S. federal prosecutors. Efforts to burnish Low’s reputation cost $1.1 million over seven months, according to the New York Times.
Such expenses are likely sizeable enough to pressure even a fortune as large as that of the Ghosn family.
Still, some costs may be lower than expected. The $350,000 contract for Ghosn’s Osaka to Istanbul flight was to be paid in two tranches. The charter company has so far only received the first half.
More must-read stories from Fortune:
—25 ideas that will shape the 2020s
—USPS could privatize as early as next year
—UPS’s $20 billion bet on e-commerce is paying off
—Airbnb copes with a bad trip on the road to a 2020 IPO
—The Trump administration is targeting anti-Trump Facebook users
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fortune--2020-01-10--Air France’s New Female Boss Has a Flight Plan Cleared for Take Off

Air France is off to a turbulent start to 2020. Unions in France are in a standoff with the French government over pension reforms and are threatening walkouts and strikes. But no matter how it all plays out, Air France’s new CEO plans to tough it out and run the entire flight schedule as planned.
This tough response says a lot about Anne Rigail, who was tapped for the airline’s top job a year ago. She is one of the few female CEOs to head up a major airline and when she took charge she said she was determined to transform Air France. She says she has a clear agenda of what needs to be done.
Air France is the number-one airline in France and together with its partner, KLM, it is one of the world’s largest carriers by revenue. But all is not well: it is not profitable, it has been losing customers to low-cost carriers and it has an aging fleet of planes.
“The first goal is to fix the fundamentals, the operational performance, punctuality, regularity. Simplify the fleet to be more economical and environmentally efficient,” Rigail says. “And we will have to tackle the efficiency of the organization. [Fewer] management layers.”
Already, Rigail has made big changes in modernizing Air France’s fleet. She is moving ahead with one of its biggest airplane orders in years, announcing the purchase of 10 new Airbus A350s. She also decided to phase out all of Air France’s massive Airbus 380 jumbo jets, saying they consume too much fuel and are no longer cost effective.
Rigail says these decisions are “totally critical” to her turnaround plans for Air France and especially for the airline’s goal of cutting carbon emissions by 50% by 2030.
In addition, Air France will add to its fleet of Boeing planes. One last 787 Dreamliner will be delivered in May. But Rigail notes that the grounding of the troubled Boeing 737-Max plane after the tragic crashes has brought fresh attention to safety issues.
“It’s an old lesson that safety comes with adapting to the new technologies and the behavior and the training,” she says. “We are focusing on our safety every day.”
Watch the video above for more.


fortune--2020-01-10--Brazil Beauty Company Natura Wants to Give Avon a Makeover

When Roberto Marques rang the opening bell at the New York Stock Exchange this week, he celebrated two big milestones. His Brazilian cosmetics company, Natura & Co, listed shares on the Big Board. Natura also publicized its acquisition of Avon Products. The deal price was only $2 billion, but the combination creates a huge cosmetics powerhouse. Natura & Co, which also owns the Natura, Aesop, and The Body Shop brands, is now the fourth-largest beauty company in the world, just behind L’Oreal, Estee Lauder, and Shiseido.
“Avon is a beautiful brand,” explains Marques about the rationale for buying the legendary company, founded in 1886. “We want to unleash, to celebrate that legacy of Avon again. We want people to be proud.”
Avon had been a corporate beauty icon for most of its 133-year history, but in recent years it struggled to stay in business as its revenues fell dramatically. Its 2018 profits plunged 188% from the year prior and many of its “Avon Ladies” sales representatives abandoned the company. A year ago, Avon sold its U.S. and Canadian operations to LG, South Korea’s consumer goods giant. Natura is buying Avon’s London-based international operations. Marques says that the Avon acquisition expands Natura’s global reach to 100 countries and he expects revenues of the combined company to top $10 billion.
Marques is betting that a “renaissance in direct selling” to consumers will reinvigorate Avon. Avon, of course, was famous for championing the door-to-door direct selling model with its catchphrase, “Ding Dong, Avon Calling.” Marques says the Avon merger creates a “powerful network” of 6.4 million sales agents, or what he prefers to call “relationship consultants.” He believes they will ring up sales by using social media digital tools like Instagram, Whatsapp, YouTube, and Facebook to connect with consumers.
“It’s our goal … to continue to evolve them,” Marques says of the famed Avon Ladies. “Not just to be the ‘Ding Dong,’ but to actually be the ‘Click Click,’ in a high-touch, high-tech way.”
When Marques talks about the goals of the Avon makeover, he goes beyond financial performance. He is a big believer in balancing profitability and sustainability. Natura evaluates the environmental impact of all its products, supports preservation of Brazil’s Amazon forests where the company derives many of the natural ingredients for its beauty products, and forbids animal testing. That commitment earned Natura the distinction in 2014 as the world’s largest, publicly traded B Corporation, a designation for companies that adhere to high standards of social and environmental performance.
“In our mind, we don’t want to just be maybe the best group or beauty company in the world,” says Marques. “Our aspiration is to become the best beauty group for the world.”
Watch the video above for more.


fortune--2020-01-10--Short-Sellers Took on Tesla and Elon Musk in 2019—and Lost Their Shirts

