Sen. Tim Scott (R-S.C.) gets a big endorsement as he launches his presidential campaign today

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Axios AM

By Mike Allen · May 22, 2023

☕ Good Monday morning! Smart Brevity™ count: 1,501 words ... 5½ mins. Edited by Kate Nocera.

🗳️ Situational awareness: Sen. Tim Scott (R-S.C.) gets a big endorsement as he launches his presidential campaign today in his hometown of North Charleston, S.C. He'll be joined by Sen. John Thune (S.D.), the Senate’s No. 2 Republican.

 

 

1 big thing: Weaponizing medical AI

Illustration of a warning sign with a skull and crossbones style robot head and arms

Illustration: Natalie Peeples/Axios

 

Machine learning can bring us cancer diagnoses with greater speed and precision than any given doctor — but could also ignite another pandemic at the hands of a relatively low-skilled programmer, Axios' Ryan Heath reports.

Why it matters: The medical field is generating some of the most exciting artificial-intelligence innovation. But AI can also weaponize modern medicine against the same people it sets out to cure.

What's happening: As this technology races ahead, everyone — companies, government and consumers — needs to be clear-eyed that it can both save lives and cost lives.

AI in health is delivering speed, accuracy and cost dividends — from quicker vaccines to helping doctors outsmart killer heart conditions.

Next, it's set to help beat the trickiest cancers and boost success rates for in vitro fertilization (IVF).

But disaster can lurk one click or security breach away:

Escaped viruses are a top worry. 350 companies in 40 countries are working in synthetic biology. With more artificial organisms being created, there are more chances for accidental release of antibiotic-resistant superbugs, and possibly another global pandemic.

One person's lab accident is another's terrorism weapon. Researchers in 2022 proved they could create 40,000 new chemical weapons compounds in six hours. They used AI models meant to predict and ultimately reduce toxicity — and trained them to increase toxicity instead.

Today's large language models make things up when they don't have ready answers. Such "hallucinations" could be deadly in a health setting.

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2. 🔎 How Epstein tried to blackmail Gates

Jeffrey Epstein's financial web

Illustration: Sarah Grillo/Axios

 

Jeffrey Epstein discovered that Bill Gates had an affair with a Russian bridge player, and later appeared to use his knowledge to threaten Gates, The Wall Street Journal scoops (subscription).

Why it matters: So much is unexplained about the sex offender's frequent meetings with some of the world's A-listers. The revelation sheds light on Gates' entanglement, and illuminates how Epstein worked.

What happened: Gates met the woman, Mila Antonova, around 2010, when she was in her 20s. Epstein met her in 2013 and later paid for her to attend software coding school. In 2017, years after the Gates relationship had ended, Epstein emailed the billionaire and asked to be reimbursed for the course, The Journal reports:

"The sum was immaterial for the two men and the tone of the message was that Epstein knew about the affair and could expose it."

A spokeswoman said Gates didn't make the payment, "and met with Epstein solely for philanthropic purposes. Having failed repeatedly to draw Mr. Gates beyond these matters, Epstein tried unsuccessfully to leverage a past relationship to threaten Mr. Gates."

Antonova, the Russian bridge player, told the Journal she didn’t know who Epstein was when they met: "I am disgusted with Epstein."

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3. 🏛️ Debt-ceiling talks enter make-or-break

Speaker McCarthy in the Capitol Rotunda yesterday. Photo: Patrick Semansky

Ahead of their in-person debt-ceiling meeting this afternoon, neither President Biden nor Speaker McCarthy knows whether the other is willing to compromise at the 11th hour, Axios' Hans Nichols reports.

Why it matters: Treasury Secretary Janet Yellen, on NBC's "Meet the Press" yesterday, repeated her warning that June 1 — 10 days from now — is "a hard deadline" to raise the debt ceiling.

What's happening: After on-again, off-again talks over the past 72 hours, Biden and McCarthy spoke yesterday when the president was flying home from Japan. Their top negotiators reconvened last night.

McCarthy described his call with Biden as "productive" — but told reporters on Capitol Hill: "We're still apart.”

McCarthy’s point man — Rep. Garret Graves (R-La.) — says top-line spending levels are the key to a deal.

Republicans insist on spending less money in FY 2024 than FY 2023, with Graves calling it a "red line."

Biden proposed keeping spending between this year and next year flat — but wants the Pentagon to share in the cuts.

Biden seems pretty far from accepting the GOP cuts.

Between the lines: Even if the two leaders reach agreement, they'll then face the difficult — and shared — problem of shepherding it through the House.

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A MESSAGE FROM THE BOEING COMPANY

Giving back gives us purpose

 

 

Boeing employees volunteered 366,000 hours and donated more than $63 million to charitable causes in 2022.

The impact: Through Boeing Cares Volunteer Corps, Boeing employees, with the support of the company match, are making a difference in communities globally.

Learn more.

