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China released its censusreport on Tuesday, showing that the number of births in the country last year dropped 18% from 2019. And China isn't alone — populations have been stagnating globally for decades, including in the U.S.
Why it matters: China has long relied on its large population — the biggest in the world — as a core engine for economic growth. The way that it, and officials across the globe, deal with changing demographics will lead to shifts in the economy and geopolitics.
State of play: China's falling birth rate is the direct effect of its 30-year one-child policy.
- The country is now reversing course aggressively, with officials calling for incentives to encourage births.
- In the U.S., the rising cost of healthcare, education and housing, coupled with a lack of government and corporate support for families, make it difficult to reverse the trend.
What they're saying: Low birth rates impact labor supply and consumer demands, can reduce entrepreneurship and innovation and lead to monetary policy changes, according to demographer Lyman Stone.
- Older people consume more services, causing economies like the U.S. to shift away from manufacturing, he says.
- When younger populations shrink, incumbent companies may face less competition from new entrepreneurs.
- Older populations also have higher savings and less desire for new investments, reducing interest rates.
Case in point: Greece, which has one of the fastest-aging populations in the world, dipped into negative interest rates in 2019.
By the numbers: China reported 12 million births in 2020, compared with 14.7 million in 2019. Its total population now stands at 1.41 billion.
- People 60 and older make up 18.7% of the population, up from 13.3% in 2010.
- The working-age population (15-59) is now 63.4% of the total, down from 70% in 2010.
- The country has already had to boost its pension pools, and officials are slowly increasing the retirement age to limit the impact on its workforce.
As she faces a voteto be thrown out of House Republican leadership, Rep. Liz Cheney has told associates she doesn’t plan on going anywhere — and plans to run for re-election.
What to watch: In the meantime,as she sees it, she will aggressively pursue a fight for the soul of the Republican Party, after an expected vote to strip her of her post as GOP conference chair, the party's No. 3 House post.
Cheney, who today faces a 9 a.m. confrontation with the conference she chairs, views Trumpism in general — and election denial specifically — as an ongoing threat to democracy.
- And she will not accede to her colleagues’ desires to please shut up.
Last night, at 8:06 p.m., Cheney — the highest-ranking Republican woman in Congress — said so on the House floor.
- "Remaining silent, and ignoring the lie, emboldens the liar," Cheney declared from her lectern, to a near-empty chamber.
- "I will not participate in that. I will not sit back and watch in silence, while others lead our party down a path that abandons the rule of law, and joins the former president’s crusade to undermine our democracy."
Axios is told Cheney will take her case to the public with speeches and other appearances. Cheney and her team has been intentional about painting the stakes as higher than a squabble about a leadership job, but instead about truth and the future of the Republican Party.
- Look for the congresswoman to be active in midterm races and other elections, as she works to mold a future Republican Party that looks more like a Cheney party and less like a Trump party.
With House Republicans on the brink of replacing Cheney with Rep. Elise Stefanik of New York, watch for House Minority Leader Kevin McCarthy to argue that a conference with unified leaders can now turn to fighting President Biden and Speaker Pelosi.
- Look for McCarthy to stress food and gas prices, jobs and school reopenings.
Reality check: Cheney has her work cut out for her. Polling shows it's still Trump’s party — and it’s not a close call.
Tel Aviv — With Israel and Hamas now engaged in their most destructive fight in seven years, the Biden administration is considering plans to dispatch a State Department official to join the de-escalation efforts, five Israeli officials and Western diplomats tell me.
Driving the news: The fighting intensified overnight, with Hamas and other militants firing a second barrage of over 100 rockets toward Tel Aviv and other nearby cities, and Israel continuing its air campaign in the Gaza Strip by destroying high-rise buildings, Hamas facilities and rocket units.
- Three Israelis were killed and 200 wounded in the barrage, while three Israeli soldiers were critically wounded when Hamas fired anti-tank rockets at military vehicles along the border with Gaza.
