Tentative Deere strike accord | U.S./EU reach trade truce | Timeline murky for infrastructure
In Today’s Digital Newspaper
Market Focus:
• It’s not just food prices rising, as wages accelerate
• Deere reaches tentative rate hike agreement with striking workers
• American Airlines canceled lots of flights
• Markets betting on the Fed raising U.S. interest rates next summer
• Biden administration’ blames OPEC for soaring gas prices in the U.S.
• Granholm : U.S. still mulling a release from the SPR
• Stronger than expected August soyoil use for biodiesel
• The year 2021 expected to qualify among hottest seven in history
Policy Focus:
• House Dems back off having votes as soon as Tuesday re: infrastructure
• Key issue: Payment caps and new conservation spending re: BBB
Afghanistan:
• Biden, Draghi discuss Afghanistan, Mediterranean security challenges
• Draghi will assist U.N. in setting up a system to route aid payments to Afghanistan
• Taliban demands access to frozen funds as Afghans face widespread starvation
China Update:
• China’s manufacturing activity contracts for second straight month
• Chinese authorities announce release of some stored gasoline and diesel
Trade Policy:
• U.S. and EU reach trade truce on steel and aluminum, with caveats
• Forced labor in textile industry discussed between USTR, senior U.S. textile executives
Energy & Climate Change:
• Biden emphasizes $900 billion in climate investment from infrastructure measures
• New White House report for achieving “net-zero” greenhouse gas emissions by 2050
• G20 leaders failed to reach accord on phasing out domestic use of coal
• Supreme Court to review power plant rule case
• Is this the real reason why there has not yet been an RFS announcement?
Livestock, Food & Beverage Industry Update:
• Elon Musk challenges U.N. official’s claim re: solving world hunger
Coronavirus Update:
• Psaki tests positive for Covid-19
• FDA authorizes Pfizer’s Covid vaccine for kids ages 5 to 11
• Supreme Court denies religious exemption to state vaccine mandate for healthcare workers
• Research on people with ‘natural immunity’ from prior Covid-19 infection
• Britain, Australia and South Korea reached agreements drugmaker Pfizer
• Australia opens its airports to travelers from abroad
Politics & Elections:
• Kinzinger not seeking re-election
• New Jersey gubernatorial race update
• NBC News poll: Biden’s approval rating drops to 42%
• Biden: Not deterred by declining poll numbers
• McAuliffe and Youngkin statistically tied in race for Virginia Governor
Other Items of Note:
• Biden tells Macron: U.S. was ‘clumsy’ in handling nuclear-powered submarines issue
• Macron: Australia’s prime minister lied to him about submarines decision
• Biden offers Iran a way to lift sanctions
• Supreme Court to weigh Texas abortion law
MARKET FOCUS
Equities today: Global stock markets were mixed but mostly firmer in overnight trading. The U.S. stock indexes are pointed to higher openings. Asian stocks rose as traders digested the outcome of Japan’s election and a rise in U.S. shares to a fresh all-time high. Equities climbed for Japan, after the Liberal Democratic Party preserved its outright majority. Some 160 S&P 500 companies are scheduled to report quarterly results this week, including Pfizer and Moderna. Asian equities were mixed with Japan rising after elections and property concerns weighing on markets on mainland China and in Hong Kong. The Nikkei gained 754.39 points, 2.61%, at 29,647.08. The Hang Seng Index lost 222.92 points, 0.88%, at 25,154.32. European equities are moving higher in early action, with the Stoxx 600 up 0.6% and regional markets up 0.5% to more than 1.3%.
U.S. equities Friday: The Dow rose 89.08 points, 0.25%, at 35,819.56. The Nasdaq gained 50.27 points, 0.33%, at 15,498.39. The S&P 500 was up 8.96 points, 0.19%, at 4.605.38.
For October, the Dow saw a 5.8% rise, while the S&P 500 advanced 6.9% (its best monthly performance since last November) and the Nasdaq rallied 7.3%.
On tap today (see detailed list of events and reports below):
• COP26 in Glasgow: Governments from around the world are meeting in Scotland to push global climate talks forward.
• IHS Markit’s U.S. manufacturing index for October is expected to tick up to 59.3 from a preliminary reading of 59.2. (9:45 a.m. ET)
• Institute for Supply Management’s manufacturing index is expected to fall to 60.3 in October from 61.1 one month earlier. (10 a.m. ET)
• U.S. construction spending for September is expected to increase 0.4% from the prior month. (10 a.m. ET)
• USDA Grain Export Inspections report, 11:00 a.m. ET.
• Reserve Bank of Australia releases a policy statement at 11:30 p.m. ET.
• USDA Crop Progress report, 4:00 p.m. ET.
