By CCN: Always the optimist, Binance CEO Changpeng “CZ” Zhao sees a silver lining in the wake of WeChat’s recent ban on crypto trading activities. According to a tweet today by Dovey Wan, founding partner of Primitive Ventures, the Chinese social media company released an updated payment policy which states that it will terminate merchant accounts that participate in cryptocurrency transactions.
In her tweet, Wan argues that most of China’s over-the-counter (OTC) cryptocurrency trades occur on WeChat. So, the ban could have a significant effect on the local market
This is a classic example of short term pain, long term gain.
It is inconvenient for people short term, and they take a hit. But long term, it is precisely this type of restriction of freedom that will push people to use crypto. Not a bad thing.
This ban isn’t the first time that WeChat has taken action against cryptocurrency transactions. Last August, WeChat Pay began restricting users from transacting cryptocurrency-related funds on the platform. Both moves are in line with China’s continuous crackdown on cryptocurrency and associated activities.
Just last month, the Chinese government released a report describing plans to put an end to bitcoin mining in the country.
CZ’s Silver Lining
Although the ban will obviously have some negative short-term implications on China‘s crypto market, CZ applauds the move as a positive for the industry. He explains,
“It is inconvenient for people short term, and they take a hit. But long term, it is precisely this type of restriction of freedom that will push people to use crypto. Not a bad thing.”
With WeChat and other payment apps continuing to expand restrictions and impose bans, he assumes more people will flock to cryptocurrency in response.
Is CZ Correct, Though?
More people aren’t going to begin using cryptocurrency because WeChat banned it on its platform. Although CZ doesn’t provide too much of an explanation, it seems as if he’s comparing this ban to other types of censorship. When Dave Rubin left Patreon due to censorship disagreements, he turned to cryptocurrency as a censorship-free funding alternative. The same reasoning should hold for WeChat, right?
Wrong. The ban only affects merchants who are working or plan to work with cryptocurrency. Those without cryptocurrency won’t feel a sudden urge to buy some because the ban doesn’t affect their life. Contrary to what CZ says, WeChat has become a major roadblock for the more than one billion people who could potentially be more involved with cryptocurrency.
WeChat banning cryptocurrency transactions is a huge barrier to the over 1 billion people who could be using the platform to work with the new technology. | Source: Statista
Any restriction of freedom is a bad thing – whether or not it helps the crypto cause. We shouldn’t be rooting for adverse events to push adoption forward. Even though CZ’s heart is in the right place, his views on the WeChat ban are greatly misplaced.
By CCN: The Dow and broader U.S. stock market plunged anew on Tuesday, as President Trump’s latest tariff gambit triggered an extreme bout of volatility for Wall Street.
Dow, S&P 500 Race Into Meltdown Mode
All of Wall Street’s major indexes reported massive declines on Tuesday, mirroring a volatile pre-market for Dow futures. The Dow Jones Industrial Average bottomed at 25,875.70, having declined 563 points. It was last down 558 points, or 2.1%, at 25,882.70.
The Dow is on track for its worst day since January. | Source: TradingView
The broad S&P 500 Index of large-cap stocks plummeted 1.9% to 2,876.20. All 11 primary sectors registered losses.
The technology-focused Nasdaq Composite Index declined 2.4% to 7,939.74.
A measure of implied volatility known as the CBOE VIX surged for a second straight day, painting an ominous picture of Wall Street’s recovery. VIX, commonly known as the “fear index” gained 35% to 20.79 on a scale of 1-100 where 20-25 represents the historic average. The fear gauge rose by as much as 46% on Monday.
President Trump plays hardball amid signs China is reneging on trade promises. | Source: MANDEL NGAN / AFP
There’s a good chance that President Trump’s tariff threat against China will become reality, according to Jeffrey Gundlach, chief executive of the DoubleLine asset management group.
In an interview with CNBC’s Halftime Report, Gundlach says the 25% tariff bump on Chinese imports “is better than 50% chance” because “both the premier of China and the president of the United States want to come across that they prevailed and didn’t give in.”