 

 

4. 🔑 America's growing rent squeeze

Data: Moody’s Analytics CRE. Chart: Axios Visuals

Rent is growing faster than incomes around the country, piling pressure on inflation-burdened households, Emily Peck reports for Axios Markets.

The median U.S. renter needed to spend 30% of their monthly income on rent in the first quarter of 2023, according to a report from Moody's Analytics.

Why it matters: That's an "uncomfortably high" ratio, Moody's says — though it's a slight dip from last year, when the rent-to-income threshold crossed 30% for the first time ever.

💡 The rub: It's still cheaper to rent than buy in the vast majority of the U.S.

A new Redfin report says there are only four major metro areas in the U.S. where a typical home has a lower monthly mortgage cost than its estimated rent — Detroit, Philadelphia, Cleveland and Houston.

🧠 What's happening: Rents surged in the pandemic for a variety of reasons, and they remain high now partly as a side effect of surging mortgage rates.

Those rates are keeping would-be first-time homebuyers on the sidelines — and that's pushing up demand for rentals.

Context: Back in 1999, New York was the only "rent burdened" metro area in the U.S. (more than 30% of income spent on rent), according to Moody's.

By the end of last year, six metros had joined that pricey club — Boston, Northern New Jersey, Palm Beach, Fort Lauderdale, Miami and L.A.

Share this story ... Explore the data: Use this Moody's tool to match your household income with 492 housing markets to compare rent affordability.

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5. 🚀 Private flight to Space Station

Photo: John Raoux/AP

Rayyanah Barnawi (left), a stem-cell researcher, became the first Saudi in space when a multimillion-dollar SpaceX flight, chartered by the kingdom, rocketed toward the International Space Station yesterday.

The Falcon 9 rocket, with a Crew Dragon spacecraft, also included (beginning second from left) commandeer Peggy Whitson, who holds the U.S. record for most accumulated time in space (665 days and counting) ... pilot John Shoffner of Knoxville, Tenn., who owns a sports-car racing team ... and Saudi fighter pilot Ali al-Qarni.

Read AP's story.

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6. 💎 The full Dimon

Today's Financial Times front page

 

A rare harmonic convergence on the front pages of today's Wall Street Journal and Financial Times, with both exploring the extended dominance of JPMorgan Chase and CEO Jamie Dimon on the bank's Investor Day:

"The bank has opened branches in 25 new states, plus Washington, D.C., since 2018," The Journal reports (subscription). The "nearly 4,800 locations are in every state in the Lower 48, an achievement it alone has unlocked. ... It now has more than 13% of the nation’s deposits and 21% of all credit-card spending, a bigger share in each than any other bank."

"Dimon has been in his element acting as Wall Street’s unofficial ambassador to Washington on the recent regional banking crisis and during the debt-ceiling debate," the FT says (subscription). "People close to the 67-year-old, who is often said to thrive during crises, describe him as having an extra spring in his step in recent months."

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7. 🛒 Blue-chip brands cash in on dollar-store surge

Illustration: Sarah Grillo/Axios

 

Premium brands — including Lunchables and Dunkin' — are spinning up variations for discount shelves, as dollar stores saturate the nation, Axios' Sareen Habeshian and Kelly Tyko report.

Why it matters: Inflation has pushed many consumers to discount and dollar stores for groceries and essentials, fueling a stunning surge in new dollar-store locations.

What's happening: America's dollar-store chain storefronts steadily increased between 2019-2023, with more than 34,000 in the U.S. last year — exceeding the total of all McDonald's, Starbucks, Target and Walmart locations in the country combined, per a recent study.

In 2021, nearly half of the new stores that opened in the U.S. were chain dollar stores — "a degree of momentum with no parallel in the history of the retail industry," according to research published in March by the Institute for Self-Local Reliance.

This year, Dollar General plans to open 1,050 stores and Dollar Tree 650.

Kraft Heinz, one of the world's largest food and beverage companies, is focusing on "meal solutions that make the dollar go further," Cory Onell, Kraft Heinz chief sales officer, told Axios.

The company reconstructed Lunchables for discount stores, selling at a bargain $1.25.

Kraft Heinz is also marketing "Taco Tuesday" meals with Taco Bell-branded products, and "Italian night" with Classico pasta sauce to change the perception that dollar stores only offer a drink and a snack, Onell said.

The J.M. Smucker Co. noticed consumers purchasing items beyond necessities at discount stores — and now is bringing seasonal flavors of its packaged Dunkin' coffee to those shelves, Reuters reports.

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8. 📷 What it's really like to cover a summit

Photo: Richard A. Brooks /AFP via Getty Images

Members of the media huddle around a TV in the international media center to listen to a press conference by Ukrainian President Volodymyr Zelensky at the G7 Summit in Hiroshima, Japan, yesterday.

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A MESSAGE FROM THE BOEING COMPANY

Giving back gives us purpose

 

 

Boeing is working to create lasting change in communities worldwide by supporting veterans and their families, students in STEM education, racial equity and social justice, and efforts to protect our planet.

The benefits: In 2022, Boeing supported more than 13,000 community partners.

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