* * * * * THURSDAY, AUGUST 13, 2020 ~ VOL. CCLXXVI NO. 37 WSJ.com HHHH $4 .00
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BeijingSharpensFocus onDomesticEconomyAmid global downturn,frayed ties with U.S., Xiprioritizes shift awayfrom foreign markets
Video CallsAre Good forLaundry, Too
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Multitaskers usework meetings toget chores done
BY SHAN LI
At the start of the coronavi-rus lockdown, Miguel Ariasshowed up to every Zoom callin a suit and tie—giving hisundivided attention to virtualmeetings as city council presi-dent of Fresno, Calif.
Fast forward into summer,and not only is the formalwardrobe gone, but Mr. Ariassaid he has taken to plowingthrough laundry, cooking andother items on his to-do listwhile on video calls with hisstaff. Most of the time, thecamera is on.
“Between 30 Zoom calls aday, something’s gotta give,”said Mr. Arias, 42.
More than five months intothe pandemic, people are
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apolis.But many of the cuts are
cosmetic, temporary or rep-resent a relatively small partof budgets. In the case ofMinneapolis, they may notstick. A Minnesota statecommission has delayed acity council plan to put aproposal to disband the po-lice department on the No-vember ballot.
On Monday, Seattle’s citycouncil approved about a $3million cut to police spend-ing for the remaining budgetyear, around 1% of the an-nual police budget but farless than the 50% targetsome on the city councilhave proposed. Police ChiefCarmen Best, the first Blackwoman to hold the post andwho opposed sharp spendingcuts, announced her retire-
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Cities across America areweighing whether to reduceor redirect spending on po-lice. Some, with backingfrom mayors and city coun-cils, are already undertakingefforts to do so, as protest-ers in their streets call for“defunding.”
They’re quickly learningthat police budgets, built upover generations with broadpublic support, are difficultto dismantle.
Elected officials in NewYork, Seattle, Los Angelesand Minneapolis, amongother places, have approvedplans to reduce police bud-gets in response to the na-tionwide protests followingthe killing of George Floydin police custody in Minne-
BY HEATHER GILLERSAND ANDREA FULLER
Sumner Redstoneturned his family’smovie-theaterbusiness into asprawlingentertainmentempire, whichhe assembledthrough a mix ofsavvy investing,creative litigationand all-aroundruthlessness. B1
INSIDE
U.S. stocks climbed Wednes-day, extending a steady Augustrally that has pushed the S&P500 to the cusp of its first re-cord close since the coronavi-rus pandemic brought theeconomy to a halt.
The benchmark U.S. stockindex has risen in all but onetrading session this month,buoyed by the prospect of de-clining coronavirus cases at atime the federal governmentand central banks are still sup-porting the economy.
The S&P 500 opened mod-estly higher and flirted with re-cord levels for much of the day,finally eclipsing February’sclosing high in the final hour ofthe session. But the indexcouldn’t hold on, ending justshy of the record and setting itssecond-highest close in history.
“There’s optimism right
now about an environmentwhere the virus situation getsbetter, but we still have a tonof stimulus in the system,”said Ilya Feygin, a managingdirector at broker-dealer Wal-lachBeth Capital.
The S&P 500 ended the dayup 46.66 points, or 1.4%, at3380.35, drawing within 0.2%of the Feb. 19 high. It is up 3.3%in August and 4.6% in 2020.
The Dow Jones IndustrialAverage climbed 289.93points, or 1%, to 27976.84, andthe Nasdaq Composite Indexadvanced 229.42 points, or2.1%, to 11012.24, snapping athree-session losing streak.
Shares of semiconductorcompanies and beaten-downenergy stocks led the way. Ad-vanced Micro Devices surged7.5%, while ConocoPhillipsgained 4.9% and Apple rose3.3%, edging closer to a $2trillion market value.
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BY BEN EISENAND SAM GOLDFARB
For decades, Chinese leadersembraced foreign investmentand exports to power China’seconomy. Now, with the worldin recession and U.S.-Chinatensions deepening, PresidentXi Jinping is laying out a majorinitiative to accelerate China’sshift toward more reliance onits domestic economy.
The new policy is gainingurgency as Chinese companies,including Huawei TechnologiesCo. and ByteDance Ltd., faceincreasing resistance in foreignmarkets, Chinese officials said.
In speeches to senior gov-ernment officials since May, Mr.Xi has trotted out the newstrategy, translated as “domes-tic circulation,” prioritizing do-mestic consumption, marketsand companies as China’s maingrowth drivers. Investmentsand technologies from overseas,though still desirable, wouldplay more of a supporting role.
The concept remains vaguein detail, and the notion ofempowering Chinese consum-ers in particular has beenaround for some time.
As with many top-level slo-gans in China, Mr. Xi’s new de-velopment model is meant toguide policy makers and localleaders and result in meaning-ful changes. The goal is tomake China far less dependenton foreign firms, technologyand markets, though doing sowon’t be easy, especially when
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BY LINGLING WEI
campaign, Ms. Harris managedto impress a Wall Street setthat tends to be fiscally con-servative and socially liberal.With Ms. Harris as Mr. Biden’srunning mate, they see a non-controversial partner—closelyaligned with him on issuesthey care most about—and anasset with big donors.
