WSJ What’s News - The World Plots Its Response to an 'Adversarial' America

Episode Date: January 21, 2026

A.M. Edition for Jan. 21. Wary European allies are preparing for President Trump’s arrival at the World Economic Forum today. WSJ’s Washington coverage chief Damian Paletta says the President is very much at peace, being more adversarial with U.S. allies and that he's not going to take no for an answer when it comes to Greenland. Plus, the U.S. shifts military firepower to the Middle East. And, your boss might be lauding the efficiencies of AI, but new research finds chatbots aren’t saving workers much time - if any - at all. Luke Vargas hosts. Sign up for the WSJ’s free What’s News newsletter. Learn more about your ad choices. Visit megaphone.fm/adchoices

It's the golden moment. Triumph on the podium, golden hand. But with Corona Serro, golden moments go beyond the Winter Olympics. They're enjoying sunsets, time outside, reconnecting with nature, and laughs shared with friends. For every golden moment at the Winter Olympic Games, enjoy your own with Corona Serro, 0% alcohol and a source of vitamin D. Corona Serro, the official non-alcoholic beer of Milano Cortina 2026. Davos gears up for President Trump with all eyes on how hard he pushes for Greenland.

This is a completely different president than in past years. He's very at peace, ironically, being more adversarial with U.S. allies, and he's not going to take no for an answer. Plus, the U.S. shifts military firepower to the Middle East and a big day for the Fed's independence at the Supreme Court. It's Wednesday, January 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. After a brief delay leaving the U.S. due to mechanical issues on Air Force One, President Trump is said to take center stage today in Davos, Switzerland.

The journal's Jenny Strasbourg is at the World Economic Forum and says the president's quest to acquire Greenland is dominating a gathering that organizers had titled A Spirit of Dialogue. Really, every topic, robotics, artificial intelligence, critical minerals, everything has been overtaken by discussion of Trump's visit today. Everyone's talking about his plan to acquire Greenland, his doubling down on that, despite the fact that global leaders are fighting back. Prime Minister Mark Carney of Canada delivering a speech that saw a, a, relatively rare standing ovation. We're reminded that we live in an era of great power rivalry,

that the rules-based order is fading. And he called for global leaders to essentially act together and cooperate in the face of what a lot of people see as aggression. Though Jenny said that not everyone is taking Carney's approach. There is a difference in how a lot of people are speaking publicly. and how they are speaking privately in meetings with CEOs and other C-suite executives, consultants, et cetera. We're hearing a lot about anger and frustration and worry about how this order is being disrupted. But at the same time, a lot of folks won't say their words publicly. President Trump is set to speak at 8.30 a.m. Eastern and here to discuss what we can expect from those remarks.

I'm joined by the journal's Washington coverage chief, Damien. Pelletta. Damien, I went through our archives to recall Trump's first Davos appearance as president back in 2018. He was talking about going after China's trade practices, though he didn't mention China by name. He floated the U.S. joining a rework version of the TPP, that Trans-Pacific Partnership Trade Pack, and he framed his ideological priorities in quite conciliatory terms, saying America First did not mean America alone. Seems like quite a contrast to maybe where we are now. Yeah, this is a completely different president than in past years. He has a much different focus. He's very at peace, ironically, being more adversarial with U.S. allies. His approach here is that, you know, this is his second term. He's done playing nice. And he has his eyes on a target, which is the largest island in the world, Greenland. And he's not going to take no for an answer. And so I think we saw most of his first year of his second term, business. leaders, world leaders, trying to play nice with him, trying to convince him that there are alternatives

to his hard-charging tactics. And now, quite frankly, business leaders and world leaders have to decide whether to finally stand up to him and push back. And the question is, what do they do? What kind of retaliatory measures can they take? Can they ban together? Can Europe and Canada actually decouple from the United States? These are the sorts of conversations that are actively taking place at Davos and around the world right now as President Trump prepares to kind of draw his line in the sand or his line in the snow, so to speak, when he says, you know, what his actual plan is for Greenland, how is he going to proceed with Russia and Ukraine? You know, all these things kind of click together. Can the new world order replace an old world order that was much more

cooperative and maybe slow moving, but much more of an alliance? You know, how does it work if the U.S. isn't a part of that, isn't leading that alliance anymore? Trump comfortable being adversarial, you say, and yet he's expressing confidence that, as he's put it, things are going to work out pretty well. Has the White House signaled what success for Trump would look like coming out of Davos? Is there a way they think there could be a negotiated settlement over Greenland or something to that effect? No, in fact, it's really interesting you ask that because I think there's a view in the White House that they're not exactly sure where Trump wants this to end. And so one of the frustrations for European leaders is that they don't know who to be

negotiating with here. Marco Rubio, the Secretary of State, has made comments. in recent weeks that are much more cautious. You know, we're not going to use the military. This is something Trump wants to buy Greenland. But then when President Trump speaks, it's a much more, you know, maybe we'll use the military. I'm not going to take anything off the table approach. And so it's hard for the Europeans to know exactly who to negotiate with. And that's why President Trump going to Davos here is such a key moment for the whole

conversation, because they'll see how serious he is and what his ultimate objectives are. Damien, we've been speaking a lot here about foreign policy at the world economic forum. And I mean, look, I doubt most voters are as glued to Davos as we are. But does the president risk getting a bit distracted by, you know, territorial, you know, ambitions when voters we know are really focused on the economy and affordability? Excellent question. We're less than 10 months away from the midterm elections. And these are really consequential elections that'll determine who controls Congress in the final two years of Trump's. presidency. Now, President Trump is a lame duck president. He's not going to run for re-election.

