Flagship

US government shuts down

The US federal government went into shutdown for the first time since 2019, after Republicans and Democrats failed to reach a deal on health care spending. Each party blocked the other’s proposals, spending the final hours of negotiations “pointing fingers at one another,” The New York Times reported. Trump said he would use the shutdown to cut programs that Democrats favor, as well as “vast numbers” of government workers: Almost 90% of staff at some departments, such as the Environmental Protection Agency, have been furloughed. Neither side looks likely to blink, Semafor’s US politics team wrote, and may learn a painful lesson: “Getting into shutdowns is easy. Getting out of them is a lot harder.”

Russia’s ‘hybrid war’ in Europe

Russia’s “hybrid war” against NATO is only just beginning, Denmark’s prime minister warned. Speaking ahead of a meeting of European leaders where they’re set to discuss regional security, Mette Frederiksen told the Financial Times that the military alliance must step up its response to Russian aggression after repeated cyberattacks and incursions into its airspace. Latvia’s defense minister gave similar warnings, saying Europe is “not formally at war, but we are not at peace, we are in hybrid warfare,” including alleged Russian sabotage and signal jamming. Officials believe recent moves by Russia’s ally Belarus to apparently encourage thousands of migrants to cross into EU countries is part of that hybrid warfare: An attempt to seed a humanitarian crisis in the bloc.

China woos top foreign talent

China launched a new program to woo top scientists and tech experts from around the world, in sharp contrast with a recent US policy that dramatically increased the price of talent visas. China’s new “K visa” seeks to attract foreign experts to boost the country’s standing as a global technological superpower: In a symbolic move, a world-leading Italian battery scientist recently left a top position in Europe to lead a research facility at a Nanjing university, the South China Morning Post reported. Beijing’s openness to foreign talent is at odds with Washington’s recent decision to hike the price of visas for talented workers as much as 50-fold. “The US has definitely shot itself in the foot,” an expert told Reuters.

Modi hails once-outlawed group

Indian Prime Minister Narendra Modi hailed a once-outlawed paramilitary organization that promotes Hindu nationalism, releasing a commemorative stamp and coin to mark the 100th anniversary of its founding. The Rashtriya Swayamsevak Sangh was banned multiple times after India gained independence, including for its links to Mahatma Gandhi’s assassination, and has long been criticized for religious nationalism. But the RSS, which has close ties to Modi’s BJP, has gained greater acceptance during Modi’s time in power, with the premier’s latest remarks signifying the huge change in its public reputation. “To transform India into a Hindu [nation] was the top priority of the RSS founders,” a leading analyst recently wrote. “In that sense, the RSS has not changed, but it has changed India.”

Cloudflare courts tech interns

Online security firm Cloudflare will hire 1,111 interns, bucking the Silicon Valley trend for reducing early-career headcount. The company said that other tech firms’ decision to downsize intern and new-graduate hiring in the face of AI proliferation “misreads the moment completely.” Instead, Cloudflare argued, AI will make new staff more productive, and allow the company to set more ambitious goals. AI’s jobs impact remains ambiguous: While research has suggested that young people were struggling to find work, a new Yale Budget Lab study found no evidence that AI was causing job losses in the US. Graduate unemployment is up, but the jobs mix is little changed from the previous cohort, suggesting the slowdown is not because of technological change.

AI’s electricity costs surge

New analysis highlighted the astonishing economic cost of AI data centers’ power demands. A Bloomberg review of electricity prices at tens of thousands of locations across the US found some faced power costs as much as 267% higher than five years ago in areas close to data centers. “Without mitigation, the data centers sucking up all the load is going to make things really expensive for the rest of Americans,” one major investor said. Demand from the power-hungry facilities looks unlikely to abate: According to The Information, OpenAI chief Sam Altman has floated eventually needing 250 gigawatts of electricity — equivalent to about a third of peak power consumption across the US.

Oil firms get lean with layoffs

Oil majors are shedding jobs and investment as the industry gets used to a new norm of low prices. Exxon plans to cut 2,000 staff, about 3% of its global workforce, part of a yearslong push to thin its ranks: Its headcount is already down 19% since 2014. TotalEnergies expects to cut capital spending by $1 billion a year, while Chevron and BP have also started cutting jobs. Analysts suggest that oversupply could lead to crude falling below $50 a barrel next year, partly thanks to the growth of US shale production, up 45% since 2015. The situation is likely to continue: OPEC+ is discussing fast-tracking a new round of supply hikes, Bloomberg reported, which would push prices even lower.

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Youth-led protests grip Madagascar

Demonstrators again clashed with police in Madagascar’s capital, following days of Gen Z-led protests that have gripped the impoverished country. Thousands have protested in cities across Madagascar since last week, demanding an end to repeated water and power cuts that have further weakened an already fragile economy. President Andry Rajoelina dissolved his government, but it did little to quell anger. The demonstrations come just weeks after a Gen Z-led uprising toppled Nepal’s government, while in Morocco, young people recently clashed with authorities in the largest anti-government protests in years, denouncing corruption and spending priorities that have gutted health and education sectors.

Motorcycles fuel LatAm road deaths

Booming motorcycle sales in Latin America have fueled a spike in road deaths, wiping out decades of safety gains and weighing on economies in the region. A rise in the courier economy, a desire for upward mobility, and improved access to credit have led to a surge in motorbike sales, propelling economic growth that has come at a steep cost, a Bloomberg columnist argued. One estimate suggests motorcycle fatalities grew by almost 175% between 2013 and 2022, making traffic accidents one of the leading causes of death among young people. The economic toll is also huge. A World Bank report said road crashes cost Brazil 3.8% of its GDP each year.