WSJ : U.S. Delegation to Visit Greenland as White House Ramps Up Pressure on the

U.S. Delegation to Visit Greenland as White House Ramps Up Pressure on the Island
Greenland’s prime minister calls trip by U.S. national security adviser and vice president’s spouse ‘highly aggressive’

WASHINGTON—U.S. national security adviser Michael Waltz and second lady Usha Vance will travel to Greenland this week, the White House said Sunday, further straining relations over President Trump’s improbable vow to acquire the Danish territory “one way or the other.”

Greenland Prime Minister Múte Egede called the planned visit days before local elections “highly aggressive.” Energy Secretary Chris Wright is also expected to join Waltz, Vance and her son as part of the first high-level U.S. delegation to visit the self-governing island since Trump declared he wanted to take it over from Denmark.

“We are now at a level where it can in no way be characterized as a harmless visit from a politician’s wife,” Egede told the Greenland newspaper Sermitsiaq. “What is the national security adviser doing in Greenland? The only purpose is to demonstrate power over us.”

Both local lawmakers and the Danish government have expressed strong opposition to Trump’s overtures, insisting that the mineral-rich island of 57,000 residents, while open to stronger commercial ties with the U.S., isn’t interested in an American takeover.

In a three-day visit, the U.S. delegation will travel to historical sites to “learn about Greenlandic heritage” and attend the country’s national dogsled race, the Avannaata Qimussersu, which will feature more than 440 dogs, according to the White House.

“I’m coming to celebrate the long history of mutual respect and cooperation between our nations and to express hope that our relationship will only grow stronger in the coming years,” Vance said in a video posted to Instagram on Sunday. Vance visited Germany and France in February, along with her husband, Vice President JD Vance.

National Security Council spokesman Brian Hughes said the visit “should not be a surprise,” given America’s security interests in the Arctic. Waltz and Wright will visit a U.S. military base in northern Greenland, he said, adding that it is an “opportunity to build on partnerships that respects Greenland’s self-determination and advances economic cooperation.”

The president’s son Donald Trump Jr. visited the island in January in what local authorities referred to as a “private visit.”

Local elections in Greenland are set to take place on April 1. “It is clear that the Trump camp doesn’t respect our right to self-determination without outside interference,” Aaja Chemnitz, a Greenlandic member of the Danish Parliament, wrote on Facebook.

Greenland leaders said they had been approached to meet with the U.S. delegation and declined. “I can confirm that they have approached me and wanted to meet,” Malik Berthelsen, the mayor of Greenland’s second-largest city, Sisimiut, told local press. “As we are in the middle of the election campaign, I have kindly declined and suggested that we can meet after the election.”

When Trump first floated the idea of purchasing Greenland during his first term it was rejected by Denmark’s government as an “absurd” idea. He has pursued it more aggressively since returning to the presidency in January.

“We will keep you safe. We will make you rich. And together we will take Greenland to heights like you have never thought possible before,” he said in his speech to Congress earlier this month. He also raised the idea of a U.S. takeover with North Atlantic Treaty Organization Secretary-General Mark Rutte when he visited the White House this month.

In response, hundreds of Greenlanders took to the streets of the island’s capital earlier this month, waving the territory’s red and white flag, and holding signs that read “We aren’t for sale” and “Make America Go Away.”

Some Republicans in Congress have backed Trump’s proposal, introducing legislation dubbed the “Make Greenland Great Again Act,” that would authorize the U.S. government to acquire the territory, as well a separate measure, the “Red, White, and Blueland Act,” which seeks to rename the island.

The vice president accused Denmark of “not being a good ally” and allowing Chinese and Russian access to sea lanes. “How are we going to solve that problem, solve our own national security?” he said on Fox News last month. “If that means that we need to take more territorial interest in Greenland, that is what President Trump is going to do, because he doesn’t care what the Europeans scream at us.”

Only 6% of Greenlanders support becoming part of the U.S., according to a poll commissioned by the Danish paper Berlingske in January.

