15th January 2020

Written by Scott Reid, Associate Partner

Edited by Kevin Pringle, Partner


Good morning,

All is not well with the US Democrats. And yet, on paper at least, aren’t things going well? They enter a 2020 presidential race facing one of the most unpopular presidents in US history, and from today, the third such to be impeached, this time by a Democratic committee in a majority-controlled House of Representatives. But as six candidates in the race for the Democratic nomination – Joe Biden, Pete Buttigieg, Amy Klobuchar, Bernie Sanders, Tom Steyer and Elizabeth Warren – took to the stage in Des Moines last night for the final televised debate ahead of the Iowa primary caucus in three weeks, party unity was not the order of the day. The headline story of the night, and perhaps of the Democratic race so far, is that the big tickets from the party’s left, Sanders and Warren, are not getting along. Earlier this week, Warren claimed that Sanders had said in a closed door meeting in 2018 before launching her campaign that “no woman could win” this year’s race. Claims of sexism abound with Sanders denying the charge; one of his supporters hit back that “he was marching for women’s right at the same time Warren was a Republican.” And last night that culminated in Warren’s apparent rejection of a handshake by Sanders (which is roughly the debate night equivalent of giving him the middle finger anywhere else). Why does all this matter? Because identity matters in US politics. Splitting the camp between feminists, socialists, millennials and any other moniker you can stick on an “X for Sanders/Warren” badge ultimately splits the only opposition that will count come November. Policy detail is a casualty of the crossfire, as it was last night, and everyone is poorer for it. Sure, divided parties are nothing new in US elections – primaries are just part of the rough and tumble. But when Republicans were ruthlessly, if shockingly, getting behind Donald Trump’s candidacy in 2016, it is useful to remember that Democrats were still at each other’s throats over Hillary Clinton’s nomination. Back then, former secretary of state Madeleine Albright famously quipped there was a “special place in hell” for women who didn’t support Hillary, the party’s opposing wings set about each other and, well, we all remember the rest. The candidates’ respective feminist credentials rightly deserve to be aired in public alongside their dirty laundry. But they should be careful about the surrounding optics. As 2016 showed the world, Democrats play the identity card at their peril.


News

The UK government yesterday formally rejected a request by Nicola Sturgeon to hold a second referendum on Scottish independence. In a written response, prime minister Boris Johnson said that another poll would “continue political stagnation”, and that the first minister had promised the 2014 referendum would be “once in a generation”. The Times reports this morning that the SNP is planning to hold a demonstrative vote in the Scottish Parliament in support of another referendum, hoping to attract the votes of some Labour MSPs as well as the pro-independence Greens. The US House of Representatives will today vote on sending articles of impeachment to the Senate, with a trial of president Donald Trump likely to begin next Tuesday. After withholding the articles for nearly a month, the Democratic speaker of the house, Nancy Pelosi, yesterday nominated fellow Democrats, Adam Schiff and Jerrold Nadler, as impeachment managers who will effectively act as chief prosecutors. Iran’s Islamic Revolutionary Guard Corps (IRGC) have announced the first arrests in connection with the mistaken shooting down of a Ukrainian passenger plane last week. President Hassan Rouhani sided with protestors who continue to demonstrate in Tehran, and demanded a formal investigation into the “unforgivable error” by the IRGC.


Business and economy

The government has struck a financial rescue package with Flybe. Ministers agreed to offer a repayment plan to settle the regional airline’s debts, which are reported to exceed £100 million, while the firm’s owners, including Virgin Atlantic and Stobart Group, will also invest more money inthe business. The government also agreed to review air passenger duty currently levied on domestic UK return flights, which Flybe suggests has contributed to its losses. Google is to phase out the use of third party cookies from its Chrome browser. Following similar moves by Apple and Microsoft, the removal will restrict the flow of consumer data to ad agencies and brokers, a model which has underpinned digital advertising for 25 years. The FT speculates whether the move has been decided among the larger tech firms to pool targeting between themselves, rather than open the market to third-parties. (£) UK tech start-ups attracted the most investment in Europe last year. According to a report by government agency Tech Nation, the UK tech sector won a record £10.1 billion in venture capital funding in 2019, up £3.1 billion on the figure for 2018 and with £7.1 billion raised by London-based companies alone. The figure puts the UK third behind the United States and China for overall VC fundraising.


