McDonald’s will serve its very first organic burger in locations across Germany. Uber is getting into hot water from London Mayor Boris Johnson as well as cities worldwide. United States consumers are opening up their wallets again. The American public’s distrust of the mainstream media continues to grow. And Republican Party frontrunner Donald Trump released his tax plan.
These are the five global business headlines from last week.
1. McDonald's Goes Organic (Sort of)
McDonald’s to go organic? Not just yet, but it’s slowly getting there.
For a limited time from Oct. 1 to Nov. 18, McDonald’s will offer customers in Germany its first-ever 100 percent organic beef hamburger. The iconic fast-food chain joins its fellow restaurants to give the general public what it wants: more natural and less processed food.
Known as the "McB" burgers, these burgers are made from organic beef sourced from Austrian and German organic farms. Steve Easterbrook, CEO of McDonald’s, said this is part of the company’s efforts to turn McDonald’s into a "modern, progressive burger company."
"We have made a great effort to secure sufficient quantities of meat which satisfies the organic requirements and our own quality claims," said Holger Beeck, chief executive of McDonald’s Germany.
Despite owning the moniker of being the biggest restaurant chain by revenue, McDonald’s sales have slumped in recent years. As other and newer chains, like Chipotle Mexican Grill, offer healthier choices for consumers, McDonald’s had maintained that status quo. Now, the home of the golden arch is trying to modify its image of being an unhealthy choice.
Earlier this year, McDonald’s announced that it would stop purchasing meat that had chickens raised with antibiotics. Instead, the company wants meat without any antibiotics or hormones. Also, it confirmed this past summer that it would only serve cage-free eggs within the next decade.
2. Is Uber 'Systematically Breaking the Law'?
Public officials all over the world are upset that Uber, the ride-sharing mobile app service, isn’t following the same regulations as the taxi industry. Or are public officials upset that they’re not getting a share of that billion-dollar pie?
From New York to Toronto, from Paris to London, regulators and politicians are looking to rein in the likes of Uber and Lyft as well as the overall independent, sharing economy. The latest one to criticize Uber is London Mayor Boris Johnson.
Writing in a weekly op-ed published in the London Telegraph, Mayor Johnson opines that Uber may be doing a great job but it has to play by the rules like everyone else. He wrote that Uber’s innovative mobile phone technology is simply aping the act of hailing a cab. However, consumers can only hail a cab that is regulated and approved by the city.
"Until Parliament has the guts to change the law we must uphold the existing and long-standing legal distinctions between black cabs and minicabs," wrote Johnson.
The mayor’s comments come as the Transport for London (TfL), which is chaired by Johnson, is in a high court battle with Uber over the issue of whether or not the Uber app is breaking the law by acting as a meter.
Nevertheless, even with the popularity of Uber, Johnson said there needs to be a level playing field and a balanced approach. There cannot, says Johnson, be a free for all, a deregulation of all sides.
With that being said, Johnson agrees with those who support a free market approach: there shouldn’t be an outright ban on technology. Many Uber supporters say that taxicabs are simply going the way of the horse and buggy industry, the ice delivery men, the video tape store. All because of technology.
"We want competition, we want choice – but if Margaret Thatcher believed in one thing it is that freedom is only possible under the rule of law," concluded Johnson.
3. U.S. Personal Incomes up, Wallets Open
Consumers are beginning to open up their wallets once again, thanks to gains in personal incomes.
According to a new report from the Department of Commerce, consumer spending rose 0.4 percent in the month of August, while personal incomes went up 0.3 percent. Both figures exceed what polls of economists had initially forecasted, with 0.3 percent and 0.2 percent, respectively.
This data may help convince Federal Reserve Chair Janet Yellen and the 12-member Federal Open Market Committee (FOMC) to raise interest rates sometime this year. New York Fed President William Dudley told CNBC last week that a rate hike could happen this year, and as soon as October.
In August, automobile spending jumped 0.9 percent, while utilities spending spiked 0.5 percent.
Official overall inflation remained subdued. It increased only 0.3 percent, but when excluding food and energy, prices soared 1.3 percent, up from July’s 1.2 percent year-over-year gains.