On Sunday, President Trump tweeted a new tariff threat against China after one of his top trade advisers informed him that Beijing was reneging on some of its prior commitments. Namely, Beijing is refusing to amend laws that force U.S. companies to give up intellectual property when doing business in China.
The news triggered a nearly 500-point drop in the Dow just after the open on Monday. The index would later pare most of the declines.
Despite the four-month recovery in stock prices, Gundlach believes equities are in a bear market.
“I think that we’re in a late cycle and I think the market can only be termed by the way I look at evolution of market prices as a bear market,” he told CNBC. “The market hasn’t gone anywhere in 15 months.”
The S&P 500 and Nasdaq met the definition of a bear market in December after they fell more than 20% from their prior peak. Both indexes returned to record highs last month.
Click here for a real-time Dow Jones Industrial Average price chart.
By CCN: Research in the latest issue of Diar reveals that Bitcoin transaction fees skyrocketed 250% in April as BTC blocks grew nearly as full as they were during December 2017 when the Bitcoin price peaked at just under $20,000.
SegWit Usage Drops Average Fees Significantly
Fees were much lower than at that time, because SegWit usage has steadily increased in the intervening months. Diar writes:
“On-chain volume still heavily used for ramping on and off exchanges has been the main culprit as traders look for an opportunity with the price of Bitcoin rising 43% during April resulting in full blocks (see chart 3). But SegWit, the scalability solution that addresses the issue has also hit a high with the percentage of blocks using the mechanism averaging 35% alleviating fee pressures. 2018 average SegWit usage was only 26% and only 11% at Bitcoin’s peak highlighting the continued adoption by major players.”
SegWit usage is helping limit the rate at which Bitcoin transaction fees rise. | Source: Diar
Nevertheless, fees did jump 250% month over month. In total, Bitcoin miners collected nearly $14 million in fees alone.
Segregated Witness wallets and services are lowering fees, as expected. SegWit usage is reportedly around 35% at this point, with the expectation that it will continue to rise as more and more services look to save money. The higher this figure goes, the more accessible the network becomes.
With transactions taking less space, the cost per byte for later operations can be lower. The result is that the average fee collected for a transaction drops for other users. Increasingly, users are looking to alternative methods to save precious satoshis, including using Lightning Network.
Bitcoin Efficiency on the Rise Despite Fee Uptick
Bitcoin is growing more efficient despite the rising transaction fee. | Source: Shutterstock
Users who want transactions confirmed faster typically pay a higher fee to have their payment processed sooner. The more people that do this, the higher the average fee goes.
Diar estimates that fees will be about 55% lower than the last time transactions peaked if their volume continues to increase. At the same time, fewer coins are moving – they’re just moving more often.
Lightning Network usage is also growing. According to 1ML, the number of Lightning Network nodes has grown by 5%. One city, Toronto, has more nodes than any other – 107, with a total of more than 1,200 channels. The Lightning Network as a whole has the capacity to transfer more than 1,000 BTC in seconds.
At the time of writing, the latest block was 575003. A total of 2,500 transactions were sent, collecting fees of over $3,200, making the average transaction cost just over $1.25. A few transactions paid over $17 in fees, while numerous transactions paid less than $2. Transactions were included with fees as low as 50 cents, though these transactions may have waited awhile to be confirmed.
While still far higher than alternative chains for transferring value such as Bitcoin Cash, the reduction in fees brought about by scaling technologies is a positive sign for Bitcoin.
The White House has ordered former counsel Don McGahn not to comply with a congressional subpoena for documents, deepening the Trump administration’s refusal to cooperate with Democratic-led investigations.
A letter from McGahn’s attorney addressed to House Judiciary Committee Chair Jerrold Nadler (D-N.Y.), says McGahn was ordered not to produce the documents by White House acting chief of staff Mick Mulvaney. Mulvaney argued that the documents “implicate significant Executive Branch confidentiality interests and executive privilege,” McGahn’s attorney, William Burck, states in his letter to Nadler.