By the summer of 2019, some Tesla insiders had spent the previous 18 months selling off parts of their holdings to pocket millions. The stock, battered, sunk to a low of $185.16 on May 31.
But that was then. Shares have been consistently hitting new highs because of record vehicle deliveries last quarter and the start of production at the company’s factor in China. The stock closed on Thursday at $481.34, and those who held on made a boatload. CEO Elon Musk himself saw his paper profits hit $10.1 billion.
On the flip side are the short sellers—Musk’s nemeses who reaped profits during troubled periods for the car company, like when Musk got in trouble in 2018 for talking about taking the company private on Twitter and when he gave a revealing interview in the New York Times. The ensuing share slide netted the shorts a $1.2 billion gain. What has driven their zeal is a belief that Tesla lacks the production capability, cash flow, and profitability to sustain the massive valuations it’s been bestowed by the markets.
Right now, they’re wincing at their losses. But there’s a showdown still to come.
First, Musk. A Fortune analysis of Securities and Exchange Commission filings show he personally came into 2019 with 33,824,680 Tesla shares. He then purchased multiple times that amount in May as shares were falling in price and heading to a low. The purchases included a bundle of 102,880 shares at $243 each (buying at market rates as Musk likely tried to show confidence as share prices were slipping) and another 175,000 shares at a $31.17 option price. In December, Musk gave 17,000 shares to a charity, although the filing didn’t indicate the recipient. (Tesla did not respond to a request for the name of the charity before publication.)
To figure out how much Musk made since that 2019 low point, Fortune took each block of shares and multiplied the number by the share price appreciation between purchase date and January 9. For the bulk of the shares he came into 2019 with, the initial price, for the sake of consistency, was set to the low on May 31, 2019. The two sets of shares purchases in May were valued at their purchase prices, of course. Then Fortune subtracted the gift of 17,000 shares from the number of highest-priced shares. The table below shows the data.
The results showed Musk with a gain of $10.1 billion—$10,117,442,111.60 to be exact. It put his total “paper” wealth, based only on shares of Tesla and ignoring any other assets, at roughly $18.6 billion.
One potential drawback for Musk is that, according to the 2019 proxy statement, he has pledged 13,394,056 shares as “collateral to secure certain personal indebtedness,” or something under $6.4 billion. Still, quite the bump for the auto executive.
Selling Tesla short
Then there are the short-sellers.
The idea behind shorting stock is that investors can potentially make money through a speculation or hedge that the share prices will fall. The individual or institutional investor borrows shares, sells them, and watches the price. If it drops significantly, they purchase replacement shares for less money, returns the borrowed shares (with additional payment to the lender, who also wants a profit), and pockets the difference.
When share prices go up, however, the shorts lose money because it costs more to replace the shares. As the price keeps climbing, so do the losses. In theory, the amount of loss is unlimited.
Early in Tesla’s history as a company, shorting was more popular than today. The graph below shows the number of shorted shares (called the short interest) as a percentage of shares outstanding (the number of shares available for trading).
For those who have been shorting Tesla lately, losses have piled up as shares have climbed since early December 2019. According to the most current data from Bloomberg, the short interest are at 27.5 million, or 15.3% of total shares outstanding. (Data is released every two weeks.) That was down nearly 1.2 million from the previous two-week period.
Every dollar over the price at which investors shorted costs short sellers a dollar a share, or $27.5 million given the number of shares shorted. For example, between Monday’s close of $451.54 and Wednesday’s record high of $492.14, shorts collectively lost more than $1.1 billion.
“I put on a small short condition [Wednesday] that for an investment firm my sons and I run,” Brad Cornell, emeritus professor of finance at UCLA and managing director at global consulting firm BRG, tells Fortune. “We thought at $488 it was so wildly overvalued, how long could it go on?”
Given that his short position was on 1,000 shares and Wednesday closed at $492.14, that was a loss of $4,140. By the end of Thursday, however, Cornell and his sons were instead up $6,570 because the share price dropped to $481.34, which was below their purchase price at $488.
For a person or organization with a large portfolio, the shifts may not matter practically. However, it’s always possible to get a margin call, which means whoever has the short position must make up the difference between it and the current state of the shares. Call it a hedge on a hedge.
Cornell took a $500,000 short position on Tesla with a $25 million portfolio. “There’s cash in there and other things that cover the margin,” he says. “Even if this went to $750 [a share], we wouldn’t get a margin call but we’d have a very unpleasant loss of $260,000.”
The irony is that covering margin calls and closing short positions means buying stock, which increases demand and can help push share prices higher. Some of the pressure has likely come off over time. On October 15, 2019 the short interest was almost 37.2 million, according to Steve Sosnick, chief strategist at Interactive Brokers. The share price was $257.89.
“If those shorts hadn’t covered, they would be looking at a … loss of over $8 billion today,” Sosnick said in a message to Fortune. “Obviously many of those shorts covered, bringing the short interest down to 27.5 million only two months later.”
“Remember, there’s got to be a buyer for every seller,” Cornell says. “Musk owns a lot of stock and he’s not selling. You have a bunch of investor fans and they’re not selling. You’ve got to induce people to sell. That takes a bit of a run up in price.”
Sosnick thinks that pressure is limited. “The net buying of about 10 million shares is a drop in the bucket for a stock with average daily volume of about 6 million shares per day,” he says. “The real trigger for Tesla’s rally was a set of market friendly announcements that turned into a massive momentum rally.”
Despite the current highs, fueled by devoted investor-fans of the brand, the stock has seen big swings and the company has some critical fundamental weaknesses, making Tesla attractive to shorting. But as Cornell asked, how long can that go on?
That brings everyone back to the big question of how long the rally can last. Between Wednesday and Thursday, shares dropped 2.2% even though the Nasdaq, where Tesla is listed, was up about 0.8% over the same period.
Cornell, for one, is not giving up. At a current market cap of $95 billion, Tesla has to grow insanely to gain the revenues and profits its market size would seem to promise. “This company has to be as profitable as Porsche and as big [in sales] as VW in ten years so it has the huge cash flows in the future to justify the [current] market cap,” he points out.
The shorts may need the nerves of a race car driver to see that reality play out. And Musk? He’s got a lot of reason to break into dance.
More must-read stories from Fortune:
—Nissan-Renault became a ‘masquerade of an alliance,’ according to Ghosn
—Investors see a 2020 recession coming—but think they’ll make money
—Investors shrug off Iran concerns, analysts find the complacency ‘disconcerting’
—Laws meant to close down tax havens and shut loopholes could have opposite effect
—What a $1,000 investment in 10 top stocks a decade ago would be worth today
Subscribe to Fortune’s forthcoming Bull Sheet for no-nonsense finance news and analysis daily.


