Ray Dalio is stepping down from managing the world’s biggest hedge fund firm amid a company-wide shake-up

Ray Dalio

Ray Dalio, the founder of the world's biggest hedge fund firm, is expected to continue overseeing the firm's investments.

Ray Dalio, who oversees the world's biggest hedge fund firm, is stepping down from management amid a company-wide shake-up.

Dalio will stop managing Bridgewater Associates by mid-April, according to a client note Wednesday reviewed by Business Insider. Dalio said in the note that he had "temporarily stepped back into management" 10 months ago to help transition Greg Jensen's co-CEO role.

Dalio will remain co-chief investment officer along with Bob Prince and Jensen. Dalio wrote that he expected "to remain a professional investor at Bridgewater until I die or until those running Bridgewater don't want me anymore."

Bridgewater is the world's biggest hedge fund firm, managing about $103 billion in its hedge funds as of midyear 2016, according to the HFI Billion Dollar Club ranking.

Bridgewater's culture is known for being unusual and difficult. In its world of "radical transparency" and "radical truth," employees rate one another's performance in real time on proprietary iPad apps, and nearly all meetings are recorded to be available for scrutiny. The company reports that 30% of employees leave within their first two years.

A slew of other changes were also announced in the client note:

  • "David McCormick will be stepping up to join Eileen Murray in the co-CEO role."
  • Jon Rubenstein is leaving Bridgewater after 10 months (he was previously also co-CEO) because he did not fit into Bridgewater's culture, Dalio wrote. Rubenstein, who previously worked for Apple's Steve Jobs, will continue to advise the firm.
  • "Osman Nalbantoglu (who has been at Bridgewater for nine years) continues to run our portfolio implementation and trading/execution areas, and eight of our key investment research associates will step up into senior researcher roles."
  • "Carsten Stendevad, the former CEO of the large Danish pension fund ATP, is joining Bridgewater as part of our new 'Bridgewater Senior Fellowship Program,' which will bring highly distinguished individuals into Bridgewater for a year to explore what our culture is like and lend their expertise and insights to our organization."
  • "John Megrue joined me as a co-chairman on January 1st. John has been a leader in the private equity industry for over 30 years and is currently chairman of Apax Partners US."

Bridgewater has now posted the full memo to clients on LinkedIn.

Original Article

Wizkid: Pop star signs new deal with Sony’s RCA Records

 

The singer who got on to Sony Music Entertainment in 2016, has finally sealed a deal their subsidiary, RCA Records.

Wizkid has signed a new deal with RCA Records.

The singer who got on to Sony Music Entertainment in 2016, has finally sealed a deal their subsidiary, RCA Records.

This deal comes after his exploits on Drake's Hot 100-topping hit "One Dance" (which he co-wrote and co-produced).

"It’s hard for me to describe what I do, since I work with rhythms from Afro-Beat, reggae, hip-hop, dance hall and others," WizKid told Billboard in a statement. "What’s important to me is for music to be real, authentic, raw and timeless. I don’t wanna be boxed in to any one genre."

RCA Records chairman and CEO Peter Edge added: "We are thrilled to welcome WizKid to the RCA Records family. He has become a superstar in the African music scene and will be a game-changer in bringing African music to the world. We are extremely excited to have him as a part of RCA and are eager for the journey ahead."

Wizkid first gained popularity with the 2010 track "Holla At Your Boy" as a signee to Banky W's Empire Mates Entertainment. He's also released two albums: 2011's Superstar and 2014's Ayo.

"We couldn’t be more excited to welcome WizKid to the Sony Music family," said Sony Music International president of Northern & Eastern Europe and Africa Adam Granite in a statement.

"This is an incredibly important signing as we look to make Africa a major source of repertoire for the world. Wiz is a key ambassador for this movement and we look forward to helping him conquer the globe."

WizKid has also already racked up a few accolades in his young career, including a BET Award for Best International Act Africa in 2012 and a British MOBO Award for Best African Act in 2011.

Most recently, he took home the honor of African Artist of the Year at both the 2016 MTV Base Music Awards and the 2016 Ghana Music Awards.

Original Article

Spain just hired someone to solve its growing sex problem

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With a fertility rate of just 1.49 children per woman, Spain is taking drastic measures to make sure people start having more sex.

