WSJ What’s News - With a Deal Unlikely, Government Shutdown Looms

Episode Date: September 30, 2025

P.M. Edition for Sept. 30. With just a few hours to go and no last-minute deal emerging, the federal government is likely to shut down starting at 12:01 a.m. Wednesday. We hear from WSJ economics reporter Justin Lahart about what the economic impact of a government shutdown might be. Plus, the White House has unveiled a direct-to-consumer web site for Americans to buy medications, called TrumpRx, while also announcing that Pfizer plans to offer some of its drugs at a reduced rate. WSJ reporter Liz Essley Whyte discusses what we know about the site and Pfizer’s commitment. And OpenAI is launching a new social media app for its AI video generator, taking on the likes of TikTok and YouTube. Alex Ossola hosts. Sign up for the WSJ's free What's News newsletter. Learn more about your ad choices. Visit megaphone.fm/adchoices

With no deal in sight, the government heads towards a shutdown. Plus, what Pfizer gets out of offering its drugs to Americans at a reduced rate. So in exchange for continuing to invest in domestic manufacturing and making these other concessions, it won't be subject to what are called 232 tariffs. That'll be great for Pfizer, which has quite a large manufacturing footprint outside the United States. and CoreWeave secures a $14 billion contract with META. It's Tuesday, September 30th. I'm Alex O'Sullough 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 federal government appears to be mere hours away from a shutdown. Funding will lapse just after midnight tonight unless Congress passes a stopgap spending bill, which is an increasingly remote possibility. Speaking to reporters, President Trump said a shutdown was likely. He said he could use a lapse in funding to flex his executive powers at Democrats' expense while also signaling he could be open for more discussions regarding their health care demands.

With just hours to go, Democrats leaned on Trump to rally Republicans behind some sort of deal. More votes were planned in the Senate today, but there was no sign of a late reprieve. For more about the impact of a potential shutdown, I'm joined by WSJ economics reporter, Justin Layhart. Justin, government workers themselves, I think, are the primary ones feeling the consequences, but how many of them would be furloughed as a result of the shutdown? People think upwards of 800,000 workers would be furloughed, so they wouldn't be working. The last shutdown was at the end of 2018 into 2019. Congress at that time had passed a variety of spending bills already.

So it was a partial shutdown, something around 350,000 workers got furloughed in that one. The previous shutdown to that was in 2013, and that was about 800,000 as well. As we mentioned on this morning show, a shutdown means the Bureau of Labor Statistics won't release or collect any economic data, which includes this Friday's jobs report. What are the implications of having that not come out? If you think of policymakers, like at the Federal Reserve, investors, businesses, regular Americans, when we have less economic data or when we don't get to see economic data, we're flying blind a little bit. If this was a prolonged shutdown, the Fed would be getting inflation data either. It's harder than them to make a decision about rates, for example. We don't often think of the private sector as being affected by a government shutdown, but it is, right?

Oh, yeah. There's a lot of government contract work that goes on. And so those folks won't be getting paid. Or then you just think about some other things. There's the coffee shop federal employees go to. They're not selling as much coffee. People who have businesses set up around national parks. Well, national parks are closed, so you don't have that going on.

What does the government shutdown mean more broadly for economic growth? When the government shuts down, it does shave some growth off. GDP does not grow as quickly. Now, what happened after the shutdown is that there is a rebound, but there is some business that is lost forever. We end up with a somewhat smaller economy than we would have had. That was WSJ economics reporter, Justin Layhart. Thank you, Justin. Thanks.

A rally in pharmaceutical stocks helped lift major indexes today, overcoming worries about a government shutdown and new data pointing to a decline in consumer confidence. The Dow rose about 0.2%. The NASDAQ added 0.3%, and the S&P 500 was up roughly 0.4%. Texas Stock Exchange, the Dallas-based listing venue taking aim at New York's dominance, is one step closer to being open for business. Today, the Securities and Exchange Commission approved Texie to operate as an exchange, paving the way for Texie to start listing shares next year. And ExxonMobil announced today that it is slashing 2,000 jobs worldwide. According to a person familiar with the matter, none of those job cuts are in the U.S. Almost half are in Canada at Imperial Oil, majority owned by Exxon. The affiliate plans to reduce its workforce by 20% by the end of 2027.

As we mentioned on this morning show, today Defense Secretary Pete Hegseth addressed hundreds of top military officers at an extraordinary meeting at the Marine Corps base in Quantico, Virginia. WSJ National Security correspondent Michael Gordon joins me now from Washington. Michael, what were some of the main takeaways from Hick's address today? It was kind of a rah-rah speech where Secretary Hicketts talked about how he wanted to strengthen standards largely for physical fitness within the military, even if it means that women would be excluded from combat roles, and he railed against diversity and inclusion, which had been familiar targets for him. One thing that was different was President Trump

attended the meeting, which wasn't part of the original plan, and he gave a very striking speech about using the military, potentially in American cities, to quell disorder. What were the reactions from the military personnel who were there? Were they surprised by any of this? I think the military was pretty stoical throughout. They're trained to be apolitical. I know people who were in the room at the time, and I've spoken with them, and the ones that conveyed to me, there was occasionally some nervous laughter. I think the attacks on President Biden and President Trump's speech, I think that the military is not comfortable with that. They're not really tuned to hear speeches in which one political leader assails another.

