WSJ What’s News - Pakistan Is Developing Missile That Could Reach the U.S., White House Says

Episode Date: December 23, 2024

P.M. Edition for Dec. 23. In the Biden administration’s last few weeks in office, officials are disclosing the intelligence in an effort to get Pakistan to stop the program, says Wall Street Journal national security correspondent Michael Gordon. And the House Ethics Committee releases an explosive report about sexual misconduct allegations against former representative Matt Gaetz. Plus, WSJ reporter Laura Cooper tells us how beverage companies are ramping up lobbying to keep sugary drinks eligible for purchase with food stamps. Alex Ossola hosts. Sign up for the WSJ's free What's News newsletter. Learn more about your ad choices. Visit megaphone.fm/adchoices

Amazon Q Business is the generative AI assistant from AWS. Because business can be slow, like wading through mud. But Amazon Q helps streamline work, so tasks like summarizing monthly results can be done in no time. Learn what Amazon Q Business can do for you at aws.com slash learn more. A House committee has released an explosive report

detailing former representative Matt Gates' alleged misconduct while in office. And the White House says Pakistan is developing a long-range missile that could reach the U.S. This is not an imminent threat. They're talking about a capability that Pakistan would be able to field in several years or perhaps a decade. But the administration is beginning a diplomatic campaign to persuade

Pakistan to halt the program. Plus, beverage companies are lobbying Washington to keep sugary drinks eligible for food stamps. It's Monday, December 23rd. I'm Alex Osala for The Wall Street Journal. This is the PM edition of What's News, the top headlines and business stories that move the world today. The House Ethics Committee released a report detailing its investigation of sexual misconduct allegations against Matt Gaetz, a Florida Republican who abruptly resigned from Congress last month

while under consideration to be president-elect Trump's attorney general. The report said that Gaetz regularly paid for sex, accepted impermissible gifts, and also used or possessed cocaine and ecstasy while he was in Congress. Gates denies wrongdoing and his lawyers didn't respond to a request for comment. Katie Stetsch-Ferrick, who covers Congress for the Wall Street Journal, told me that it's rare for the House Ethics Committee to publish a report after a representative leaves Congress. It's only happened a handful of times. The committee generally takes the position that once someone leaves Congress, their jurisdiction ends. But this was a very divisive issue for the members of the committee. There's five Republicans, five Democrats, and they were split on whether or not this should be released to the public. But they ultimately concluded that the nature

of the misconduct that the congressional investigators uncovered explained why they were willing to continue talking about this report and its potential release since he left Congress. Last night, some news outlets said that this report was coming out shortly, and Matt Gaetz raced to the courthouse and filed a lawsuit earlier this morning against the committee and its Republican chair saying that it shouldn't be released. And before a judge could even look at that lawsuit or hold a hearing, the committee decided to release its report. Confidence among American consumers

dropped unexpectedly this month. That's according to an index that measures consumers' near-term confidence in income, business, and the jobs market, published by research group group The Conference Board. The expectations index fell close to the level that often signals a recession. In US markets, all three major indexes climbed, buoyed by rising tech stocks. The Nasdaq climbed about 1 percent, while the S&P 500 rose less than 1 percent, and

the Dow edged up after hovering around the flatline most of the day. In business news, the founding family of Nordstrom has reached a $4 billion deal to take the struggling retailer private. Several family members, along with Mexican retailer El Puerto de Liverpool, are acquiring all of Nordstrom's outstanding stock in a deal. Including debt, the company said the deal had an enterprise value of $6.25 billion. The deal is expected to close in the first half of next year, subject to approval from regulators and two-thirds of Nordstrom shareholders. Robert F. Kennedy Jr., Donald Trump's pick to run the Health and Human Services Department,

wants to take sugary drinks like soda from federal programs like food stamps, the so-called Supplemental Nutrition Assistance Program, or SNAP. That could have big repercussions for the beverage industry, and companies like Coke, Pepsi, and Keurig Dr. Pepper are pushing back. Laura Cooper, who covers beverage and tobacco companies for the Wall Street Journal, joins me now with more. Laura, are companies like Coke and Pepsi increasing their lobbying activity in Washington to try to continue to be a part of SNAP?

Yes. Coke, Pepsi, Dr. Pepper, others in the sugary beverage industry are stepping up their lobbying in D.C. Lobbying groups associated with these companies have long been faced with the prospect of SNAP making sugary drinks ineligible, also desserts, ice cream, things of that nature. So companies are very well versed in this fight. Last year, Senator Marco Rubio co-sponsored legislation with Representative Joss Brekeen of Oklahoma. Brekeen said he actually plans to reintroduce that legislation as soon as next month

and is counting on help from Trump and Robert F. Kennedy Jr. to help get that passed. If Kennedy is approved, this is likely to be top of mind for him. And what's really new here is he has the support of Trump in his campaign to do this. So having that level of support in the White House for something like this may make it more likely than in the past. As you mentioned, this is not the first time these companies have been faced with this prospect. What is their argument this time around for keeping these sugary drinks SNAP eligible?