Edelmira Barreira Diz has a big task ahead of her: As of earlier this year, it is now her job to get Spaniards to have more sex.

In late January, Barreira was hired as a special commissioner in Spain's government to reverse the trend of falling fertility rates in the country. According to CIA data, women have an average of just 1.49 children, well below the replacement fertility rate of 2.2 kids, which demographers say keeps a population steady.

As a result, in 2015 Spain had its first year in decades in which deaths outnumbered births.

Low fertility rates can be both a symptom and cause of larger economic woes. On the one hand, if people aren't reproducing, there are fewer people alive to keep the economy healthy through spending. On the other, low fertility rates can indicate the economy is already weak, and that people don't feel like they have the means to start families.

Barreira, for her part, acknowledged to Spanish press in late February that "it isn't going to be possible to solve the problem overnight." The case in her country is unique in that women in Spain wait longer than most women in Europe to have kids — the average age is over 30 — and that Spaniards live longer, on average, than any other country residents in the European Union.

Over the next several months it'll be Barreira's job to produce a "clear diagnosis" of the problem, according to the Spanish newspaper Faro De Vigo. Already, the unemployment rate stands out as a clear sign the country needs a kickstart, Barreira said. Nearly half of all young people in Spain are jobless.

Similar to how Prime Minister Shinzo Abe has had to address demographic challenges in his home country of Japan, which has young people abandoning their elders outside hospitals because in-home care is too expensive, Barreira will look to develop solutions of her own.

"We have a lot of work ahead of us," Barreira told Faro De Vigo.

She hasn't yet revealed specific plans to combat falling fertility in the face of widespread aging, but other countries may offer some creative ideas.

In Japan, Abe has launched speed dating events and fatherhood classes to get men interested in family life. (Although some scholars argue the real solution involves much more government intervention to change Japan's work-heavy culture.)

In Denmark, TV ads told viewers to "Do it for Denmark." In Singapore, where fertility rates are the lowest in the world, the government held an event in 2012, sponsored by Mentos, that not-so-subtly encouraged people to "let their patriotism explode."

And in Russia, September 12 has been the official Day of Conception since 2007. Women who give birth nine months later, on June 12, win a free refrigerator.

Original Article

Microsoft says its newest Xbox service won’t kill GameStop after all (GME, MSFT)

gamestop employee

Microsoft says that GameStop and other stores will resell access to the Xbox Game Pass service.

On Tuesday, Microsoft announced Xbox Game Pass: A Netflix-style service where Xbox One gamers get access to over 100 titles for $9.99 a month.

Following that news, GameStop shares took a tumble, falling just about 8% by the closing bell. Wall Street seemed to be showing concern that Xbox Game Pass would take a bite out of the retail chain's lucrative used game business.

Now, Microsoft Corporate VP of Xbox Marketing Mike Nichols says that the two companies are in touch and now plan to come up with a way for GameStop stores (and other retail establishments) to resell Xbox Game Pass to their own customers.

Nichols tells Business Insider:

“We’ve been extremely happy with the response to yesterday’s announcement of Xbox Game Pass. We also know that our fans look for a variety of ways to purchase and try games and services, and I’m happy to announce that we are working with retail partners, such as GameStop, on offering Xbox Game Pass to their customers. We’ll have more details to share in the future.”

Without those further details, we can only guess, but it seems likely that GameStop and other stores will sell prepaid cards, the same way you can buy Netflix or Hulu subscription credit at the cash register.

While it's still up in the air to what extent the Xbox Game Pass service will lure budget-conscious shoppers away from used games, Microsoft is signalling that it's not willing to leave its retail partners entirely out in the cold while it works this new service out.

That is important, too, because Microsoft still relies on stores like GameStop to sell Xbox hardware and software to customers — for lots of gamers, GameStop is how they get their fix.

Original Article

Trump wants to upend the ‘slow and burdensome’ drug-approval process at the FDA — here’s what the agency actually does (FOLD)

As he addresses Congress, President Trump applauds Megan Crowley, who lives with Pompe disease, a rare inherited disorder.

Trump spent a portion of his speech to a joint session of Congress airing his grievances about prescription drug.

President Trump spent a portion of his speech to a joint session of Congress airing his grievances about prescription drugs, both in how they're approved and how much they cost.