Deere reaches tentative rate hike agreement with striking workers. Deere & Co. said Saturday it reached a tentative agreement with striking workers, more than two weeks after workers walked off the job. Leaders for the United Auto Workers union briefed their members on the terms that cover more than 10,000 workers at 14 plants. The company said the deal would run for six years, same as previous contracts with the union.
The accord includes wage increases, no new tiers to retirement benefits and a signing bonus of $8,500 — Deere will also contribute 5% of employees’ annual wages to their 401(k), immediately eligible. The deal, still subject to approval by union membership, includes wage hikes of 10% in the first year of the contract and 5% in the third and fifth years, according to a published document (link) of the deal on the union website Sunday. There would be a 3% lump sum bonus paid in the even years of the contract based on prior-year earnings.
The post-retirement health care fund includes cash balance savings at 2.5% for the first through fourth years, 3% in years five through 14, and 4% for 15 years and above, and it includes $2,000 of seed money per year of service. There were no changes to the cost of health insurance, with employees paying no premiums or deductibles, and still having co-pays.
Background. The workers went on strike a few days after voting down a proposed contract on Oct. 10 that would have offered workers raises of 5% to 6% in the contract’s initial year, but the proposal included smaller raises and lump-sum bonuses for the remaining years. Deere employees said they considered the contract negotiations as their best opportunity in years to secure higher pay and better benefits than provided in the last pair of six-year contracts that were negotiated when the U.S. economy or the farm-equipment market was weak.
Inflation watch: The third-quarter U.S. employment cost index report showed civilian wages leapt 1.5%, the largest advance in series data back to 2001, as companies across a swath of sectors resorted to higher pay against a backdrop of labor shortages. Meanwhile, personal consumption expenditures price index rose 4.38% and core PCE gauge climbed 3.64%, both largest annual advances since 1991. The Conference Board’s October confidence report showed consumers anticipate a higher inflation rate in the year ahead. Some 64.4% also expect interest rates to be higher, the biggest share since January 2019
Inflation watch: It’s not just food prices on the rise, as wages accelerate. Wages in the third quarter were up 4.2% from a year earlier, the fastest increase since 1990 as labor shortages in a widening range of industries prompted employers to raise pay. Meanwhile, inflation has topped 5% for the past four months, the hottest in decades.
American Airlines canceled lots of flights. American Airlines canceled nearly 900 flights on Sunday — and more than 1,700 since Friday — after wind slowed travel late last week and forced personnel to be out of their regular rotations. As of mid-afternoon on Sunday, American had canceled 31% of its flights, or 870, according to the tracking website Flightaware.com. Dallas-Fort Worth, where American is based, accounted for 158 cancellations, or 15% of the flights originating there. American delayed another 281 flights, or 10% of its schedule on Sunday. The carrier said wind in Dallas, its busiest hub,, and bad weather elsewhere last week left flight crews in the wrong places. “We have adjusted our operation for the last few days this month by proactively canceling some flights,” said Chief Operating Officer David Seymour in a note to staff on Saturday. “We are taking this measure to minimize any inconvenience as much as possible.” Most people were booked on new flights for the same day.
Some 1,800 American Airlines flight attendants who had been out on leave were slated to be back on the job starting Nov. 1 and another 600 new cabin crew were in the process of being hired. The airline expects to add 4,000 new employees in the fourth quarter throughout its system.
Fed watch: Most think the Federal Reserve this Wednesday will begin winding down its $120-billion-a-month asset-buying program with an eye toward ending those purchases by next June. Markets show investors are increasingly betting on the Fed raising U.S. interest rates next summer, following recent inflation reports and signals from other major central banks that they are moving toward tightening policy.
Market perspectives:
• Outside markets: The U.S. dollar index is slightly higher ahead of U.S. trading, with the euro and Japanese yen both edging higher versus the greenback. The yield on the 10-year U.S. Treasury note has moved higher, trading around 1.58%, with a mixed tone to global government bond yields. d of US economic updates. Gold is trading around $1,788 per troy ounce and silver around $23.95 per troy ounce.
• Crude oil futures are higher ahead of U.S. trading, with U.S. crude around $83.95 per barrel and Brent around $84.40 per barrel. Futures had moved lower in Asian action, with U.S. crude down 4- cents at $83.17 per barrel and Brent down 31 cents at $83.41 per barrel.