The American Beverage Association, which is an industry group which represents Coke, Pepsi, Dr. Pepper, has said that the companies it represents are selling more low calorie or zero calorie drinks than ever before. And that includes things like seltzers, sports drinks, bottled waters, teas, and of course the zero in diet options of the sodas that we all know. They highlight that the sales of these low and zero-calorie options represent 60% of non-alcoholic package and fountain drinks sold in the US by volume, so a significant amount. The choice is also a big part of this,

that consumers, no matter their income, should have the opportunity to make the choices of what they wanna eat when they go to the supermarket. In addition, some lobbyists have said that instead of being restricted of what SNAP families can buy in the supermarket, Congress should fund programs for families to access healthier foods. Some of the SOT soda companies are also sponsors of those types of groups.

That was Wall Street Journal reporter Laura Cooper. Thanks so much, Laura. Thanks so much for having me, Alex. Coming up, why the U.S. revealed intelligence about Pakistan's missile program. That's after the break. grow tax free. But remember, the contribution deadline is December 31. Open your Questrade FHSA online today in just a few minutes. Weeks before the Biden administration leaves office, officials have said that Pakistan is developing a long-range ballistic missile. It could eventually mean that Pakistan, which possesses nuclear weapons, would be able to strike the US. Deputy National Security Adviser John Finer called

Pakistan's actions, quote, an emerging threat to the United States, allegations that Pakistan's foreign ministry spokeswoman said were, quote, unfounded, devoid of rationality, and unhelpful for the overall relationship. Here to tell us more about what this means is Wall Street Journal national security correspondent Michael Gordon. So Michael, Pakistan was once considered a U.S. partner in South Asia. Now U.S. officials are saying its weapons program is a threat. What does the development of this missile say about the relationship between these two countries? Well, the assertion was really quite striking. And what he's saying is that Pakistan which has been

getting military support from China is developing a ballistic missile that is not merely aimed at its adversary India but can go beyond South Asia and could even strike the continental United States and that's of grave concern to the current administration because Pakistan has nuclear weapons, perhaps about 170 or so, according to an estimate by the Federation of American Scientists. Now it's important to note that this is not an imminent threat. They're talking about a capability that Pakistan would be able to field in several years or perhaps a decade, but the administration is beginning a diplomatic campaign to persuade Pakistan to halt the program. So that's the import

of this. What's going on is that since the US left Afghanistan, Pakistan is no longer such an important strategic ally. It's no longer really in that category and it's much closer to China and Pakistan's unhappy about the American efforts to strengthen relationships with its arch enemy, India. And I think that's the subtext here. So it sounds like there's more of a rift that in between the two countries than there used to be? Yes, and it has to do a bit also with the current direction of Pakistan's authoritarian

government. So there are tensions between the two sides. There are a number of steps Pakistan has taken, according to the State Department, to extend the range of these missiles. They've acquired or in the process of acquiring test equipment to test very large rocket motors. An effort was made to broach these concerns quietly, privately, through confidential channels with the Pakistanis over past months. But what Finer said publicly last week is those efforts went nowhere. So what they did is they went public with these assertions and also by declassifying

intelligence about the program. A lot of this diplomatic work that you're talking about is being done, of course, by officials in the Biden administration. How are we expecting Donald Trump and his administration to approach the relationship with Pakistan when he takes office next month? It's very hard to predict the course of the Trump administration since there's a spectrum of views about what the U.S. security priorities are. But you can expect the incoming administration to take a pretty hard line on the subject, particularly since it was President Trump during his first term who slashed security assistance to Pakistan. One would expect some continuity there.

That was Wall Street Journal National Security Correspondent Michael Gordon. Thanks so much, Michael. Thank you. Elon Musk has been everywhere this year in business and in politics. The world's richest man now has a new gig in 2025 and President-elect Donald Trump's administration as co-lead of a newly created department of government efficiency. Our columnist, Tim Higgins,

spoke to our tech news briefing podcast about how Elon Musk has put himself firmly in the center of US politics. It has been a year of politics for Elon Musk, not somebody who we would have seen as being very political if we were talking, say, three or four years ago. We've seen this kind of evolution occur in real time. And of course, on X, his social media platform, where he's become increasingly more political, taking on more conservative points of view,

or at least what some people might see as conservative, Musk would say that he has remained centrist and that the world around him has moved. As the world's richest man, he has a lot of money and he spent some of that in 2024, helping Trump win the White House, roughly $250 million into pro-Trump political movements. This was very unlike Elon in past years,

where he wasn't known as a very big giver to political causes. This injected him into the Trump campaign. He was out on the campaign trail, if you can imagine this, almost like he was a candidate moving around Pennsylvania, trying to rally support for Trump, really speaking to young men who found him to be inspiring. So really the year of politics for Elon Musk. And you can hear more about Musk's approach

to co-leading the new department of government efficiency and the challenges that lie ahead in 2025 in tomorrow's Tech News Briefing podcast. And that's what's news for this Monday afternoon. Today's show was produced by Pierre Bienhame with supervising producer Michael Kosmitis. I'm Alex Osala for The Wall Street Journal. Tomorrow we'll be back with just one show that will publish midday U.S. Eastern Time. Thanks for listening.