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- [00:01]
Advertiser
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- [00:33]
Luke Vargas
A legal reprieve for New York City Mayor Eric Adams as the DOJ orders an end to his bribery case. Plus, OpenAI's Sam Altman rejects the advances of a group led by Elon Musk and world leaders converge on Paris for an AI summit as they try to put the tech to work in boosting their economies.
- [00:53]
Sam Schechner
We've gone from trying to avert catastrophe to trying to make sure that Europe and frankly, other parts of the world as well, can participate in and catch up in this AI race.
- [01:04]
Luke Vargas
It's Tuesday, February 11th. I'm Luke Vargas for the Wall Street Journal, and here is the AM edition of what's news, the top headlines and business stories moving your world Today, the Justice Department is ordering federal prosecutors in Manhattan to drop their bribery case against New York City Mayor Eric Adams, claiming the indictment against him interfered with his ability to participate in President Trump's immigration enforcement. Adams was char charged in September with taking illegal campaign contributions from Turkey and accepting $100,000 in travel and hotel perks in exchange for official acts, making him the first sitting New York City mayor to be indicted. Adams had denied any wrongdoing and called the indictment politically motivated, accusing former Justice Department officials of targeting him because of his criticisms of then President Biden's handling of the migrant crisis. Those accusations won the Democrat, an ally in had floated at the idea of a pardon. A spokesman for the U.S. attorney's office in Manhattan declined to comment. Rounding up a few other developments out of Washington, President Trump has pardoned former Illinois governor Rod Blagojevich, who was convicted nearly a decade and a half ago on corruption charges. Trump already commuted Blagojevich's 14 year sentence in 2020 and repeated claims yesterday that the Democrat was treated unfairly by prosecutors.
- [02:34]
Advertiser
It's my honor to do it. I've watched him. He was set up by a lot of bad people, some of the same people that I had to deal with.
- [02:43]
Luke Vargas
In another executive order, Trump is stopping enforcement of the Foreign Corrupt Practices act, which forbids US Companies from bribing foreign officials. The statute has been used to punish overseas misconduct at banks such as Goldman Sachs and mining giants like Glencore. In its place, the White House is asking for new guidelines to be drafted to remove obstacles to American firms competing abroad. And the President signed an order yesterday backing the use of plastic straws and directing the federal government to stop buying paper straws, which the White House described as being non functional and pushed by WOKE activists who prioritize symbolism over science. OpenAI CEO Sam Altman has rejected a bid from a group of investors led by Elon Musk to gain control of the company. As we reported on a our PM show yesterday, Musk's lawyer says he submitted an unsolicited offer of $97.4 billion to buy the nonprofit that controls OpenAI. In a post on X, Altman wrote, no thank you, but we will buy Twitter for 9.74 billion if you want, using the old name for Musk's social media platform and moving the decimal point from the bid for OpenAI1 space to the left. In a slack message to employees, Altman wrote, quote, our structure ensures that no individual can take control of OpenAI, end quote and described the bid as tactics to try and weaken us. We are exclusively reporting that activist Elliott Investment Management has built a more than $2.5 billion stake in Phillips 66 and plans to push for operational changes at the Houston based oil refiner to boost its stock. According to people familiar with the matter, those changes could include selling or spinning off its midstream business. Jenny Strasberg covers energy for the Journal.
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Advertiser
Phillips 66, which is a big refiner in the US has about a $50 billion market cap and it also has a very valuable business called midstream and that's a collection of pipelines and terminals that transport oil and gas. And during the US Sh boom that became ever more valuable. So what Elliot is looking at is could that midstream business be worth more outside of Phillips 66 than it is inside Phillips 66?
- [05:24]
Luke Vargas
Just two days ago Jennie reported that Elliot has also taken a stake in bp. The British oil major today posted lower than expected earnings and announced a strategy reset to focus on growing its cash flow and shareholder returns. Shares in Phillips 66 are up in off hours trading while bps are little changed in London. In other business and markets news, a record 126 million people watched the Philadelphia Eagles defeat the Kansas City Chiefs in Sunday's super bowl on Fox and various streaming platforms. That's according to preliminary numbers from Nielsen and the network, making it the third super bowl in a row to set a new viewership record. South Korea's state run think tank has cut its growth forecast for the country this year, citing President Trump's trade policy as a downside risk to exports. The Korea Development Institute now sees GDP growing at 1.6% in 2025, compared with a 2% forecast made in November. On deck, Federal Reserve Chair Jerome Powell will begin two days of testimony on Capitol Hill this morning in his first congressional appearance since President Trump's inauguration. He is likely to face question on interest rates and inflation, as well as how Trump's policy changes could affect the Fed's outlook and earnings. Season continues with Coca Cola, Marriott, Lyft and Shopify all set to report results coming up. Paris is the center of the AI world today, with industry and world leaders gathered in the city for a major summit. We'll check in with tech reporter Sam Schechner in the French capital after the break.
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Sam Schechner
It's tax season. So what's new this year that could save you money?