• Biden administration’s senior energy official on Sunday blamed OPEC for soaring gas prices in the U.S., putting more pressure on the group to increase crude output ahead of a meeting later this week. “Gas prices of course are based on a global oil market. That oil market is controlled by a cartel. That cartel is OPEC,” said Jennifer Granholm, the U.S. energy secretary. “So that cartel has more say about what is going on.” Granholm’s comments to NBC’s Meet the Press followed a briefing from a senior administration official over the weekend that said President Biden would raise the “short-term imbalance in supply and demand in the global energy markets” in talks at the G20, whose members include OPEC linchpin Saudi Arabia. “What’s important is that global energy supplies keep up with global energy demand,” said the official. “Global energy demand has returned almost back to pre-pandemic levels. Global energy supplies have not.”
• Granholm indicated the U.S. is still mulling a release from the country’s strategic oil stockpile (SPR) to be among the “tools” it could use to reduce prices. “I’ll let the president make that decision, make that announcement,” Granholm said.
• Stronger than expected August soyoil use for biodiesel. The U.S. used 815 million lbs. of soyoil for biodiesel in August, which was a record for the month, according to the Energy Information Administration (EIA). Soyoil use was stronger than expected given USDA’s 2020-21 forecast of 8.800 billion lbs. and the highest monthly estimate for 2020-21. Pro Farmer expects USDA to increase its 2020-21 biofuel use forecast in the Nov. 9 Supply & Demand Report and lower other domestic use.
• CFTC Commitments of Traders report (Source: Barron’s):
• The year 2021 is expected to qualify among the hottest seven in history, all of them recorded since 2014, according to an early estimate by the United Nations World Meteorological Organization. Officials meeting in Glasgow will confer on how to keep warming below 2°C (3.6° Fahrenheit) compared with pre-industrial levels… and preferably 1.5°C.
• NWS weather: Wintry mix forecast for the Central Rockies and Plains, while showers and thunderstorms are forecast for the Southern Plains... ...Cold front to bring cooler, Fall-like temperatures from the Plains to the East Coast... ...Rain likely ahead of a Pacific storm system along the West Coast... ...Daily rain and snow showers expected for the Great Lakes region, spreading into the Northeast on Tuesday.
POLICY FOCUS
— House Democrats back off having votes as soon as Tuesday on President Joe Biden’s economic agenda — both the $1 trillion bipartisan infrastructure bill and the $1.75/$1.85 trillion social safety net and climate bill. Legislative language on the BBB/reconciliation measure was still being worked on over the weekend. Also, progressives in the caucus said they wanted to hear public commitments by centrist Democratic Sens. Joe Manchin (D-W.Va.) and Kyrsten Sinema (D-Ariz.) that they would support the larger bill before the progressives agreed to support the infrastructure bill.
Over the weekend, Manchin was in contact with the House Speaker Nancy Pelosi’s (D-Calif.) office, and Rep. Pramila Jayapal (D-Wash.), chair of the Congressional Progressive Caucus, to explain his concerns. Manchin still has concerns about the proposed revenue streams, and whether they will cover the full cost of the nearly $2 trillion package. Sinema is working on a compromise about how to include savings from Medicare by allowing the gov’t to negotiate prescription drugs directly with the pharmaceutical industry.
Senate Finance Committee Chairman Ron Wyden (D-Ore) said he was still in active discussions with Manchin and Sinema. “Folks, this isn’t done until the Senate acts,” Wyden said. Wyden, who has broad oversight into how the bill will be paid for, noted that he was still discussing tax fairness with Manchin.
Sen. Bernie Sanders (I-Vt.), chairman of the Senate Budget Committee, told CNN’s State of the Union on Sunday that he was still working to get other programs included in the larger bill, including paid family leave, Medicare coverage for dental and vision benefits, and government power to negotiate lower prescription drug prices with drug companies. Sanders also indicated that he was going to try to get a Medicare expansion to cover vision. The framework only expanded Medicare to cover hearing.
Sanders says timeline depends on Senate. “I think there has got to be a framework agreed upon in the Senate that all of us know is going to be implemented before the members of the House vote,” Sanders told CNN. “You don’t have to have all of the legislative language, but you have to have a statement which says A, B, C, D and E is going to be in the package and 50 members of the Senate are supporting it,” he said.
On immigration, Senate Democrats are pitching the parliamentarian on a third option to provide work authorization and protection from deportation to some undocumented immigrants. “We are gathering the information for the budget impact with the Congressional Budget Office. And that is, like the first thing that needs to be presented to the parliamentarian, and we’re gonna discuss possibilities that might follow from that,” Sen. Dick Durbin (D-Ill.) said.
Link to more on this topic via our The Week Ahead, including possible other topics progressives are pushing for the BBB, and a rundown of tax and other revenue raisers to offset the huge amount of spending.
