Disney is preparing for Republicans to take control of the House, as polls suggest the party has an edge over Democrats in the days before the midterm elections.
Disney CEO Bob Chapek has been having private phone calls this year with House Republican leaders including Minority Whip Steve Scalise, R-La., according to people briefed on the matter. Scalise is in line to become House majority leader if Republicans take control of the chamber, which would make him the No. 2 official in the majority party.
These people briefed on the calls declined to be named in order to speak about private conversations. Asked about Chapek’s engagement with Scalise and other House GOP officials, a spokesman for Disney said in an email that the company speaks to lawmakers from both sides of the aisle. A spokeswoman for Scalise did not return repeated requests for comment.
The conversations this year are taking place as Republicans on Capitol Hill attack Disney and other companies as “woke” after they took stances on a range of political or cultural issues. The GOP has used the criticism of businesses in part to try to mobilize conservative voters ahead of the elections.
Some Disney executives and their advisors are concerned Republicans could ramp up their attacks on the company if the party wins control of the House, according to people familiar with the matter. They worry the GOP could pressure the company not to speak out on social issues, such as the Supreme Court ruling in June that overturned the right to an abortion enshrined in Roe v. Wade. After the decision, Disney said it would help pay for employees’ pregnancy-related care if they travel to a different state.
“I think there is significant concern now that Republican lawmakers believe in free markets and capitalism but only if they agree with that company,” Cristina Antelo, a Democratic lobbyist who counts Disney as a client, told CNBC in a recent interview.
Though she would not comment directly on Disney, Antelo said that Republicans”can bring pressure on companies that they believe are too woke” if they retake the House majority starting in January.
While most major companies have been preparing for a potential power shift in Washington for months, Chapek has engaged directly with lawmakers poised to become a lot more powerful if the GOP retakes the House.
Scalise and Disney have had a close relationship for years. Scalise’s leadership PAC hosted a fundraising event at Disney World’s Polynesian Village in Florida, Axios reported. Scalise’s campaign has hosted previous fundraisers at Disney World, according to NOLA.com.
Bill Bailey, a senior Disney lobbyist, has donated $1,500 combined to Scalise’s leadership PAC and his reelection campaign since October 2021, according to Federal Election Commission records. Scalise, like all U.S. House members, is up for reelection this year.
Meanwhile, Disney’s company PAC and individual employees have combined to giveover $900,000 to federal candidates in the 2022 election cycle, according to data from the nonpartisan OpenSecrets. The data shows 87% of those donations went toward Democrats. Much of the campaign funding this cycle came from individual employees and not the company PAC.
Polling suggests Republicans have a strong chance to win control of the House and could regain the Senate. Democrats have a slim majority in both chambers of Congress, and the party has to rely on Vice President Kamala Harris’ tie-breaking vote in the Senate to cement its majority.
The president’s party typically loses seats in midterm elections. President Joe Biden’s relatively low approval rating has appeared to pose a challenge for Democrats: a recent NBC News poll found 45% of voters approve of the job Biden is doing, while 52% disapprove.
The same survey found 46% of respondents want a Republican-controlled Congress, while a near identical 47% say they prefer Democrats remaining as the majority.
An average of recent polls shows voters slightly prefer Republicans to control Congress over Democrats, according to FiveThirtyEight.
Even as House Republicans lack much of the formal power they would gain by winning the majority, they have tried to pressure Disney and other companies over their stances on social issues.
Chapek defends Disney’s stances
Many of the calls between Chapek and House Republican officials involve the Disney CEO being “direct” and defending the company’s opposition to Florida’s so-called “Don’t Say Gay” bill, those familiar with the conversations have said. GOP Gov. Ron DeSantis signed the Florida bill, officially called Parental Rights in Education, into law in March.
The law forbids instruction on sexual orientation and gender identity in public schools within the Sunshine State from kindergarten through third grade. After feeling pressure from employees, Chapek and Disney publicly opposed the bill, including after DeSantis signed it.
Though the exact dates of the calls between Chapek and GOP leaders are unclear, a person familiar with them say some took place shortly before and after members of the conservative House Freedom Caucus signed a letter to the Disney CEO in April. The letter specifically called out the company for speaking against the DeSantis-signed legislation.
“We stand in opposition to the dangers posed by corporate wokeness, and we applaud the Florida legislature for giving children and families the tools to fight back against woke indoctrination,” the letter to Chapek reads. Austin Livingston, a spokesman for Freedom Caucus member and letter signatory, Rep. Ralph Norman, R-S.C., said their office has not received a response from Chapek or Disney.
Livingston noted, though, that the South Carolina Republican “simply has no patience for otherwise rational business leaders who cower in fear over woke progressives. He will continue to call out these executives when appropriate.” Norman is up for reelection in 2022. He currently serves on both the House Financial Services Committee and the House Oversight Committee.
