Head to Head illustration by Matt Kenyon

Corporate America is on a spending spree. Flush with cash from President Donald Trump’s 2017 tax cuts, companies are on track to shell out more than $1tn on stock buybacks this year. Critics such as US senator Elizabeth Warren say this is bad news. Buybacks may boost prices in the short run, they claim, but a better way to boost the value of a corporation is to invest in the future.

Ought the US to be making moves to restrict the rush of activity? Lenore Palladino, an economist at the Roosevelt Institute, and Alex Edmans, a professor at London Business School and Gresham College, make the case for each side of the debate.

Lenore argues that buybacks should be regulated because they reward executives at the expense of a company’s staff and customers. But Alex counters that buybacks can be a good use of cash as they boost stock prices and create value in the long term.

Wolfgang Münchau sees three specific areas in which the EU could help UK prime minister Theresa May pass her Brexit deal. That would be a desirable outcome for both sides, he says.

Nick Butler interprets Qatar’s decision to quit Opec as a sign of the once-powerful cartel’s waning influence. It has become a price-taker, with no control over the market it once ruled.

Seema Malhotra warns that uncertainty over post-Brexit trade threatens to set UK back by 46 years. The Labour party MP points out that the UK’s new Brexit secretary has said he cannot guarantee the UK would still benefit from the EU’s free trade agreements.

What you’ve been saying

Letter from Michael V Sternberg in response to Eyes down and history books open for Brexit bingo

Gideon Rachman’s excellent article lists a number of historical parallels to where we are now. Many exemplify a semi-detached approach to Europe where we ended by paying (as we will now) a significant cost. There are two more very important ones. If the UK had intervened militarily to reverse the Nazi occupation of the Rhineland in 1936, Wehrmacht generals would have toppled Hitler and the second world war would have been avoided. Had the UK entered the Common Market as a founding member on March 25 1957, it would almost certainly have prevented the EU moving to the position which Brexiters now find so objectionable. Halfhearted engagements with Europe usually end very badly for us.

Comment by Wake Up Westminster! on Theresa May, a political survivor cornered by Brexit

Theresa May entered — and committed to — a complex negotiation without having established a consensus over what she wanted. This is an unforgivable error. No company or organisation would commit to change — with a deadline — without firm and overwhelming consensus as to the destination. This wasn't just a one-off error. It was her whole approach — claiming the ‘secrecy’ was necessary to get the best deal, when in reality she had not done the groundwork, or reached out across the party divide. Her whole instinct is to kick the can down the road at every opportunity.

Letter from Louis J Cutrona, Jr, in response to Tussle for tech supremacy powers US-China animosity

David Zweig, in characterising the US-China trade dispute as a ‘tussle’, misses a crucial issue. From a national security standpoint, the US should not, indeed must not, allow itself to make use of Chinese-made technology (including communications and internet of things devices) because of the certainty that the Chinese government will ensure that such devices have a back-door capability to send any and all data to Chinese monitoring sites. This is a security not a tech supremacy problem and it will be with us for decades.

Today’s opinion

The EU could, and should, help Theresa May’s deal pass
The backstop is awful and a purgatory in which the union does not want to end up

Small Talk: Companies — Investors should take just a small bite out of litigation funding
While Manolete plans to join Aim, Juridica is to quit the market and appoint liquidators

Brexit trade uncertainty threatens to set UK back by 46 years
Prime minister Theresa May is putting the British economy at risk

Inside Business: High utility dividends are bad for Britain’s infrastructure
Companies such as BT are not investing as much of their earnings as they should

Global Insight: Brexit, Brussels and Northern Ireland: careful what you wish for
Backstop plans could hand the EU extraordinary powers over the province

Lex: Embraer/Boeing — grounded
The proposed joint venture makes sense despite the bumpy ride

Head to Head: Should the US rein in share buybacks?
An economist and business professor argue for and against the corporate spending spree

Climate change is firing up middle-class activism
Employers are having to think about how to deal with staff who set out to be arrested

Instant Insight: The walls are closing in on ‘individual #1’
Donald Trump is battening down the hatches as the Mueller inquiry nears its conclusion

May’s deal avoids the pitfalls of no deal and no Brexit
Compromise is the most pragmatic and moderate response to a polarised nation

FT View

The FT View: Tesco trial failure is another setback for SFO
The UK should lower the burden of proof in corporate fraud cases

The FT View: For Germany’s sake, the CDU must heal its rifts
Annegret Kramp-Karrenbauer should start planning to lead her country

The Big Read

The Big Read: Dell — the tricky maths of a reverse merger
Five years after quitting Nasdaq the technology group is to return to the public markets after a fierce fight over valuation

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