WH instructs Don McGahn to NOT turn over documents to House Judiciary. Here’s the letter from McGahn attorney. Live on @CNN next pic.twitter.com/Ceccitb8VW
The defiance shows an increasing White House antagonism to Democratic attempts to dig into special counsel Robert Mueller’s investigation and other matters involving President Donald Trump.
Attorney General William Barr refused to appear at a Judiciary Committee hearing last week and faces a contempt vote on Wednesday for refusing to turn over a complete copy of Mueller’s report. Meanwhile, Treasury Secretary Steve Mnuchin said Monday he wouldn’t comply with Democratic demands for Trump’s tax returns. And Trump, after saying Congress should hear from Mueller himself, said over the weekend that the special counsel “should not testify.
Trump’s current counsel, Pat A. Cipollone, argued in a separate letter to Nadler on Tuesday that McGahn does “not have the legal right” to produce the documents sought by Congress. Cipollone told Nadler to request the documents directly from the White House.
Burck said McGahn will “maintain the status quo” and will not turn over the documents as a result of the conflict between the Judiciary Committee and the White House. The lawyer added that Cipollone told him the Department of Justice is aware of the refusal and “concurs with this legal position.”
McGahn, who served as Trump’s White House counsel for the first year and a half of his administration, was asked to turn over the documents by Tuesday.
By CCN: A volatile Dow Jones Industrial Average lurched toward a triple-digit setback on Tuesday as the clock continued to tick on President Trump’s high-stakes gamble that threatening to slap new tariffs on hundreds of billions of dollars of Chinese imports will force Beijing to sign a trade deal.
Dow Dives as Investors Ignore Warren Buffett’s Warning
The stock market took a massive step down at the opening bell, and by 9:43 am ET the Dow had lost 213.01 points or 0.81%. The DJIA last traded at 26,225.47. The S&P 500 and Nasdaq posted comparable declines, sinking 0.81% to 2,908.73 and 0.84% to 8,055.17.
The Dow plunged more than 200 points as the stock market reeled from Trump’s ruthless trade war gamble. | Source: Yahoo Finance
On Monday, the Dow plunged as much as 471 points but made a stunning recovery ahead of the closing bell, ultimately ending the session at 26,438.48 for a loss of 66.47 points or 0.25%. The S&P 500 declined 0.45% to 2,932.47, and the Nasdaq fell 0.5% to 8,123.29 as the stock market grappled with Trump’s trade war ultimatum.
Some analysts, most notably billionaire Warren Buffett, laughed off the stock market’s hand-wringing, alleging that investors who sold in response to the alarming headlines were just being melodramatic.
Clock Ticks as Stock Market Counts Down to New Tariffs
Nevertheless, Wall Street remained apprehensive about the US-China trade deal on Tuesday, as strategists digested US Trade Representative Robert Lighthizer’s claim that the Trump administration would raise tariffs at 12:01 am ET on Friday.
“Over the course of the last week or so, we’ve seen an erosion in commitments by China, I would say retreating from commitments that have already been made in our judgment,” Lighthizer said.
Treasury Secretary Steven Mnuchin, who had been among the loudest trumpeters in the Trump administration’s trade deal progress parade, revealed that the state of the negotiations had suddenly gone “substantially backward.”
Chinese negotiators will travel to the US this week for a new round of trade discussions, but it’s unlikely that a trade deal will emerge before the clock strikes one minute past midnight on Friday morning.
That’s when the stakes in Trump’s ruthless China gamble will begin to intensify. Stock markets in both the US and China could suffer under the enhanced tariff regime, particularly if Beijing calls Trump’s bluff and retaliates in kind.
Moreover, if the White House follows through on its threat to expand tariffs to another $325 billion of imports, analysts warn that its US consumers that will feel the pinch – a key consideration heading into a presidential election year.
“I remain hopeful that a deal comes and we won’t see new tariffs on Friday,” said Peter Boockvar, chief investment officer at Bleakley Advisory Group, in remarks cited by CNBC. “But it’s clear the level of mistrust between the two sides will last for years and some of the tariffs will remain as part of the enforcement tools.”
Does Trump Have the Fortitude to Go All-in on His Trade Deal Gamble?
