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By NewsPress Now
California announces new deal with tech to fund journalism
SACRAMENTO, Calif. | California will be the first U.S. state to direct millions of dollars from taxpayer money and tech companies to help pay for journalism and AI research under a new deal announced Wednesday.
Under the first-in-the-nation agreement, the state and tech companies would collectively pay roughly $250 million over five years to support California-based news organization and create an AI research program. The initiatives are set to kick in in 2025 with $100 million the first year, and the majority of the money would go to news organizations, said Democratic Assemblymember Buffy Wicks, who brokered the deal.
“This agreement represents a major breakthrough in ensuring the survival of newsrooms and bolstering local journalism across California — leveraging substantial tech industry resources without imposing new taxes on Californians,” Gov. Gavin Newsom said in a statement. “The deal not only provides funding to support hundreds of new journalists but helps rebuild a robust and dynamic California press corps for years to come, reinforcing the vital role of journalism in our democracy.”
Wicks’ office didn’t immediately answer questions about specifics on how much funding would come from the state, which news organizations would be eligible and how much money would go to the AI research program.
The deal effectively marks the end of a yearlong fight between tech giants and lawmakers over Wicks’ proposal to require companies like Google, Facebook and Microsoft to pay a certain percentage of advertising revenue to media companies for linking to their content.
The bill, modelled after a legislation in Canada aiming at providing financial help to local news organizations, faced intense backlash from the tech industry, which launched ads over the summer to attack the bill. Google also tried to pressure lawmakers to drop the bill by temporarily removing news websites from some people’s search results in April.
“This partnership represents a cross-sector commitment to supporting a free and vibrant press, empowering local news outlets up and down the state to continue in their essential work,” Wicks said in a statement. “This is just the beginning.”
California has tried different ways to stop the loss of journalism jobs, which have been disappearing rapidly as legacy media companies have struggled to profit in the digital age. More than 2,500 newspapers have closed in the U.S. since 2005, according to Northwestern University’s Medill School of Journalism. California has lost more than 100 news organizations in the past decade, according to Wicks’ office.
The Wednesday agreement is supported by California News Publishers Association, which represents more than 700 news organizations, Google’s corporate parent Alphabet and OpenAI. But journalists, including those in Media Guild of the West, slammed the deal and said it would hurt California news organizations.
State Sen. Steve Glazer, who authored a bill to provide news organizations a tax credit for hiring full-time journalists, said the agreement “seriously undercuts our work toward a long term solution to rescue independent journalism.”
State Senate President Pro Tempore Mike McGuire also said the deal doesn’t go far enough to address the dire situation in California.
“Newsrooms have been hollowed out across this state while tech platforms have seen multi-billion dollar profits,” he said in a statement. “We have concerns that this proposal lacks sufficient funding for newspapers and local media, and doesn’t fully address the inequities facing the industry.”
Body of Mike Lynch is among those recovered from yacht wreckage
PORTICELLO, Sicily | The Italian coast guard said Thursday the body of British tech magnate Mike Lynch is among those recovered off the coast of Sicily from the wreckage of a superyacht whose builders had called unsinkable.
One woman remains missing. She has not been identified, but Hannah Lynch, Lynch’s 18-year-old daughter, is reportedly unaccounted for. The family had been celebrating his recent acquittal on fraud charges with the people who defended him at trial in the United States.
Five others were recovered by rescue crews following Monday’s tragedy.
The Bayesian, a 56-meter (184-foot) British-flagged yacht, went down in a storm early Monday as it was moored about a kilometer (half a mile) offshore. Civil protection officials said they believe the ship was struck by a tornado over the water, known as a waterspout, and sank quickly.
Termini Imerese Public Prosecutor’s Office investigators were collecting evidence for a criminal investigation, which they opened immediately after the tragedy despite no formal suspects having been publicly identified.
The chief executive of The Italian Sea Group, which owns the Bayesian’s manufacturer, told the AP in an interview on Thursday that superyachts like these are “designed to be unsinkable.”