FT : The rise of Eurozone bond yields outside Germany is unwarranted

The rise of Eurozone bond yields outside Germany is unwarranted
It might be time to consider a pause in unwinding the ECB’s pandemic-era asset purchasing programme

Long bond yields in the Eurozone have risen sharply on the back of the “whatever it takes” fiscal measures presented by Germany’s chancellor-in-waiting, Friedrich Merz, on March 4. The benchmark 10-year Bund yield has jumped by about 0.25 percentage points since then.

The sell-off is warranted by fundamentals, given expectations for significantly stronger economic growth and government bond issuance. This is not true elsewhere in the region, where similar scaled debt-financed spending measures are not in the pipeline.

The welcome German measures won final approval last Friday, with relatively low import content from other euro area member states. As such, positive spillover from stronger German growth to the rest of the region is likely to be modest and is potentially even in danger of being more than offset by the sharp rise in bond yields. Soaring bond yields also add to governments’ debt servicing costs, adding to the challenges for member states in need of fiscal consolidation.

It is further worth noting that euro area bond yields are now around the levels that prevailed last June, just before the European Central Bank embarked upon its current monetary policy-easing cycle, which has now led to 1.50 percentage points of cuts to its key deposit rate. There is thus an argument to be made that euro area member states, outside Germany, are experiencing an “unwarranted” increase in bond yields. Zooming in on the major 10-year benchmark bond yields in the France, Italy and Spain, these have increased by about 0.25 percentage points since the announcement of the German measures.

The ECB’s toolkit has since the euro area debt crisis been expanded to deal primarily with unwarranted widening of euro sovereign bond yields relative to the German benchmarks, with notably the Outright Monetary Transactions and the Transmission Protection Instruments schemes. Neither tool has been used, but there is little doubt about their effectiveness.

OMT is the 2012 scheme to buy government bonds in potentially unlimited amounts if needed. It was the delivery on Mario Draghi’s July 2012 promise to do “whatever it takes” to preserve the euro as the then-ECB president. TPI, introduced in July 2022 in what Christine Lagarde, his successor, called a “historic moment”, marked a further addition to counter disorderly market dynamics. It allows the ECB to buy the bonds of a Eurozone country if is suffering from an increase in its borrowing costs beyond the level justified by economic fundamentals.


In theory, the TPI could be activated to counter the recent rise in bond yields in member states outside Germany, but this seems both unlikely and suboptimal. The TPI is widely understood to be a tool to counter disorderly spread movements in jurisdictions under market pressure and comes with the conditionality of respecting European fiscal rules. Using the tool outside this context may lead to market confusion.

And further rate cuts could prove a blunt instrument, if such moves were to merely to steepen the German bond yield curve, widening the gap between shorter and longer interest rates. Likewise if rate cuts steepened the yield curve farther by raising growth and inflation expectations in Germany.

There is thus a case to be made for a tool to deal with an unwarranted rise in long euro area bond yields that is driven by the de facto anchor for this market, Bunds.

Pausing so-called quantitative tightening — the unwinding of the long-running programme of bond buying to lower the costs of borrowing in order to stimulate the economy — could mark a first step. That could ease upside pressures on the premiums placed on longer-term bonds across the euro area over short-term debt.

A speech by ECB executive board member Piero Cipollone last month discussed the right balance for the ECB’s balance sheet and its implications for monetary policy. He cited survey data suggesting the potential for a greater impact from QT on Spain and Italy, compared with France and Germany, in lifting bond yields. If accurate, this asymmetry offers a case to pause QT.

A further avenue for the ECB involves its Pandemic Emergency Purchase Programme, a temporary asset purchase programme of private and public sector securities buying to offset the shock of the outbreak of Covid-19 in 2020. The ECB is letting those purchases “run off”, not reinvesting proceeds from maturing bonds. The central bank has said this process will be managed “to avoid interference with the appropriate monetary stance”. It may be time to consider that, at least pausing PEPP run-off outside Germany.