fortune--2020-01-10--What ‘Megxit’ Says About Britain’s Communities of Color

This is the web version of raceAhead, Fortune’s daily newsletter on race, culture, and inclusive leadership. To get it delivered daily to your inbox, sign up here.
While the world finds a creative way to help rescued animals in Australia, Hollywood assistants gear up for a fight, a sudden #Megxit doesn’t surprise everyone, and the BBC pledges to shake its elitist, white image.
But first, here’s your Friday week in review, in Haiku.
I’ve found comfort in
this unexpected call to
arms: Crafters Unite!
Injured animals
in Australia need pouches,
wraps, and carry bags.
You sew? You can help!
Why stop there? Let crafters send
knitted relief to
SCIF rooms and briefings,
calm the fat-shamers, royals,
politicos. Sounds
nice, right? A global
campaign of makers, soothing
a fiery world.
Have a safe and meaningful weekend.
Ellen McGirt
@ellmcgirt
Ellen.McGirt@fortune.com
On Point
If you want to know why Meghan Markle wanted out, ask a Black Briton Author Afua Hirsch says there's no point speculating about what caused the royal split. "If the media paid more attention to Britain’s communities of color, perhaps it would find the announcement far less surprising," she begins. Besides the obvious harassment by the tabloid press, there’s a new prime minister who traffics in openly racist speech, "some of which would make even Donald Trump blush," a nationalist Brexit scheme, and hostility toward immigrants. "Many of us are also thinking about moving," she says. But the abuse has been real. (I’d forgotten that the very first headline about Markle declared she was "(almost) straight outta Compton.")
New York Times
The BBC strives for socioeconomic diversity in its workforce and coverage It’s been a year since an internal review revealed that BBC employees felt the media outlet had an “overwhelmingly middle-class image” which reflects poorly on management practices and on-air coverage. Enter RAISED, which stands for Real Action in Socio-Economic Diversity, a new internal network tasked with making sure that people from all economic backgrounds are thriving in the workplace. The findings from the review was published last October in a report called, "Reflecting the Socio-Economic Diversity of the U.K." It revealed a tense culture. “Once inside the BBC, staff from working class backgrounds feel pressure to assimilate, to ‘fit in’ and feel that their career advancement has been hindered because they don’t have the right accent.” RAISED has a plan. Registration required.
Broadcast Now UK
Hollywood assistants demand a re-write of their job descriptions They’ve taken to meeting in large numbers, sharing horror stories, and making plans. These assistant gigs-to-bigwigs have always held an outsized promise for aspiring screenwriters, producers, and directors, but the low pay, long hours, and abuse make the job untenable for anyone who doesn’t already have a trust fund, a thick skin and/or a foot in the door. Now, they’re organizing, #MeToo style. "I just don’t think we can be silent on certain things anymore," says former assistant at ICM, Kiran Subramaniam.
New York Times
On Background
How a homecoming video produced by the University of Wisconsin created an uproar about race Three New York Times reporters were in the middle of interviewing University of Wisconsin-Madison students about a variety of things: Their aspirations, student debt, relationships, race, all the big topics. And then a video about the school was created and posted by the student-led homecoming committee—“a short, visual ode to school spirit”—as part of a series of events to celebrate Homecoming Week. Nearly every student in the video was white. There was an immediate backlash. Suddenly, the Times team had a new story to report. “To students of color, the homecoming video was a glimpse of what they experienced every day as they walked through campus,” they found. This tick-tock of events, including additional first-person commentary, shows how the school, already under fire for failing to address incidents of bias, struggled to manage what happened next.
New York Times
Two forgotten Georgia writers challenged white supremacy during Jim Crow Matthew Teutsch, the director of the Lillian E. Smith Center at Piedmont College, recalls two authors, now mostly unknown, who compelled him “to challenge the vine-choking beliefs about race that are deep within us." Frank Yerby, who was Black, Seminole, and white, was a romance novelist; his first book was published in 1946 and was an instant hit. The Foxes Of Harrow, a literary answer to Gone With The Wind, made Yerby the first African American ever to sell the film rights for a book. The film was subsequently nominated for an Oscar. Lillian Smith, who was white, is best known for her novel, Strange Fruit, but also published a radically liberal quarterly with her partner Paula Snelling from 1936 to 1945. She was mentioned in Martin Luther King’s “Letter From a Birmingham Jail,” as a Southerner who “grasped the meaning of this social revolution and committed themselves to it.”
The Bitter Southerner
Kurt Lewin, the founder of social psychology, was a refugee Psychology Today asks a poignant question: What if the U.S. had not let Kurt Lewin in? Lewin was a German Jewish refugee, and the only member of his immediate family to escape death in Nazi concentration camps. But he went on to be a founder of social psychology, management theory, and a contributor to an influential theory called "the interactionist perspective," a fascinating and more inclusive alternative to the “nature vs. nurture” idea of personality development. (Have you ever used the term "safe space"? You can thank Lewin.) The author then goes on to trace Lewin’s influence through a professional "genealogy" that describes his now wide-reaching impact on the field of human understanding. “One refugee and another and many others set in motion critical influences that made you who you are. The you that you now know would not exist without them,” he says.
Psychology Today
Quote
"The American cultural ideal of the self-made man, of everyone standing on his own feet, is as tragic a picture as the initiative—destroying dependence on a benevolent despot. We all need each other. This type of interdependence is the greatest challenge to the maturity of individual and group functioning."
—Kurt Lewin


fortune--2020-01-10--Alphabet’s Top Lawyer to Retire Following Questions on Conduct