Trump reiterated his interest in bringing down drug prices, telling Congress he wants to "work to bring down the artificially high price of drugs … immediately."

Trump singled out Megan Crowley — a 20-year-old living with Pompe disease, a rare inherited disorder that leads to a buildup of a complex sugar in organs and tissues — to talk about the regulatory process at the FDA.

Shortly after she was diagnosed, Megan Crowley's father, John, started working to find a treatment, and Megan entered a clinical trial by 2003. John is the CEO of rare-disease company Amicus Therapeutics. The company's share price jumped 12% Wednesday after the presidential shout-out.

"But our slow and burdensome approval process at the Food and Drug Administration keeps too many advances, like the one that saved Megan's life, from reaching those in need," Trump said. "If we slash the restraints, not just at the FDA, but across our government, then we will be blessed with far more miracles just like Megan."

Not everyone agreed that the rare-disease drug was approved slowly. Dr. David Kessler, who served as FDA commissioner from 1990 to 1997, had a different take:

Regardless of how fast the particular drug was approved, Trump's anecdote is in line with his plans to deregulate the drug industry. "We're going to be cutting regulations at a level that nobody's ever seen before," Trump said in a meeting with pharma executives on January 31. He estimated up to 80% of regulations will be slashed.

The FDA is responsible for regulating food and drugs. It's also responsible for regulating medical devices, blood donations, veterinary products, cosmetics, and tobacco. Trump's comments have left the drug industry concerned about what that deregulation could mean for the drug-approval process.

Here are some examples of the FDA at work

  • It, of course, approves new drugs. In 2016, 22 new drugs made the cut, compared to 45 the year before.
  • In September 2016, the FDA banned antibacterial soap based on evidence that showed that the soaps weren't any better, cleaner, or safer than regular soap.
  • The agency cracked down in April 2016 when diet supplements showed up containing a dangerous stimulant.
  • The FDA keeps track of any side effects that come up after a drug's approved, and can make changes accordingly. In July, the agency changed the label on a commonly used class of antibiotics to reflect more potentially permanent side effects.
  • It makes sure ads for drugs aren't misleading.

The FDA was officially founded in 1906, when the Food and Drugs Act was signed into law, prohibiting misbranded food, drinks, and drugs from interstate commerce. This cracked down on misleading claims that treatments could "cure" patients.

Following the thalidomide birth-defect crisis that happened in western Europe, the FDA got more leeway to make sure drugs were not just safe but effective. That's been the standard for the past 55 years, but it's possible that Trump's pick will be interested in changing back the regulation to make it just revolve around safety.

While Trump still hasn't disclosed his FDA commissioner nod, there are three reported candidates:

What the drug industry thinks about the FDA

In theory, getting more drugs approved at a faster pace would seem like a good idea. Drug development from start to finish can often take longer than a decade, and it can be an expensive process.

But the process also builds up evidence that the drug companies can point to to show that their drugs work they way they're approved to. That can help get the drugs paid for by insurance plans. So far, the response from industry executives and experts has been against cutting regulations that would make the FDA approve drugs solely based on their safety.

“The underpinnings of belief among patients, payers, even investors, is that somebody out there has tested these things and has shown, with some evidence, that they work,” Harvard professor Daniel Carpenter told The New York Times.

There's a fair amount of concern that by making sure drugs are just safe, and not necessarily effective, the US might start to have more "snake oil" treatments.

"Without rigorous scientific and medical proof to establish that a drug is both Safe and Effective, we risk taking a step back into a time when people sold colored water for cancer treatments and patients became the unwitting tools of unscrupulous marketeers," Ovid Therapeutics CEO Jeremy Levin told Endpoints in February.

Original Article

Dow surges to new high above 21,000 after Trump speech

Screen Shot 2017 03 01 at 9.41.16 AM

Stocks gained as a more measured tone in President Donald Trump's speech reassured investors.

The Dow Jones industrial average zoomed past the 21,000 mark for the first time on Wednesday as stocks resumed their record-setting rally.

Stocks gained as a more measured tone in President Donald Trump's speech reassured investors, while bank stocks gained on higher chances of an interest rate hike this month.

In his first address to a joint session of Congress late Tuesday, Trump said he wanted to boost the U.S. economy with a "massive" tax relief, make a $1 trillion effort on infrastructure and overhaul Obamacare.