FT : Dealmakers reassess hopes for Trump bump as M&A slips to decade low

Dealmakers reassess hopes for Trump bump as M&A slips to decade low
Stock market falls and policy uncertainty from president’s administration have held back longed-for revival

Dealmakers are being forced to reassess expectations for a surge in activity this year, as stock market falls and policy uncertainty from the new Trump administration have held back takeovers and initial public offerings.

As the end of the first quarter approaches, the volume of takeovers globally has risen more slowly than many advisers expected at the end of last year when investment banking stocks hit record highs in anticipation of a “Trump bump”.

The number of deals announced since the start of January is the lowest in more than a decade, according to data from Dealogic. There have been about 6,600 global transactions announced so far this quarter, down almost 30 per cent on a year earlier and 44 per cent below the peak in 2021.

Wall Street has been trying to talk a dealmaking recovery into existence for two years after interest rate rises in 2022 killed off a pandemic-era boom. What started in 2023 as “green shoots” became “early innings” in 2024 and then “animal spirits” following Donald Trump’s victory in the US presidential elections in November. 

Yet with Trump pushing up tariffs and a changing of the guard at global competition regulators, companies are having a hard time planning their next factory, let alone takeover. 

US stock markets have been gripped by fears in recent weeks about the health of the domestic economy, with the blue-chip S&P 500 index down nearly 4 per cent so far this year.

The chair of the US Federal Communications Commission last week warned he could block deals from companies with “invidious forms of [diversity, equity and inclusion] discrimination”, while other antitrust officials such as Gail Slater are now expected to maintain a more vigorous approach to enforcement than Wall Street initially anticipated from the Trump administration.

“There is always uncertainty when a new administration comes to power, but the uncertainty today is well beyond whatever I’ve experienced before,” said Jonathan Corsico, who leads the law firm Simpson Thacher’s Washington DC M&A practice.

The value of takeover offers announced has increased by 14 per cent on the same period last year, to almost $812bn, the Dealogic data show. But the increase in value has been driven in part by a handful of megadeals.

This month Google parent Alphabet announced its largest ever acquisition, a $32bn deal to buy cyber security firm Wiz; BlackRock struck a $23bn agreement to buy dozens of ports — including two on the Panama Canal — as Hong Kong-based seller CK Hutchison faced pressure from Trump; and buyout group Sycamore Partners agreed a deal for pharmacy retailer Walgreens Boots Alliance.

Private equity firms, which are under pressure to sell assets and return cash to their backers, have also increased their activity. The value of so-called financial sponsor backed M&A reached $295bn, up from $160bn in the same period last year.

Activity has fallen short of the marked recovery for which advisers had been preparing after two years of muted dealmaking.

“We are experiencing an understandable delay in the M&A recovery,” said Evercore’s co-head of US investment banking, Naveen Nataraj, although he added that the bank still expected “a more active M&A environment as the year progresses, particularly as trade and foreign policy related uncertainty begin to clarify.”

Senior bankers and lawyers said that while there are plenty of discussions with clients about transactions, chief executives and boardrooms were cautious about finalising deals.

“The appetite to look at deals is strong but the appetite to execute deals is not the same,” said Piers Prichard Jones, an M&A partner and chair of the law firm Freshfields. “There is a thesis that things could change quite quickly but sitting here now I wouldn’t bet on that.” 

Initial public offerings have also failed to rebound as strongly as expected, even if companies such as CoreWeave, StubHub and Klarna are opting to proceed. So far this year IPO proceeds are only about a fifth higher than last year, according to data from the London Stock Exchange Group — well down on 2021 and 2022.

The lacklustre market has led some banks and law firms to adjust their hiring plans.

“Banks still want to hire top talent,” said Will Lahaise co-founder of executive search firm pltfrm. “But as we get to the end of the first quarter, several of our clients indicate that growth in hiring is stabilising rather than continuing the surge that many experienced at the beginning of the year.”

At Goldman Sachs, teams that have fewer live deals may not immediately replace junior bankers who are leaving, according to people familiar with the matter. Goldman declined to comment.