David Drummond, the legal chief of Google parent Alphabet and a company veteran, stepped down following questions about his conduct at the technology giant.
Drummond, 56, will step down from his role on Jan. 31, according to a note he sent to colleagues on Friday. The company has not named a replacement, an Alphabet spokeswoman said. She confirmed that Drummond did not receive a pay package on exit.
“I believe that it’s also the right time for me to make way for the next generation of leaders,” Drummond wrote in the note, which Alphabet provided to Bloomberg News.
Drummond was Google’s first lawyer and ran the search giant’s legal and corporate development arms for years before shifting to parent company Alphabet in 2015.
Last year, Drummond was accused of having had a relationship with a female employee in the legal department. The woman, Jennifer Blakely, later came forward saying Drummond abandoned her and their child and repeatedly violated rules governing workplace relationships.
Drummond has said the two went through a difficult breakup and that he “never started a relationship with anyone else who was working at Google or Alphabet.” Axios reported in September that Drummond married another Google employee.
Alphabet’s board this year began investigating how misconduct matters were handled. The probe included a look into the behavior of Drummond. Accusations of misconduct by other senior Google executives sparked criticism that the company hadn’t done enough to reform a culture where powerful men weren’t penalized for inappropriate relationships or sexual misconduct. Thousands of Google employees worldwide walked off the job to protest in November 2018 after a report that Andy Rubin, a former executive, received a $90 million pay package following allegations of sexual harassment. Rubin has denied some of the charges.
Drummond’s departure comes after Google Chief Executive Officer Sundar Pichai took the top job at Alphabet, succeeding co-founders Larry Page and Sergey Brin. Since 2015, Drummond has overseen the company’s two investment arms, GV and CapitalG, as well as Jigsaw, a political research division. The spokeswoman said the company has not decided if an executive will oversee those units.
Here is Drummond’s note sent on Friday:
More than 20 years ago, Larry Page and Sergey Brin first asked me to help them with their unincorporated startup. Of course, that startup would grow to include more than 100,000 employees and make a positive impact on the lives of people around the world. From the beginning, I felt privileged to work with Larry and Sergey to realize their commitment to making information more universally accessible and useful, and was thrilled to join Google full-time in 2002. With Larry and Sergey now leaving their executive roles at Alphabet, the company is entering an exciting new phase, and I believe that it’s also the right time for me to make way for the next generation of leaders. As a result, after careful consideration, I have decided to retire at the end of this month. As I do so, I’d like to thank everyone with whom I’ve had the privilege to work so closely over the past two decades. Whether we were fighting alongside others around the globe to protect and expand freedom of expression; pressing to make sure copyright law continued to foster openness and creativity; designing an unconventional but dynamic corporate structure that has served Google so well; putting together industry-changing acquisitions that served as the foundation for some of Google’s most popular products; creating and evolving the rules that protect our users; or establishing start-up models to help unleash the potential of our amazing Other Bets: I have always relished the opportunity to work with such talented colleagues. In particular, I have loved building and being a part of the legal team: your dedication, drive and leadership in helping digital innovation flourish has been amazing to behold. I have also been energized and deeply impressed by my time with the corporate development, public policy, trust and safety and communications teams, as well as the folks at GV, Capital G and Jigsaw. These groups’ relentless creativity and herculean efforts to further Google’s ambitious mission have been beyond inspiring. I’d also like to thank BGN and all of the company’s employee resource groups, whose tireless efforts continue to make the company better.
I know this company is in the best of hands, and I am excited for what the future holds for Google, for Alphabet and for me. But, as I move on, I’d like to thank Larry and Sergey and each and every one of you for providing me with the most engaging, challenging and rewarding professional environment that anyone could hope for. I am deeply grateful.
More must-read stories from Fortune:
—Greenpeace ranks China’s tech giants on renewable energy
—Facebook deepfake video ban may set off ‘cat and mouse’ game
—Why there are so many scooters in Los Angeles
—What a $1,000 investment in 10 top stocks a decade ago would be worth today
—Missile strike vs. cyberattack: How Iran retaliates
Catch up with Data Sheet, Fortune’s daily digest on the business of tech.


fortune--2020-01-10--Best of CES 2020? Tech Sites Opinions Differ Wildly

Despite all the attention paid to sexual wellness products at this year’s CES, when it was time to pick the best of show, traditional tech ruled supreme.
Technology sites, such as Engadget and The Verge, have rolled out their annual Best of CES awards as the show winds down. And while previous years have frequently seen a consensus about the show’s most interesting tech, this year was a bit less clear.
Engadget gave this year’s nod to Hydraloop, a device that recycles water used in the home by up to 85% say its manufacturers. That could significantly reduce water consumption and help in drought stricken areas. The device carries a beefy $4,000 price tag, but Engadget editors were impressed with how frictionless the device was, which could make it more appealing to consumers
The Verge, meanwhile, named Lenovo’s ThinkPad X1 Fold, a foldable computer, as its best of show winner, though it did admit there was some internal disagreement about the choice. By offering a spec sheet and a firm release date, rather than just showcasing a concept unit, Lenovo made the cut, though.
CNET didn’t name any one particular item its best of show (focusing instead on 20), but it did show appreciation for Impossible Foods’ Impossible Pork, which made its debut at CES this year, noting the positive comments from taste testers and the continuation of the company’s winning streak from last year.
Other products that caught editors eyes in different categories at Engadget included Phonak Virto Black, a new style of hearing aid that’s custom made for users’ ear canals, offers Bluetooth streaming, acts as an earbud for phone calls and comes with an external device (called “Roger”) that helps with distance listening.
And Samsung and LG both got awards for their new line of TVs, with The Verge leaning towards Samsung’s QLED Bezel-less 8K set, while Engadget favored the LG CX-series OLED TVs. CNET was more enamored with Vizio’s new OLED TV, noting the company’s history of offering more affordable sets.
More must-read stories from Fortune :
—Greenpeace ranks China’s tech giants on renewable energy
—Facebook deepfake video ban may set off ‘cat and mouse’ game
—Why there are so many scooters in Los Angeles
—What a $1,000 investment in 10 top stocks a decade ago would be worth today
—Missile strike vs. cyberattack: How Iran retaliates
Catch up with Data Sheet, Fortune’s daily digest on the business of tech.


fortune--2020-01-10--Americans Streamed 1 Trillion Songs Last Year, But Their Real Interest Was Music Videos

American demand for streaming music soared last year, with listeners streaming more than 1 trillion songs for the first time. And more and more, we’re just as interested in watching our music as listening to it.
A new study from Nielsen finds that we streamed 1.15 trillion songs on services ranging from Spotify to YouTube. That’s 29.3% jump over the previous year.
Video music saw an explosion in viewers, though, spiking 40.7% to 401.2 billion views. Audio streams beat that actual total, with 745.7 billion streams, but that was just a 23.8% climb.
It’s one of the most authoritative signs to date about the shifting listening habits of Americans and could indicate an approaching one, as fans look to emulate the dance moves of their favorite artists such as Billie Eilish.
Physical music sales continued to decline, falling 15% even as vinyl continued its resurgence.
“Old Town Road,” by Lil Nas X and Billy Ray Cyrus, was the year’s top song, streaming 2.5 billion times. Other big artists include Eilish, Post Malone and Lizzo.
More must-read stories from Fortune :
—Inside 1917: Designing a World War I battlefield—Greta Gerwig and cast reveal how they reinvented Little Women
—How Neil Young’s eccentric online home was born
—How Netflix transformed the peak TV terrain in the 2010s
Follow Fortune on Flipboard to stay up-to-date on the latest news and analysis.


fortune--2020-01-10--AMD’s Command Performance at CES 2020 Was Years in the Making