- At least 20 Palestinians were killed in the last 24 hours, according to the Gaza ministry of health. That brings the overall death toll to 43 including at least 15 women and children.
Behind the scenes: The Biden administration is trying to work with Egypt to push for de-escalation, U.S. and Israeli officials told me.
- Deputy assistant secretary of state for Israeli-Palestinian affairs Hady Amr is expected to travel to Tel Aviv on Wednesday.
- Israeli officials tell me the trip is likely to happen but they're waiting on final confirmation. The State Department didn’t comment.
- It would be the most active U.S. intervention so far in the Gaza crisis, and Amr’s first trip to the region since assuming office.
Meanwhile, national security adviser Jake Sullivan spoke on Tuesday to his Egyptian counterpart, Abbas Kamel. The White House said Sullivan discussed “steps to restore calm over the coming days" with Egyptian officials.
- State Department officials have also been communicating with Cairo.
- Sullivan also spoke with his Israeli counterpart, Meir Ben Shabbat. According to the White House, Sullivan condemned the Hamas rocket attacks and “conveyed the President’s unwavering support for Israel’s security and for its legitimate right to defend itself and its people, while protecting civilians."
- Secretary of State Blinken also spoke on Tuesday with Israeli Foreign Minister Gabi Ashkenazi. Israeli officials tell me Blinken didn’t press the Israelis to stop the operation in Gaza for now, but stressed the U.S. doesn’t want things to escalate into all out war and wants to prevent civilian casualties in Gaza.
The big picture: The Israeli-Palestinian conflict had been a low priority in President Biden's early months, but once a crisis erupted the administration found itself understaffed.
- Unlike his predecessors, Biden didn’t appoint an envoy for the Israeli-Palestinian issue. He still hasn't nominated an ambassador to Israel or followed through on his plans to re-open the U.S. consulate in Jerusalem.
- That has left him without a senior diplomat on the ground to talk to either the Palestinian or Israeli leadership. At this time four years ago, Trump’s ambassador was already in Israel.
- Instead, Amr has functioned as both the deputy assistant secretary and the de-facto consul general and point of contact to the Palestinians.
The state of play: Egyptian and UN mediators are talking to both parties, but were rebuffed by the Israeli government when they raised the possibility of a ceasefire, Israeli officials tell me.
What’s next: The Israeli security cabinet is expected to convene today to discuss the Gaza operation. Israeli officials say they want to hit Hamas harder is order to renew deterrence before engaging in ceasefire talks.
- The UN Security Council will convene at 9am ET for a closed session to discuss the Gaza crisis. For now, the U.S. is still blocking any attempt to issue a joint statement on the situation.
As House Republicans meet to oust Rep. Liz Cheney from her leadership post for criticizing Donald Trump, swing voters in Axios' latest Engagious/Schlesinger focus groups hold a near-unanimous view that Minority Leader Kevin McCarthy and his caucus are making a mistake.
The big picture: Nine of 14 voters said they could vote for a Republican for U.S. House or Senate races next year. All but one ruled out backing any candidate who clings to the former president's lie that the 2020 election was stolen from him.
- 13 of the 14 said Cheney (R-Wyo.) should not be removed and that it would be a mistake for House Republicans to go through with their plans.
These were the biggest takeaways from two back-to-back focus groups conducted Tuesday night, on the eve of an expected vote to purge Cheney from her No. 3 spot in the House GOP leadership.
- The two seven-member panels included women and men, from a mix of the most competitive swing states, who voted for Trump in 2016 but President Biden in 2020.
- While focus groups are not statistically significant samples like polls, the responses show how some voters in crucial states are thinking about issues that could shape next year's midterm elections.
What they're saying: These voters said they're turned off by House Republicans' perceived fealty to Trump and the idea that there's no tolerance for dissent or critical or independent thinking.
- "It seems like you need to conform to be a leader in the Republican Party," said Rosie F., 53, of Pennsylvania.
- "They're followers," said Jimmy S., 41, from Maricopa County, Arizona. "It's all about trying to please one person."