House leaders gave themselves more time by punting procedural moves they’d planned for Monday by the House Rules Committee. That would have set up floor votes on the actual bills on Tuesday. But as anyone closely following this topic should have known, too many items are up the air to have a Tuesday reckoning. Now the word is a vote will come “as early as possible this week.” The real timeline is whenever Democratic leaders know they have the votes.
Pelosi: “The text is there for you to review, for you to complain about, for you to add to, for you to subtract from, whatever it is. And we’ll see what consensus emerges from that.” Pelosi added in a letter to her caucus that “your feedback is welcome and necessary, soon” to help get a bill ready for the House floor.
Bottom line: There appears to have been some progress getting language in a final reconciliation bill that deals with prescription drug pricing, Medicare and some other initiatives which were not included in the text posted to House Rules on Thursday, thus the delay in the hoped-for Tuesday voting. When votes will occur is a moving target, the only certainty on this issue. Bill Hoagland, who was the main staffer on the Senate Budget Committee for many years, tweeted: “I will venture that even if the House passes BBB reconciliation bill this week - they will be voting again on it around Thanksgiving. Senate will send back if for no other reason than Byrd and vote-a-Rama.”
Link to White House info on BBB.
Link to ag sector funding via the BBB, per Senate Ag Chairwoman Debbie Stabenow (D-Mich.)
— A big issue relative to the $27 billion to $28 billion in new conservation funding part of the BBB: Are there any payment limitations relative to conservation programs stemming from the big boost in funding?
AFGHANISTAN
— Biden, Draghi discuss Afghanistan, Mediterranean security challenges. The White House today released the readout of President Biden’s meeting in Rome with Italian Prime Minister Mario Draghi. The statement says Biden met with Draghi “to affirm the strength of the U.S./Italy bilateral relationship and thank the Prime Minister for his personal leadership of the G20 during a year of overlapping global challenges. Both leaders recognized the historic achievement of a global minimum tax, building resilience against future pandemics, and the commitment to rapidly decarbonize how we produce electricity. President Biden thanked Prime Minister Draghi for all Italy has done to support the people of Afghanistan, including by convening an extraordinary G20 session to address counter-terrorism efforts and humanitarian aid, and by temporarily housing over 4,000 Afghans en route to the United States last August. The leaders discussed challenges to security in the Mediterranean Sea region and reaffirmed the importance of NATO’s efforts to deter and defend against threats from every strategic direction. The leaders also reaffirmed their unwavering commitment to the bilateral relationship and to the Transatlantic bond, including through NATO. They emphasized the importance of the U.S./EU partnership, including ongoing work to ensure the rules governing the 21st century economy are based in shared democratic values.”
— Draghi will assist the U.N. in setting up a system to route aid payments to Afghanistan, sources say, at the request of Secretary General Antonio Guterres.
— Taliban demands access to frozen funds as Afghans face widespread starvation. Reuters reports, “Afghanistan’s Taliban government is pressing for the release of billions of dollars of central bank reserves as the drought-stricken nation faces a cash crunch, mass starvation and a new migration crisis.” According to Reuters, “Afghanistan parked billions of dollars in assets overseas with the U.S. Federal Reserve and other central banks in Europe, but that money has been frozen since the Islamist Taliban ousted the Western-backed government in August. ... ‘The money belongs to the Afghan nation. Just give us our own money,’ [finance] ministry spokesman Ahmad Wali Haqmal told Reuters. Haqmal added, “Freezing this money is unethical and is against all international laws and values.”
CHINA UPDATE
— China’s official manufacturing purchasing managers index dropped to 49.2 in October, according to data released Sunday by the National Bureau of Statistics, lower than September’s 49.6 reading and the lowest since the outbreak of the pandemic in February 2020. The reading fell far short of the 49.9 median forecasts expected by economists and below the 50-point threshold that indicates expansion rather than contraction. The gauge’s decline from 49.6 in September also reflects electricity supply disruptions at factories, from those in China’s northern rustbelt to the high-tech workshops in Guangzhou and Shenzhen. The figures come two weeks after data showed that economic growth in the third quarter slumped to its slowest pace in a year.
The non-manufacturing gauge, which measures activity in the construction and services sectors, dropped to 52.4, well below the consensus forecast.
Meanwhile, cracks are beginning to show in China’s policy of stamping out all traces of Covid as soon as it appears. But Beijing remains committed to “Covid-zero,” at least through the Winter Olympics that begin in in February.
— On Sunday, Chinese authorities announced the release of some stored gasoline and diesel “in response to the need to maintain supply and price stability in some regions,” amid a deepening energy crisis in the country.
TRADE POLICY
— U.S. relaxes tariffs on European steel; EC will likely drop retaliatory tariffs. The U.S. and the European Union reached a deal to ease U.S. tariffs on steel and aluminum imports that date to former President Donald Trump.
