THE TICKER

Money buys satisfaction, and the lack of it can be so dire that it leads to suicide.

Those may or may not sound like intuitive truths. But two new studies put data behind them and reveal just how stark the difference is between the lived experiences at either end of the wealth scale.

The first — from NPR, the Robert Wood Johnson Foundation and the Harvard T.H. Chan School of Public Health — finds that 90 percent of those earning more than $500,000 a year say they are “completely” or “very” satisfied with their lives. Only 44 percent of those earning less than $35,000 said the same. And the study found statistically no 1 percenters say they are dissatisfied with their lives.

At the bottom of the income heap, relatively minor adjustments in pay can yield such a dramatic difference they register as public health benefits, according to the second study, published in the Journal of Epidemiology and Public Health. That paper found “state-level increases of $1 in minimum wage corresponded with a 3.4 percent to 5.9 percent decrease in the suicide rates of people with a high school diploma or less” among 18- to 64-year-olds, per my colleague Eli Rosenberg.

The perspectives come amid a roiling debate over wealth inequality that has helped shape the Democratic presidential primary and is sure to spill into general election. 

About 6 in 10 American adults now agree the scales are too heavily tipped toward the rich, but while Democrats identify the issue as a top priority for the federal government, few Republicans say the same, according to a new Pew Research Center survey. 

Specifically, 61 percent of Democrats and Democratic leaners say reducing inequality should be a leading concern for policymakers, versus 20 percent of Republicans and Republican leaners who say the same; and Democrats are nearly twice as likely as GOPers to say there’s too much inequality, by a margin of 78 percent to 41 percent:

Unsurprisingly, Pew finds that the higher someone is on the income scale, the less likely they are to identify inequality as a matter that needs urgent attention: 52 percent of lower-income Americans believe Washington should make it a focus, versus 36 percent of those pulling in higher pay.

It’s no great leap to suggest the reason is simple: The very rich have a good thing going, and they know it. The NPR-RWJF-Harvard survey focuses on the life satisfaction of that cohort, rather than in-the-moment happiness. Other studies have shown a strong correlation between happiness that starts to weaken once people are earning more than $75,000 in annual income, my colleague Christopher Ingraham notes.

The new study is the first to gather meaningful data from the 1 percent and “shows that life satisfaction continues to rise with income through at least the $500,000-a-year threshold.”

Per Ingraham, “The rich might not be any happier than the rest of us on a day-to-day basis, in other words, but they are an awful lot more self-satisfied. Among the 1 percent, for instance, 97 percent say that they’ve already obtained the ‘American Dream’ — the definition of which was left to the respondent — or are actively working toward it. Among low-income adults, by contrast, 4 in 10 say the American Dream is completely out of reach.”

In a more practical sense, the very rich don’t have to grapple with many of the stressors facing low-income people. “Among low-income households, for instance, nearly 40 percent said they had trouble paying their medical bills in the past several years and 30 percent reported having difficulty paying for food, Ingraham writes. “Among the top 1 percent, those shares were 5 percent and zero, respectively.”

Those at the bottom are seeing higher rates of “deaths of despair” — from suicide, alcoholism, and drug use — even as a historically long economic expansion continues its run, Rosenberg notes. “We’ve known for a long time that economic distress affects people’s well-being,” John Kaufman, the lead author of the report on the link between the minimum wage and suicide rates, told him. “So in our study, we’re just trying to estimate what’s the strength of minimum wage increase.”

The federal minimum wage of $7.25 an hour hasn’t budged since 2009, but twenty-nine states and the District of Columbia have set it higher. House Democrats have passed a measure to lift the federal minimum wage to $15 an hour. It has gotten no action in the GOP-controlled Senate, and President Trump has taken contradictory positions on the matter.