About half a dozen leadersin business and finance saidthey expect Ms. Harris, ifelected, to be a moderatevoice committed to rebuildingan economy upended by thecoronavirus pandemic. Theyexpect her to take some
swings at Wall Street; as Cali-fornia attorney general, shehelped take big banks to taskfor their role in the foreclo-sure crisis and she has pro-posed taxing financial transac-tions to pay for a health-careoverhaul. But they aren’t con-cerned that that would dra-matically affect their business.
“I think she is a reasonable,rational person who hasworked in the system,” saidBill Daley, Wells Fargo & Co.’shead of public affairs and aformer chief of staff to Presi-dent Obama. “Is she a progres-sive? Yes. Is she someone who
wants to burn the buildingdown? No. I think she wants tostrengthen the building.”
Mr. Biden and Ms. Harrismade their public debut asrunning mates Wednesday ata school gymnasium in Wil-mington, Del., with Mr. Bidenpraising the 55-year-old Cali-fornian as “a proven fighter
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When Joe Biden announcedSen. Kamala Harris of Califor-nia as his vice-presidentialpick, he pointed to her tough-on-banks record. Much of WallStreet cheered anyway.
The warm welcome in in-terviews reflects some reliefthat in choosing Ms. Harris,Mr. Biden has—for now atleast—fended off the moreprogressive wing of the Demo-cratic Party that has called fortougher financial regulation.
During her own presidential
BY EMILY GLAZERAND LIZ HOFFMAN
Harris Draws Plaudits FromWall Street as Biden’s Pick
Former Vice President Joe Biden and Sen. Kamala Harris made their first appearance as running mates Wednesday.
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S&P 500’s RisePuts It Just ShortOf Precrisis Record
Taiwan seeks to deepen tradeties with U.S. ............................. A7
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Running mates differed onsome policy stances.............. A5
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THEMIDDLE SEATPassengers strugglewith airlines and travelagencies for refundson canceled flights. A9
JASON GAYFans, players and
coaches are up in arms,but college footballisn’t a bubble. A12
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Police Budgets PoseBarriers to CuttingCities that try ‘defunding’ find costs fixed,broad voter support for law enforcement
CONTENTSArts in Review.... A11Business News.. B3,5Capital Account.... A2Crossword.............. A12Heard on Street.. B11Markets................... B10
Opinion.............. A13-15Personal Journal A9-10Sports........................ A12Technology............... B4U.S. News............. A2-6Weather................... A12World News...... A7,16
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What’sNews
The choice of Harris asBiden’s running mate drewplaudits in interviews withleaders in business and fi-nance, who said they ex-pect her to be a moderatevoice committed to re-building the economy ifthe ticket is elected. Theyexpect her to take someswings at Wall Street. A1, A5 A standoff between Dem-ocrats and Republicans overanother coronavirus-reliefbill showed no signs ofabating, as talks threatenedto stall until next month. A3 The federal deficit morethan tripled in the first 10months of the fiscal year,as spending to combat thecoronavirus continued tooutpace tax collection. A2 The U.S. reported morethan 46,000 new coronavi-rus cases, its lowest newdaily tally since Aug. 3. A4The U.S. is readying sanc-tions against some promi-nent Lebanese figures in abid to weaken Hezbollah’sinfluence after last week’sdeadly blast in Beirut. A16 Taiwan’s presidentsaid she wants to begintalks on a free-tradeagreement with the U.S. A7U.S. agriculture officialssaid they are working withChina to determine who issending mysterious seedpackages to U.S. residents.A3A businessmanwhose tipled the government to un-ravel the college-admissionsscam was sentenced toprison in a separate case. A3 Died: Sumner Redstone,97, built a media empire. B1
China’s Xi is laying out amajor initiative to accel-
erate the country’s shift to-wardmore reliance on its do-mestic economy, as theworldremains in recession and ten-sionswith the U.S. deepen.A1A steady rally in stocks haspushed the S&P 500 to thecusp of its first record closesince the pandemic broughtthe economy to a halt. A1 Fannie and Freddie saidthey would impose a new feeto insulate themselvesfrom losses on refinancedmortgages they guarantee.A2 Goldman is bidding toreplace Capital One as GM’scredit-card issuer. Barclaysis also in the running. B1 Lyft reported a dramaticdrop in riders and revenuefor the second quarter. B1 The SEC and FBI areexamining investmentssold by the online plat-form YieldStreet. B1 Cisco said it would adjustinvestment plans and pursuedeep cost cuts amid shiftingcustomer priorities. B4 Simon and Brookfieldhave teamed up and are inadvanced talks to buy J.C.Penney’s retail operations. B3 U.S. consumer pricesrose in July, a sign of firm-ing inflation as demandfor goods rebounded. A2 The U.K. economy shrank20.4% in the second quarter,taking the worst hit from thecoronavirus in Europe. A7 Tencent played downthreats from potential U.S.curbs on its WeChat app asthe Chinese firm posted bet-ter-than-expected results. B4
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