The U.S. economy grew by healthy 3.8 percent in the second quarter.
4. The Collapse of the American Media Continues
Do you trust the mainstream media? If you answered no then you’re certainly not alone. Many people are just turning off or taking whatever the news anchors or political commentators say with a grain of salt.
A new Gallup survey finds that just four in 10 Americans trust the media, younger Americans are far less likely to trust media outlets and trust in the media has reached record lows. This may seem very troublesome, particularly at a time when the presidential election is heating up.
The general public’s confidence in the media has gradually dwindled from the all-time high of 55 percent in the years 1998 and 1999. However, ever since 2007, the majority of Americans have had very little or zero trust in what’s being showcased on CNN, Fox News or MSNBC. What’s even more interesting is that this trust usually collapses during election years (2012 was a record low for trust in the media).
Survey authors say this decline in trust mimics the trend of Americans’ distrust in the federal government and other institutions.
Here are two other findings from the study:
- 36 percent of Americans aged 18 to 49 trust the media, compared to 45 percent of those 50 and older.
- Democrats trust the media more than Republicans, 55 percent and 32 percent, respectively. Independents also have very little trust with just 33 percent having confidence in the mass media.
The polling institution’s "bottom line" is that much of this distrust may very well be "self-inflicted."
"Major venerable news organizations have been caught making serious mistakes in the past several years, including the scandal involving former NBC Nightly News anchor Brian Williams in 2015 that some of his firsthand accounts of news events had been exaggerated or ’misremembered.’"
The telephone poll was conducted with 1,025 adults between Sept. 9 and 13. It contains a margin of error of +/- four percentage points.
5. Donald Trump Making America Great Again?
Everyone in the U.S. is getting a tax break. The national debt is reaching an all-time high, the country is facing $120 trillion in unfunded liabilities and expenditures and an unbalanced budget. But, if elected, Donald Trump would give all income groups some sort of tax cut.
Releasing his tax strategy Monday, the GOP frontrunner told an audience at his New York Trump Tower that his plan would provide tax relief predominantly to middle-class Americans. He also said that it would simplify the tax code, while giving a major tax reduction to most Americans.
Also, for Americans that will pay zero income taxes, "They get a new one page form to send the IRS saying, ‘I win.’”
So, just what is inside Trump’s tax proposal? Let’s take a gander at some of the numbers:
- Today, 36 percent of Americans pay zero income taxes. Under Trump’s plan, that figure would soar to 50 percent.
- Americans with either low or modest incomes would have their income tax bills slashed to zero.
- The top income tax rate would be reduced to 25 percent from today’s 39.6 percent.
- Married couples would pay zero tax on their first $50,000 of income. On the next $50,000, they would pay just 10 percent.
- The estate tax would be gone and never heard from again (until perhaps the next president).
- Corporate tax rates would be lowered to 15 percent from 35 percent. Trump would also offer a 15 percent special tax rate to business owners.
- Maximum rates on dividends and capital gains would be cut to 20 percent from 23.8 percent.
Many were soon asking just how would the federal government be able to afford these generous tax cuts. Some budget and tax experts fear it will actually add billions of dollars to the deficit and national debt over a decade.
Trump’s response is that he would take "one of the greatest scalpels in history" to the budget and cut spending.
"So here’s the thing: There’s tremendous cutting that goes with my tax plan that I haven’t talked about yet, but that will be phase two," Trump said in an interview with CNN. "So we’re going to have a government that’s going to be much leaner, much better, much meaner, but it’s going to be meaner in the sense... of it’s going to be efficient."
What may be concerning is that right now the top one percent earners pay more than half of the taxes in the U.S., and with half of the country paying zero taxes, there could be serious budget holes in a Trump White House.
McDonald’s customers can soon enjoy a bite of its first-ever organic hamburger. Uber is continually being hammered by elected officials in every part of the world. American consumers are confident in the economy to buy again. CNN, MSNBC, Fox News, CBS and other mainstream media outlets in the U.S. aren’t to be trusted these days. And Donald Trump wants everyone to pay lower taxes.