Violent Rioting Sweeps France

Vladimir Putin proposes talks with President Trump and China's chief to discuss ending the Ukraine war, plus France reels after cost of living protests, spin out of control, and Jamie Dimon shares what he's learned a year into a push to invest in companies that are critical to American national security. This is actual security resistance in drones and space and missiles and an advanced manufacturing and farm and healthcare and grids and all the things that we all know we need, but the other side is skills and training and small businesses and vendors and other things we could do. It's Monday, October 19th. 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 our world today. French officials are holding emergency meetings this morning after a wave of rioting swept across the country over the weekend with more on how cost of living protests in the country have spiraled out of control, sparking widespread rioting, vandalism, car jackings, and even arson. I'm joined by our Paris bureau chief, Stacey Mykri. Stacey, we first had you on around two weeks ago. This is when France was preparing for mass demonstrations over school funding. Suffice it to say, other events have now subsumed that initial message, though not entirely, right? But retrace force, if you could, the evolution of what's occurred here. So the movement began with high school students around Paris in the sort of poor mountain use, the outskirts of the city, who were upset about school conditions. And then this Saturday, it basically boiled over in the sense that a number of other protesters joined. These were protesters who were upset about the rise of cost of living with all those people taking to the streets, police were stretched extremely thin, doing crowd control. And thousands of other, let's call them rioters, began to, you know, do smashing grab operations at the margins of the protest, attacking everything from electronic stores to luxury boutiques. We saw a Louis Vuitton boutique basically get cleaned out. The rioters also did something that we usually don't see in these kinds of situations. You know, usually town halls, city halls are considered off limits, largely because they're regarded as almost like symbols of, of the Republic of civic identity, they're like the people's house. Well, this time around, we saw a number of city halls come under attack. There was one raided in Maussay, they basically ran the door in, they went in, they graffitied the lobby, and in the moj, which is a town in central France known for porcelain making. We saw rioters penetrate the building, set it on fire. And those flames basically ended up consuming the roof and its famous bell tower, which collapsed. So the scenes were quite shocking, I mean, even by the standards of French protest, obviously France is a country with a history of violent protest, but the events of this weekend really sort of stood out. Yeah, those photos from Limot splashed across many front pages this morning around the world. I'm curious, then how, how is the French state responding to this? notably, I should say we've seen the French private sector appealing for help here, the head of supermarket chain, KF4, saying the Republic must protect its retailers. I don't know how much affect that particular call to action is going to have, but what should we be looking for from Paris? Well, for starters, the government's hand is significantly constrained this time around. I mean, you know, President Emmanuel Macron has a history of dealing with crisis by essentially doing cash dumps. In order to boost the purchasing power of the French public, unfortunately, the French government is just in this sort of fiscal mess where they're running deficits north of 5%, they're under pressure from markets to bring that down. So they're not in any position to start doing handouts. That pretty much leaves, you know, security measures as the only real option to reign in the violence. And there again, the government has faced some real criticism. There's complaints that the government had been a bit heavy handed in their policing tactics. There were a number of, you know, sort of gruesome injuries that minor suffered. So there again, the government's going to have to sort of walk a tight rope in terms of if they decide to crack down, how severe is that crack down going to be? You mentioned KF4, you know, the police force just simply isn't big enough to position officers in front of every major retailer. And Stacey, this is all having some bigger political implications too as well, right? With notably far right leader, Marine Le Pen, using this moment to really hit out at McCrone's government. If anything, this whole situation strengthens Le Pen's hand. I mean, we've seen already a pretty significant rise in her poll numbers as the protests have unfolded over the weeks. And images of monuments being toppled on live TV feed into her narrative, which is that France is a country in decline. It's a country where the government hasn't done enough to protect the people, to protect its traditions, to protect its heritage. And so a weekend of mass writing in which we're seeing the sort of defacement of some of the symbols of the Republic really fuel support for her. Stacey Mike Tree is the Wall Street Journal's Paris Bureau Chief. Stacey, thank you so much for the update. You're welcome. Great to be with you. Russian President Vladimir Putin has proposed to meet with President Trump and Chinese leader Xi Jinping next month to discuss ways to end the war in Ukraine. We exclusively report that the idea was floated in a call between Putin and Trump earlier this month that also produced a deal for the U.S. to buy Russian diesel and facilitate its global sale. Our Russia Bureau Chief Thomas Grove says that Putin's plan marks an effort to capitalize on warming U.S. Russia ties and is raising alarm in Kiev. This is definitely