Today’s computer chips are fiendishly complicated, containing billions of transistors and requiring years of design and testing to create.
That incontrovertible reality helps explain why recently hired Intel CEO Bob Swan had so little new to offer at this year’s CES tech trade show in Las Vegas, while the keynote by his rival, Advanced Micro Devices CEO Lisa Su, was packed with new chips offering faster performance across an array of categories. If 2019 was the year AMD caught up to some of Intel’s best chips, it’s starting to look like 2020 may be the year it pulls decisively in front.
That’s not to say that surging AMD, with its $7 billion of revenue last year, will soon match Intel’s financial performance; Intel has 10 times AMD’s annual sales. And even after AMD’s stock gained almost 150% last year, crushing Intel’s 28% gain, Su’s company has a market capitalization that is only one-fifth of Intel’s.
Five years ago, Su started AMD on a path to developing a strong family of chips for PCs, servers, and graphics cards. Swan has only been running Intel for a few months and got the job after his predecessor, Brian Krzanich, failed to manage the transition to more efficient manufacturing technologies.
To put it bluntly, the stark contrast on stage at CES in 2020 was years in the making.
Intel’s CES show
The first outsider to run Intel in its 51-year history, Swan, who previously worked at GE and eBay, projects a calm and steady approach. He was a surprise pick as CEO last year, seven months after Krzanich lost the confidence of the board and was ousted for having a consensual relationship with an employee. Taking the stage in Las Vegas on Monday, Swan started off on a humbler note than many of his peers: “My name is Bob Swan. It’s a pleasure for me to be here.”
Once Swan finished his introduction, however, the razzle-dazzle began. The crowd filling a cavernous auditorium at the Mandalay Bay Resort and Casino on Monday was treated to football highlights with zooming digital camera effects, high-definition video of a prancing elephant, and a cool looking 17-inch tablet that folds into the size of a 12-inch laptop. There was also a dazzling—and hilarious—demonstration of Adobe Photoshop’s A.I.-driven editing features.
Most mind-bending of all was a sky viewpoint video of an autonomous car using Intel’s Mobileye sensors to navigate a busy intersection in Jerusalem. After some hesitation, and to the crowd’s great relief, the car eventually made it through despite irregular waves of pedestrians and other vehicles darting in and out of view.
“They told me I was going to get in this car, and I said, ‘Not on your life,'” Swan explained, adding that eventually he did get in and had a successful trip.
Somewhat less visible were new product announcements about anything Intel plans to sell to its customers anytime soon. Just one chipset got a mention— the previously announced Tiger Lake processor for thin and light laptops. Laptops with the chips are “coming soon,” Intel said without giving a date. Intel also briefly showed off a laptop running a new graphics chip called the DG1, but it didn’t offer any details about when it might come to market.
That’s in stark contrast to last year’s CES presentation when then-CEO Kraznich unveiled a half-dozen new chips for desktops and laptops featuring the company’s ninth and 10th generation Core designs that were ready to hit the market.
The lack of new products reflected Intel’s slipping position in the processor market. Beset by manufacturing difficulties and shortages over the last few years, Krzanich and now Swan have instituted a reboot to get Intel back on track. Part of the problem was Intel engineers getting too ambitious and trying to stuff too many improvements into upcoming designs, Swan has said. But even after curtailing its ambitions, it’s likely to take another year or more before the revamped strategy pays off.
AMD’s CES celebration
Meanwhile, AMD is reaping the benefits of Su’s reboot that started five years ago. The chip engineer with three degrees from MIT didn’t have any Olympic athletes or NFL football games in her company’s CES keynote. She didn’t need them.
Su started by showing off some of her company’s big wins in high-profile new computers, including supplying the graphics card in Apple’s new Mac Pro, custom processors powering the upcoming Microsoft XBox Series X and Sony Playstation 5, as well as server chips for Twitter and graphics chips for Google’s Stadia cloud gaming service.
Then came the new products for consumers. A new line of chips for thin and light laptops, called the Ryzen 4000 mobile series, will be included in a dozen laptops starting in the next few weeks and over 100 this year, Su said. The chips have up to eight individual computing cores, the most ever for the category, and run at speeds up to 4.2 GHz. The performance makes them “the best laptop processor ever built,” Su bragged. Outsiders will have to test the boast, as previous AMD mobile chips have lagged Intel’s best.
Next, following up on new high-end graphics chip sets released last year, AMD debuted a less expensive chip called the RX 5600 XT. It goes on sale in two weeks for under $300.
Finally, came the pièce de résistance. “I have one more product to share,” Su said, channeling the late Apple CEO Steve Jobs.
One of Su’s strategies has been to offer performance once reserved for elite corporate workstations in chips aimed at typical creative professionals like photo editors and software developers, or even home enthusiast videographers and gamers. At CES, Su unveiled a third version of the leading player in that strategy, the Threadripper line of chips. The new Threadripper 3990X has 64 individual cores, double the previous high, and goes on sale Feb. 7 for $4,000.
Su then showed a special effects scene rendering from Hollywood shop Blur Studios for the movie Terminator: Dark Fate running on a Threadripper chip that outperformed by 33% the same task running on a $20,000 system that had two of Intel’s Xeon Platinum chips. “Just imagine what that can do for your productivity,” she said. “It might also be slightly cheaper.”
As the presentation wrapped up, attendees rushed the stage to snap photos and selfies with Su. As long time tech industry analyst Bob O’Donnell noted, “she has really become a rock star in the tech industry and a great example of female leadership in tech.”


fortune--2020-01-10--Carlos Ghosn Is Now a Fugitive In Exile. Here Are His Legal Options, According to Experts

