Overnight Finance

On the Money — Yellen highlights wealth gap in MLK speech

Associated Press/Jacquelyn Martin

Happy Monday and welcome to On The Money, your nightly guide to everything affecting your bills, bank account and bottom line. Subscribe here: thehill.com/newsletter-signup.

Today’s Big Deal: Treasury Secretary Janet Yellen says the U.S. has much more work to do to solve racial disparities in the economy. We’ll also look at a potential mess for airlines and new information on the economic threat of climate change.

But first, let’s check in on Dallas Cowboys fans.

For The Hill, we’re Sylvan Lane, Aris Folley and Karl Evers-Hillstrom.  Reach us at slane@thehill.com or @SylvanLane, afolley@thehill.com or @ArisFolley and kevers@thehill.com or @KarlMEvers.

Let’s get to it. 


Treasury chief: US has ‘much more work’ to do

Treasury Secretary Janet Yellen said in a speech Monday commemorating Martin Luther King Jr. Day that the U.S. has “much more work” to do to narrow racial inequalities in the economy.

In taped remarks at National Action Network’s annual King Day Breakfast, Yellen touted actions taken by the Biden administration to foster a more inclusive economy while highlighting decades of unequal treatment for Black Americans.

  • Yellen referred to King’s iconic 1963 “I Have A Dream” speech, in which he compared the discrimination faced by Black Americans to a bounced check written by the founders.
  • Yellen said that while King was alluding to racial discrimination broadly, his reference to a promissory note alluded to the “economic injustice … bound up in the larger injustice he fought against.”

“From Reconstruction to Jim Crow to the present day, our economy has never worked fairly for Black Americans — or, really, for any American of color,” Yellen said. 

The background:

  • Black Americans have far lower levels of household wealth, employment and home ownership on average than their white counterparts due to decades of discrimination and exclusion.  
  • Segregationist laws and practices in the banking and real estate industries blocked Black households from economic opportunities available to whites, including key programs of the New Deal and GI Bill that helped fuel the post-World War II economic boom. 

Sylvan has more here.


Airlines warn of ‘catastrophic’ crisis when new 5G service is deployed  

U.S. airlines and cargo carriers on Monday warned that the new 5G wireless service set to deploy Wednesday could ground flights, potentially stranding thousands of Americans overseas and delaying the delivery of key goods.

  • In a letter to Biden administration officials, executives of major carriers wrote that C-band 5G causes disruptions to airplanes’ instruments that could make “huge swaths” of the U.S. fleet unusable.  
  • They noted that by Wednesday’s deadline, most of the nation’s large airports will be under 5G-related flight restrictions from the Federal Aviation Administration (FAA).

“This means that on a day like yesterday, more than 1,100 flights and 100,000 passengers would be subjected to cancellations, diversions or delays,” chief executives of Delta Airlines, United Airlines, FedEx, UPS and others wrote in the letter. 

What they want: The executives urged U.S. officials to prevent 5G from being implemented within 2 miles of affected airports until the FAA figures out a way for affected airplanes to fly safely or risk a “catastrophic disruption” to passenger flights and the global supply chain.

Karl breaks it down here.


Nearly half of GDP in cities at risk of disruption from nature loss

Loss of biodiversity and nature could put up to $31 trillion of cities’ gross domestic product (GDP) at risk, according to research released Monday by the World Economic Forum.  

  • More than 70 percent of the 576 biggest urban centers worldwide, comprising more than 1.4 billion people, are at elevated or extreme risk from environmental hazards like pollution, water contamination or extreme heat, according to the report.  
  • About $31 trillion of their GDP, or 44 percent, is at risk from these losses.  

Although this is below the global average of 50 percent, it would trickle down to other regions due to the numerous sectors that are headquartered in cities, such as utilities, transportation and shipping.

Zack Budryk explains here.



Amazon scraps plan to stop accepting Visa cards in UK

Amazon told customers Monday it is dropping its plan to stop accepting Visa cards issued in the United Kingdom.

The change was set to be implemented on Wednesday, but the company said it would be paused as it works with Visa on a “potential solution” to solve a dispute over fees.

“The expected change regarding the use of Visa credit cards on Amazon.co.uk will no longer take place on January 19. We are working closely with Visa on a potential solution that will enable customers to continue using their Visa credit cards on Amazon.co.uk.,” Amazon said in an email to customers.

Good to Know 

Stocks for major banks declined after they submitted their earnings reports on Friday, CNBC reports, part of a second consecutive week of drops for Wall Street to start out 2022.

“The Dow Jones Industrial Average slid 201.81 points, or 0.56%, to 35,911.81. The S&P 500 inched up 0.08% to 4,662.85, while the tech-heavy Nasdaq Composite outperformed with a 0.59% gain to close at 14,893.75,” CNBC reported. 

Here’s what else we have our eye on: 

  • Op-Ed: “Full employment and living wages for Black workers: The unfinished demands of MLK” 
  • Twitter is expanding a feature that lets users flag a tweet as “misleading” to more countries, the company said Monday. 
  • Chinese President Xi Jinping at the World Economic Forum on Monday called on world leaders to back away from a “Cold War mentality” and advised that they seek out “win-win outcomes.” 

That’s it for today. Thanks for reading and check out The Hill’s Finance page for the latest news and coverage. We’ll see you Tuesday.

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