the biggest diplomatic gambit that Putin has put forward in a very long time. And it's raising alarm in Ukraine mostly because it would just completely cut the country out of negotiations regarding its own invasion. We've seen a real public souring between Trump and Zelensky in the last several weeks. We've seen Trump come on TV to actually say out loud that Ukraine needs a new president. And we've also seen him repeatedly criticize Zelensky for the fact that Ukraine has been targeting Russian refineries. Ukraine did give a pause after Trump tried to clinch the energy ceasefire. But after Russia kept hitting Ukraine's own energy infrastructure, it started to strike back. And over the weekend, we saw another big strike on St. Petersburg. This is, of course, Vladimir Putin's hometown where they hit an oil terminal sending a big plume of smoke into the sky. Trump then sought back at Zelensky saying that he didn't want to end the war and criticized him for the strike. But for the U.S. side that may provide all the more impetus for such a meeting, the Kremlin's spokesman confirmed discussions about a potential meeting we're taking place. Well, the White House declined to comment, and China's embassy in Washington didn't respond to a request for comment. While something worth watching in the coming weeks is that agree to which Trump has moved by GOP pushback to his diesel deal and his decision to waive sanctions on Moscow. We are reporting that some Republican contenders in tight midterm races are openly breaking with the president, arguing that the U.S. shouldn't ease pressure on Putin despite fuel costs remaining stubbornly high. Trump has defended the move as an effort to lower prices and bring Russia to the negotiating table over Ukraine. And President Trump has thrown his support behind Israeli Prime Minister Benjamin Netanyahu ahead of elections there a week from Tuesday. Netanyahu will be fighting for his political survival in that closely contested vote in which he's trying to portray himself as close to Washington. He responded to the endorsement in a series of social media posts, including one that showed a video montage of Trump praising him. Analysts are split on the power of Trump's endorsement, given deep-seated polarization over Netanyahu's leadership, and polls showing that the percentage of Israelis who believe the country's security is a central consideration for Trump have dropped in recent months. China's economic growth picked up in the third quarter with GDP expanding by 4.5% compared to a year earlier. Reporter Katrina Northrop covers the Chinese economy and says that despite booming exports, consumer spending remains depressed, as Beijing tries to get a handle on an accelerating to track economy. "Exports in China are really driving growth. That's the main bright spot in the economy, particularly exports that are related to the AI boom. So chips and computing equipment from China to overseas markets have really surged, but there's still a lot of issues at home in the domestic economy. So the numbers today show that property investment is still really in a bad spot. Consumer sentiment is bad. Consumer spending is still very depressed and unemployment, particularly among youth, is still very high." And Anthropic is planning to commit 5% of its shares to a so-called "Public Benefit Fund," which could be used to make donations to nonprofits or distribute funds to people who are affected by AI labor disruption. Between the new fund and previous commitments from anthropics, founders, and employees, the company said that roughly 20% of its shares would be dedicated to the "Public Good." That news comes ahead of its planned IPO, which could raise as much as $100 billion at evaluation of around $2 trillion. Meanwhile, Anthropic has remained quiet, about a five-person trust that's empowered to shape its board and block major corporate moves. Our Federal Reserve Chairman, Ben Ben Bernanke has been named as one of the trustees, which the AI lab says will have a mandate to steer AI for humanity's long-term benefit. Because the company will become a so-called public-benefit corporation steered by the trust, shareholders will have less say than in other public companies. And for more on what that structure means for future investors in Anthropic, check out the explainer we've left a link to in our show notes. Moving up we'll hear an exclusive conversation with JP Morgan Boss, Jamie Dimon, as he plows billions of dollars into critical US industries. That's after the break. Last year, JP Morgan Chase announced that it would help to mobilize a trillion and a half dollars in investments to boost America's national economic security and resiliency over the next decade. A year on, that program known as the SRI is taking shape with the help of who's who of business leaders, politicians, and military brass who are advising the bank on what sorts of investments into technology and American supply chains are worthwhile. In an exclusive interview for the WSJ Leadership Institute presents leaders podcast, our Alan Murray spoke to JP Morgan, chief executive Jamie Dimon, about how the SRI is coming along. You look back at the last year, one year anniversary, what are you most proud of that you've accomplished? First of all, it's really lifted up our people. It's been far more than that we would have expected. Other companies are doing it. I think it's great. The purpose is security resiliency, and the breadth has just gotten bigger. We'll blow way past that trillion and a half dollars. That 10 billion is direct investing in security resiliency and also opened up a lot of other issues. Actual security resilience in drones and space and missiles and advanced manufacturing and farm and health care and grids and all the things that we all know we need. Obviously, we should have done something before, but on the other side, it's skills and training, small