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Each day FT Leader writers on the Editorial Board meet to discuss the topics to be considered for Leader columns. Here are the issues that dominated this week:

We opened the week with a look ahead at today's Budget, and the challenge facing new UK chancellor Jeremy Hunt: "Hunt’s plan will need to satisfy markets, his party and voters, while limiting damage to the economy," we argued.

"That will not be easy. Bank of England forecasts last week showed the UK is slipping into a protracted recession."

Later today the Editorial Board will return to the Budget and pass judgment.

In between we focused on the other big set piece of the week, the G20 meeting in Bali, where US President Joe Biden and President Xi Jinping of China met in person for the first time as heads of state. With so many challenges facing the world, our leader welcomed the mere fact of dialogue.

“The most positive aspect of Monday’s talks between US president Joe Biden and his Chinese counterpart Xi Jinping is that they took place at all,” we wrote.
Breaking: UK slides into recession

Today’s Autumn Statement by Jeremy Hunt, the UK chancellor, heralded a return to orthodox economics, following his predecessor Kwasi Kwarteng’s
disastrous “mini” Budget just eight weeks ago.

With backing from Prime Minister Rishi Sunak, Hunt confirmed a £55bn package of fiscal tightening. He pulled more people into top income-tax bands and squeezed public spending against a backdrop of inflation at 11.1 per cent – a 41-year high – fuelled partly by rising energy costs, and a worsening economic outlook.

The dividend allowance will be cut from £2,000 to £1,000 next year, then £500 from April 2024.

The Office for Budget Responsibility confirmed the UK is now in recession, with finances deteriorating on the back of weak outlook, higher borrowing costs and increased public spending. Inflation is forecast to fall to 7.4 per cent next year.

Investors and the City were seeking reassurance from Hunt, after the market turmoil the short-lived Truss administration left in its wake – and they largely got it.

The chancellor confirmed that he does not plan to change the Bank of England’s remit to bring down inflation, and new fiscal rules, including no longer avoiding borrowing for current spending. The latter makes it easier to hit fiscal targets.

Sunak earlier said he would not “sacrifice quality for speed” in securing post-Brexit trade deals aimed at boosting the UK economy.

Follow reaction and analysis to the Autumn Statement on our live blog throughout the day.

A Trumpian dilemma

Republicans have won back control of the US House of Representatives with a narrow victory, but Democrats have retained control of the Senate. The unexpected results from last week’s US midterm elections usher in a new era of divided government in Washington.

The size of the Republicans’ house majority is still unclear , but it is likely to be significantly smaller than the party hoped for. That weakens its political hand for the next two years.

Earlier in the week, former president Donald Trump declared he will run for president a third time in 2024, despite several of his handpicked candidates failing to win their races, and some high-profile Republican donors, including Blackstone chief executive Stephen Schwarzman , abandoning Trump.

Schwarzman said: “It’s time for the Republican party to turn to a new generation of leaders and I intend to support one of them in the presidential primaries.” Some Republican lawmakers, too, have urged the former president to step aside.

Ed Luce writes how, for the Democrats, Trump is the gift that keeps on giving . His opponents believe that if Trump were to be the 2024 Republican presidential nominee, his name would all but ensure yet another Republican defeat.

But whether Maga-style Trumpism would fare better without its figurehead is unknown.

“It would be a blunder to think the American Kraken has just been slain,” Ed Luce writes. “It needs a new figurehead. There’s no reason to think that Trump’s demise would restore the party to the country club Republicans whom he banished.”

Meanwhile in Bali at the G20 summit, President Joe Biden and China’s Xi Jinping used their first in-person meeting as leaders to signal a desire to improve relations .

Despite growing tensions over Taiwan, they agreed to “maintain communication” on climate change, economic stability and food security.

“We may look back on the Biden-Xi meeting as the first signs of an inflection point that began to decelerate the spiral towards conflict,” says one expert.

Will Musk’s layoffs undo Twitter?