Bolstered by a red-hot US economy, Trump likely holds the upper hand. Just look at the havoc his $500 billion middle finger wreaked on China’s stock market on Monday.
However, will the “Art of the Deal” author – who notoriously looks to Wall Street to affirm the efficacy of his economic policies – demonstrate the fortitude to weather a short-term correction when trade war-susceptible stocks like Caterpillar drag the Dow into the red?
Answer that question, and you’ll likely know whether the White House will succeed in its quest to fundamentally reshape US-China relations or just become the latest administration to slap a band-aid on a standoff of economic superpowers that has simmered for decades.
Click here for a real-time Dow Jones Industrial Average (DJIA) price chart.
By CCN.com: As the Dow edges toward new record highs, Warren Buffett says US stocks have plenty of room to run. But on one condition: that interest rates remain low.
It’s a big “if,” but one that US president Donald Trump is desperate to maintain. Trump has repeatedly called for a one percent cut in interest rates and slammed the Federal Reserve for moving in the other direction.
If Trump gets what he wants, and interest rates stay low, the Dow Jones Industrial Average (DJIA) is poised for much bigger gains.
Warren Buffett: “I Think Stocks Are Ridiculously Cheap”
Speaking to CNBC, Buffett said the current mix of high employment, five percent budget deficit, and ultra-low interest rates is like “Nirvana” for stocks.
“We’re sitting with very, very little inflation with a Federal Reserve that put a target for two percent on it not that long ago and it looks like Nirvana, it looks like we’ve found the promised land, where essentially money doesn’t cost anything and… you can have full employment and no inflation.”
This perfect combination of factors has sent the Dow Jones Industrial Average more than 30 percent higher in just two years. Buffett goes on to explain:
“Now, if [these conditions persist], then stocks are ridiculously cheap.”
The DJIA’s unstoppable five-year run off the back of ultra-low interest rates. Source: Yahoo Finance
Trump Demands Lower Interest Rates to Fuel Stock Market
Donald Trump is one figure who would like to see these “Nirvana” conditions persist. Last month the president said:
“We have the potential to go up like a rocket if we did some lowering of rates, like one point, and some quantitative easing.”
The president even called on the Federal Reserve to lower interest rates by one percent in order to fuel stock market growth.
China is adding great stimulus to its economy while at the same time keeping interest rates low. Our Federal Reserve has incessantly lifted interest rates, even though inflation is very low, and instituted a very big dose of quantitative tightening. We have the potential to go…
….up like a rocket if we did some lowering of rates, like one point, and some quantitative easing. Yes, we are doing very well at 3.2% GDP, but with our wonderfully low inflation, we could be setting major records &, at the same time, make our National Debt start to look small!
As CCN reported, the Federal Reserve ignored his pleas and kept interest rates on hold. After raising rates four times in the last year, Fed chairman Jerome Powell aims to hold firm on the current rate for the rest of 2019. Trump hit back:
“If the Fed had done its job properly, which it has not, the Stock Market would have been up 5000 to 10,000 additional points.”
Will the Dow Keep Rising?
Warren Buffett did say the current economic climate won’t last forever.
“I probably could not have conceived of a world where you would have full employment, five percent budget deficits with actually the probability of those rising from that level and at the same time have the long-bonds [rate] at three percent, I would have said that couldn’t happen.”
The Oracle of Omaha said that something will have to give. Either the Fed will be forced to raise rates or the economy will buckle. While the era of cheap money has fueled incredible stock market growth, Buffett said we’re now at an “impossible” convergence.
“The convergence of these factors would have seemed impossible to me and generally if I feel something is impossible it’s going to change over time. I don’t know in what way, but I don’t think we can continue to have these variables in this relationship.”
For now, at least, the US interest rate will remain at relative lows. And with a president ready to slam the Fed for any further monetary tightening, this Nirvana could allow stocks to forge new highs yet.
By CCN.com: One has probably never heard of Japanese Content Token (Ticker: JCT), a crypto-asset issued by a Singapore-based blockchain firm. But that has not deterred the cryptocurrency from jumping more than 700-percent in merely two hours.