U.S. Commerce Secretary Gina Raimondo said Saturday that the arrangement would maintain the tariffs but would allow limited amounts of European imports to enter the U.S. tariff-free — the U.S. agreed to allow up to 4.4 million tonnes of steel annually to enter from the EU tariff-free, in line with levels before President Donald Trump imposed tariffs under little-used national security legislation. Imports are half that level at present.
Raimondo said the EU would drop retaliatory tariffs in return and expressed confidence that the deal would ease supply-chain pressure and high prices. “We fully expect this agreement will provide relief in the supply chain and drive down cost increases,” she said. “Of course, it is also good for the American manufacturers who use steel and aluminum in their products.”
European Trade Commissioner Valdis Dombrovskis confirmed the accord and said the two sides would be “inviting like-minded economies to join this arrangement.” The EU had been poised on Dec. 1 to boost tariffs to 50% on various U.S. products, including Harley-Davidson motorcycles and bourbon from Kentucky. In return for the U.S. action, the European Commission has proposed to EU member states that they temporarily drop retaliatory tariffs and pause legal action at the World Trade Organization.
Officials said the deal would ensure that steel entering the U.S. from Europe was entirely produced in Europe. It also calls on future negotiations to take “carbon intensity” levels in steel and aluminum into account in future trade talks, which Raimondo said would allow production of products that are “significantly cleaner” than steel and aluminum produced in China. The U.S. and EU will not try to leverage the accord into a broader global arrangement that would penalize countries that don’t meet low-carbon targets for steel and aluminum exports.
White House national security adviser Jake Sullivan said the tariff agreement removes “one of the largest bilateral irritants in the U.S./EU relationship.” The EU and U.S. in June also paused a long-running dispute over subsidies given to aircraft makers Boeing and Airbus.
Speaking in Rome, President Biden said the arrangement would “lift up U.S. aluminum and steel… incentivize emission reductions in one of the most carbon intensive sectors of the global economy.” The deal would “restrict access to our markets for dirty steel from countries like China, and counter countries that dumped steel in our markets, hammering our workers,” Biden said at a press conference with Ursula von der Leyen, the commission president.
China reacts. The Chinese embassy in Washington said Beijing firmly opposed “the U.S. groundless accusations.” China produces 56% of the world’s steel, mostly through blast furnaces that use iron ore and coking coal. It was one of a handful of countries to increase output in 2020. “How the U.S. develops its economic and trade relations with the EU is its own business. But it should not make an issue of China or even attempt to form a clique against China,” the embassy said. “We hope all sides can earnestly take effective measures to contribute to the orderly operation of the global market, and sound and steady growth of international trade.”
Mixed reaction in U.S. The Coalition of American Metal Manufacturers and Users (CAMMU) said the news “is good news for U.S. manufacturers who continue to experience the highest prices in the world and long delivery delays. However, it is disappointing that the agreement will not completely terminate these unnecessary trade restrictions on our allies.” CAMMU said it is concerned that replacing the tariffs with a tariff rate quota (TRQ) will hurt its members “because the threat of tariff reinstatement looms with the surge in steel and aluminum demand expected when the bipartisan infrastructure bill passes. This type of government restriction on raw materials and intervention lead to market manipulations and allow for gaming of the system that could put this country’s smallest manufacturers at an even further disadvantage. The U.S. domestic steel sector does not need protection from competition and the US should immediately begin negotiations to lift these damaging tariffs on our other close allies and trading partners.”
— Forced labor in textile industry discussed between USTR, senior U.S. textile executives. U.S. Trade Representative (USTR) officials met Friday with members of the National Council of Textile Organizations, with the focus on boosting textile/cotton trade with several Central American countries. “The Western Hemisphere supply chain for textiles and apparel is a core pillar of the partnership between the United States and the countries of the Dominican Republic-Central America-United States Free Trade Agreement (CAFTA-DR),” said Deputy USTR Sarah Bianchi. “The CAFTA-DR rules of origin provide the certainty needed by industry to invest and expand operations in a way that promotes economic opportunity for both U.S. workers and those in the region. Maintaining certainty on the rules of origin and the short supply process in CAFTA-DR is critical to facilitating investments in the region by U.S. and Central American textile producers.” As we expected, the issue of forced labor in the textile industry was discussed, with Bianchi noting, “Recent concerns about the unreliability of geographically-extended supply chains and the pervasiveness of forced labor make this a particularly opportune time for expanding production in the Western Hemisphere.”