His comments, though lacking in detail, helped underscore his pro-growth stance that has pushed Wall Street to record highs in a post-election rally.

However, the markets were more focused on comments on Tuesday from a handful of Federal Reserve officials, including the influential New York Fed President William Dudley, who said the case for tightening monetary policy had become "a lot more compelling".

"The markets are trading higher on the softer approach by the President," Peter Cardillo, chief market economist at First Standard Financial wrote in a note.

"The dollar and yields are moving higher as next theme of the market, the 'Fed' overrides the Trump effect."

The probability of a March rate hike jumped to 67.5 percent from roughly 30 percent, according to Thomson Reuters data, following the comments from Fed officials. The central bank's policy-setting body meets on March 14-15.

The dollar jumped 0.79 percent to mark its biggest one-day gain since Dec. 15, while shares of Bank of America, Goldman Sachs and Citigroup rose about 2 percent in premarket trading.

Yellen, who has said a rate increase could happen in an upcoming meeting, is scheduled to speak on Friday. Meanwhile, investors will closely watch Fed Board Governor Lael Brainard's comments on Wednesday for her take on rates.

A report from the Commerce Department showed U.S. consumer spending rose less than expected in January, while inflation pushed higher.

The Dow was up 195 points, or 0.94%, to 21,007.96 at 9:39 a.m. ET. The S&P 500 was up 19 points (0.85%) and the Nasdaq was up 47 points (0.83%.)

The Dow broke its 12-day record streak on Tuesday as retail stocks declined and investors remained cautious ahead of Trump's late evening speech.

Among stocks, Lowe's jumped 5.7 percent to $78.58 after the home improvement chain issued an upbeat sales forecast for the year.

Mylan rose 7.4 percent as the generic drugmaker reported a 31 percent jump in quarterly revenue.

Cybersecurity firm Palo Alto tumbled 21 percent to $120 as its current-quarter revenue and profit forecasts missed analysts' estimates.

(Reuters reporting by Yashaswini Swamynathan in Bengaluru; Editing by Sriraj Kalluvila)

Original Article

Trump’s budget could cut 3,000 staff from the EPA, report suggests

U.S. President Donald Trump sits for an interview with Reuters in the Oval Office at the White House in Washington, U.S., February 23, 2017.

Trump's budget proposal is expected to cut $2 billion and 3,000 jobs from the Environmental Protection Agency, according to a report from E&E News.

Trump's budget proposal is expected to cut $2 billion and 20% of staff from the Environmental Protection Agency, according to a report from E&E News.

As reported by the New York Times, the administration's forthcoming budget proposal is expected to ramp up military spending by $54 billion, and impose steep cuts on non-military agencies.

E&E News got new details about the budget's likely impact on the EPA from sources informed about the plan. A 20% staff decrease would mean layoffs of 3,000 employees, and a $2 billion cut would reduce the EPA budget by about 25% from its current $8.1 billion. (For comparison, the 2016 Department of Agriculture budget was $140 billion, the State Department's was about $50 billion, and NASA's was about $18 billion. The Pentagon budget, which includes military spending, was $560 billion.)

About 74% of the EPA's annual budget funds grants to states, tribes, and government contractors for cleanup and preparedness efforts. The remainder goes to staff payroll, scientific studies, and other expenses.

The reduction in staff would take the agency from about 15,000 employees to 12,000. While significant, that decrease is less severe than those previously hinted by transition officials — rumors had suggested the agency could be cut to just 5,000 employees.

Since 2010, the EPA has already decreased its operating budget by $2.1 billion — at the time, its expenses totaled $10.2 billion.

Trump's budget proposal, of course, would not immediately become law once released. Rather, it presents a framework that Congress can vote on.

According to E&E News, Gina McCarthy, the former EPA chief under Obama, said that if the Trump administration believes the budget won't hinder the EPA's mission to protect public health, it's a "fantasy."

Original Article

Here’s how the US military is sticking it to Beijing in the South China Sea

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Six countries claim parts of the South China Sea, and the US isn't one. But the US doesn't need a dog in the race to stand up for freedom of navigation.

China has for years been whittling away at the US military's asymmetrical advantage in conventional military strength with a naval buildup, building and militarizing artificial islands in the South China Sea, and creating systems and weapons custom built to negate the US's technological advantage.