- Engagious president Rich Thau, who moderated the focus groups, said swing voters themselves tend to be non-conformists so "when they see a political party punishing a person like them, it rubs them the wrong way."
Between the lines: This remains largely an inside-the-Beltway drama.
- Just six of the 14 voters initially knew of Cheney by name, and only five knew she holds a leadership post.
- Only after details of the controversy and her public statements were outlined did most say that her expected removal would be wrong.
Of note: While a couple of voters said they thought Cheney should run for president in 2024, none believed that she would stand a chance of winning the GOP's nomination.
Pandemic-related anxieties are entering a new phaseas more employers start to call vaccinated workers back into their offices.
Why it matters: Some employees simply don't want to go back to the office; some are desperate to. Some are struggling to rearrange their routines yet again; some don't have that flexibility. And everyone — employers and employees alike — is figuring out on the fly how to make it work.
Driving the news: "More and more employers are saying: 'If you've been vaccinated and we have all the safety precautions in place, it's time to come back to work.' That's causing a lot of anxiety," said Lucy McBride, a primary care physician in Washington, D.C.
- "There's also the anxiety of, 'I had to make all these adjustments to my life because my kids weren't in school," said Georgia Gaveras, co-founder and chief psychiatrist of Talkiatry, a telepsychiatry company. "Now it's like, 'What do I do now if I have to go back to work?'"
Many Americans are still easing into the idea of being in close quarters with other people again, even after being vaccinated. But many workers also may be suffering mental distress from over a year of isolation.
- Younger workers may be surprisingly skittish about going back into the office, said, Gregg Miller, the chief medical officer of Vituity, a firm that staffs hospital emergency departments.
- "COVID used to be a disease defined by the elderly and the infirm. Now it’s a disease of people who are in the workforce, so this is going to be a bigger issue than ever for employers," Miller said.
- Heading back to the office could bring unique stressors for women, who are more likely to shoulder the burden of parenting and household chores at the same time.
What we're watching: OSHA doesn't yet have a federal standard for workforces. “To date, it has been sort of a patchwork of incomplete guidance, unfortunately," National Safety Council CEO Lorraine Martin told Axios.
- Employers will need to consider everything from how they screen employees coming into the office to their investments in protective equipment and physical changes to their offices, including new ventilation systems — and they need to communicate those efforts to their employees, Miller said.
The intrigue: Plenty of workers may be distressed because they've rearranged their lives around their new reality — or they've realized they simply like remote work.
- In a survey released earlier this year by the Society for Human Resource Management, fewer than half of U.S. workers said they wanted to go back. In all, 52% said they'd prefer to work from home permanently.
- 45% of workers who preferred to stay home said they'd even accept a 5% pay cut in exchange for permanent work-from-home status.
Simple matters of socialization, such as how to dress and whether we'll return to handshakes, will require their own adaptations.
- "It's a lot to adjust to. We got used to living a certain way. We got used to it really fast, actually, and for a lot of people, they're enjoying it," Gaveras said.
- One indicator that people are headed out of the house: Sales of Spanx and other shapewear brands spiked in the last month, the Washington Post reports.
The bottom line: "We benefited in some ways from having more time at home, which meant you could throw a load of laundry in while you were on a conference call and you didn't commute. That itself was a pivot to change our entire work life in March and April of 2020," McBride said.
Reports of fuel shortages across the U.S. emerged on Tuesday as the national average for gasoline prices soared to its highest level since 2014 amid a key fuel pipeline shut down, per Bloomberg.
What's happening: Operator Colonial Pipeline aims to have service restored by the week's end following last Friday's ransomware attack that shut down some 5,500 miles of pipeline from Texas to New Jersey. Florida Gov. Ron DeSantis (R) declared a state of emergency after panic-buying created a fuel shortage.
Editor's note: This article has been updated with more photos.
More than 100 Republicans will sign a letter Thursday threatening to create a third party if the GOP doesn't "break" with former President Trump, Reuters first reported.