The level of market volatility has made it more difficult for buyers and sellers to agree on prices, although advisers said deals could be revived when more certainty emerged about antitrust policy, for example.

“It just feels like there’s less certainty on valuations than there was previously,” said Stephen Pick, Barclays’ head of M&A for Europe, the Mideast and Africa. “There’s a lot of transactions being sidelined or still on the back burner that can be resuscitated very quickly.”

FT : Nobel chief warns of growing threat to science and free inquiry

Nobel chief warns of growing threat to science and free inquiry
Nobel foundation director’s comments come as Trump cracks down on leading research agencies

The annual Nobel Prizes must “stand up” for scientific learning and free inquiry in an age when both are under growing threat, the new head of the foundation that oversees the honours has warned. 

The 124-year old awards’ task was ever more crucial because the spread of disinformation was undermining knowledge acquired by research, said Hanna Stjärne, Nobel Foundation executive director. 

While Stjärne did not criticise President Donald Trump’s administration directly, her remarks come in the context of a widening US official crackdown on leading research agencies, with Washington cutting funding and suppressing some areas of inquiry. 

“Our mission will always be to stand up for knowledge, and to stand up for the profound work that scientists do,” Stjärne said in an interview in her office in Stockholm, where a portrait of Alfred Nobel’s mother Andriette hangs beside her desk. “This task is even more important than it used to be, because in turbulent times people are seeking hope.”

The Nobel Prizes have long been on Trump’s radar. He has expressed frustration that he has not won the peace prize, but his predecessor Barack Obama did.

Trump said in February he deserved the honour for his work on ending the war in Gaza, but added that he believed the awards committee would never give it to him. National security adviser Mike Waltz separately predicted his boss would win it, including for his efforts to end the conflict in Ukraine. 

Asked whether she feared a new transatlantic row if Trump did not scoop the award when it is announced by the Norwegian Nobel Committee in October, Stjärne said: “There are so many people that want the Nobel Prizes. If you would look in my mailbox, you would find suggestions — a lot of suggestions — every day.”

The wider Nobel Prizes are likely to be even more closely watched than usual this year because of their potential to be seen as a commentary on contemporary political trends.

A US movement called “Stand Up for Science” is protesting against the planned funding cuts and reports of ideologically-driven curbs on research in areas such as diversity, climate change and vaccines. Trump has picked vaccine-sceptic Robert F Kennedy Jr to be health secretary.

The Nobel Foundation has a duty to “safeguard knowledge” and fight the “fast spread” of scientific disinformation that unfairly undermines research findings, said Stjärne, a former journalist and media executive who took office in January.

The prizes founded by dynamite inventor Alfred Nobel must embody “freedom of thought” and the “ability for scientists to work freely without restrictions,” she added.

The Nobel Prizes for medicine or physiology, physics and chemistry account for half the awards each year, with the others given for economics, literature and peace. 

Past science recipients include the theoretical physicist Albert Einstein, Marie Curie — the first-ever double Nobel winner — and Sir Alexander Fleming, who discovered the life-saving antibiotic penicillin.

Stjärne, the Nobel Foundation’s first female executive director, acknowledged criticisms of the three science awards for their lack of diversity. All seven of last year’s winners were men, while women account for just 26 of the more than 600 laureates named since the first awards in 1901.

The committees that award the science honours were “really aware of this criticism” and in an “ongoing discussion” about how to respond to it, Stjärne said. 

The prizes were often given for work done many years ago, when science was even more male-dominated than now, she added.   

Each Nobel award is decided by a special committee, with most of the prize nominations invited from thousands of researchers and others.

Nobel Peace Prize nominations can be made only by people who meet certain criteria, such as membership of national governments or legislatures. The prize committee has said it received 338 nominations for this year’s award by the January 31 deadline, although the names are kept confidential.

FT : Trump stirs fears of a new nuclear arms race

Trump stirs fears of a new nuclear arms race
Washington extended an atomic umbrella over its allies. Now some fear it may be time to seek their own weapons

During the cold war, the US and the Soviet Union were at least able to agree on one thing: nuclear proliferation was bad for everyone.