Disclosure reports show that since members of the Freedom Caucus sent the letter to Chapek, Disney added former House Republicans Bob Goodlatte and Greg Walden to its legion of lobbyists. They were registered to lobby for Disney in May and June, respectively, according to disclosure reports. Records show Disney already had CGCN, a Republican-led lobbying firm, on retainer.
Disney spent just over $2.3 million on in-house lobbying from the start of the second quarter through the end of the third quarter, records show.
The company shelled out $1.37 million in the second quarter alone. The sum makes it the most the company has spent on its in-house lobbying efforts in a single quarter since the first quarter of 2011, according to disclosure reports.
Original Article: cnbc.com
Elon Musk Says He Doesn’t Want to Be CEO of Any Company and Tries to Walk Back SEC Insults
Elon Musk said in court on Wednesday that he does not want to be the CEO of any company.
Musk also confirmed that the arrangement at Twitter is temporary. “I expect to reduce my time at Twitter and find somebody else to run Twitter over time,” he said.
Musk and Tesla are in the midst of a trial over the 2018 CEO pay package that the company granted him, an unparalleled compensation plan that has made Musk a centi-billionaire and the richest person on the planet.
Shareholder Richard J. Tornetta has sued Musk and Tesla alleging that the CEO compensation was excessive, and that its authorization by the Tesla board amounted to a breach of its fiduciary duty.
Musk also said during the testimony that CEO is not necessarily an apt description for the work he thinks he does at his companies.
He said, “At SpaceX it’s really that I’m responsible for the engineering of the rockets and Tesla for the technology in the car that makes it successful. So, CEO is often viewed as somewhat of a business focused role but in reality, my role is much more that of an engineer developing technology and making sure that we develop breakthrough technologies and that we have a team of incredible engineers who can achieve those goals.”
He also said, “It’s my experience that great engineers will only work for a great engineer. That is my first duty, not that of CEO.”
Attorneys for Tornetta also asked Musk about a CNBC report that he had authorized at least 50 Tesla employees, mostly Autopilot engineers, to help with his work at Twitter, now that he owns the social media company.
Musk said he only called on Tesla employees to assist him at Twitter on a “voluntary basis,” and to work “after-hours” at Twitter. He said that no Tesla board member had called him to say it is not a good idea to use Tesla resources for one of his other, privately-held companies.
The Tesla CEO specified that, “This was an after hours– just if you’re interested in evaluating, helping me evaluate the Twitter… that’d be nice. I think it lasted for a few days and it was over.”
When a lawyer asked if he thought it was a good idea to be using Tesla assets at Twitter, Musk responded, “I didn’t think of this as using Tesla assets…There’s 120,000 people at the company. This is de minimis.”
With all of his business commitments, Musk explained during his testimony that Tesla has taken more time than anything in recent years.
Attorneys for the plaintiffs in the trial asked Musk whether it was a good idea to strike a combative attitude towards regulators, and specifically asked him about prior insults he lobbed at the Securities and Exchange Commission.
“In general, I think the mission of the SEC is good but the question is whether that mission is being executed well,” he replied.
“In some cases I think it is not. The SEC fails to investigate things that they should and places far too much attention on thing that are not relevant. The recent FTX thing I think is an example of that. Why was there no attention given to FTX? Investors lost billions. Yet the SEC continues to hound me despite shareholders being greatly rewarded. This makes no sense.”
In fact, the SEC and several other regulators have reportedly launched an investigations into collapsed crypto firm FTX, but it’s not clear if those investigations started prior to the firm’s sudden bankruptcy last week.
This news is developing, please check back for updates.
Fed’s Daly Sees Rates Rising at Least Another Percentage Point As ‘pausing Is Off the Table’
San Francisco Federal Reserve President Mary Daly said Wednesday she expects the central bank to raise interest rates at least another percentage point, and possibly more, before it can pause to evaluate how the inflation fight is going.
Daly told CNBC in a live interview that her most recent estimate in the Fed’s summary of economic projections puts the benchmark overnight lending rate around 5%. She added that the right range is probably from 4.75% to 5.25% from its current targeted range of 3.75%-4%.
“I still think of that as a reasonable landing place for us before we hold, and the holding part is really important,” she told Steve Liesman during the “Squawk on the Street” interview. “It’s a raise-to-hold strategy.”
Thus far, the Fed has hiked the fed funds rate, which spills over into a slew of other consumer debt products, six times, including four consecutive 0.75 percentage point moves.
Looking ahead, market pricing is largely in line with what Daly suggested. Traders see the central bank adding another 0.5 percentage point when it meets again in mid-December, then moving a bit higher before stopping around the 4.75%-5% range.
Daly said she sees a point where the Fed will be able to evaluate the impact of its hikes before moving higher, but that is not now.
“Pausing is off the table right now. It’s not even part of the discussion,” she said. “Right now, the discussion is rightly around slowing the pace and … focusing our attention really on what is the level of interest rates that will end up being sufficiently restrictive.”
