Inside Trump’s Greenland Deal

Paramount and the state of California discuss concessions that could get the company's mega-merger with Warner Brothers' discovery over the finish line. Plus, President Trump proposes a new AI force, though don't hold your breath for more regulation. And we'll look at whether a new U.S. Greenland security deal could end months of uncertainty about the island's future. A lot of American and Greenland business people let us speak to say they hope that this agreement will ease some of the geopolitical tension and they hope it will drive investment and also remove some of the stigma, frankly, that many Greenlanders have attached to cooperating with Americans. It's Monday, September 21st. 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. Could a pledge from Paramount to remain in California help to close its $81 billion merger with Warner Brothers' discovery? We're exclusively reporting that company executives and attorneys general from a handful of states that sued to block the merger on antitrust grounds spent the weekend trying to hash out a series of concessions, which conclude a $1.5 billion investment by Paramount into California productions, as well as promises not to sell its Hollywood-area studios and to stay in the state. The talks are part of advanced settlement negotiations as Paramount pushes to close the deal. Starting next month, Paramount will be on the hook to pay Warner shareholders a ticking fee of roughly $7 million a day until the merger is complete. A final deal hasn't been reached, and it's unclear what terms the parties may ultimately agree to. Stephen Trump is creating a new AI force, and recruiting an AI czar to lead it following recent tech industry alarm over AI development. It marks the first time that Trump has publicly suggested that there could be a new federal government entity solely focused on AI, though it's not clear what role it would play, or how it would interact with the White House's Office of Science and Technology Policy. Speaking on Fox News yesterday, the head of that office, Michael Kratzios suggested that Washington was likely to take a light regulatory touch. Our position is if you do believe that you're developing a technology that is unsafe or you don't want it out in the world, you can just stop it. You don't need someone to force you to do that, and I think that's what's been a bit confusing about this whole narrative. So there's leaders of these companies that are going out and saying we're going to do all these measures, and the government has to do all these things. When reality, they just need to slow down if they feel that they need to do so. And Trump has opposed increased AI regulations, arguing that limited guardrails are needed to stay ahead of China. Trump and Chinese leaders Xi Jinping are set to discuss the issue at a summit in Washington later this week. Well ahead of that, high stakes meeting the U.S. auto industry is urging President Trump to keep Chinese car manufacturers entirely out of the U.S. In a joint letter, the group's representing manufacturers, dealers, and suppliers implored the administration to block Chinese companies from selling, importing, or building vehicles domestically. That rare industry wide warning comes after Trump indicated that he'd welcome Chinese owned auto plants on U.S. soil, a prospect that the coalition argues would threaten American jobs, national security, and domestic market share. We are exclusively reporting that the Trump administration is preparing to impose sweeping sanctions on the international criminal court. General reporter Matthew Dalton says that marks a sharp escalation in Washington's efforts to dismantle the institution after it issued an arrest warrant for Israeli Prime Minister Benjamin Netanyahu over the war in Gaza. So this is a bid really to dismantle the ICC. The Trump administration wants to bring down the entire institution. They're saying we are going to now sanction the entire court as an institution, meaning that U.S. companies of all stripes will be largely barred from conducting transactions with the court. And that includes crucially U.S. banks. And the problem is, is that de facto, that really means all Western banks, European banks as well, because every European bank does business in the United States does transactions and dollars crucially. So this could effectively make it very difficult or impossible for the ICC to conduct financial transactions and thus very difficult for it to operate. The Trump administration has already sanctioned a number of ICC officials. Matthew says the court jurisdiction is a major issue with Secretary of State Marco Rubio, saying that the ICC poses a threat to American sovereignty. The court issued the warrant against Benjamin Netanyahu and former Defense Minister U.S. Galant for their conduct of the war in Gaza. They alleged that the two men were intentionally restricting humanitarian aid into Gaza as a means of waging war on Hamas. So the Trump administration says that the court shouldn't be exercising its authority over the nationals of non-member states, states that have not signed the Rome statute, the court's founding treaty. Israel has not signed it, the United States has not signed it. The court's response is that true, the people who are alleged to have committed these crimes are not nationals of ICC member states, but they committed them on the territory of entities that have signed the Rome statute. And that includes the Palestinian Authority. The Treasury Department declined to comment while the ICC didn't respond to a request for comment. Yemen's Iran-backed Houthis launched fresh attacks against Saudi Arabia over the weekend, targeting jet fuel storage at Riyadh's King Khalid International Airport, marking the first direct assault on the Saudi capital in months. The rebels claim they'll continue the strikes until Saudi Arabia ends its decade-long blockade, and the Houthi official warned other countries not to join the conflict. According to reports from the AP, the group assured the Trump administration that it won't attack U.S. vessels in the Red Sea. Iran and its allies have been looking for ways to slow Saudi Arabia's oil exports, ramping up attacks on the Babel Mendebs straight and hitting the Kingdom's east-west pipeline