By all indications, China is building aircraft carriers and getting ready to place surface-to-air missiles deep into the South China Sea.

Meanwhile, China's neighbors have grown increasingly worried and timid as it cements a land grab in a shipping lane that sees $5 trillion in annual trade and has billions in resources, like oil, waiting to be exploited.

Six countries lay claim to parts of the South China Sea, and the US isn't one of them. But the US doesn't need a dog in this fight to stand up for freedom of navigation and international law.

Here's how the US counters China in the region.

For the US, checking Beijing in the Pacific often means sailing carrier strike groups through the region — something the Navy has done for decades, whether China protests or not.

As Navy Vice Adm. Joseph Aucoin, commander of 7th Fleet, said recently at a military conference: "We’re going to fly, sail, operate wherever international law allows."

The strike group has plenty of aircraft along with them, like this A F/A-18E Super Hornet and a nuclear-capable B-1B Lancer from Guam.

Unlike submarines and ICBMs buried under land or sea, the US's strategic, nuclear-capable bombers make up the most visible leg of the nuclear triad. Placing a handful of B-1Bs in Guam sends a message to the region.

Here's the US's entire strategic bomber force lined up in Guam, representing more than 60 years bomber dominance.

It also doesn't hurt when the US Navy shows off its complete mastery of carrier-based aircraft. There are F-18 pilots in the Navy that likely have more carrier landings than the entire Chinese navy combined.

Those jets benefit from the support of about 7,000 sailors on the ship, who keep them running around the clock.

Airborne early warning and control planes like the E-2 Hawkeye use massive radars to act as the eyes and ears of the fleet. Not much gets past them.

But carriers don't sail alone either. Here a guided missile destroyer knocks through some rough seas accompanying the Vinson.

The US Navy may be the most professional in the world, with a very serious mission in the South China Sea, but they still make time for a swim on one of the US's newest combat ships, the USS Coronado.

The Coronado doesn't look like an aircraft carrier, but it does have serious airpower in the form of a MH-60S Seahawk with twin .50 caliber door guns.

But the key to the US's success in far away waters is allies. The US doesn't do anything alone, if you're noticing a pattern here. Here US and Royal Brueni Navy sailors practice boarding a ship.

In February, US Marines partnered up with Japanese self-defense forces to practice amphibious landings — a skill that may one day come in handy on artificial islands.

Sometimes working with allies means getting down and dirty. Here a Seabee gets neck deep in Japan.

The bottom line is that the US military has decades of experience sailing, training, and fighting with its allies in the Pacific. China has come a long way in shifting the balance of power in the region, but the US remains on top — for now.

Original Article

PayPal One Touch hits 50 million users

Paypal Active Customers

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PayPal One Touch, the firm’s single-click checkout solution, remains PayPal’s most rapidly adopted product in the company’s history, according to a new company blog post.

The offering, which allows users to bypass account and payment information entry, now counts over 50 million global users and 5 million merchant partners, including 75% of the top 100 US retailers. For context, that means that about a quarter of PayPal’s 200 million customers are now One Touch users, though engagement and usage statistics aren’t available.

One Touch seems to be beating its goals, particularly on the consumer end. At the end of Q2 2016, PayPal counted 25 million One Touch users. And the firm noted in September that it expected 36 million users by the end of 2016 — a figure that it likely exceeded, based on the current totals. In terms of merchants, the 5 million total has remained relatively consistent, but is still in line with PayPal’s overall aims.

It’s likely that this is partly due to trends across the industry reflected in PayPal’s own performance.

  • E- and m-commerce are rising, which creates friction that payments firms have the opportunity to solve. BI Intelligence expects US e-commerce to hit $631 billion in 2020, with 45% via mobile, up from $341 billion and 19% in 2015. Those gains are reflected in PayPal’s own business, which saw vast mobile increases in 2016, particularly during the holiday season. But buying on mobile in particular tends to have low conversion rates, thanks to friction associated with small screens and slower connections, which could make it complicated for payments firms and retailers in the space.
  • One Touch helps solve these pain points, so it’s logical that adoption is rising. Users are flocking to checkout expediters and buy buttons as a means of resolving this tension, particularly as mobile commerce rises, so it’s natural that PayPal is seeing growth here, especially during the busy holiday shopping season. In addition, the firm has made it easier to sign up for One Touch, which likely also helped accelerate growth rate.