“Haunted” by the thought of a “spiralling nuclear arms race” around the world, US President John F Kennedy initiated talks in the 1960s on what would become the Non-Proliferation Treaty, a bargain between superpowers that has kept nuclear weapons states in single digits to this day.

The containment rested on the US extending its nuclear umbrella to convince allies they need not seek the weapons themselves.

Denis Healey, the late British minister, quipped that US nuclear policy only required “5 per cent credibility to deter the Russians, but 95 per cent to reassure the Europeans”.

Now, under Donald Trump, that assurance has never appeared weaker.

The US president’s pivot to Moscow and scathing disregard for Nato has prompted old allies — from Berlin and Warsaw to Seoul and Tokyo — to confront what was seemingly unthinkable: how to prepare for a potential withdrawal of their US nuclear shield.

“The fraying great power consensus on non-proliferation is real,” said Ankit Panda of the Carnegie Endowment think-tank and author of The New Nuclear Age. “The Trump phenomenon has provided a powerful accelerant for voices in US-allied states who now see nuclear weapons in their own hands as fundamentally solving the problem posed by American unreliability.”

Under the NPT, the number of official nuclear weapons states has been limited to the US, Russia, China, France and the UK — the five permanent members of the UN Security Council. India, Israel and Pakistan, which have never signed the pact, have also developed nuclear weapons, as has North Korea, the one country to leave the NPT.

Trump’s return to power has jolted debate across the western alliance. Analysts fear that if the NPT were to collapse, in part because of the withdrawal of US guarantees, the world may move closer to the 15-25 nuclear weapons states Kennedy foresaw — with a greater risk of a cataclysmic atomic war.

Lawrence Freedman, one of the foremost scholars of nuclear strategy, noted the dilemma for allies is an old one.

France’s weapons programme grew out of Charles de Gaulle’s assessment that Washington was unreliable. China, following its split with the USSR in the 1960s, made a similar calculation about Moscow.

But when US allies doubted Washington in the past, they looked at what developing alternatives entailed and realised that it is “difficult, expensive, and draws attention to themselves”.

“In the end, they lived with it,” Freedman said. “That’s been the position in the past. So the problem is, with the crisis this time of such severity, they’re not sure that they can.”

Germany
Friedrich Merz, Germany’s chancellor-in-waiting, said last month that Europe’s largest nation must now explore “whether nuclear sharing, or at least nuclear security from the UK and France, could also apply to us”.

That call, in itself historic, has triggered an unprecedented public debate that has even seen some analysts publicly ask whether Germany — whose postwar image is constructed around promoting peace in Europe and the world — should seek to obtain its own nuclear weapons.

Germany has hosted US nuclear weapons since 1983. Today, there are roughly 20 US B61 nuclear bombs held at the Büchel air base, about 100km south of the city of Cologne. 

German officials are at pains to stress that the US has given no indication it will withdraw this nuclear shield. Defence minister Boris Pistorius has described the debate as an “escalation in the discussion that we do not need”.

But privately, as they have reeled from the pace of events since Trump took office, some officials have begun wondering aloud whether Germany should consider getting its own nuclear weapons. 

Merz insisted earlier this month that such a scenario would not happen, pointing to two different international treaties that would prohibit it. 

Wolfgang Ischinger, a former German ambassador to Washington, said any real suggestion of Germany becoming a nuclear power would create a “shitstorm of unknown proportions from Moscow, from the [right-wing, anti-German] Law and Justice party in Poland, from other neighbours”.

He added: “We would risk losing most of the trust we have been able to build after the last five or six decades after the catastrophe of world war two.”

But Thorsten Benner, head of the Berlin-based Global Public Policy Institute, is one of several think-tank experts to have floated the idea that the country should at least “invest in maintaining nuclear latency” — a move that would mean putting the infrastructure in place to create a nuclear weapon if necessary without immediately building one.