businesses and vendors and other things we could do. Some of the stuff, I mean, you're the biggest bank in the country in the world. Some of the stuff is stuff you would have done anyway. How do you distinguish what's really new and different? It wasn't Boeing, it was Boeing military division. It wasn't Exxon or Energy. It was LNG going to Europe because they needed for security and security is different for every country. So, it's 29 industries, around five, but it's grids and power. It's not all AI, it's not AI for consumers. It is some of the AI for military. Does it have a different hurdle rate than other things you would do or have to think about it? George, do we think that companies at an earlier stage than Jake and where we normally do? These companies talk about they need money. They need to build a plan to satisfy the contract, but they don't have the contract and they can't get the contract unless they can prove they can build a plan. So, trying to bridge some of that, take it around the world, and then we've extended very importantly to Europe, so think of Germany, Italy, France, UK, Poland, and then Australia, Japan, South Korea, basically allies in the United States, they all need it. Like you mentioned, the 4,500 companies, so we've hired a lot of bankers to cover them both in SRI and outside of SRI, policy is a big deal. How do you get the government to make purchases bigger? How do you get? We did research on the shipbuilding ecosystem, the shipbuilding ecosystem, the farm ecosystem, and these are ecosystems that are far more complicated than build a ship. Like you know, the shipbuilding one, you need chemicals from Japan, stuff from Korea, the ASML, etching equipment from Netherlands. You have these extensive supply chains, you just can't move stuff. But you know, when you talk about it, it almost sounds like a wartime industrial policy. I mean, first of all, is that what it is? And second, does JP Morgan belong in the wartime industrial policy space? Yeah, I'm a patriot, and I wouldn't call wartime industrial policy, but I'd say we should have been doing this anyway. And actually, General George came to see me today, and people like General Millie, who we do work with in some other generals, but it's really Randy George said, we need help on educating with these ecosystems, finance these ecosystems, getting Congress to have different ways to authorize purchasing, which they have done by the way, they're moving very quickly now, whether it all works or not, isn't the point, they need to move quickly. And then when you look at our weaknesses on rare earth, and we rely on China, and I'm not, China is not an enemy. I wouldn't rely on anyone for all of our rare earths. I mean, we know in a JP Morgan, we got multiple supply chains, and it's true for semi-conductors, it's true for act of pharmaceutical ingredients, it's true, some of this advanced manufacturing that we sent out, you know, it's an amazing, you know, how much money we save by outsourcing rare earths? Almost nothing. $500 million, or something like that. You know, but it made sense at the time, you know, you're saving a five cents a magnet, which could be $10 a car, you know, people are trying to reduce costs. But we also, when we did that, we lost the ability to advance the IP. And so an advanced manufacturing isn't just that you outsource it to a cheaper place, you actually lost the ability, and that IP was improved since we outsource it 10 years ago. And to me, we, you know, if you look at it, I like to do post-mortems and be self-critical, we should have done this way before China did. There were warnings, there was, we just didn't think it all through at the time and the world was, you know, for a long time, everyone was doing stuff and we're doing fine. So, but the fact is, forget all that, you know, my view is, you know, obviously, it doesn't get to work. And that's what this is. But yeah. Isn't it also because the world has become a more dangerous place? I mean, we've got two wars going on, neither of them seem to end. We've got this great superpower rivalry going on. The institutions that were created after World War II to create peace and prosperity are all deteriorating. How worried are you about America's place in the world and the state of the world? Yeah. So, it absolutely is more urgent today than five years ago than 10 years ago than 20 years ago. Absolutely. But when Ukraine was invaded, you know, I wrote a little thing in my chair, and as I liked to read, I'm a chair, and as I know, they're long to read sometimes. But that the world didn't change that day. You know, we just reminded the world's real politic and that peace was never at always at hand. And bad people do bad things, and we weren't prepared. So I've been reading that long belt kind of since then. Of course, in Ukraine, you've seen, it's gotten worse and worse, but you've seen how quickly this technology changes. And you know, our military is kind of on it. Now you travel around, you actually see enormous progress, very quickly in space and drones and supersonic missiles and new small nuclear reactors and governments trying to quickly allow things to take place. But absolutely, the urgency today is time-urgent. And yes, the American, you know, America still has 40 military alliances. There was still the leader of the world, and they still rely on us, and this is why we're also expanding this to the rest of the world. And so, you know, you can criticize some of the actions that we've done, but it is critical in my view to keep the Western world together properly, economically and militarily. And to hear Jamie Dimons' full interview with Alan, check out the link that we've left in our show notes. And that's it for what's news for this Monday morning. Today's show was produced by Daniel Bach and Hadi Moyer, our supervising producer, his 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.