“And it is unsinkable not only because it is designed in this way, but also because it is a sailing ship and sailing ships are the safest ever,” CEO Giovanni Costantino said.
Costantino added that “obviously they must not hit the rocks violently, discarding the hull, and they must not take in water,” suggesting the second possibility was the most likely in this case.
Costantino also noted that sailing ships require “a greater competence” to be guided compared with motor boats.
Investigators are now looking at why the Bayesian, built in 2008 by Italian shipyard Perini Navi, sank while a nearby sailboat remained largely unscathed. Fifteen of the 22 people aboard survived by escaping in a lifeboat, including a mother who reported holding her 1-year-old baby over the waves to save her. They were rescued by the sailboat Sir Robert Baden Powell.
The sailboat’s captain, Karsten Borner, said his craft sustained minimal damage — the frame of a sun awning broke — even with winds that he estimated had reached 12 on the Beaufort wind scale, the highest hurricane-strength force on the scale.
He said he had remained anchored with his engines running to try to maintain the ship’s position as the forecast storm rolled in.
“Another possibility is to heave anchor before the storm and to run downwind at open sea,” Borner said in a text message. But he said that might not have been possible for the Bayesian, given its 75-meter (246-foot) tall mast.
“If there was a stability problem, caused by the extremely tall mast, it would not have been better at open sea,” he said.
Yachts like the Bayesian are required to have watertight compartments that are specifically designed to prevent a rapid, catastrophic sinking even when some parts fill with water.
Lynch is the only person confirmed dead; the other bodies have not been formally identified by the Italian coast guard.
Besides Hannah Lynch, those missing are Christopher Morvillo, one of Lynch’s U.S. lawyers, and his wife, Neda; Jonathan Bloomer, chairman of Morgan Stanley’s London-based investment banking subsidiary, and his wife, Judy.
The body of chef Recaldo Thomas was the first to be recovered, on Monday. His death was confirmed by his family.
Friends of Thomas, best known as “Rick,” paid tribute to him on Thursday at a favorite bar in the Caribbean Island of Antigua. Cooking for Lynch was supposed to be one of Thomas’ last jobs before retiring, his cousin, David Isaac, told the AP.
Divers have struggled to find the bodies in the yacht’s hull on the seabed 50 meters (164 feet) underwater.
“We would need a crystal ball to know when we’ll be able to find the next body,” said Luca Cari, spokesperson for the fire rescue service.
“It’s very difficult to move inside the wreckage. Moving just one meter can take up to 24 hours,” Cari said.
U.S. applications for unemployment benefits inch up
Slightly more Americans filed for unemployment benefits last week, but the number of claims remains at healthy levels.
Jobless claims rose by 4,000 to 232,000 for the week of Aug. 17, the Labor Department reported Thursday. The four-week average of claims, which evens out some of the weekly gyrations, ticked down by 750 to 236,000.
For the week ending Aug. 10, 1.86 million Americans were collecting jobless benefits, 4,000 more than the week before.
Weekly filings for unemployment benefits, which are a proxy for layoffs, remain low by historic standards.
From January through May, claims averaged a paltry 213,000 a week. But they started rising in May, hitting 250,000 in late July and adding to evidence that high interest rates are taking a toll on the U.S. job market.
However, the tiny increase in claims this week follows two straight weeks of declines, largely dispelling worries that the job market is deteriorating rapidly rather than just slowing.
The Federal Reserve, fighting inflation that hit a four-decade just over two years ago, raised its benchmark interest rate 11 times in 2022 and 2023, taking it to a 23-year high. Inflation has come down steadily — from more than 9% in June 2022 to a three-year low of 2.9% last month. Despite higher borrowing costs, the economy and hiring kept chugging along, defying widespread fears that the U.S. was poised to tip into a recession.