This matters for the success of PayPal’s longer-term strategy. PayPal’s push to become a constant presence in users’ financial lives has led it to pursue new segments, like bill pay through the TIO Networks acquisition. But growth in its traditional business products, or those related to them, indicates that it remains top-of-mind and top-of-wallet for many consumers, which will be important as it works to onboard those users into its new offerings down the line.

Peer-to-peer (P2P) payments, defined as informal payments made from one person to another, have long been a prominent feature of the payments industry.

That’s because individuals transfer funds to each other on a regular basis, whether it's to make a recurring payment, reimburse a friend, or split a dinner bill.

Cash and checks have historically dominated the P2P ecosystem, and they’re still a popular tool. But as smartphones become a primary computing device, top digital platforms, like Venmo and Google Wallet, have enabled customers to turn away from cash and make those payments digitally with ease. Over the next few years, though overall P2P spend will remain constant, a shift to mobile payments across the board and increased spending power from the digital-savvy younger generation will cause the mobile P2P industry to skyrocket.

That poses a problem for firms providing these services, though. Historically, most of these players have taken on mobile P2P at a loss because it’s a low-friction way to onboard users and won’t catch on unless it’s free, or largely free, to consumers. But as it becomes more popular and starts to eat into these firms’ traditional streams of revenue, finding ways to monetize is increasingly important. That could mean moving P2P functionality into more profitable environments, leveraging existing networks of friends to encourage spending, or offering value-added services at a nominal fee.

Jaime Toplin, research analyst for BI Intelligence, Business Insider's premium research service, has compiled a detailed report on mobile P2P payments that examines what’s driving this shift to mobile P2P and explains why companies need to find a way to capitalize on it quickly. It discusses how firms can use the tools they have to gain in the P2P space, details several cases, and evaluates which strategies might be the most effective in monetizing these platforms.

Here are some key takeaways from the report:

  • Consumers still want mobile P2P services, and they’re turning to them. Individuals pay their peers on a regular basis, and as smartphones are increasingly used as computing devices, these consumers look to such services for fast and easy ways to pay.
  • Monetizing P2P is more important than ever. Initially, P2P was a valuable onboarding tool for companies, and when it was still a small segment, taking it on at little value or a loss didn’t have major implications. But as volume grows and user bases scale fast, finding ways to monetize quickly should be a priority for firms looking to stay ahead.
  • New technology could put some apps ahead of their peers. P2P continues to rely on networks, especially for informal, social transactions. But rather than having a large network, it’s becoming important for firms to understand their user bases and the networks within them. This means that chat apps, and leveraging bot and AI technology, may offer a distinct advantage.

In full, the report:

  • Forecasts the growth of the P2P market, and what portion of that will come from mobile channels, through 2021.
  • Explains the factors driving that growth and details why it will come from increased usage, not increased spend per user.
  • Evaluates why mobile P2P isn’t profitable for companies, and details several cases of attempts to monetize.
  • Assesses which of these strategies could be most successful, and what companies need to leverage to succeed in the space.
  • Provides context from other markets to explain shifting trends.

Interested in getting the full report? Here are two ways to access it:

  1. Subscribe to an All-Access pass to BI Intelligence and gain immediate access to this report and over 100 other expertly researched reports. As an added bonus, you'll also gain access to all future reports and daily newsletters to ensure you stay ahead of the curve and benefit personally and professionally. >> START A MEMBERSHIP
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Original Article

Trump and union leaders find shaky common ground: ‘He’s promised that he’s going to create good jobs’

President Donald Trump meets with union leaders at the White House

Trump is attempting to cement his support among organized labor and union leaders — virtually all of whom endorsed Clinton — are cautiously on board.

Candice Johnson, a veteran spokesperson for the Communications Workers of America, did not know who Andrew Puzder was when she received a notification that President Donald Trump had nominated him to be the nation's next labor secretary.

But it did not take long before she began formulating the union's critical response to the fast food restaurant CEO and mobilizing its membership against him.

"He was someone who was really the antithesis of what the labor secretary should be," Johnson told Business Insider.