At his two-and-a-half hour press conference from Beirut on January 8, Carlos Ghosn passionately and garrulously protested his innocence from the alleged financial crimes that led to his indictment and 130-day imprisonment in Japan. Just ten days after he escaped house arrest in Tokyo, smuggled inside a musical instruments crate in a caper worthy of a Hollywood thriller, Ghosn—attired in dark suit and pink tie—appeared super-charged for combat, snapping his fingers and flapping his arms to dramatize his attack. “I am innocent of all the charges, and I can prove it,” he intoned on a global videocast carried online by major news outlets, and extensively discussed on venues from CBS This Morning to CNBC’s Squawk Box, proving just the spotlight the media-savvy showman craved.
Ghosn’s press offensive isn’t mainly aimed at getting Japan to dismiss or settle the case against the one-time auto mogul, or even convince the world that he did nothing wrong. Neither outcome is likely, and Ghosn probably knows it. Instead, it may well be about expanding the gilded cage that has him trapped in luxury, but still trapped.
Ghosn was renowned as an inveterate globetrotter when he headed three major automakers with worldwide networks: Nissan and Mitsubishi of Japan and Renault of France. He was born in Brazil to a family of Lebanese immigrants, and lived there until age 6, when his family moved to Lebanon, where he attended grammar and high school. He received his higher education in France, earning a diploma from the nation’s top academy for the business and government elite, École Polytechnique. At the presser, he delivered a tour de force in multilingual dexterity, answering questions in English, French, Arabic, and Portuguese. Ghosn is now living on the lam as the world’s most famous white-collar fugitive, and Japan is desperate to capture him for trial. Tokyo will apply diplomatic pressure and seek cooperation from any country where it can legally nab him, and that nab-able territory encompasses most of the globe.
Hence, this ultra-internationalist’s world has now shrunk to just three nations where he’s probably safe to live and visit by virtue of being a citizen: Lebanon, France, and Brazil. Of course, many fugitives would be content keeping quiet, and enjoying their riches hopping freely among those nations where they’re protected and welcome––and Ghosn is embraced in France and Lebanon as a hero.
But Ghosn will chafe at boundaries. He’s used to living like an emperor who relished nothing more than circling the globe and alighting to pose with heads of state. So he’s speaking out loudly, and the likely reason is that he wants to visit lots of other nations, even if briefly, with little chance of being detained, and if he should get unlucky and be arrested, to minimize the chances he’ll be flown back to Japan in handcuffs. (Fortune could not immediately reach Ghosn for comment.)
Read: Carlos Ghosn’s net worth takes a hit as escape, life on the run prove costly
Ghosn will doubtless be carefully advised by a security staff that will assess where it’s relatively safe to travel, and where he’s at high risk of being caught and extradited. But getting careless by spending too many days in the wrong nation or getting arrested at a stopover in Athens or Madrid on his way to Rio isn’t the only way that Ghosn could face extradition to Tokyo. In the 1980s, the U.S. employed fake meetings with a middle-Eastern businessman to lure fugitive commodities trader Marc Rich to a yacht in the Adriatic, and planted spies to get wind of his coming trips, resulting in sundry-near nabs that never happened.
Traditionally, the Japanese have always taken a more cautious approach to nabbing fugitives, and that could be good news for Ghosn.
Nevertheless, the Japanese dread that Ghosn will become the new Marc Rich, the nation’s most-wanted white collar fugitive basking in luxurious exile—especially since while Rich was mainly silent, Ghosn is already making headlines by bashing the “corrupt” and “inhumane” Japanese legal system and “vindictive” accusers from the safety of Beirut. At a minimum, the Japanese will use their extensive intelligence network to discover if he’s visiting a nation where he can be detained, and given how badly they want Ghosn, might even change its cultural aversion to undercover capers.
One reason that Ghosn may be claiming so loudly that he was victimized in Japan by a corrupt justice system is to lay the legal groundwork for possible future visits to states where he’s now vulnerable to detention and extradition. That’s the opinion of experts consulted by Fortune, notably Ben Brandon, partner and head of the extradition practice at London law firm Mishcon de Reya.
Brandon points to Ghosn’s assertions in his press conference that the charges in Japan weren’t based on even-handed justice but “political” motives, that he has “zero chance” of getting a fair trial in Tokyo, and that he was a victim “inhumane” treatment in prison, where he was held in solitary confinement, allowed to shower just once a week, and “interrogated day and night without a lawyer.” Ghosn alleges that the Japanese courts might have taken five more years to reach a judgment that he was certain to lose because of what he calls a stacked legal system, leaving him convinced “you’ll die in Japan or you have to get out.”
“He’s publicly building a number of defenses,” says Brandon. “They follow three lines: that the prosecution was motivated by politics, that he can’t get a fair trial in Japan, and that his incarceration was inhumane and degrading. All three are enshrined in human rights conventions governing most of the countries that Ghosn where could potentially be apprehended. He can use those arguments to lower the chances that he will be either detained when visiting a nation outside of the three where he’s a citizen, or if he is detained, to avoid extradition.”
For Brandon, Ghosn’s thinking fits a common pattern for fugitives who were once shrewd operators in the business world. “These senior business leaders are well-versed in assessing risk,” he says. “For Ghosn, it will be about balancing the risk of arrest versus freedom of movement. That risk will be dynamic.” But these human rights arguments, if successful, could significantly increase the chance he won’t be stuck in just three countries for the rest of his life.
Arguing innocence will not protect Ghosn
Carlos Ghosn gestures during a heated press conference in Beirut, Lebanon on January 8, 2020. JOSEPH EID—AFP via Getty Images
Ghosn faces several charges of criminal financial conduct in Japan. Two counts accuse him of failing to report $80 million in compensation that was to be paid to him in retirement. He’s also accused him of transferring $17 million in personal losses on derivatives trades to Nissan, and funneling $5 million that Nissan paid to a distributor in Oman to benefit companies with ties to his family. The cases are fiendishly complex, in part because the $80 million was never actually paid to Ghosn since he was indicted prior to his planned retirement. Ghosn also alleges that Nissan was fully aware of the deferred comp arrangement, and that the board would have to approve it before he actually got the money.
Although Ghosn’s protestations of innocence have some credibility because he never received the pay he’s accused of concealing, his position is weakened by a recent settlement with the U.S. Securities and Exchange Commission. Last year, the SEC charged Ghosn with fraud for concealing more than $140 million of his total pay from Nissan. Ghosn settled the case by paying a $1 million fine, neither admitting nor denying wrongdoing.
As Brandon emphasizes, financial fraud is deemed a crime in virtually every nation around the globe. Hence, accusations of financial fraud by Japan would form grounds for extraditing Ghosn almost anywhere he’s detained. “The test for the nation where he’s detained isn’t whether or not Japan would win the case, but whether the case is worthy of a trial,” says Brandon. “If Ghosn is arrested in another country, arguing that he’s innocent would not prevent extradition. The nation detaining him would simply say that fraud is an extraditable offense since it’s also a crime in our country, and based on the nature of the charges alone, judge that his guilt or innocence should be decided by a trial in Japan.”
Ghosn may try to use human rights arguments to stop “Red Notices”
Immediately after Ghosn fled, Tokyo issued what’s called a “Red Notice” for his arrest around the world through Interpol, the International Criminal Police Organization. Interpol is not an international police force. The General Secretariat that coordinates its activities and oversees its rules, is based in Lyon, France. Interpol is an information-sharing agency that counts 194 nations as members, and fosters cooperation in apprehending criminals and fugitives convicted or charged in one country that are traveling or living in another Interpol member state.