ENERGY & CLIMATE CHANGE
— President Biden emphasized the $900 billion in climate investment the bipartisan and partisan infrastructure deals would make in climate mitigation and resilience programs during his Sunday 25-minute stand-alone news conference, his first since his last foreign trip in June. Biden also swiped at Presidents Xi Jinping of China and Vladimir Putin of Russia, who “didn’t show up” in Rome, citing coronavirus concerns. Climate action is “going to require us to continue to focus on what China’s not doing, what Russia is not doing, or what Saudi Arabia is not doing,” he said. Biden departs Rome for Glasgow, Scotland, on Monday to attend the United Nations climate summit (COP26). He is anticipated back at the White House on Wednesday.
— New White House report for achieving “net-zero” greenhouse gas emissions by 2050 — under which the country would try to eliminate or offset all of its climate pollution. The plan entails switching to clean energy sources for electricity generation; making many parts of the economy run on electricity, including cars, buildings and industrial processes; increasing energy efficiency and scaling up the use of technology that pulls carbon dioxide from the atmosphere. The report projects that by 2050, electricity could provide between 15% and 42% of primary energy. The new report doubles down on President Biden’s pledge to eliminate power-sector emissions by 2035. Link to White House Fact Sheet. Biden today announced (link) the President’s Emergency Plan for Adaptation and Resilience (PREPARE), a coordinated federal approach.
Ways to achieve U.S. goals. The plan points to additional policies like incentives and standards for reducing power plant pollution, utilizing nuclear power and technology to capture emissions when fossil fuels are burned at power plants and investments in technologies for batteries that store renewable power. To reach its additional goals, the report promotes policies like adopting “climate-smart” agricultural practices and addressing emissions of a powerful greenhouse gas called methane through “stringent” standards for oil and gas production and investments in plugging leaks from coal, oil and gas extraction. The administration would seek $3 billion in annual funding starting in fiscal year 2024.
— G20 leaders failed to reach agreement on a provision sought by some nations to phase out the domestic use of coal, which accounts for around 44% of man-made carbon dioxide emissions. The final communique, after two days of intense negotiations in Rome, agreed to phasing out investment in new offshore coal power plants by the end of 2021. But tougher language was opposed by some of the worlds’ largest emitters, including India, China, and Russia. Now it’s down to negotiators at the COP26 summit in Glasgow to try to achieve a breakthrough.
The U.S. climate envoy, John Kerry, tried to manage expectations. “Glasgow was never, ever going to get every country joining up in Glasgow or this year necessarily,” Kerry said. “It was going to galvanize the raising of ambition on a global basis.”
Facts and figures: Any deal may have to be much larger than past ones. Even if all countries achieve their 2015 Paris Agreement targets, average global temperatures are on track to rise 2.7 degrees Celsius by the end of the century — 1.2 degrees over the goal.
— Supreme Court to review power plant rule case. The Supreme Court said on Friday that it will review what tools the Environmental Protection Agency can use to regulate greenhouse gas emissions from power plants. The petitions it granted Friday pertained to a case in which a court nixed the Trump administration’s rollbacks of Obama-era power plant rules. The court agreed to look at that case and consider questions about whether to limit the scope of the EPA’s regulations over these pollution sources.
— Is this the real reason why there has not yet been an RFS announcement? Some Washington sources say the Biden administration is holding off announcing several long-awaited Renewable Fuel Standard (RFS) decisions until after the two infrastructure-related measures are passed by Congress. Reason: The pending measures have funding for the biofuel industry and combined with the coming announcement of $700 million in biofuel aid relative to Covid program assistance will show the administration’s support for the biofuel industry, even if the coming RFS announcements may not please the biofuel sector.
LIVESTOCK, FOOD & BEVERAGE INDUSTRY
— Elon Musk challenged a United Nations official’s claim that just a small percentage of his wealth could help solve world hunger — and said if he could prove it he would pay up. Musk was responding to comments by David Beasley, director of the U.N.’s World Food Program, who said just $ 6 billion of his wealth could “solve world hunger.” Musk wrote in a Twitter post that if the World Food Program could describe exactly how the problem would be solved, “I will sell Tesla stock right now and do it.”
CORONAVIRUS UPDATE
— Summary: Global cases of Covid-19 are at 246,811,481 with 5,001,817 deaths, according to data compiled by the Center for Systems Science and Engineering at Johns Hopkins University. The U.S. case count is at 45,971,267 with 745,836 deaths. The Johns Hopkins University Coronavirus Resource Center said that there have been 422,070,099 doses administered, 192,453,500 have been fully vaccinated, or 58.6% of the total U.S. population.
— White House Press Secretary Jen Psaki has tested positive for Covid-19 after several family members at her home were infected earlier in the week, she announced. She was experiencing mild symptoms and said in a statement that she hadn’t had contact with President Biden or senior White House staff since Wednesday, when she began isolating at home.