earlier this month. Well, despite those weekend attacks, oil prices are pulling back this morning on hopes that Trump and Gulf leaders can find some time for diplomacy on the sidelines of this week's UN General Assembly in New York. But as the journals Rebecca Fung reports, the oil market is contending with a new shortage that's threatening to keep prices higher, too few tankers. The shortage right now is in what we call VLCCs, which stands for very large crude carriers. What's happening now is that more of these massive tankers are being called back into the Persian Gulf area to carry these oil exports from the Middle East to global customers. And that basically caused a sudden supply crunch and boosted the cost of hauling oil through the straight-of-war moose to the highest-known record. For example, now to get one of these VLCCs to load oil within the Persian Gulf and transit through the straight-of-war moose costs $1 million a day. And based on the current oil prices, that beacuse to about $26 per barrel, roughly a quarter of the crude values normally, it's only a very, very small fraction of that. And that surge in prices isn't just being felt in the Middle East, with Rebecca telling me that shipping rates between the American Gulf coast and China, as well as West Africa and China are now roughly double where they were just a week ago. Coming up, we'll look at how President Trump's new Greenland deal could clear the way for U.S. businesses on the resource-rich Arctic island. More on that after the break. The U.S. and Greenland are expected to sign a security deal this week that will allow more American forces to be stationed on the island and crucially drive U.S. investments toward the semi-autonomous Danish territory. Correspondent Sunarasmussen has traveled numerous times to Greenland since President Trump first started talking about wanting to acquire it in his first term, and he joins me now with more. Soon at this agreement announced by President Trump on Friday evening, "I didn't catch it. I doubt many listeners did either, given the timing of Trump's true social posts, recap for us what has evidently been agreed to here and notably what hasn't." So the deal isn't official yet, but we do know the contours of the deal, both from President Trump's statement, but also from brief statements from the Danish and Greenland governments. And it seems like the deal follows a previous 1951 treaty, which was amended in 2004, which basically gives the U.S. the right to station. As many troops have built as many bases on Greenland as it wants to, as long as it consults with or informs Denmark and Greenland about it. What does make this deal different, it seems, is that it will last as President Trump says forever or in perpetuity. The previous treaty was contingent on Greenland remaining part of Denmark, and it also was contingent on NATO existing and I think this deal, as far as we understand it, will last beyond a potential Greenlanding independence from Denmark or a potential collapse of NATO. So that seems to be the main difference. I mean, how is this likely to go over within the White House, given that Trump had a time just mused about annexing Greenland, this sounds far short of that, and I'm curious just how it's been received in Greenland and Denmark as well. I think in Greenland and Denmark, this will come as a relief because in the Danish Prime Minister's statement, she says that this is notably a deal that respect Greenlanding and Danish sovereignty. And that was the red line for Greenland and Denmark. They were not willing to concede territorial sovereignty over any part of Greenland. When it comes to the White House, I've spoken to officials in and around the White House who speak to the president who, for a long time, have acknowledged that whatever security designs the US had on Greenland or whatever security interests it wanted to protect, it could do so with the existing treaty. And they were sort of trying to convince the president that maybe he should settle for less than what he was proclaiming in public. And that seems to be what he's done now. - Soon to interrupt you. I mean, it sounds like not a whole lot is likely to change then on the military front here. Different picture on the investment side a little bit more off-screen. - So while not a lot will change on paper, I do think that the US will use this deal as an occasion to ramp up its military presence in Greenland. But where things will change, I think is on the investment side and on the economic side. A lot of American and Greenland business people that I speak to say they hope that this agreement will ease some of the geopolitical tension that has made the investment climate around Greenland very uncertain and they hope it will drive investment. And also remove some of the stigma, frankly, that many Greenlanders have attached to cooperating with Americans, 'cause there is a paradox here and Trump's initial interest in Greenland, which they expect to his first term where he first proposed buying the island, drove new commercial attention to Greenland, but his threats to annex it by force made investors skittish and also made many Greenlanders wary of American intentions on the island. One of the things we often hear about Greenland is that there's wealth of mineral resources in the underground and that is true. But these resources, including rare earths, are very difficult and expensive to extract. So I think where we'll see the most immediate impact of the deal is probably in other areas where American investors and business people have shown interest. That could be tourism, for example, but it could also be around these military bases if the US goes in and builds new military bases in Greenland. That will probably benefit Greenlandic subcontractors who can provide catering, cleaning, construction services, things like that. I've been speaking to Wall Street Journal correspondent Sooner-Rasmussen, Sooner. Thank you so much for bringing us this story. Thanks for having me. And that's it for what's news for this Monday morning. Today's show was produced by Daniel Bach and Hetty Moir, a supervising producer in Sandra Killhoff. And I'm Luke Vargas for the Wall Street Journal. We will be back tonight with a new show. And until then, thanks for listening.