Elon Musk is on a collision course with EU regulators under new European laws to police Big Tech that came into force yesterday.

The Digital Services Act is aimed at curbing the spread of illegal content online, and Brussels is especially worried about Twitter Blue, Musk’s flagship premium subscription service. Its “blue tick” feature was abused by impersonators immediately after launch.

Officials are also concerned about the number of Twitter executives with key roles in dealing with regulators who have left since the Tesla chief bought the social media platform. “The DSA will require Twitter… to have massive technical and legal compliance,” a source told the FT. “Many of these people have been laid off.”

Ultimately, Twitter could be banned in Europe by Brussels if Musk fails to address its concerns.

Twitter is grabbing more headlines for brutality and incompetence in its job losses. Gillian Tett explains why Musk’s order to staff to stop working from home is out of date .

But it is not the only Big Tech company to shed workers in recent weeks. Amazon and Meta, which owns Facebook, are also on a firing spree, with plans to lose more than 10,000 jobs each.

Brooke Masters argues that badly-handled lay-offs could wound the tech sector for years to come. Meanwhile Ofcom, the UK regulator, may try to force social media sites to reveal their algorithms , over concerns that news feeds drive young people to extremes and aggravate societal divisions.

Best of business news

In a forerunner to the UK’s Autumn Statement, Rishi Sunak told bosses this week to curtail their pay , urging them to “embrace restraint” as workers faced a cost-of-living crisis.

A report by PwC last week found FTSE 100 chiefs’ pay was at its highest for five years. It is likely that Sunak is trying to avoid a wage-price spiral.

But the prime minister’s comments will unnerve some boardrooms, given complaints by UK executives that UK-listed companies are already unable to match the pay offered by their global - and often private - rivals.

Sunak is one of the wealthiest people to hold the office, thanks to his past careers as a banker and hedge fund manager.

More pressure on boards to rein in executive pay came from the UK’s top fund managers, who this week urged FTSE companies to show “additional restraint” to reflect the pain likely to be inflicted on their staff.

Meanwhile, the UK government’s corporate governance reforms risk a flight of capital from public markets, according to the chair of the UK audit regulator the Financial Reporting Council.

Sir Jan du Plessis criticised ministers for not going further in a shake-up this year, which swept about 600 extra private companies into a tighter regulatory system - fewer than would have been caught by options set out in an original consultation.

Du Plessis said he had “deep concern over the significant incentives we are offering capital today to leave public markets”.

In US business news, Goldman Sachs has paid out more than $12mn to a partner who had accused the bank’s chief David Solomon and other senior figures of misogyny. The bank paid the settlement before the executive left the company in an effort to keep her allegations secret.

The embarrassing revelations come at a difficult moment for Solomon, who last week announced a second major restructuring as he battles to close a stock-market valuation gap with Goldman’s peers. He also faces internal questions over his ostentatious management style.

The executive’s complaint highlights Wall Street banks’ difficulties in recruiting and retaining female and minority employees, in an industry still dominated by white men. Last week, the bank promoted a record number of female and black employees to partner level.

More executive trouble at Tyson Foods, the largest meat-packing company in the US, which this week launched a review of the conduct of its new financial officer , who has been charged by police with public intoxication and trespassing after a woman found him asleep in her bed.

Analysts were already concerned by John Randal Tyson’s recent promotion, raising questions over the depth of his experience. He is a scion of the company’s controlling family, and the 32-year-old son of Tyson chair John H Tyson.

Tyson’s chief executive, Donnie King, said: “Our independent board of directors are overseeing a thorough review of this matter and I am confident in this independent process.”
Navigating Cyber Risk (FT Special Report)
What FTX’s collapse means for crypto (FT podcast)
Dealing with corruption (Stanford Business School podcast)
Considering the public interest (UK Financial Reporting Council webinar)
Principles for public interest test (UK Financial Reporting Council news)
Investors demand greater ESG voting rights

This article is brought to you by FT Specialist’s Agenda, a publication that focuses on corporate boards.
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