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THREE AMIGOS TEASER: Presidents Joe Biden and Andrés Manuel López Obrador and Prime Minister Justin Trudeau will convene in Mexico City next week for the 2023 North American Leaders’ Summit.
Regionalization is the focus of the Jan. 9-10 confab, but Biden will also make his first trip as president to the U.S.-Mexico border. During a speech on Thursday, Biden said he will accept 30,000 migrants a month from Cuba, Haiti, Nicaragua and Venezuela, but immediately turn away those who attempt to cross the border illegally.
The Wilson Center hosts a preview today (livestreamed at 3:30 p.m. ET) featuring Brian Nichols, U.S. assistant secretary of state for Western Hemisphere affairs, and Juan Gonzalez, National Security Council senior director for the Western Hemisphere.
THE OTHER KEVIN: Australia’s Kevin Rudd, incoming ambassador to the U.S. and Mandarin-speaking former prime minister, says America needs to stop throwing allies “under a bus.”
“You cannot continue to assume that there’ll be collective solidarity on security questions, but on the economy, the United States is happy to throw some of its allies under a bus,” Rudd told Bloomberg TV, in reference to successive administrations running away from new trade agreements.
Spoiler alert: Expect more colorful commentary from Rudd as he arrives in Washington in March.
Disclosure: Your host — who was once fired by the ambassador-designate (from work as an adviser to one of his associates) — has first-hand experience of Rudd’s temper and way with words.
RUSSIA AND UKRAINE
GERMANY MATCHES U.S. EFFORTS TO ARM UKRAINE: What a difference a year makes. Per a White House statement following a Biden call Thursday with German Chancellor Olaf Scholz: “The United States intends to supply Ukraine with Bradley Infantry Fighting Vehicles, and Germany intends to provide Ukraine with Marder Infantry Fighting Vehicles.”
RUSSIA’S SELF-INTERESTED CEASEFIRE: Russian President Vladimir Putin said he will unilaterally implement a 36-hour weekend ceasefire — during the Russian Orthodox Christmas holiday — with the support of Turkish President Recep Tayyip Erdoǧan. Putin seems to want the PR credit that comes with the word “ceasefire” — but Ukraine is having none of it, which shows the move is more about Russian troop moral management than any sign of concessions or lasting peace.
UKRAINE SAYS WESTERN TECH ENABLING IRAN DRONES: Ukraine intelligence shared with CNN suggests Iranian drones used to attack Ukraine contain components from 13 Western firms. The Biden administration has vowed to investigate such supply chains in order to shut down Iran’s drone production.
We’ll know next week how many VVIPs — national leaders and Fortune 100 CEOs — are headed to the World Economic Forum in Davos Jan. 16-20. But two things are certain: Big Tech is scaling back its presence, and there will be a shift to the Middle East from Russia when it comes to dubious reputation-washing and parties.
Tech void: Twitter — which, let’s face it, literally doesn’t have teams to send anywhere anymore, let alone to Davos — won’t be there. The absence of a Facebook pavilion will leave a big hole on the town’s Promenade. Google wound up its big party years ago, leaving only Salesforce (which just announced 8,000 layoffs) and Cloudflare as possible Big Tech party hosts. Crypto companies seemed set to step into the void after dominating the daytime Promenade during the 2022 “summer Davos,” but with crypto winter descending on the sector, they’re unlikely to overreach this month.
Ukraine replaces Russia: WEF cut off Russian entities in March 2022, meaning no more caviar and prostitute-heavy parties hosted by Russian oligarchs. Ukraine is happy to fill the void. The Victor Pinchuk Foundation, financed by one of Ukraine’s leading oligarchs and operating in cooperation with the Office of the President of Ukraine, will run an immersive art program called Ukraine is You. Organizers said via email the exhibition will “invite guests to be Ukrainian for a moment, warning that what is happening to Ukraine is equally a threat to others.”