Each nation has a National Central Bureau, usually based in the capital city, composed of police officers who specialize in sharing leads via the Interpol network. The local police who issued the arrest warrant for a defendant who’s fled the country will request that its NCB issue a Red Notice. The NCB will then forward the request to Lyon, stating in Ghosn’s case, for example, that he’s a fugitive wanted for prosecution, along with his picture, and his arrest warrant from Japan. A typical application would read, “Request for Red Notice with view to detention pending an extradition request.” The Lyon headquarters then dispatches the Red Notice to the NCBs at all 194 member nations. The NCBs in turn issue the Notice to their local police departments and immigration agents that check passports at the airports and train depots. Lebanon has acknowledged receiving a Red Notice for Ghosn, meaning that a warrant for his detention has circulated around the globe.
Just because a nation has received a Red Notice doesn’t mean that it will detain a criminal or fugitive. National laws supersede a Red Notice—which could be a big break for Ghosn. France, Lebanon, and Brazil, the nations where Ghosn holds passports, have a blanket policy of declining to extradite their citizens. “Lebanese authorities have no security of judiciary charges against him,” says the Lebanon’s Justice Minister, who also confirmed that Lebanon will not extradite Ghosn. France follows the same policy. “If Mr. Ghosn comes to France, we will not extradite Mr. Ghosn, because France never extradites its nationals,” said an economy ministry official. Since detention is the first step towards extradition, and those nations will not extradite Ghosn because he’s a citizen, the Red Notice will not prompt their local police to detain him.
What if Ghosn flies from Lebanon to another nation? What are the chances he’ll be detained? It depends on the country, and the regimes divide roughly into two categories, countries that follow civil law that’s dominated by statutes, and those ruled by common law heavily influenced by decisions reached in the courts. The civil law contingent includes Germany, France, Spain, Italy, Belgium, and Greece, among many others. In those states, a Red Notice triggers an automatic arrest: If a immigration official at, say, a Frankfurt airport flags a fugitive’s passport via a Red Notice, he alerts the local police, who detain the fugitive right at the terminal, and keep him or under detention for around 40 days. So if Ghosn lands in any of those countries next week, he’s likely to face immediate detention. The civil law states are also the ones that, in general, ban extradition of their citizens, while the common law countries, including the U.S. and U.K., do allow their citizens to be extradited if their courts so rule.
But in common law nations such as Britain, the U.S. and Australia, a Red Notice does not trigger an arrest. Instead, it triggers a potentially time-consuming series of steps to secure a fugitive’s detention. “If Japan gets word that Ghosn is visiting London,” says Brandon, “the Japanese government would have to first agree to an ad hoc extradition arrangement with the U.K. (as we’ll soon see, Japan has few extradition treaties), second, make a provisional request for his extradition, upon which the issue would go to the U.K. courts, which would then rule on whether to issue an arrest warrant—they almost always too. Only then could the fugitive be detained.” Finally, Japan would issue a full extradition in a time period stipulated by the ad hoc arrangement, usually within a period between 40 to 65 days. The problem in states such as Britain, says Brandon, is the time it would take to get an arrest warrant for his detention. Ghosn would probably be safe visiting for short periods if he’s willing to take the risk. By comparison, he’d probably be nailed at the airport in Italy or Germany.
“Ghosn’s immediate goal is probably to eliminate the Red Notices,” says Brandon. “The Interpol constitution prohibits Red Notices when the charges involve violations of human rights. Its Article 3 also sates “that it’s strictly forbidden for the organization to undertake any activities of a political…character.” Given Ghosn’s hammering on those issues in his press conference, the odds are high that he will render an appeal to Interpol, by applying to its Commission for Control of Files, to cancel the Red Notices. If he’s successful, he won’t be detained immediately at the nations that arrest for Red Notices on sight. Those nations would then be in the same position as the U.S. or U.K. They’d require a request from Japan and a court decision, all of which takes time, to detain him. So ditching the Red Notices would greatly increase Ghosn’s travel options, at least for short trips.
“The big problem with Red Notices,” says Brandon. “It that it locks you down, whether you’re traveling to a country that arrests on them or not. Even if you manage you to have them deleted, you don’t eliminate the risk. But it significantly reduces the risk.”
Japan’s lack of extradition treaties doesn’t mean Ghosn can’t be extradited for trial
Pedestrians walk past a screen displaying a news broadcast on former Nissan Motor Co. Chairman Carlos Ghosn in Tokyo, Japan, on Thursday, Jan. 9, 2020. The former head of Nissan Motor Co. and Renault SA appeared as energetic and combative as ever at a rowdy two-and-a-half-hour press conference in Beirut, the first since his arrest in Tokyo more than a year ago on allegations of financial misconduct. Photographer: Akio Kon/Bloomberg via Getty Images Akio Kon—Bloomberg via Getty Images
Amazingly, Japan has extradition treaties with only two nations, the U.S. and the Republic of Korea. “But not having a formal extradition treaty does not bar an extradition,” explains Brandon. Of course, for Japan to succeed in extraditing Ghosn, he’d have to be under detention. Otherwise he could simply bolt the nation he’s visiting. But if Ghosn slips up and is detained in a nation that directly arrests fugitives on a Red Notice here’s what would happen. He’s now in detention under the Red Notice. Japan would be likely reach out diplomatically to the state where he’d been detained, and inquire whether that nation would be receptive to a formal extradition request. It is likely that Ghosn would be detained until the conclusion of any extradition proceedings that followed.
The extradition is probably contain a summary of the charges and even some of the evidence, together with details of the proceedings in Japan. The case would then be considered by a court in the detaining nation to determine is there is any reason why he shouldn’t be extradited. Once again, the decision doesn’t hinge on whether Ghosn would be convicted, but rather on whether the crime merits a trial in the country where it was committed. The offense also needs to be a crime in both countries for the detaining nation to extradite. Once again, few crimes are more universal than financial fraud.
If Ghosn is unlucky enough to be detained, the defenses raised at his press conference might save him. “In most countries, there is a prohibition against extraditing for political purposes, and he may additionally be able to challenge his extradition on the basis that he won’t receive a fair trial in Japan, or would be subject to inhumane and degrading treatment,” says Brandon.
Will Japanese gumshoes to soon start setting traps for Ghosn? They haven’t taken that approach in the past. But Tokyo could get daring and plant a mole in Ghosn’s camp, and get word that he plans a visit to Amsterdam. It could then sign an arrangement with the Dutch government stating that Ghosn is expected to fly to Skipol Airport on a certain date, and securing an agreement for the Dutch police to arrest him. Within weeks, Ghosn could be back in a Tokyo jail. Tokyo’s skulduggery may be the plot line of this real-life thriller’s next episode.
More must-read stories from Fortune:
—How Nissan-Renault became a ‘masquerade of an alliance,’ according to Ghosn
—Investors see a 2020 recession coming—but think they’ll make money
—As investors shrug off Iran concerns, analysts find the complacency ‘disconcerting’
—Laws meant to close down tax havens and shut loopholes could have opposite effect
—What a $1,000 investment in 10 top stocks a decade ago would be worth today
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fortune--2020-01-10--Pelosi: House Moving to Send Articles of Impeachment to Senate Next Week