Did Trump or Hegseth signal or announce any strategic shifts in how the U.S. military operates? Two things have happened that the administration has been very direct and open about, but which are controversial within military circles, within the Congress. One is the increasing use of the National Guard and even active duty military in American cities. And the other one is the role of the military in the Caribbean, and including against the National Guard. drug boats. The emphasis on operations in the Caribbean, partly directed in intimidating Venezuela and partly directed at drug traffickers is a new thing. There's a new national defense strategy, which is expected to emphasize Western Hemisphere Defense while still taking note of the challenge from China. That was WSJ National Security correspondent, Michael Gordon. Thank you, Michael. Thank you.

Coming up, what we know about the government's new direct-to-consumer site for buying medicine. That's after the break. This episode is brought to by Tron Aries. For the first time, the captivating world of Tron breaks out of the grid. Aries, a highly advanced program, journeys into our world on a dangerous mission, marking humankind's first encounter with AI beings, Featuring an electrifying original soundtrack by 9-inch Nails, Tron Ares is a must-see movie event filmed for IMAX and made for the big screen.

Experience it only in theaters October 10. Get tickets now. Today, there's a big change for the autos industry. The $7,500 tax credit that buyers would get for purchasing a new electric vehicle has expired. Last month, EV sales were a bright spot in auto sales numbers, with Toyota, Hyundai, and Kia reporting double-digit increases in August from a year earlier, as consumers raced to take advantage of the credit. So what does it mean for these companies now that the credit is gone? John Murphy, a managing director of Strategic Advisory at Hague Partners, told our take on the week podcast where the auto industry goes from here. It's a very big deal in many ways. First and foremost, when we look at EV penetration last year, it was about April.

First few months of this year, it's ramped up because people were anticipating the end of these EV credits. The reality is once that drops off, we're probably going to see something far below 10%, 8%, probably just a few percent. Because for a lot of folks in the country, it's a subpar product at a higher price. Simply over time, if you can bring the cost of an EV down and ramp up the charging network and create a better product at a better price, I think people will move in that direction. But we have not gotten there yet in the auto industry in the United States. And we are probably a very long way off from actually making that work. To hear more, listen to the latest episode of Take On the Week. In other business news, Spotify CEO Daniel Eck said today that he plans to step away from the top job nearly two decades after he founded the music streaming company.

Spotify's co-presidents Alex Nordstrom and Gustav Soderstrom will become co-CEOs on January 1st. CoreWeave has secured a contract with Meta worth up to $14.2 billion to provide the social media company with artificial intelligence cloud infrastructure through 2031. The announcement follows multi-billion dollar deals that Corweave has recently struck with OpenAI and Nvidia. And today, OpenAI announced a new social media app for its AI video generator. Users can upload short clips of themselves and insert them into AI generated worlds, describing the idea, style, and style. scene they want to see. They can also connect with other users, watch, and comment on their content. With this app, OpenAI is facing off against TikTok, Google's YouTube, and meta, as Silicon Valley ramps up its focus on AI video generation. Today, the White House unveiled a direct-to-consumer

website for Americans to buy medication. On the site dubbed Trump RX, people would pay cash for certain drugs directly at a discounted price negotiated by the government. Wall Street Journal reporter Liz Esley-White joins me now. Liz, what do we know about how the site would work and what kinds of drugs it would offer? We don't know a ton about how the site would work. We know that Pfizer's committed to offering some of its drugs on the site. And we do know that of the drugs that they are offering, some of those are drugs that are already in their patient assistance program.

And most Americans actually have private insurance or on Medicare. Medicaid, and so we're already getting some discount off the list price of the drug. You mentioned Pfizer, which as part of the same announcement at the White House, said it would offer some of its drugs at a reduced rate. What do we know about Pfizer and its commitment? Pfizer is the first company to say we've made a deal with the Trump administration, and here are all the different things that we're willing to do. One of them is they're going to offer some kind of most favored nation price, which is somehow linked to what other countries pay. Those details aren't yet clear either, to Medicaid. And they're going to offer all new drugs introduced into

the United States at this most favored nation price as well. But the exact details Pfizer said were confidential. And has the company gotten anything from the administration in return? The company said that it got a three-year grace period or reprieve from national security-related tariffs. So in exchange for continuing to invest in domestic manufacturing, and making these other concessions, it won't be subject to what are called 232 tariffs. That'll be great for Pfizer, which has quite a large manufacturing footprint outside the United States. That was WSJ reporter, Liz Estley White. Thank you, Liz.

Thanks. And that's what's news for this Tuesday afternoon. Today's show is produced by Pierre Biennameh and Rodney Davis with supervising producer, Jana Heron. I'm Alex Oslo for the Wall Street Journal. We'll be back with a new show tomorrow morning. Thanks for listening. Thank you. Thank you.