GEOPOLITICAL RISK REPORT SEASON
Next out of the gate is Morning Consult’s 2023 risk predictions report. The data show U.S. adults are prioritizing economically oriented national security policies. If leaders act on those sentiments, the fallout could include greater friction with Europe, and more upheaval for multinational companies.
The missing piece in the puzzle: U.S. trade agreements with such allies as the EU and U.K., which would allow for the evolution of national security while minimizing ally friction. Across the U.S. and Europe, around 1 in 4 adults say they’d pay more for friend-shored goods, compared with roughly 1 in 3 for reshored goods.
ICYMI: Global Insider reader Robert Manning, a Stimson Center distinguished fellow, has a list of top risks, co-authored with Mathew Burrows. Top of the list: polycrisis fallout from the Ukraine war, with an interesting sidebar on “technopolarization.”
Up next: The Council on Foreign Relations (event Jan. 10) and World Economic Forum.
CES STARTS TO GROW UP: The world’s biggest gadget conference, like its competitors in Europe and Canada, has realized it’s not enough for tech companies to simply show off worker-assisting robotic exoskeletons and emotion-detecting VR headsets. Tech companies without policy viewpoints and constructive relationships with governments are going nowhere, fast.
This year’s CES lineup in Vegas includes Secretary of Energy Jennifer Granholm, Sens. Mark Warner (D-Va.) and Jacky Rosen (D-Nev.), and a slew of policy assistants and members of the House. An adviser to Bitcoin-loving Rep. Tom Emmer (R-Minn.) is making the case for “Making America #1 in Blockchain and Financial Innovation,” and a group including Reps. Yvette Clarke (D-N.Y.) and Darrell Issa (R-Calif.) are here to lay out tech priorities in the newly formed Congress.
Elon Musk might want to build an “everything app.” Jeff Bezos before him wanted to build an Everything Store. But lawmakers and law enforcers are wise to the downsides of that concentration of market and political power. The smarter tech companies today know they need help: They can’t predict all the consequences of their products, or all the ways their customers might misuse them.
“It’s inconceivable to me that the bad guys won’t start using generative AI to generate very high yielding [phishing] lures at scale,” Robert Blumofe, EVP & Chief Technology Officer at the cloud computing company Akamai, told my colleague Derek Robertson. He added that “the federal government can actually play a positive role” in setting standards for the fight.
QUANTUM CRACKED, CLAIM CHINESE RESEARCHERS: Computer security experts were struggling this week to assess a startling claim by 24 Chinese researchers. They claim to have discovered how to break the most common online encryption using the current generation of quantum computers — which, if true, creates a massive problem years before most experts expected it to land on our collective plate.
The researchers’ method claims it will take only 372 qubits of computing power to break the leading RSA encryption algorithm. IBM has said that it will unveil a 433 qubit system early this year.
META’S AD PRACTICES RULED ILLEGAL IN EU: Ireland’s data privacy board — Meta’s main regulator in the EU because of its Dublin headquarters — said Meta forced users to accept personalized ads, violating the EU’s General Data Protection Regulation. Meta was fined $414 million. The affected practices, such as telling advertisers what videos on Instagram prompt a person to stop scrolling, or what types of links a person clicks when browsing on Facebook, delivered Meta $118 billion in 2021.
AMAZON TO CUT 18,000 JOBS, up from 10,000 announced in November.
FEDERAL TRADE COMMISSION PRIVACY WARNING: “Increasingly, you hear companies say, ‘Oh, well, we have to do this because of privacy.’ That’s a fine argument to make. But if it comes before the commission, we’re going to look under the hood,” Alvaro Bedoya, member of the U.S. Federal Trade Commission, told my colleague Josh Sisco. “Companies need to know that if they come to the commission and seek to justify conduct that seems to limit competition, on privacy grounds, they’re going to face a lot of questions.”