The JCT-to-dollar exchange rate was trading close to $0.045 at around 0730 UTC. By the time the clock hit 0930 UTC, the pair had jumped a Mount Everest, establishing its historical high towards $0.362. It noted a small downside correction afterward, dropping 16-percent to indicate that traders were beginning to exit the market on surplus intraday gains.
JAPANESE CONTENT TOKEN (JCT) PRICE SURGED MORE THAN 700% IN JUST TWO HOURS | SOURCE: Coinmarketcap.com
Based on a 24-hour adjusted timeframe, the JCT surged 651-percent against bitcoin. The same timeframe witnessed JCT appreciating 625-percent against Ethereum, the second largest cryptocurrency by market capitalization. Exchanges trading JCT-enabled pairs posted volumes worth $704,229.
Such a small volume didn’t justify how JCT added $93 million to its total valuation. Besides, one of the exchanges – unregulated – posted more than 41-percent of the overall daily volume for JCT, which raises doubts about potential wash trading and price manipulation.
Fundamentals, if any
JCT didn’t have a history of price explosions. It didn’t even have an essential past at all. The crypto-asset got listed on CoinMarketCap.com on April 2, the day the bitcoin price surged 23-percent to close above a significant resistance level. JCT was trending sideways ever since, existing without much notice to an average crypto trader, especially when the larger capitalization coins were recovering impressively.
Nevertheless, the Japanese Content Token kept adding small recognition to its profile. It got listed on five crypto exchanges to begin its innings as any speculative crypto-asset. And, ahead of the listings, the team behind the Japanese Content Token signed a partnership with public blockchain project TomoChain.
On the whole, the upside opportunities seem to have faded. Traders wondering about entering long positions on intraday highs must do so if they can handle a potential dump. Meanwhile, they must maintain a stop loss position against the direction of their trade. Such a strategy would ensure they exit the JCT market on a minor loss should there be a bias reversal scenario.
By CCN: Every year, the financial world’s brightest minds convene at the Milken Global Conference. This year, many of those same minds warned that the stock market faces a decade characterized by doom and gloom.
Milken Analysts: Wave Farewell to Roaring Stock Market
Guggenheim’s Chief Investment Officer Scott Minerd grabbed the big headline at the Milken Global Conference by saying the annual returns for the stock market over the next 10 years would be minimal.
“For US equities over the next decade we should be expecting maybe a 1% to 2% return. This [current] long period of outperformance is eventually going to run into a period of underperformance.”
Minerd didn’t stop there. He added:
“Not only are equities inflated in value, but bonds are inflated in value.We’re continuing to inflate assets … and not really being compensated to take on a lot of risk.”
The stock market has indeed been roaring over the past ten years – but not for much longer.
Ignacio Jayanit, a managing partner at Corsair Capital, also sounded the alarm at the Milken Global Conference by pointing out two elements in existence today that helped create the stock market crash during the dot-com bubble.
“From the perspective of value destruction, the twin pillars of overleverage and technology were the problems of that era, from a private-equity investing perspective. Where we sit today, that could well be the same two pillars of value destruction.”
It was over-leverage that also created the stock market crash, and took the American economy with it, during the mortgage crisis.
Excessive debt leading to a market crash was also on the mind of Christine Lagarde, the managing director of the International Monetary Fund. At the Milken Conference, she pointed out that non-financial US debt was 73% of GDP, almost the same level as right before the financial crisis.
This, of course, stems from the head-in-the-sand monetary theory that governments can just keep interest rates low, and borrow their way to ongoing growth forever. The problem, she said, is that debt eventually must be paid back, saying:
“This excessive debt is going to weigh on us and is going to be a problem.”
Nowhere to Run: Private Equity Not a Safe Haven from Economic ‘Tsunami’
More gloom and doom at the Milken Global Conference came from Mark Machin, CEO of the Canada Pension Plan Investment Board. He sees a bubble growing in the private equity sector, as more and more pension funds plow money into alternative investments.