— FDA authorizes Pfizer’s Covid vaccine for kids ages 5 to 11. The Food and Drug Administration (FDA) authorized the use of Pfizer and BioNTech’s Covid-19 vaccine for children ages 5 to 11, a move that will make the shots available to 28 million kids in the U.S. The Centers for Disease Control and Prevention must sign off before shots can be distributed. It’s scheduled an advisory committee meeting to review the pediatric doses this week and is expected to swiftly clear them for public distribution immediately thereafter. The FDA clearance — which was expected — came after the agency’s Vaccines and Related Biological Products Advisory Committee voted overwhelmingly Tuesday to back a smaller dose of the Pfizer vaccine for young children. According to Pfizer’s data, the smaller dose is more than 90% effective against symptomatic Covid-19 cases in young children. Pfizer and its partner BioNTech said they had sold 50 million child-sized doses of their Covid-19 vaccine to the U.S. government.
— Supreme Court denies religious exemption to state vaccine mandate for healthcare workers. Three conservative justices dissented, arguing that workers should be able to opt out for religious reasons because the state authorized medical exemptions to the vaccine requirement. The action means a lower court order upholding the mandate, which took effect Friday, remains in place, although the plaintiffs still can appeal through the Supreme Court’s regular procedures.
— People with “natural immunity” from a prior Covid-19 infection are more than five times more susceptible to another infection than a person vaccinated with a Pfizer-BioNTech or Moderna vaccine who’s never been infected, according to a new Centers for Disease Control and Prevention study.
— Britain, Australia and South Korea reached agreements with the drugmaker Pfizer to purchase its antiviral pills used to treat Covid-19 once regulators approve them.
— Australia opened its airports to travelers from abroad, after more than a year and a half of enforcing one of the world’s strictest border regimes.
POLITICS & ELECTIONS
— Kinzinger not seeking re-election. Rep. Adam Kinzinger (R-Ill.), a critic of Donald Trump who is one of two Republicans on the panel investigating the deadly Jan. 6 Capitol attack, announced Friday that he is not seeking re-election. He was one of 10 Republicans who voted to impeach Trump on the charge of inciting the Jan. 6 riot at the Capitol and joins a growing list of GOP Trump critics in Congress deciding to bow out. He is now the second to retire, after Ohio Rep. Anthony Gonzalez said he would do the same. The news comes on the same day that Illinois’ legislature approved a new congressional map for the state, aiming for a state delegation with 14 Democratic seats and 3 Republican ones. His redrawn district now wedges him and Rep. Darin LaHood — who more closely aligns with Trump — into a deep-red northern slice of the state.
Downstate, Republican Reps. Mike Bost (R-Ill.) and Mary Miller (R-Ill.) are also drawn into the same district. It is unclear at to what both of them will do under the new map.
Rep. Cheri Bustos (D-Ill.) is retiring, though Illinois Democrats hope to have shored up her northwestern seat.
— New Jersey gubernatorial race. New Jersey hasn’t re-elected a Democratic governor in 44 years, but the New Jersey Star-Ledger reports (link) the latest poll in the race for New Jersey governor shows Gov. Phil Murphy (D-N.J.) continuing to lead Republican challenger Jack Ciattarelli (R-N.J.) by 9 percentage points in the final days of the election. Murphy is up 50% to 41% over Ciattarelli, a former member of the state Assembly, among likely voters leaning toward a candidate, according to the Stockton University Poll. The Philadelphia Inquirer reports (link) that if Murphy wins a second term on Nov. 2, it would validate his campaign’s message: that most New Jerseyans agree with his progressive approach to taxes, health care, and gun laws. Bottom line: Polls indicate Murphy will win re-election even as his Republican rival has narrowed the lead in the final weeks of the race.
— NBC News poll shows President Biden’s approval rating has dropped to 42% — “a decline of 7 points since August, with much of the attrition coming from key parts of the Democratic base” — while his disapproval is now at 54%. Biden’s approval rating is lower than any other modern first-year president’s at a similar point in time, with the key exception of Donald Trump, whose approval averaged 37% in fall 2017. 71% in the poll — including 70% of independents and even 48% of Democrats — believe the nation is headed in the wrong direction. Of note: Just 18% strongly approve of Biden, while nearly half (46%) strongly disapproval. Link for more details.
— Biden insisted he was not deterred by his declining poll numbers, dismissing complaints he and liberal lawmakers were a drag on Virginia Democratic gubernatorial nominee Terry McAuliffe, whose closer-than-expected election race with GOP challenger Glenn Youngkin is Tuesday. “The polls are going to go up and down, up and down,” Biden told reporters Sunday in Rome. “Well, look at every other president, that’s what’s going to happen. But that’s not why I ran.”