So his ambitions and goals might not completely overlap with the goals of the Republican Party or even the goals of voters. For voters, affordability and the economy, these are huge issues and those are always big issues. Those are the sorts of things that can decide elections, potentially more, much more so than whether the United States controls Greenland. But President Trump is in legacy mode. He's trying to think of the sorts of things that'll outlive him, the sorts of things that will define him in his legacy going to the future. Now, ironically, this midterm election idea is kind of forcing Trump to move faster because he knows he only has 10 or 11 more months of Republican control of Congress. If Democrats take control of the House, it makes it much

harder for him to operate unilaterally like this. So that might make him even more adversarial, even more aggressive with the European allies. And that could, ironically, pull him even further away from voters. And that's exactly what we're going to be watching for today and in the days to come. Journal of Washington Coverage Chief, Damian Paletta. Thanks as always for dropping by. My pleasure. Thanks. Coming up, the Supreme Court

weighs in on whether Trump can fire Lisa Cook from the Fed Board and we'll explore the growing gulf in the office as CEOs go all in on AI while workers feel left behind. That and more.

After the brain. Adobe Acrobat Studio, your new foundation. Use PDF spaces to generate a presentation. Grab your docs, your permits, your moves. AI levels of your pitch gets it in a group.

Choose a template with your timeless cool. Come on now, let's flex those two. Drive design, deliver, make it sing. AI builds the deck so you can build that thing. Do that, do that, do that with acrobat. Learn more at adobe.com slash do that with acrobat. More American firepower is headed to the Middle East. The U.S. is sending a carrier, jets, and air defense systems to the region,

giving President Trump more options for a strike on Iran. Last week, Trump pulled back from ordering an attack on Iran, but he's continued to press for what he terms decisive military options, as the regime in Tehran tightens its control of the country. The Supreme Court will hear oral arguments today in a case deciding whether President Trump can fire Federal Reserve Governor Lisa Cook. Fed Chair Jerome Powell and the Fed have been named by Cook as defendants in her initial lawsuit contesting the president's attempt to remove her over disputed mortgage fraud allegations. Speaking to CNBC in Davos, Treasury Secretary Scott Besant,

who had previously urged Trump not to fire Powell, said he thought it was inappropriate for him to attend today's hearing. I actually think that's a mistake, because if you're trying not to politicize the Fed, for the Fed chair to be sitting there, trying to put his thumb on the scale is a real mistake. Besant also called out Powell for not meeting with federal prosecutors last month before they issued grand jury subpoenas in a criminal investigation of the Fed's building project.

Meanwhile, Senate Democrats Elizabeth Warren and Dick Durbin have demanded records from the Trump administration regarding the criminal probe into the Fed, calling it a serious misuse of power. In letters sent yesterday and seen by the journal, they requested documents detailing how the investigation came together and any coordination between the White House, DOJ, and the federal housing finance agency. The Democrats' demands don't carry legal weight, but could lay the groundwork for a more formal investigation in the future. Lindsay Halligan, the prosecutor who led the Justice Department's cases against former FBI director James Comey and New York Attorney General Letitia James is stepping down. That comes just four months after the former White House aide and personal lawyer to President Trump was installed as the top federal prosecutor in eastern Virginia after her predecessor was forced out of the job. The indictments Halligan secured against Comey and James were later dismissed by a judge who ruled she was unlawfully appointed.

President Trump is accelerating his effort to ban large institutional investors from buying single-family homes. Yesterday, he signed an executive order telling agencies to find ways to stop the federal government from backing loans and providing other financial incentives for Wall Street. We don't have the fine print yet, though. Treasury Secretary Scott Bessent has 30 days to take. decide exactly which investors are affected and which types of homes are off limits to them. And heads up that we've got a special bonus episode of the pod coming later today. In the latest What's News in Earnings, we'll dive into what's behind the booming Wall Street businesses of the country's biggest banks and the risks that bankers are looking at this year.

Keep an eye out for that in your What's News feed at midday. And finally, the productivity boosting powers of AI. are causing a growing divide in the workplace. While CEOs are rallying behind the tech, saying that it saves them more than eight hours of work a week, a majority of workers are finding AI doesn't save them any time at all and is instead another complex tool they have to manage. Journal reporter Lindsay Ellis says that between learning prompts and fixing errors,

workers are feeling overwhelmed. There's been a bunch of recent data that reinforces this sense of a clear divide. For one, there was a new report from Workday, the business software company. It recently found that about 1,600 employees who had surveyed, about 85% of them said that they were saving one to seven hours a week by using AI. But a lot of the time that was saved, they wound up having to use to correct errors and rework AI-generated content. And when you ask Americans writ large, Nork and the Wall Street Journal surveyed, many of them over the summer. About six and ten characterized AI and other new technologies as

mostly a threat to the U.S. economy because of its potential to replace well-paid workers. So how are you using AI in your work? Let us know in the Spotify comments. And that's it for what's news for this Wednesday morning. Today's show was produced by Daniel Bach and Hattie Moyer. Our supervising producer was Sandra Kilhoff, and I'm Luke Vargas for The Wall Street Journal. We'll be back tonight with a new show. Until then, thanks for listening. Thank you.