Puzder's nomination was unanimously condemned by union leaders and criticized both on the left, for Puzder's opposition to raising the minimum wage and worker protections and benefits, including the Affordable Care Act, and on the right, for his support for immigration.

Puzder withdrew his nomination in mid-February amid controversies surrounding his employment of an undocumented immigrant as his housekeeper and allegations of domestic abuse.

Trump has since done an about-face on his labor pick, selecting Alexander Acosta, an uncontroversial former assistant attorney general, as Puzder's replacement. Unions have expressed their relief, and, in some cases, are embracing Acosta.

The move was in line with Trump's recent efforts to cement his popularity among union members, a traditionally Democratic constituency from whom he earned more support in the general election than any Republican since President Ronald Reagan 1984.

Trump's gains among blue collar workers can be attributed in large part to his unorthodox positions on trade and infrastructure spending and his commitment to repealing regulations some argue hinder economic growth.

Through a combination of outreach from the White House and pressure from union members who support the president, some union leaders are cautiously warming to the prospect of working with Trump.

Courting the labor movement

Just three days into his presidency, Trump met with the leaders of building trade unions to discuss his plans on infrastructure and trade.

The meeting, which included most of Trump’s top advisers, provided a politically valuable photo op for the White House and sent a message to Trump's union supporters that their leadership is willing to collaborate with the administration.

After dismissing members of the press from the meeting, Trump called them back in to record Douglas McCarron, president of the United Brotherhood of Carpenters and Joiners of America, praising the president's inaugural address, which McCarron said was "a great moment for working men and women."

"We have a common bond with the president," Sean McGarvey, the president of North America’s Building Trades Unions, added after the meeting. "We come from the same industry. He understands the value of driving development, moving people to the middle class."

On Fox News, conservative columnist Charles Krauthammer characterized Trump's meeting with labor leaders as "a great act of political larceny," noting, "that is the constituency [Trump] stole to get elected to the presidency, and as long as he nurtures it, he's got a leg up on the Democrats."

Trump’s rocky history with unions

But while Trump has made inroads in one of the Democratic Party’s most loyal voting blocks, his relationships with union leadership has been rocky.

In December, Trump publicly sparred with Chuck Jones, the president of United Steelworkers Local 1999, who represents the workers at an Indianapolis Carrier plant who were the subject of a publicized deal Trump made with the company in November.

Jones said Trump "lied his ass off" about the exact number of jobs saved by the deal, in which the air conditioning manufacturer agreed to keep what Trump said was 1,100 jobs in Indianapolis that otherwise would have been outsourced to Mexico.

Trump retaliated by tweeting that Jones had "done a terrible job representing workers" and "no wonder companies flee country!" Jones ended up being right about the numbers—only 800 jobs were saved.

As an employer, Trump has long had dealings with unions and will continue to, indirectly, through the Trump Organization.

In November, the National Labor Relations Board ruled that the Trump International Hotel Las Vegas had violated federal labor law and ordered it to negotiate with the union representing the hotel’s culinary workers. The parties reached an agreement in December, just as the Trump International Hotel in DC settled negotiations with the union representing its employees.

Some are also skeptical of Trump's motives surrounding unions. These observers see the administration’s union outreach as a shrewd move to divide organized labor, and thereby reduce its collective power.

“I would not be surprised if Steve Bannon and others would be overtly and covertly trying to divide the labor movement,” Randi Weingarten, president of the American Federation of Teachers, told The New York Times.

Illustrating this tension, just the day before Trump visited a Boeing complex in South Carolina, the company's production workers voted down a bid to unionize. Trump took the opportunity to emphasize his economic agenda, doubling down on his promise to bring jobs back to “forgotten” communities.

This all comes as unions are at their weakest point in decades. Fifty years ago, one-third of American workers were unionized. As of 2015, it was one in 10.

Karla Walter, director of employment policy at the left-leaning Center for American Progress, says Trump’s gains among organized labor should be understood in the context of years of decline and “concerted attacks on unions.”

“In some of the states where he had the biggest gains what we saw was that these were states where unions were under attack for a number of years and unionization rates had fallen considerably,” Walter told Business Insider.

Better trade agreements or 'corporate giveaways'?

On his first full day in office, Trump signed an executive order withdrawing the U.S. from the Trans-Pacific Partnership, which he previously called a "rape of our country."