- [07:13]
Advertiser
The IRS says that taxpayers spend 13 hours and $290 preparing and paying just for the tax prep. So it's worth looking into different options.
- [07:25]
Sam Schechner
On the YOUR Money Briefing podcast from the Wall Street Journal, we're breaking down the latest tax rules, how to keep your tax data safe, and ways to file for free. Catch our Series tax season 2025, what's new and everything else you need to know leading up to tax day on youn Money Briefing.
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Luke Vargas
World leaders and the heads of top tech companies are gathering today in Paris for the final day of a major international AI summit. French President Emmanuel Macron used the event yesterday to announce a new nuclear powered AI computing project. The EU this morning pledged $200 billion in AI investments and U.S. vice President J.D. vance just took the stage. Journal tech reporter Sam Schechner is also there and he joins me now from the bustling Grand Palais in the French capital. First off, Sam, these AI summits, gotta say, in a pretty impressive list of attendees this year, India's Prime Minister, the UN Secretary General, the head of Google. We've seemingly got ourselves a new must attend global gathering. And yet what is the point of this? Is it to set policy, to make deals something else?
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Sam Schechner
That's a very good question. What is the point? Right? When the first one of these was convened by the UK in Bletchley park, they were thinking very specifically about AI safety and really the potential for catastrophe from AI models in the future. And the French very consciously broadened the mandate for this summit. And this is much more about how to reap the benefits from AI, in addition to talking about government governance, talking about some safety issues, talking about ethical issues. Macron gave the accent last night in his speech on $109 billion of investments in coming years for France alone, and a kind of regulatory loosening that he promised to encourage more AI in Europe. So we've gone from trying to avert catastrophe to trying, I guess, to make sure that Europe and frankly, other parts of the world as well, can participate in and catch up in this AI race.
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Luke Vargas
That's a pretty big question for the EU in particular, is it not, Amid some concerns that the continent was maybe falling behind relative to the US and China in kind of seizing AI's economic benefits.
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Sam Schechner
Well, I mean, people in Europe have been pretty bruised over the last few technological revolutions. There are some AI companies. France has Mistral AI, which is one of the prominent makers of what's called foundation models, these generative AI models, but they're smaller and less capitalized than something like OpenAI by an order of magnitude. So it's definitely an issue. But interesting, interestingly, France made a real push for this summit to push beyond just the eu. They're co presiding this summit with India and there's this push from France to make sure that the conversation about getting the benefit from AI is not just something for a handful of countries, or that we're not talking about a bipolar US China race, but that we're really talking about something that benefits everybody.
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Luke Vargas
I was going to say, what does that look like? Is that like, you know, we think about the UN climate talks where the goal is always try to get some agreements on paper, new rules of the road being talked about, or we just mean spreading the benefits? Is that just more sovereign AI deals between tech companies and individual countries to, I don't know, build out within their own borders or something like that?
- [10:45]
Sam Schechner
It's a little bit of both. Everybody wants to have more sovereign AI, but there's also talk about how do you make for governance that is more broad based, that it's not just a handful of players making those decisions. Is that going to be the priority that's articulated by the Trump administration or by the Chinese? That's perhaps less clear.
- [11:05]
Luke Vargas
Right. And speaking of that, Sam, we just heard From Vice President J.D. vance at the summit. Let's take a quick listen. Now, our administration, the Trump administration, believes that AI will have countless revolutionary applications in economic innovation, job creation, national security, healthcare, free expression and beyond. And to restrict its development now will not only unfairly benefit incumbents in the space, it would mean paralyzing one of the most promising technologies we have have seen in generations. Because finally, Sam, beyond a new administration in Washington, the other big 2025 development has been deep SEQ, of course, the Chinese AI company that showcased its generative AI model last month that was built at a fraction of the cost of what some of the leading AI companies have spent to develop theirs. Has Deep Seek's impact been felt there?
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Sam Schechner
I mean, it's been a topic of almost every conversation here. What does it mean? And you hear different things. The people who make the chips that perhaps deepsea needed fewer of say, well, hold on a second. If anything, more efficiency is going to mean more demand. So we're going to sell more chips. You talk to people who are backers of Mistral, which put the accent on efficiency, and they say that Deepseek is sort of in line with what they're doing and is actually a great advertisement for what they do. And perhaps people who want a more efficient model but might not want a Chinese model will turn to a European one.
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Luke Vargas
I've been speaking to Wall Street Journal tech reporter Sam Schechner, who is surrounded by very large boom mics and cameras there at the Grand Palais in Paris. Sam, thanks. Thanks for making the time.
- [12:37]
Sam Schechner
Always a pleasure to speak, Luke.
- [12:38]
Luke Vargas
And before we go, we need to make a quick correction. In an earlier version of this episode, I incorrectly said that former Illinois Governor Rod Blagojevich was a Republican. He's a Democrat. And that's it for what's news for this Tuesday morning. Today's show was produced by Daniel Bach and Kate Bullivant with supervising producer Christina Rocca. And I'm Luke Vargas for the Wall Street Journal. We will be back tonight with a brand new show. Until then, thanks for listening.