All the top Democratic presidential contenders support lifting the standard to $15 an hour, with the exception of entrepreneur Andrew Yang, whose signature proposal is a “freedom dividend” that would give every American $1,000 a month. And though they offer different strategies for rolling it back, the Democratic contenders also agree Trump’s signature domestic achievement, the 2017 tax cut package, tilted its benefits too heavily toward corporations and the wealthy. That means no matter how Democratic resolve the intramural scrap for the nomination — between liberals pushing structural change and moderates seeking more incremental tweaks — their nominee will seek to keep these issues front and center against Trump. 

PROGRAMMING NOTE: I’ll be on my honeymoon next week, so the newsletter is briefly going dark again. See you back here Monday, Jan. 20.

MARKET MOVERS

— Weekly jobless claims fall: “New applications for U.S. jobless benefits fell more than expected last week, but the labor market appears to be cooling, with the number of Americans on unemployment rolls surging to more than a 1-1/2-year high at the end of 2019,” Reuters’s Lucia Mutikani reports.

“Initial claims for state unemployment benefits dropped 9,000 to a seasonally adjusted 214,000 for the week ended Jan. 4, the Labor Department said on Thursday. The fourth straight weekly decline saw claims almost unwinding the jump in early December, which was blamed on a later-than-normal Thanksgiving Day.”

What to expect from today's jobs report. WSJ's Eric Morath: "Economists expect 160,000 jobs were added in December. That would place 2019 as the third lowest year for job creation during the expansion, just behind 2017. If employers don’t add at least 98,000 jobs, 2019 would be the lowest for job growth since 2010... Last year’s cooling reflects employers’ difficulty finding enough workers, global uncertainty and the fading effects of 2018’s tax cuts.

"The unemployment rate is expected to close the decade at 3.5%. That could mark the third month in 2019 when the rate matched the lowest reading since 1969. Watch for revisions to unemployment data that occur annually in the December report, which could alter monthly rate readings."

More public companies are losing money, even as stocks hit new highs. WSJ's James Mackintosh: "Tesla Inc. shares have doubled in three months, while General Electric Co. shares are up 44%. The pair are the two most valuable loss-making companies, part of a shockingly high proportion of listed companies that have been losing money—despite, or perhaps because of, the long bull market...

"The combination of forces has pushed the percentage of listed companies in the U.S. losing money over 12 months to close to 40%, its highest level since the late 1990s outside of postrecession periods."

— CEOs, consumers disagree on state of the economy: “Chief executive officers and chief financial officers see an economy that is heading into a slowdown if not an outright recession. Recent surveys show that CEOs believe recession is the biggest risk in 2020, while almost all CFOs surveyed by Deloitte think the economy is likely to at least slow,” CNBC’s Jeff Cox reports. “But consumers are in the opposite camp.”

“The difference could be a simple matter of perspective. Whereas consumers tend to focus more on conditions closer to home, corporate executives take a more global view. The tariff exchange coupled with a more pessimistic view on global growth has brought down executive hopes for the future.”

Investment-grade firms have sold more than $61 billion of notes in the U.S. through Thursday, double the same period in 2019. Companies have reasoned that it makes sense to sell bonds now when conditions are still good and demand is strong.
Bloomberg
Federal Reserve Vice Chairman Richard Clarida laid out an optimistic outlook for the U.S. economy in 2020 on Thursday, saying that last year’s rate cuts were “well timed” and that monetary policy is well positioned for the new year.
Reuters

TRUMP TRACKER

TRADE FLY-AROUND:

— “Trade wars are good and easy to win”: “Tariffs imposed by [Trump] to restructure the United States’s top trade relationships have cost American companies $46 billion since February 2018, and U.S. exports of goods hit by retaliatory tariffs have fallen sharply, according to an analysis of Commerce Department data,” Reuters’s Andrea Shalal reports.

“The lion’s share of the higher tariff costs, some $37.3 billion, stemmed from duties on imports from China, said Washington-based consultancy Trade Partnership Worldwide, which calculated cumulative tariff costs through November 2019, the latest data available. Exports of U.S. goods hit by retaliatory tariffs from China and other countries fell by 23 percent in the 12 months ended November, compared with 2017, before the tariffs began, the analysis showed. Even when retaliatory tariffs have ended, those exports haven't bounced back, said Trade Partnership Vice President Dan Anthony.”