Columns of note

Responding to last week’s news that the UK suffers from the lowest foreign language knowledge in Europe, Michael Skapinker writes in the FT to call for compulsory language tuition in schools. He laments that the UK’s position is especially worrying vis-à-vis other English-speaking countries such as the US and Australia which similarly suffer from poor second language knowledge, given the host of new trading relationships which are required post-Brexit. He suggests greater teacher bursary provision, placing language teaching on the Shortage Occupations List, and making a second language compulsory for university entry could all be considered by the government. (£) In The New Yorker, Richard Brady suggests that this year’s Oscar nominations are a continuing exercise in “fossilized” self-congratulation by a predominantly white Academy. The fact that the success of streaming platform-based films such as “The Irishman” and “Marriage Story” is this year’s headline feature of the nominations, he adds, is evidence that the industry is more interested in commercial sales and viewing figures than introducing new genres and backgrounds into the competition. (£)

Source: New Yorker

Markets


What happened yesterday?


The London market managed to eke out gains yesterday as investors celebrated a positive start to the US corporate earnings season. By close of trading, the FTSE 100 was up 0.1% at 7,622.35 points with sterling up 0.15% on the dollar at $1.30 and by 0.31% on the euro at €1.17.

In the US, fourth-quarter revenues from banking groups Citigroup and JP Morgan exceeded analyst expectations whilst Wells Fargo fell below.

In the UK, housebuilder Taylor Wimpey (+3.91%) topped the list of the day’s gainers after announcing that it expected full-year results to be in line with expectations despite political and economic uncertainty connected with Brexit. Sector peers Persimmon (+2.23%) and Barratt Developments (+1.64%), and construction materials retailer Kingfisher (+2.10%) also rose on the news.


What's happening today


Interims Knights Group

Trading Announcements Persimmon Quiz Rev Bars Ten Ent Grp


AGMs

Diploma


UK Economic Announcements (09:30) Consumer Price Index (09:30) Producer Price Index (09:30) Retail Price Index

Int. Economic Announcements No children – between the age of 0 and 15 – died in traffic accidents in the whole of Norway in 2019, according to the Norwegian Public Roads Administration.


Source: Financial Times

Did you know?

No children – between the age of 0 and 15 – died in traffic accidents in the whole of Norway in 2019, according to the Norwegian Public Roads Administration.


Parliamentary highlights

TODAY House of Commons

Oral questions Wales Prime Minister's Question Time Debate on the Address A Green Industrial Revolution Adjournment Ockenden review of maternity care at Shrewsbury and Telford Hospital NHS Trust - Lucy Allan House of Lords

Legislation European Union (Withdrawal Agreement) Bill - Committee stage (day 2) - Lord Callanan Oral questions Ensuring safe staffing in social care and the NHS in this Parliament - Baroness Watkins of Tavistock Situation in Hong Kong - Lord Alton of Liverpool Engaging civil society in climate change issues ahead of COP26, to be held in Glasgow in November 2020 - Baroness Boycott Decision by Counter Terrorism Policing South East to include Extinction Rebellion on a list of extremist ideologies to be referred to the Prevent programme. - Lord Berkeley Legislation European Union (Withdrawal Agreement) Bill - Committee stage (day 2) continued - Lord Callanan Scottish Parliament

Members’ Business The Valuable Role of Independent Prison Monitors – Alexander Stewart Portfolio Questions Scottish Conservative and Unionist Party Debate Education Members’ Business Celebrating Scotland’s Wetlands on World Wetlands Day 2020 – John Finnie TOMORROW House of Commons

Oral questions Digital, Culture, Media and Sport (including Topical Questions) Attorney General Business Statement Business Questions to the Leader of the House of Commons - Mr Jacob Rees-Mogg Debate on the Address Health and Social Care Adjournment Protection for new home buyers - Kate Green House of Lords

Introduction(s) Lord Darroch of Kew and Lord Reed of Allermuir Oral questions Home Office policy on the processing of an asylum claim when an applicant says they have been the victim of child trafficking - Baroness Doocey Completion of the England Coast Path - Lord Greaves Following the 40th anniversary of the adoption of the Convention on the Elimination of all Forms of Discrimination Against Women, what plans the Government have to put forward a representative to the Committee - Baroness Burt of Solihull Support required by the Football Association to address increased levels of racism in football - Lord Addington Legislation European Union (Withdrawal Agreement) Bill - Committee stage (day 3) - Lord Callanan Short debate Implications of the use of drones to assassinate Qasem Soleimani for existing agreements on the use of drones - Lord Hodgson of Astley Abbotts Scottish Parliament

General Questions First Minister’s Questions Members’ Business Sustainable Development Goals in Scotland, On Target for 2030? - Lewis Macdonald Portfolio Questions Stage 1 Debate and Financial Resolution Disclosure (Scotland) Bill Legislative Consent Motion Direct Payments to Farmers (Legislative Continuity) 2020 Bill