Alternative investments are designed to diversify portfolios into assets that are not correlated with the overall stock market.
A problem can arise when volatility in the overall stock market perks up. Because private equity investments are often illiquid, that will force investors and funds to start dumping liquid positions – namely, stocks.
“There’s not much inventory in many of these asset classes, as we know. We saw the behavior — the gapping in December — in a number of these markets, and I think you’re going to find that risk models could blow up very quickly on the public side and trigger more events. So I think people need to be super careful.”
Finally, the chief risk officer for Credit Suisse, Lara Warner, expressed concern over a European contagion. She warned that German and Italian recessions, Italian political instability, and rising European debt could all lead to a collapse of the European economy. That, in turn, could spill over into US markets.
“I do worry that we are in a period where small earthquakes can lead to large tsunamis. It [Europe] seems to be the place that is the most fragile.”
By CCN: Despite embarking on a stunning recovery on May 6 to turn a brutal 471 point loss into a muted 67 point pullback, the Dow Jones Industrial Average plunged back into decline on Tuesday to deal investors a 435 point loss.
Dow Slides More Than 400 Points After Stunning May 6 Comeback
The Dow plunged more than 400 points on Tuesday. | Source: Yahoo Finance
Strong fundamental factors such as steady jobs growth and the Federal Reserve’s reluctance to raise its benchmark interest rate have led some analysts to ignore the trade war-induced volatility.
“I think it’s a short-term hiccup in a longer-term move up from the market,” Michael Arone, chief investment strategist at State Street Global Advisors, told CNBC.
However, on Monday, Federal Reserve Bank of Philadelphia President Patrick Harker said that in the medium-term, he expects the benchmark interest rate to rise, emphasizing that tariffs are not a “healthy thing” for the economy.
Interest Rate Hike Could Add Further Pressure to Stock Market
Earlier this month, Fed Chairman Jerome Powell said that the committee is unlikely to readjust the central bank interest rate unless a strong case is presented.
“Overall the economy continues on a healthy path, and the committee believes that the current stance of policy is appropriate. We don’t see a strong case for moving [rates] in either direction,” Fed Chairman Jerome Powell said at the time.
Fed Chair Jerome Powell alleged a rate hike is unlikely in 2019, but one Fed president predicts the central bank will levy one anyway. | Source: AP Photo/Susan Walsh
Less than a week later, Philadelphia Fed President Patrick Harker suggested the possibility of one rate increase by the year’s end.
“I suspect some of the recent weakness is transitory. So I still see it running slightly above our 2% target for the medium term, but that projection is nowhere near written in stone; more like a dry-erase board.”
“If any component of the outlook were to affect my view on the appropriate path of monetary policy, it would be inflation… I, therefore, continue to see one increase at most this year; possibly one, at most, next,” he said.
Harker is currently not a voting member of the Federal Open Market Committee and does not have an impact on the committee’s decision on adjusting the interest rate.
But, during a period in which the U.S. stock market and investors within it are on edge due to the intensifying trade dispute between the U.S. and China, the prospect of a rate hike could fuel uncertainty in the market.
Dow on Pins & Needles as Trade Deal Hangs in Balance
President Trump accused China of trying to renegotiate the trade deal, and some strategists have suggested that it relates to the efforts of the U.S. government to protect the intellectual properties of U.S. companies operating abroad.
Robert Lighthizer, the U.S. Trade Representative, said that the Trump administration has seen a lack of commitment by China in the past week.
“Over the course of the last week or so, we’ve seen an erosion in commitments by China, I would say retreating from commitments that have already been made, in our judgment,” Lighthizer said.
The uncertainty around the trade talks has led firms to reconsider market conditions and the state of the equities market.
Fundstrat, for instance, said that despite the intensifying trade dispute, stocks remain at reasonable prices for investors, echoing the sentiment of Warren Buffett at Berkshire Hathaway.
“Key lesson from 2019 (so far) is dips need to be bought, even trade-related. Does this change our near term or even YE thesis for equities? No. While the timeline is certainly in doubt, equity prices ultimately ‘look through’ near term uncertainty,” the firm said.