— Fed officials say economy is adjusting to trade wars: “The global trade wars may not be over, but U.S. Federal Reserve officials … said the economy may have weathered the worst of it as risks begin to ease and businesses adjust to a new trade environment,” Reuters’s Howard Schneider reports.

“In separate speeches and interviews, Fed policymakers, including Vice Chair Richard Clarida, were uniform in saying that developments like expected ratification of the new U.S.-Mexico-Canada trade agreement and next week’s intended signing of an initial U.S.-China trade deal have made them more confident about the economy in the year ahead.”

IMPEACHMENT MINUTE: A speed read on the latest from the congressional impeachment process.

"‘Soon,’ Pelosi promises, as some Democrats grow restless over delay in Trump’s impeachment trial." By The Post's Mike DeBonis and Rachael Bade 

"Rudy Giuliani’s bonkers column asking the Supreme Court to strike down Trump’s impeachment." By The Post's Aaron Blake 

"McConnell tells Republicans he expects impeachment trial next week." By Politico's Burgess Everett

POCKET CHANGE

— More damning 737 Max evidence: "Instant messages and other internal Boeing documents revealed show company employees discussing efforts to ma­nipu­la­te U.S. and international safety regulators," our colleagues Ian Duncan, Lori Aratani and Michael Laris report. "'Yes, I still haven’t been forgiven by god for the covering up I did last year,' said a 2018 message."

"Another exchange between Boeing employees, from August 2015, closes out with this: 'I know but this is what these regulators get when they try and get in the way. they impede progressw' [sic] In 2017, a Boeing employee wrote: 'this airplane is designed by clowns, who in turn are supervised by monkeys.' The documents were released by Boeing to congressional investigators probing how the company’s 737 Max jets were certified by the Federal Aviation Administration as safe before two crashes that killed 346 people."

— Companies are paying a lot to insure boards: “This year may bring sticker shock for publicly traded U.S. companies when they get their insurance bill,” CNBC’s Contessa Brewer and Katie Young report.

“The risks of being sued have skyrocketed and the price of insurance premiums is rising right alongside, especially for liability insurance to cover directors and officers, or D&O. Insurance broker and consulting firm Woodruff Sawyer said D&O costs for IPO companies have quadrupled in the last two years. Aon, an insurance broker to Fortune 500 companies, said its clients are paying a median 24% more in premiums from a year ago.”

— Thiel backs VC started by ‘Hillbilly Elegy’ author: “With backing from Peter Thiel, Eric Schmidt, Marc Andreessen and other Silicon Valley kings, best-selling author J.D. Vance is spinning up a new Ohio-based venture capital firm,” Bloomberg News’s Lizette Chapman reports.

“Vance’s Narya Capital has raised $93 million from investors for its first fund, with plans to raise as much as $125 million total, according to a regulatory filing. The firm will invest in young startups in the fields of science and advanced technology with a typical check size between $5 million and $10 million, said a person familiar with the plans. It will eschew consumer-focused businesses, the person said, asking not to be identified because the matter is private.”

MONEY ON THE HILL

Chamber to push Congress on immigration, trade. Roll Call's Kate Ackley: "Noting the 'extraordinary time' of political turmoil and impeachment running alongside the 2020 campaigns, U.S. Chamber of Commerce CEO Tom Donohue nevertheless said his group, the top spender on federal lobbying, would push for a full agenda this year that includes free trade, data privacy and immigration overhaul.

"Even with the expected legislative stalemate of a presidential election year, he said the chamber believed Congress and the Trump administration still may seek compromise on major matters, including funding for infrastructure projects."

Democratic Representative Katie Porter, a first-term lawmaker known as a tough Wall Street critic, accused Wells Fargo & Co of passing on costs associated with its wide-ranging scandals to third parties, in a scathing letter sent to the bank’s new chief executive on Thursday.
Reuters

DAYBOOK

Today:

  • The Labor Department releases the latest monthly job numbers

THE FUNNIES

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BULL SESSION