House Speaker Nancy Pelosi said Friday the House will take steps next week to send articles of impeachment to the Senate ending Democrats’ blockade of President Donald Trump’s Senate trial.
In a letter to her Democratic colleagues, Pelosi said she was proud of their ”courage and patriotism” and warned that senators now have a choice as they consider the charges of abuse and obstruction against the president.
“In an impeachment trial, every Senator takes an oath to do ‘impartial justice according to the Constitution and laws,” Pelosi wrote. ”Every Senator now faces a choice: to be loyal to the President or the Constitution.”
The entire Pelosi letter is below.
Pelosi has been in a standoff with Senate Majority Leader Mitch McConnell that has consumed Capitol Hill and scrambled the political dynamic more than three weeks after the House impeached Trump.
She said she has asked House Judiciary Committee Chairman Jerrold Nadler to be prepared to bring to the floor next week a resolution to appoint managers and transmit the articles of impeachment to the Senate.
“I will be consulting with you at our Tuesday House Democratic Caucus meeting on how we proceed further,” Pelosi wrote. She did not announce a date for the House vote.
The protracted showdown has scrambled the politics of impeachment and the congressional calendar three weeks after the House Democrats impeached Trump on charges of abuse and obstruction over his actions toward Ukraine.
Transmittal of the documents and naming of House impeachment managers are the next steps needed to start the Senate trial.
McConnell wants to launch a speedy trial without new witnesses.
Trump mocked Pelosi with his tweets Friday and derided her and other Democrats late Thursday in Toledo, his first rally of 2020.
The House impeached Trump in December on the charge that he abused the power of his office by pressuring Ukraine’s new leader to investigate Democrats, using as leverage $400 million in military assistance for the U.S. ally as it counters Russia at its border. Trump insists he did nothing wrong, but his defiance of the House Democrats’ investigation led to an additional charge of obstruction of Congress.
The Senate trial would be just the third impeachment trial in the nation’s history.
McConnell told GOP senators at a lunchtime meeting this week to expect the trial next week, according to two people familiar with his remarks. The people requested anonymity to discuss the private meeting.
He had signed on to a resolution from Sen. Josh Hawley, R-Mo., to allow for the dismissal of articles of impeachment if the House doesn’t transmit them in 25 days. That change to Senate rules appears unlikely to happen before Pelosi transmits the articles.
In the weeks since Trump was impeached, Democrats have focused on new evidence about Trump’s effort to pressure Ukraine to investigate his political rivals and they pushed the Senate to consider new testimony, including from former White House national security adviser John Bolton. Republicans are just as focused on a speedy trial with acquittal.
Republicans have the leverage, with a slim 53-47 Senate majority, as McConnell rebuffs the Democratic demands for testimony and documents. But Democrats are using the delay to sow public doubt about the fairness of the process as they try to peel off wavering GOP senators for the upcoming votes. It takes just 51 senators to set the rules.
“When we say fair trial, we mean facts, we mean witnesses, we mean documents,” said Senate Minority Leader Chuck Schumer, D-N.Y., promising votes ahead. “Every single one of us, in this Senate, will have to have to take a stand. How do my Republican friends want the American people, their constituents, and history to remember them?”
Trump weighed in from the White House suggesting that he, too, would like more witnesses at trial. They include former Vice President Joe Biden, who is seeking the Democratic presidential nomination now, and his son Hunter, as well as the government whistleblower whose complaint about the president’s pressure on Ukraine sparked the impeachment investigation.
On a July telephone call with Ukraine’s new president, Trump asked his counterpart to open an investigation into the Bidens while holding up military aid for Ukraine. A Ukrainian gas company had hired Hunter Biden when his father was vice president and the Obama administration’s point man on Ukraine. There is no evidence of wrongdoing by either Biden.
Trump suggested that his administration would continue to block Bolton or others from the administration from appearing before senators. Many of those officials have defied congressional subpoenas for their testimony.
“When we start allowing national security advisers to just go up and say whatever they want to say, we can’t do that,” Trump said during an event with building contractors. “So we have to protect presidential privilege for me, but for future presidents. That’s very important.”
Bolton, one of four witnesses that Democrats have requested, said this week that he would testify if subpoenaed.
McConnell has said from the start he is looking to model Trump’s trial on the last time the Senate convened as the court of impeachment, for President Bill Clinton in 1999. McConnell has said there will be “no haggling” with House Democrats over Senate procedures.
“There will be no unfair, new rule rule-book written solely for President Trump,” McConnell said Thursday.
The delay on impeachment has also upended the political calendar, with the weekslong trial now expected to bump into presidential nominating contests, which begin in early February. Several Democratic senators are running for the party’s nomination .
One 2020 hopeful, Sen. Cory Booker, D-N.J., told The Associated Press’s Ground Game podcast that a looming impeachment trial and other pressing issues in Washington could deal a “big, big blow” to his presidential campaign by keeping him away from Iowa in the final weeks before the Feb. 3 caucuses.
More must-read stories from Fortune:
—Donald Trump and the power of incumbency
—Congress confronts its powerlessness on Iran
—The wealthiest members of Congress—and how they made their millions
—USPS could privatize as early as next year
—2020 Crystal Ball: Predictions for the economy, politics, technology, and more
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