Click here for a real-time Dow Jones Industrial Average price chart.
Randi Weingarten, 61, has been an ever-present force in national Democratic politics since taking the helm of the American Federation of Teachers labor union in 2008.
With 1.7 million members at her command, Weingarten stands to play an important role in the fight to unseat President Donald Trump in 2020.
But first she needs to unite her diverse membership behind a Democratic candidate.
The union elicited criticism from some members for endorsing Hillary Clinton in July 2015 ― more than six months before any votes were cast in the race for the 2016 Democratic presidential nomination.
Now Weingarten is promising a slower, more transparent endorsement process that gives union members plenty of time to hear from the party’s plethora of White House contenders and give feedback before the AFT’s executive council makes a decision.
HuffPost spoke to Weingarten about the union’s endorsement process; the role of perceived electability in the Democratic presidential primary; her views of longtime school choice proponent Sen. Cory Booker, who is among those seeking the party’s nod; her deleted tweet questioning whether Sen. Bernie Sanders’ campaign was involved in Lucy Flores’ allegation of unwanted kissing against former Vice President Joe Biden.
In the interview, Weingarten also stressed that she believes the national debate over education policy has shifted decisively in teacher unions’ direction.
“The climate is changing and the narrative is changing and people are more willing to vote on these things,” Weingarten said.
Below is a transcript of HuffPost’s interview, condensed and edited for clarity.
Do you regret tweeting that [Lucy] Flores might have been motivated to speak up by the Sanders campaign?
I actually deleted that tweet when the Sanders campaign called me and said that they didn’t. What I suggested to them is, could they respond to the tweet, and they said, ‘No, could you delete it’?
I often forget this about Twitter. Twitter has no context. But all day long on MSNBC and other places, you had a lot of scuttlebutt about [the Sanders campaign’s involvement].
My thought was, I couldn’t imagine that this was true. I couldn’t imagine that [the Sanders campaign] could have done this.
In retrospect, Al Franken (the Democratic senator from Minnesota who ultimately resigned his seat after allegations of improper touching of women from years past surfaced) had made a decision [to subject] himself to whatever inquiry. And he should have gone through that process. I say that as a survivor, as someone who was raped, as someone who understands my own journey and process in this.
We have to deal with harassment and assault and bullying and all these things. And there should be zero tolerance for assault ― period, the end. We need to create safe environments for women ― period.
But we also need to have some due process and ensure that there is a benefit of the doubt that is given. By not being able to do that, it also undermines someone who was as courageous as Christine Blasey Ford, who had a story to tell, who should have been given her due. That should not have been done through the lens of politics.
You gave your imprimatur to a controversial Newark schools contract in 2012 when the city received a lot of money from Mark Zuckerberg. You’ve since become critical of how it was implemented.In light of that, what do you think of then-Mayor Cory Booker’s role in the Newark reform effort?
Look, I like Cory Booker. I think he’s an interesting political actor in the United States right now. But his education record leaves much to be desired.
[Current Mayor] Ras Baraka, who was an educator, wants to actually do things like really focus on children’s well-being and meet the needs of children and think about how to have a city school system, which now is democratically controlled again, that meets the needs of each and every child.
What Booker did is basically outsource it to the charter movement.
Does that mean there is no chance of an AFT endorsement of Booker in the presidential primary?
I’ve been really careful to every reporter I talk to, to say that we are at the stage of the members really being engaged in the process. There are members who will look at Cory only through the lens of ― not the charter experience, but of what he said in 2008 about this particular type of education reform, which essentially undermined regular public schools.
We’re trying to have him have a conversation with our members about where he stands right now and be able to answer our questions. But I’m not putting myself in a position that we’re putting a thumb on the scale for anybody.
But say something happens that, in the next six months, Cory zooms to the top and he becomes the nominee. Would my members vote for Cory Booker or endorse Cory Booker over Donald Trump? Yes, they would, if that were the situation.
We make a huge mistake when we think that things are as simple as an either/or of electability or values. It has to be both. Randi Weingarten
But now? It’s premature to say anything given the other candidates who are so much more pro-public education and have walked that walk for decades.