The economy is weighing heavily on voters as they prepare for November’s presidential election. Despite a solid job market and decelerating inflation, Americans are still exasperated that consumer prices are 19% higher than they were before inflation started to take off in 2021. Many blame President Joe Biden, though it’s unclear whether they will hold Vice President Kamala Harris responsible as she seeks the presidency.
Lately, higher rates have finally seemed to be taking a toll. Employers added just 114,000 jobs in July, well below the January-June monthly average of nearly 218,000. The unemployment rate rose for the fourth straight month in July, though it remains low at 4.3%.
Earlier this week, the Labor Department reported that the U.S. economy added 818,000 fewer jobs from April 2023 through March this year than were originally reported. The revised total supports evidence that the job market has been steadily slowing and likely reinforces the Federal Reserve’s plan to start cutting interest rates soon.
The Labor Department estimated that job growth averaged 174,000 a month in the year that ended in March — a decline of 68,000 a month from the 242,000 that were initially reported. The revisions released Wednesday were preliminary, with final numbers to be issued in February next year.
On top of that, monthly job openings have fallen steadily since peaking at a record 12.2 million in March 2022. They were down to 8.2 million in June.
As signs of an economic slowdown accumulate and inflation continues to drift down toward its 2% target, the Fed is expected to start cutting rates at its next meeting in September.
Average rate on a 30-year mortgage eases to 6.46%
The average rate on a 30-year mortgage eased this week to its lowest level in 15 months, welcome relief for home shoppers navigating a housing market that remains out of reach for many Americans.
The rate fell to 6.46% from 6.49% last week, mortgage buyer Freddie Mac said Thursday. A year ago, the rate averaged 7.23%.
The average rate is now the lowest it’s been since mid-May last year, when it was 6.39%.
Borrowing costs on 15-year fixed-rate mortgages also fell this week, good news for homeowners seeking to refinance their home loan at a lower rate. The average rate fell to 5.62% from 5.66% last week. A year ago, it averaged 6.55%, Freddie Mac said.
Mortgage rates are expected to continue trending lower overall this year, as signs of waning inflation and a cooling job market have raised expectations that the Federal Reserve will cut its benchmark interest rate at its policy meeting next month, which would be the first such easing in four years.
“Although mortgage rates have stayed relatively flat over the past couple of weeks, softer incoming economic data suggest rates will gently slope downward through the end of the year,” said Sam Khater, Freddie Mac’s chief economist.
After jumping to a 23-year high of 7.79% in October, the average rate on a 30-year mortgage has mostly hovered around 7% this year — more than double what it was just three years ago. But this month, the average rate has made its biggest downshift in more than a year, sliding to around 6.5%.
The recent pullback in mortgage rates overall has sparked a pickup in applications for home refinancing loans, which are 23% higher than a month ago, according to the Mortgage Bankers Association.
Applications for home purchase loans have lagged, however.
“We expect rates likely will need to decline another percentage point to generate buyer demand,” Khater said.
Elevated mortgage rates, which can add hundreds of dollars a month in costs for borrowers, have kept many would-be homebuyers on the sidelines, extending the nation’s housing slump into its third year.
Sales of previously occupied U.S. homes are running below last year’s pace, though they ended a four-month slide in July.
The rate on a 30-year mortgage is influenced by several factors, including how the bond market reacts to the central bank’s interest rate policy decisions. That can move the trajectory of the 10-year Treasury yield, which lenders use as a guide to pricing home loans.
The yield, which topped 4.7% in late April, was at 3.86% in afternoon trading in the bond market Thursday, following mixed data on the U.S. economy, which has been slowing under the weight of high interest rates meant to get inflation under control.
Most economists expect the average rate on a 30-year home loan to remain above 6% this year. That may not be enough for many prospective homebuyers in the face of record-high home prices and a shortage of properties for sale in many markets.
“Home prices are still rising in most markets,” said Lisa Sturtevant, chief economist at Bright MLS. “Opportunities for moderate-income and first-time homebuyers will still be limited even with a drop in rates.”
—From AP reports
