Chapter 1: What recent budget plan did the Senate approve regarding immigration enforcement?
The Senate funds ICE and Border Patrol, pushing past Democratic calls to reform how immigration enforcement is carried out. Plus, another shakeup of the Pentagon's top brass, and the NIMBY movement finds its next target.
Americans are hiding lots of stuff in self-storage facilities, but now we have to hide the self-storage facilities.
It's Thursday, April 23rd. 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. We begin in Washington, where senators pulling an all-nighter have pushed forward a budget plan to fund DHS in spite of Democratic opposition and calls for restrictions on enforcement operations.
Chapter 2: What led to the firing of Navy Secretary John Phelan?
The bill, which passed by a 50 to 48 margin, will hand ICE and Border Patrol an additional $70 billion and see them funded through the end of Trump's term. The bill now heads to the House.
Defense Secretary Pete Hegseth has fired Navy Secretary John Phelan in the latest shakeup at the Pentagon after Hegseth's dismissal of nearly two dozen military officers and amid an ongoing feud with the Secretary of the Army. Phelan didn't immediately respond to a request for comment.
Chapter 3: How is the Pentagon's leadership changing amid military conflicts?
Joining me with more is Journal Washington coverage chief Damian Palletta. Damian, we report that Pentagon officials told congressional aides that Hegseth had fired Phelan because he felt he wasn't moving quickly enough on President Trump's shipbuilding priorities. That priority will now fall on current Navy Undersecretary Hung Kau, who's being elevated to secretary.
What do we need to know about all this?
So in getting rid of the Navy secretary, he's getting rid of someone who is in the middle of this Iran conflict, in the middle of this naval blockade that's core to the White House's strategy of trying to pressure Iran. And it's very unusual in the middle of a war to do something like this with someone so senior.
The reason that this appeals to President Trump, though, is because part of his whole agenda, his economic agenda... is reviving, and his military agenda, quite frankly, is reviving the shipbuilding industry in the United States after really decades of lower output. And the Naval Secretary who was just fired actually was very plugged in with President Trump.
They would meet at Mar-a-Lago and talk quite often.
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Chapter 4: What are Tesla's plans for its $25 billion AI spending?
But President Trump believes that the shipbuilding industry needs to be reborn much faster than is happening.
Damien, it seems telling how big a challenge this could all be if someone like Phelan, who said he regularly texted with Trump in the middle of the night about shipbuilding and was actually the one to pitch him on the idea of new Trump-class warships, couldn't get this done.
Right. Well, it's one thing to be able to talk to President Trump and text him about it. It's another thing to actually build the ships. And so maybe that's what, after months and months, the president is looking for. President Trump envisions this Trump fleet of naval ships. You know, he has a personal identity now that he wants associated with these ships. But...
It's very complicated, expensive, and it, quite frankly, is going to need a lot of cooperation from Congress if they're going to get the kind of output that President Trump is envisioning.
Chapter 5: What new products is Tesla focusing on for future growth?
And whether the fired Naval Secretary's successor can pull this off is an open question.
That was The Journal's Damian Paletta. And a Virginia judge has blocked a new voter-approved measure to redraw the state's congressional map, siding with the Republican National Committee, which had contended that the referendum was procedurally invalid. Virginia's attorney general said he would appeal the injunction and look forward to defending the election in court.
If upheld, this week's redistricting vote would give a big boost to Democrats' efforts to reclaim the U.S. House in November. Meanwhile, the conflict with Iran has entered a damaging new phase that leaves the Strait of Hormuz closed and the prospect of escalation looming.
Although President Trump has agreed to an indefinite extension of a ceasefire with Iran, tensions are nevertheless continuing to flare in the vital waterway, the U.S. and Iran now boarding ships and taking control of commercial vessels. Drew Dowell is the journal's Middle East editor.
Chapter 6: How are private credit firms responding to market pressures?
Both Iran and the U.S. are talking tough out front and with a lot of threats going back and forth. What we had understood is that in the background, there are actually exchanges of messages and some level of engagement that could form the basis for negotiations. But, you know, right now, the situation in the Strait has come to the fore.
Iran is insisting that the blockade be dropped before it comes to the table. The risk is that as this goes on and both sides take provocative steps like boarding each other's ships or pulling ships into quarantine, that someone could take a military action that then escalates.
It's not as dangerous as the outright war was, but it's still fraught and still a significant issue for the global economy, which depends heavily on Persian Gulf oil supplies.
While securing access to those vital oil routes is also why the Trump administration is looking to reset ties with the North African country Eritrea, whose coastline faces the Red Sea. We're exclusively reporting that Trump official Mossad Boulos has discussed lifting sanctions on the authoritarian state.
That comes as Iran-backed Houthis have threatened to support Iran by shutting the Bab el-Mandeb Strait at the mouth of the Red Sea.
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Chapter 7: What challenges are self-storage facilities facing in local communities?
However, officials warned that a change in U.S. policy could trigger tensions with landlocked Ethiopia, which says that it has historic claims to Eritrean coastlines. Coming up, Tesla surprises Wall Street with better profits. And we'll take a look at how America's self-storage craze has reached a tipping point after the break. U.S.
officials are trying to get a grip on how much risk has built up in the $3 trillion private credit industry. Here's finance reporter Caitlin McCabe.
So sentiment about the private credit industry really began shifting last year and then kicked into overdrive further this year when traders really started to get spooked about AI and how it would affect software companies. Some private credit firms have quite a bit of exposure to software loans. We've also seen investors asking to pull money from these private credit firms.
Chapter 8: How is the self-storage industry evolving in the U.S.?
And so now this is just the latest step of really seeing storm clouds growing over private credit.
Three different regulators are now probing the sector, with the SEC focusing on valuations and loan selection, the Treasury Department looking into firms' business models, and the Fed asking banks about their exposure to private credit. Though, as Caitlin explains, the watchdogs aren't yet sounding the alarm.
Regulators are just starting to ask questions. They're not sounding dire alarms. And the Trump administration has basically said the same. They don't think losses in private credit funds would ripple through the financial system. And that's really similar to what executives and bankers have said, too. At the same time, regulators are honing in on some of the areas of private credit that I think
folks really have had issues with. So one of those things is the opacity surrounding private credit, meaning you just don't always know how these loans are valued. Paul Atkins, the SEC chairman, talked about that very issue in a speech earlier this week.
Shares of Tesla have slipped off hours, despite the company reporting better revenue in the first quarter compared to last year and rising car sales.
But Wall Street isn't really that interested in these numbers. Tesla is in a moment of transition where they say pretty clearly their electric vehicle business is not the focus.
That's Journal Tesla reporter Becky Peterson, who said the big news from the call was that Tesla had a lot of cash in the first quarter and is looking to spend it.
This is big news because Wall Street had been expecting Tesla to be making really heavy CapEx investments. This quarter, the CFO reiterated that they'll be spending $25 billion on CapEx. Their focus is on getting the new products up and running. Those products, which are autonomous vehicles, the Robotaxi ride-hailing app, and humanoid robots, which they're calling Optimus.
CEO Elon Musk said that cars will remain important to the company, but that those other projects will be what drives its next phase of growth.
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