— McAuliffe and Youngkin statistically tied in race for Virginia Governor; Republicans lead in enthusiasm. Just before Election Day Tuesday, the race for Virginia governor is a statistical tie. Former Democrat Gov. Terry McAuliffe holds a 1-percentage point lead over Republican Glenn Youngkin (47%-46%) with 6% undecided, according to the Roanoke College Poll (link). The downticket races are also within the margin of error, with Del. Hala Ayala (D) ahead of former Del. Winsome Sears (R) 46%-44% for lieutenant governor and Attorney General Mark Herring (D) leading Del. Jason Miyares (R) 46%-45% in the race for attorney general. The Institute for Policy and Opinion Research interviewed 571 likely Virginia voters between Oct. 14 and Oct. 28 and has a margin of error of +4.1%. Republicans hold an advantage in being extremely enthusiastic about voting (49% to 32% for Democrats), while most partisans say they are almost certain to vote or have already voted (76% of Republicans vs. 77% of Democrats). Likely voters see the economy (38%) and education (22%) as the most important issues in the election ahead of Covid (13%), health care (11%), and race relations (7%). Most voters (73%) decided who to vote for more than a month ago, but 19% decided in the last month or the last week.
Meanwhile, other polls show Youngkin was a hair ahead of McAuliffe on Saturday, according to the FiveThirtyEight tracker (link). The RealClearPolitics (link) average also showed Youngkin slightly ahead.
OTHER ITEMS OF NOTE
— President Joe Biden told Emmanuel Macron that America was “clumsy” in its handling of an agreement to provide nuclear-powered submarines to Australia. The deal supplanted a previous one agreed between France and Australia and led to an extended diplomatic spat.
— France’s president, Emmanuel Macron, said that Australia’s prime minister lied to him about a decision to renege on a $90 billion submarine contract. Scott Morrison denies having been untruthful over secret negotiations which saw Australia ditch a long-standing order for French subs in favor of nuclear-powered vessels based on American technology — part of the AUKUS military pact it signed with America and Britain in September.
— Biden offers Iran a way to lift sanctions. President Biden on Saturday opened the door to lifting sanctions as part of a diplomatic effort to prevent Tehran from building nuclear weapons. The offer was made as part of a joint statement with German Chancellor Angela Merkel, British Prime Minister Boris Johnson and French President Emmanuel Macron. The four leaders met on the sidelines of the G20 conference in Rome to plan their strategy for dealing with Iran, which has raised concerns by increasing its enrichment of nuclear material. “This will only be possible if Iran changes course,” the leaders said in their statement, adding that they were urging Iran’s new president, Ebrahim Raisi, “to seize this opportunity and return to a good faith effort to conclude our negotiations as a matter of urgency. That is the only sure way to avoid a dangerous escalation, which is not in any country’s interest.” Biden campaigned on returning to the Iran nuclear agreement, which was reached by President Obama in 2015 and abandoned by President Trump three years later. Since then, the U.S. has targeted the Iranian economy with punishing sanctions; Tehran, in turn, has ramped up its nuclear activities.
— Supreme Court to weigh Texas abortion law. Oral arguments are set for today over two lawsuits challenging the state’s ban on abortions after about six weeks of pregnancy. Also on the docket this week: a case challenging a New York state limit on concealed-weapons permits, which could see the court expand Second Amendment rights.
EVENTS AND REPORTS
Monday, Nov. 1
· COP26 summit. President Joe Biden and several cabinet-level officials will participate in the COP26 summit in Glasgow.
· 2022 midterm election issues. Washington Post Live virtual discussion on “the 50-50 Senate, the countdown to the 2022 midterms and the future of the GOP.”
· Japan elections. Center for American Progress virtual discussion on “Analyzing the Results of Japan’s 2021 General Election.”
· International issues. Peterson Institute for International Economics and the National University of Singapore’s Lee Kuan Yew School of Public Policy virtual 2021 Next STEP (Solutions to Economic Problems) Conference, with Commerce Secretary Gina Raimondo to deliver remarks.
· International development. Financial Accountability and Corporate Transparency (FACT) Coalition, the Small Business Majority, the American Federation of Labor and Congress of Industrial Organizations (AFL-CIO), and Oxfam America virtual discussion on “OECD’s (Organization for Economic Cooperation and Development) New Tax Framework for U.S. Businesses and Workers.”
· Economic reports. PMI Mfg. Index Final | ISM Mfg. Index | Construction Spending
· USDA reports. AMS. Export Inspections NASS: Cotton System | Fats & Oils | Grain Crushings | Flour Milling | Crop Progress