Trump’s promise to renegotiate the North American Free Trade Agreement, which he has called "the worst trade deal in the history of the country," was also key to his appeal among union workers. But the details of this renegotiation remain unclear, worrying union leaders.

"It could be a corporate giveaway—we don’t know," Johnson, of the CWA, said of the renegotiation. "And that’s basically how we’re looking at the Trump administration, generally."

Dean Baker, co-director of the progressive Center for Economic and Policy Research, told Business Insider that Trump’s actions on trade won’t amount to anything more than “a lot of silly symbolism.”

Baker agrees with Trump that multinational trade agreements like NAFTA have had a negative impact on the U.S. manufacturing industry. Rejecting this conclusion is "like denying global warming," he said. "The data is very clear."

While Baker believes there are changes that could be made to NAFTA that would help bring American manufacturing jobs back, he does not think Trump is savvy enough or willing to make necessary compromises.

"There’s nothing he’s said to date that indicates he has any idea whatsoever of how you would go about bringing the jobs back," Baker said.

A much-awaited infrastructure plan

Throughout the campaign, Trump called for large-scale investment in American infrastructure, something labor unions have long argued is overdue.

"We are going to fix our inner cities and rebuild our highways, bridges, tunnels, airports, schools, hospitals," Trump said in his victory speech on election night. "We’re going to rebuild our infrastructure, which will become, by the way, second to none. And we will put millions of our people to work as we rebuild it."

The president reiterated this priority during his speech to a joint session of Congress on Tuesday night, calling for a $1 trillion investment in "a new program of national rebuilding." For the first time, Trump mentioned public funding would be needed in addition to private investment.

But the details of any proposed legislation remain elusive. So far, the closest thing to a plan is an October white paper co-authored by White House National Trade Council head Peter Navarro and Commerce Secretary Wilbur Ross. The paper essentially calls for the privatization of public works projects, with $137 billion in tax breaks to businesses in order to stimulate $1 trillion in infrastructure projects over a decade.

A draft list of 50 infrastructure projects compiled by the administration was obtained and published by the Kansas City Star and The News Tribune in Tacoma, Washington, in late January.

Trump’s calls for massive infrastructure investment have been heeded by his opposition — last month Senate Democrats introduced a $1 trillion infrastructure building plan that they say will create 15 million jobs over a decade.

Meanwhile, Republican lawmakers have voiced resistance to a large-scale infrastructure plan. Senate Majority Leader Mitch McConnell has said he hopes to "avoid a trillion-dollar stimulus."

The fundamental tension between Trump and the Democrats’ plans lies in their differing funding schemes. While Trump has said he will pay for his revenue neutral plan through federal tax credits and "public-private partnerships," which economists across the political spectrum have argued is untenable, Democrats are pressing for a funding scheme that involves more direct federal spending and closing tax loopholes.

How the plan is funded is key in determining what kinds of projects and jobs are created, Ross Eisenbrey, vice president and policy director of the Economic Policy Institute, told Business Insider.

More direct federal spending pays for repairs to bridges and water treatment plants—projects that don’t attract profit-seeking private investors, Eisenbrey said. Tax credits will encourage projects that generate revenue, such as toll roads and bridges, many of which, like the Keystone XL Pipeline, experts say would happen with or without government funding.

"The more it’s just a tax credit, the fewer jobs will be created," Eisenbrey said.

Eisenbrey thinks it’s likely Congress will pass a bipartisan infrastructure plan.

"Unless the leadership is just dead-set against it, I think there will be an infrastructure program," Eisenbrey said. "If this is a signature part of Trump’s program, I don’t see how even a Republican-dominated Congress can resist it."

Strain says the infrastructure plan is likely already on the legislative back burner and may never earn enough support from Republican lawmakers. According to a recent report from Axios, the administration may push the introduction of an infrastructure plan to 2018, when Democrats will be under more pressure from unions and their constituents to support job-creating investments.

"It’s a lower priority than tax reform, it’s a lower priority than ACA reform and it seems unlikely to me that we would get all three of those done," Strain said.

Walter said it is up to the American public to hold Trump to his word.

"I think that it’s essential that working people hold him accountable for the fact that this plan needs to create good jobs," she said. "He’s promised that he’s going to create good jobs."

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