CRYPTO-FOCUSED BANK CUTS 40 PERCENT OF STAFF: Silvergate’s crisis was sparked by the collapse of Sam Bankman-Fried‘s FTX empire, prompting an $8 billion run on the banks assets, forcing it into asset sales and leading to its share value halving.
MCCARTHY FAILS AN 11TH TIME: Rep. Kevin McCarthy (R-Calif.) may have a deal to earn more votes in a 12th vote, though there’s no sign it will be enough to secure the speakership.
As POLITICO Playbook reports, McCarthy is angering his allies, willing to cede significant influence to his critics, and still going backwards in terms of support. Taken together those moves mean allies may soon start to choose their own health, or their newborn babies, over yet more failed votes.
GOP REALITY CHECKS
The 30,000 foot view in D.C.: McCarthy destroys his speakership to save it, by John Harris.
The view from abroad: Global Insider spoke to several politicians and senior advisers from Europe and Australia overnight for a reaction to the mess. Their reactions were universally damning: not because they think the situation says anything bad about America, but because — as veterans of coalition deal-making — they think it shows McCarthy is just bad at the job he wants.
Some of the verbatim reactions:
“You don’t go to a vote without the numbers, or a plan to use the voting process to get them. Why has he done it 10 times, without an actual deal? It makes no sense.”
“Whose idea is it to vote again and again with no cooling-off period between votes? It obviously won’t work.”
“If he can’t even mobilize votes for himself, how is he going to do it for issues?”
TRUMP REALITY CHECK: Global Insider is keen to reiterate that people who think the Republican speaker mess reveals waning influence for Donald Trump are missing the point. Trump benefits from chaos; Trump succeeds by dividing and conquering the minnows around him.
McCarthy’s problems in securing the speakership do not mean Trump will be the Republican presidential nominee — but they do demonstrate that the party isn’t yet good at uniting behind other figureheads … which is what would need to happen to stop Trump.
BIDEN ADMINISTRATION SEEKS TO BAN NON-COMPETES: A near blanket ban on non-compete agreements could save workers money, and stimulate the creation of new businesses and business ideas, according to the Federal Trade Commission, which estimates the move could lower health care costs by up to $150 billion a year.
The FTC’s proposal would still allow employers to protect trade secrets and other sensitive information, but would prevent such requirements from acting as barriers to new employment.
NOTHING TO SPARE: Prince Harry’s book “Spare” is excruciating in its detail of his account of being attacked by Prince William at his home in 2019. Harry also admits that he took cocaine as a teen, lost his virginity outside a pub to an older woman, killed 25 people in Afghanistan and that he and William asked King Charles not to marry Queen Camilla,Sky News reported.
There’s no official comment from Charles or William — which has been broadly received in Britain as the pair choosing not to contest the claims. Reactions have often been split along generational lines in this ongoing saga: older age groups tending to side with William and his wife, Kate, Duchess of Cambridge, and younger groups with Harry and Meghan, Duchess of Sussex.
Doreen Bogdan-Martin is now the International Telecommunications Union secretary general, the first woman to hold the post at the longest-standing global organization, founded in 1865.
POLITICO has hired Sam Wilkin as editor of POLITICO Pro, overseeing our policy journalism in Europe.
“The Children of the Volga” by Guzel Yakhina, recommended by EU Values Commissioner Věra Jourová. “It is a powerful reminder of the cruel realities in war-torn Russia at the beginning of 20th century. We must never forget that war is not only geopolitics, strategies or weapons. War means hundreds of thousands of personal tragedies. This is why we have a moral duty to stop Russia today.”
7 good books on espionage, as recommended by The Economist.
How transportation technologies shaped empires, by Tomas Pueyo.
Morse code meets pop music and Colombia hostages, by Phoebe Hopson and Lucy Wallis.
Thanks to editor Sue Allan, Brook Hayes, Mark Scott, Nick Taylor-Vaisey and producer Hannah Farrow.
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