The Fed is using its primary tool of interest rate increases to right inflation that still is around its highest level in more than 40 years.
Over the past week, the news has gotten at least incrementally better: The consumer price index rose a less-than-expected 0.4% in October, while the producer price index increased just 0.2%. Both price measures are off their highs, running at respective annual rates of 7.7% and 8%, but still well above the Fed’s 2% target.
Daly said she saw an easing of core goods inflation as “positive news” and is encouraged by the general slowing in the economy.
“Consumers are stepping back, they’re changing how they allocate spending. They’re dealing with high inflation, of course. They have to make trade-offs, put things back that they would otherwise get. But they’re also preparing for a slower economy,” she said. “That’s a very good start.”
Yet data Wednesday showed that spending is keeping up with inflation, as retail sales rose a slightly better than expected 1.3% in October. Early data is showing GDP is accelerating at a 4% pace in the fourth quarter, according to the Atlanta Fed.
Daly said she expects higher rates to continue to have an impact on the economy and bring inflation back in line.
“When we raise it and hold, over time as we’re holding monetary policy is becoming tighter as inflation comes down, so that’s another factor we’ll have to consider,” she said.
She added that her goal is to bring inflation down “as efficiently and as gently as we can.”
Binance CEO Says Crypto ‘will Be Fine’ and Announces Industry Recovery Fund
The CEO of the largest online exchange for trading cryptocurrency said Wednesday that he’s establishing a recovery fund to help people in the industry while saying the sector “will be fine.”
“We want the strong industry players today to protect the good industry players who might just be hurt short term,” Binance CEO Changpeng Zhao said during an interview with CNBC’s Dan Murphy at Abu Dhabi Finance Week.
related investing news
“That’s not to say we can save everybody. If a project is mismanaged on multiple fronts we won’t be able to help them anyway.”
Zhao said cryptocurrency had “shown extreme resilience,” suggesting he didn’t expect recent turbulence in the industry to cause long-term damage. He did not specify an exact figure for the size of the recovery fund.
The price of bitcoincould lead to the downfall of other big industry names, such as Crypto.com. The company’s CEO denied the claims and said the platform was “performing business as usual.”
“Short term there’s a lot of pain but long term it’s accelerating the efforts we’re making to make this industry healthier,” Zhao said.
The CEO on Monday said Binance had seen a “slight increase in withdrawals” in the last week, but he said this was in line with other dips in the market.
“Whenever prices drop, we see an uptick in withdrawals,” Zhao said. “That’s quite normal.”
Regulations will help, but they won’t fix everything
Zhao said he wants to form an organization that could “establish best practices” across the industry, which is known for its lack of regulation.
“Regulations need to be adapted for this industry,” Zhao said. “Regulation won’t fix all of this, it will reduce it. It’s important but we’ve got to have the right expectations,” he added.
Zhao reflected on how there were elements of traditional finance that could help the cryptocurrency market to become more regulated and better trusted, but practices would need to be adapted to be fit for purpose.
The “transparency” and “audit” aspects of traditional finance could benefit the crypto industry, but there are “subtle but very important” differences that would need to be made, according to the CEO.
“Too many regulators are more of a traditional mindset, they need to get a crypto mindset,” he said
The comments echo those made by Ripple CEO Brad Garlinghouse, who said the idea that crypto is “not regulated is overstated,” but that “transparency builds trust.”
“Crypto has never just been sunshine and roses and as an industry, it needs to mature,” Garlinghouse said on CNBC’s “Squawk Box Europe” Wednesday.
Economist Nouriel Roubini took a different line in his Abu Dhabi Finance Week interview and described crypto and some of its major players as an “ecosystem that is totally corrupt.”
The New York University professor said there were “seven Cs of crypto”: “Concealed, corrupt, crooks, criminals, con men, carnival barkers,” and finally, Changpeng Zhao himself.
— CNBC’s Jenni Reid and Ryan Browne contributed to this report.
Original Post: cnbc.com
Business6 months ago
Target Shares Sink 25% After Company Says High Costs, Inventory Woes Hit Profits
Business7 months ago
Biden Administration Signals a Decision on Student Loan Forgiveness Could Come Soon
Business3 weeks ago
Roblox Shares Sink After Reporting Bigger Loss Than Expected
Business7 months ago
Inflation Barreled Ahead at 8.3% in April From a Year Ago, Remaining Near 40-year Highs
Business6 months ago
The S&P 500 Is Little Changed Ahead of Federal Reserve Update
Business7 months ago
Boeing Tumbles on Quarterly Loss, Added Costs From 777X and Defense Delays
Business6 months ago
Dow Falls Nearly 300 Points to Start June, As Worries Mount Over Economic Growth
Business6 months ago
Job Openings Show Sharp Decline, but Still Vastly Outnumber Available Workers