The discussion, he said, was triggered by concerns about where the UK and France might be headed politically, particularly if Marine Le Pen were to win French elections in 2027. “Both the far left and far right in France are very anti-German and there would be a risk they would not honour a kind of nuclear sharing arrangement,” Benner said. “And then what?”

Poland
The debate in Poland has moved even faster with Prime Minister Donald Tusk this month becoming the country’s first leader to raise the idea of pursuing nuclear weapons, or at least seek a sharing agreement with France.

His political rival President Andrzej Duda responded by telling the Financial Times that it would be better to move US warheads to Poland — a move Moscow would see as a provocation that Washington has long resisted.

“There are suddenly lots of words and different opinions about what to do but they all show Poland believes in stronger nuclear deterrence against Russia,” said Marcin Idzik, a board director of PGZ, Poland’s state-controlled defence manufacturer.

Whether Poland has the ability to follow up on Duda or Tusk’s positions is another matter. US Vice-President JD Vance also told Fox News that he would be “shocked” if Trump agreed to relocate US weapons to Poland.

And while Poland once hosted nuclear warheads during the cold war — for Moscow rather than Washington — it has never had a civil nuclear plant. While it has committed to build one within a decade, it lacks the infrastructure and expertise of other European countries.

Duda argues Poland would need “decades” to develop its own nuclear weapons. That view is broadly shared among analysts and industry executives. Janusz Onyskiewicz, a former Polish defence minister, called Tusk’s proposal “certainly fairly hypothetical and not for the present situation”.

“For us to build nuclear weapons from scratch is too costly and we don’t have enough time to do it,” said Idzik from PGZ. “But if we can be a part of a new European team and nuclear project, of course we want to be part of this.”

South Korea
The unrelenting progress of North Korea’s own nuclear weapons programme, Pyongyang’s blossoming relationship with Moscow, and Trump’s return to power have all fuelled deep anxiety in South Korea over its security.

“Support for South Korea acquiring its own nuclear weapons is broadening, and it is hardening,” said Sangsin Lee, a research fellow at the state-affiliated Korea Institute for National Unification think-tank.

While neither mainstream party has championed such a move, leaders on both sides have advocated the pursuit of “nuclear latency” so Seoul could build or acquire nuclear weapons at short notice.

Oh Se-hoon, the conservative mayor of Seoul tipped as a possible presidential contender, earlier this month called for the US to allow South Korea to acquire a stockpile of nuclear material similar to Japan’s, giving Seoul “nuclear threshold” status.

Oh’s remarks came soon after foreign minister Cho Tae-yul told parliament that acquiring nuclear weapons was “not off the table”. “We must prepare for all possible scenarios,” he said.

South Korea already has the highest density of civil nuclear reactors in the world. “Korea has the basic technology to make nuclear weapons and already has experience of making a very small volume of plutonium and uranium,” said Suh Kyun-ryul, professor emeritus of nuclear engineering at Seoul National University.

“It has the technology to make crude nuclear bombs — similar to those dropped in Hiroshima and Nagasaki — within three months.”

Lee Chun-geun, a researcher at Korea Institute of Science & Technology Evaluation and Planning, said that in addition to acquiring sufficient nuclear material, South Korea would also “need to make a detonator and nuclear warheads, as well as conduct nuclear tests”.

“If it declares a national emergency and mobilises all national resources, it can make nuclear weapons in about two years,” said Lee.

While South Korea has between two and three years’ worth of nuclear material stockpiled, its supply would likely be cut off as a result of withdrawing from the NPT, he said. South Korea’s export economy would also struggle to withstand any economic sanctions that followed.

But Suh of Seoul National University said the Trump presidency offered South Korea a “rare opportunity to negotiate with the US to develop nuclear weapons”.

“South Koreans will ultimately have to choose between being taken over by North Korea or withstanding international sanctions by making its own nuclear bombs, because denuclearising North Korea looks impossible,” said Suh.

Japan
Japan’s unique status as the only country to have been the victim of atomic warfare has made the question of obtaining nuclear weapons, throughout its postwar history, perhaps the greatest political taboo.

