Possible marijuana reclassification / U.S. consumer spending up / Syria protests

Plus: Tropical Storm Idalia brought heavy rains to FL, GA, SC & NC yesterday.

Inside Daily Brief For August 31, 2023

Hi Insiders! Our top stories today are: A federal public health agency recommended that marijuana be reclassified as a less serious drug U.S. consumer spending rose at the fastest pace in six months in July Hurricane Idalia brought heavy rains and strong winds to Florida, Georgia, and the Carolinas yesterday And much more! If you enjoy reading the Inside Daily Brief, please share it with your friends and colleagues.  Your faithful IDB writer, Daniel p/Dan-Smith

1 A federal public health agency asked the Drug Enforcement Agency (DEA) to reclassify marijuana as a Schedule III drug. Currently, the DEA considers marijuana a Schedule I drug, the same classification as LSD and heroin. More: Xavier Becerra, the Secretary of the Health and Human Services (HHS) department, said his agency sent the recommendation following a request from President Joe Biden in October 2022. Biden made the request after pardoning thousands of people convicted of marijuana possession under federal law. At the time, Kassandra Frederique of the Drug Policy Alliance noted that marijuana was already legal in 19 states (and Washington D.C.) and that it had been decriminalized in 31 states. Under DEA rules, drugs are classified as Schedule I if they have "no currently accepted medical use" and "a high potential for abuse." Zoom Out: Senate majority leader Chuck Schumer (D-NY) said the move will help "reduce the harm caused by draconian marijuana laws." Other Senate Democrats ― notably Ron Wyden of Oregon ― have called for marijuana to be completely descheduled.  Q: Do you think marijuana should be declassified and legalized across the U.S., or is it more appropriate to reduce its classification as the HHS Department recommended? Join the debate here.

2 Dollar General stock fell by as much as 14% on Thursday after the company released a disappointing Q2 earnings report. What the numbers say: Same-store sales declined by 1% in the second quarter. Dollar General lowered its 2023 growth forecast to 1.3% - 3.3%, from 3.5% - 5%. The discount retailer expects its full-year earnings to decline by 22% - 34% after previously projecting a 0% - 8% decrease.  Dollar General stock is down ~44% YTD. Relevance: Neil Saunders, an analyst and managing director at GlobalData, attributed the drop in sales to the "acute pressure of the cost-of-living crisis." He said that cuts in SNAP payments and the end of other temporary pandemic benefits led low-income shoppers to cut back on purchases. Saunders expects this to continue for the rest of the year. The news of lower sales at Dollar General stores comes on the same day that Commerce Department data showed that overall consumer sales are increasing.

3 U.S. consumer spending grew at the fastest rate in six months in July, the Commerce Department said. Consumer spending was up 0.8% from June to July after increasing by an upwardly-adjusted 0.6% from May to June. More: Inflation-adjusted consumer spending rose 0.6%, the biggest increase since January.  The personal-consumption expenditures price index ― the measure of consumer prices favored by policymakers at the Federal Reserve ― gained 0.2% from June to July, unchanged from the previous month.  Price inflation was an annualized 2.1% in the three months through July. Core prices, which exclude food and energy, were up 2.9% on an annual basis during that three-month period. Consumer prices rose 3.2% annually in July, up from the 3% annual inflation rate seen in June. Zoom Out: Commerce lowered its GDP growth estimate for the second quarter to 2.1%, from the 2.4% reported last month. The latest data show that economic growth is steady and inflation has eased after the Federal Reserve hiked its key interest rate by 5.25 percentage points over the last year and a half. This suggests that the U.S. economy is approaching a "soft landing" instead of a recession.

4 GOOD NEWS: A Canadian study debunked common myths about homelessness, showing that a majority of unhoused people would spend a cash handout on housing, food, and other necessities, instead of drugs and alcohol. Researchers at the University of British Columbia said that their findings could help to counter harmful stereotypes about homeless people. More: A previous study based on a U.S. survey of 1,114 people predicted that unhoused people would spend most of a $7,500 cash handout on "temptation goods," such as cigarettes and alcohol, instead of necessities. The new study provided CA$7,500 to 50 people experiencing homelessness and tracked their spending. The authors also studied a control group of 65 homeless people who did not receive cash. Those who received money spent an average of 99 fewer days homeless than the control group. They also increased their personal savings and spent less time in shelters. Zoom Out: Jiaying Zhao, the psychology professor who led the study, said the research did not include people with severe drug or alcohol use, or mental health problems, because they are not representative of the homeless community. Zhao said that most homeless people are "largely invisible" because they stay in their cars or with friends.

5 Tropical Storm Idalia brought heavy rains and destructive winds to Florida, Georgia, and the Carolinas on Wednesday before moving into the Atlantic Ocean on Thursday morning. President Joe Biden approved emergency declarations for Florida and South Carolina, opening the states to federal funding to help them recover from the storm. More: Idalia made landfall in Florida as a Category 3 hurricane and was later downgraded to a tropical storm.  The storm flooded thousands of homes in Florida's Big Bend region. Coastal communities like Perry, Steinhatchee, and Cedar Key were hit particularly hard.  Florida Governor Ron DeSantis said that no deaths from the storm had yet been reported and that 40 rescues had been conducted as of Wednesday night. Idalia is likely to be one of the costliest hurricanes to ever hit the U.S., with insurance costs in Florida expected to reach around $10B. As of Thursday morning, 150,000 people were without power in Florida's Big Bend region and 35,000 in South Carolina.

6 People in Damascus, Aleppo, and other Syrian cities staged anti-government protests over the last two weeks, calling for longtime President Bashar al-Assad to resign. These are some of the first major protests in the Levantine nation since the start of the Syrian Civil War in 2011. More: Since the conflicted started, al-Assad has tightened his control over the Syrian government in the name of fighting Islamist militants and anti-government forces. The protests were triggered by the government's decision to cut fuel subsidies, which led to the doubling of gasoline prices. The civil war has devastated the Syrian economy, with ~90% of Syrians living under the poverty line. The U.N. estimates that 15.3 million people, 70% of the country's population, are in need of humanitarian assistance.  Zoom Out: Major protests against al-Assad's government in 2011 following the regional Arab Spring led to a violent crackdown on dissent. In the years that followed, ISIS and other Islamist extremist groups began to wage a war against Syrian forces throughout much of the country.

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Daniel Smith Writer Dr. Daniel Smith is an Inside writer with a Ph.D. in Political Science from the University of Cambridge. Follow him on Twitter @DJS12321 or email him at Daniel@inside.com. This newsletter was edited by NO ACCOUNT ASSOCIATED WITH THE EDITOR

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