Why it matters: Per Axios' Mike Allen and Jim VandeHei, Trump's grip on the GOP has gotten stronger since the Jan. 6 Capitol riot. The Republican Party's "allegiance to Trump" as he continues to make false claims about his 2020 election loss has "dismayed" the group, according to Reuters.
- Per the New York Times, the letter's preamble will state, "When in our democratic republic, forces of conspiracy, division, and despotism arise, it is the patriotic duty of citizens to act collectively in defense of liberty and justice."
- The letter is due to be released one day after House Republicans are expected to vote on ousting Rep. Liz Cheney (R-Wyo.) from her position as conference chair.
Details: The letter's signatories include former "governors, members of Congress, ambassadors, cabinet secretaries, state legislators and Republican Party chairmen," per the Times, citing co-organizer Miles Taylor.
- "This is us saying that ... the situation has gotten so dire with the Republican Party that it is now time to seriously consider whether an alternative might be the only option, added the Trump-era Department of Homeland Security official who wrote an anonymous NYT op-ed on the administration.
- Taylor also tweeted: "My philosophy on GOP extremists: if you won't join 'em, beat 'em. Come fight with us."
The other side: Representatives for the Republican Party and Trump did not immediately respond to Axios' request for comment. But Jason Miller, a spokesperson for Trump, told Reuters: "These losers left the Republican Party when they voted for Joe Biden."
Democratic Rep. Stephanie Murphy is planning to announce a campaign for the U.S. Senate in Florida against Republican Sen. Marco Rubio in early June, people familiar with the matter tell Axios.
Why it matters: Murphy is a proven fundraiser. Jumping in now would give her an early start to build her case for the Democratic nomination and potentially force Rubio and allied GOP groups to spend heavily to retain a seat in a state that’s trending Republican.
- President Trump won Florida by more than 3 percentage points in 2020, up from a narrow one-point margin in 2016. He did so, in part, by accusing Democrats of being soft on socialism.
- Murphy, who fled Communist Vietnam as a child, calls herself a “proud capitalist” and has warned Democrats about embracing socialism. She knocked off a longtime GOP House incumbent in 2016 at age 38.
- Murphy has been on a “listening tour” across the state as she explains her life journey.
- “Rep. Murphy has not made a decision on whether to run for the U.S. Senate,” said Lauren Calmet, a campaign spokesperson.
Between the lines: With Murphy working to appeal to Florida voters statewide, she may be less inclined to support President Biden’s proposed tax increases on corporations and capital gains — making House passage more difficult.
- Biden won her Orlando-area district by about 10 points in 2020, and while the lines may be redrawn this year through congressional redistricting, the general area leans Democratic.
The big picture: Eighteen months before the election, both parties are looking for candidates who can appeal to swing voters in an unknown campaign climate.
- The atmospherics for the midterm races will hang on everything from Biden’s approval ratings to the level of Donald Trump’s determination to re-litigate the 2020 presidential election.
- While the Senate is tied at 50-50, Republicans are defending more seats than Democrats, giving Democrats an opportunity to increase their majority — a rarity for the party controlling the presidency at the midterms.
- In the House, the Democrat's five-seat margin could be more difficult to maintain, especially with redistricting giving Republican-leaning states additional seats.
- An Axios chart visualizes the dynamic.
Florida will be center stage in 2022 and a petri dish of presidential ambitions.
- Republican Gov. Ron DeSantis is also up for reelection, with Democratic Rep. Charlie Crist already announcing a challenge and Rep. Val Demings mulling her own.
- While Rubio ran for president in 2016, DeSantis could make his own bid for the White House in 2024, assuming he wins reelection.
- Florida Sen. Rick Scott, chairman of the National Republican Senatorial Campaign Committee, also has hinted at presidential aspirations.
The bottom line: In 2022, Florida may be less of a battleground and more of a proving ground for Democratic strategies about how to win Trump supporters.