It’s premature to either discount anyone or say, ‘This is where my endorsement is going to go.’ And it undermines the process we put together, because that’s important.
For me, the process this time is as important as the result. People have to feel empowered. It is absolutely essential that nobody sits on the sidelines in November 2020.
I want Cory Booker, just like (Sen.) Kamala Harris is doing in Detroit, walking the walk with our members, having a town hall with them, just like (Sen.) Elizabeth Warren is doing in Philadelphia in a couple of weeks, just like Bernie did in Lordstown, (Ohio).
I want Cory Booker to do this and actually answer questions from people. That would show a lot of character.
And there’s no Booker town hall yet?
Not yet. But I think he’s open to it and we’re open to it.
As I understand it, the [Communication Workers of America] actually surveyed its members before endorsing in 2016 ―
Because at one point or another, the random sample of members in our polls is actually much more accurate. At the end of the day, our members over and over and over again were in favor of Hillary Clinton.
The issue is, when you have 1.7 million people [in the union], when you do a random sample, it’s pretty accurate.
If we actually try to do something another way, just like in the census, it will be enormously expensive. And you’re not going to actually be able to do this in a way that reaches everybody, so you’ll get the activists.
There is this whole electability argument going on among Democrats now. Alyssa Milano, an actress and activist, said picking a candidate who can defeat Trump is more important than anything else. The counter-argument from the left is that it risks repeating the mistakes of 2016.
We make a huge mistake when we think that things are as simple as an either/or of electability or values. It has to be both. Because people will sit on the sidelines unless they trust that candidate really will fight for their interests.
Your members, in some ways, are being more mobilized and militant than ever. I say that not in a negative way ―
And I think [Education Secretary] Betsy DeVos has helped in a perverse way to shift the Democratic Party consensus on education away from school choice-based approaches. And I guess my question is ―
I would actually argue that that was the silent majority that’s actually just coming up again. But we get to the same place.
Fair enough. Is it a goal of AFT to avoid another of what I’d call an “Arne Duncan scenario,” where a Democratic president has a neoliberal education reform agenda?
It’s no secret that there was a lot of tension between the Obama administration and us over [former Education Secretary] Arne Duncan’s leadership style and policies.
The issue for us is this: We don’t see it through the lens of politics. Politics is a way of trying to actually make things happen. We see it as: How do you strengthen community schools? How do you strengthen public schools that 90% of Americans attend?
How do you create a paradigm shift so most of America is focused on that as opposed to the top-down, test-based, treat-students-as-a-number, treat-teachers-as-an-algorithm, and threaten schools, teachers and kids if you don’t succeed on math and English tests?
And whatever Arne Duncan and the so-called ed reformers called it, what they were doing was using the market, competition, privatization and austerity as their tools to shake up a system, as opposed to meeting children’s needs as a dominant issue.
Nobody wants the status quo. Randi Weingarten
However you frame it, are you optimistic that the tide is turning and that this so-called education reform movement, as you put it, has peaked in its power?
I’m optimistic because the narrative is changing. More and more people are saying, ‘Let’s actually focus on neighborhood public schools. And let’s actually strengthen them!’
Nobody wants the status quo. Politics is a tool to actually get there. Politics is not an end of itself.
But the reason that is changing is because the climate is changing and the narrative is changing and people are more willing to vote on these things. How do you have a school that has rodents where the first thing teachers do when they get in every morning is clean up rat dung?
So I think what you’re seeing is that the priorities for schooling are about strengthening neighborhood schools for how you help kids, not about shaking people up and creating fear and assuming their incompetence. Because the other process basically assumed that teachers had to be told what to do because they were either incompetent or unwilling to do that. And that was just horrible.
It’s crap to actually have that assumption about teachers. Teachers want what kids need. Does that mean that we know everything about what to do? No.
But I do think we shaped the conversation around ESSA (Every Student Succeeds Act), the bipartisan bill that was passed and signed by Obama in 2015. It enabled people to start thinking about schooling differently again. And I think we are on that pathway.