At the same time, there has long been a quiet version of the debate in some circles: one that has evolved as North Korea became a nuclear power, China became more militarily assertive, and Trump has thrown into question the reliability of the US nuclear umbrella.

One senior Japanese official said there had always been discussion on the matter among a small group of the most hawkish politicians. “The circle of participants may now be enlarging.”

Japan was an early signatory to the NPT, but its peaceful use of nuclear energy and the opening of an enrichment plant online in the early 1990s has also given it a significant stockpile of material that could be used to build a weapon of its own.

Japan’s massive, sophisticated industrial base, and its leadership in many areas of specialised engineering, say US military experts, mean the physical construction of a weapon would be well within its capabilities, possibly within just a few months of receiving a political green light.

Japan’s most recent report showed that at the end of 2023, Japan held around 8.6 tons of plutonium domestically — enough, in theory, to produce several thousands bombs. That fact has not been lost on China, which has in the past used state media to question Japan’s possession of so much material.

But the psychological and political distance that would need to be bridged to seriously contemplate such a move is, even now, immense. In the Article 9 “peace clause” of its constitution, the Japanese people “forever renounce war as a sovereign right of the nation”: while reinterpretations of the clause have allowed Japan to build and maintain significant conventional military forces, the complexities around a nuclear deterrent remain a stretch.

“For now the whole strategy is built around securing the assurance from the US that Japan still sits under its nuclear umbrella,” said Stephen Nagy, professor of politics and International Studies at the International Christian University of Tokyo. “Plan A is to hug the US. Plan B is to hug the US harder, and so on. Plan Z, at this point, is to obtain nuclear weapons.”

Nagy added that any significant movement on the nuclear debate would also expose Japan’s extreme shortage of strategic thinkers on the issue. The long reliance on the US has, in effect, left only a tiny pool of Japanese experts capable of guiding Japanese policy on the use of nuclear weapons.

That is critical, said Nagy, because of the clear differences between the way continental US has built the strategy of deterrence and how Japan would have to fashion its own.

Japan, he noted, would receive about five minutes warning in the event of an attack by North Korea or China, versus the 30-minute warning time that the US would have if attacked.

The US as a nation would survive an attack on one or two cities; Japan would in effect be destroyed as a nation if Tokyo and Osaka were annihilated. The taboo in Japan remains strong not just because of what happened in the past, he said, but because questions of nuclear strategy are such a different game, and force such tough questions on the nation.

FT : EU watchdogs warn that weakening rules risks another financial crash

EU watchdogs warn that weakening rules risks another financial crash
Financial supervisors issue unusual warning as EU prepares to simplify regulation

Europe’s drive to simplify and streamline financial regulation is making top supervisors nervous about the risk of key safeguards being watered down. 

Two of the EU’s most senior financial supervisors told the Financial Times they were determined to avoid crisis prevention measures being swept away in the push to revive the region’s sluggish economic growth.

“If it is about deregulating and lowering the bar on financial protections, we will not be ready to tackle volatility.’’ said Dominique Laboureix, head of the Single Resolution Board — which handles failing Eurozone banks. ‘‘That means crises, which means less growth.”

The pointed intervention, which is uncommon for the watchdogs, comes after the European Commission recently announced plans to drastically cut the scope of business sustainability disclosure rules it introduced two years ago. It is also reviewing capital rules for banks and insurers as part of plans to boost financial market activity and growth.

Some officials want Brussels to go further. The heads of the German, French, Spanish and Italian central banks wrote to the commission recently calling on it to remove “unduly complex” areas of financial rules that distort international competition without improving financial stability.

Laboureix said he was “absolutely ready” to engage with calls for the burden of regulation to be eased. But he warned policymakers not to forget the lessons of the last big banking sector meltdown. “Don’t forget the 2008 crisis. What did that mean? Bailouts everywhere.”

“I am ready to discuss simplification, but I am not ready to lower the bar in terms of protecting financial stability,” Laboureix said in an interview.

Frank Elderson, vice-chair of the ECB supervisory board, pointed out that after the 2008 financial crisis Eurozone governments spent €1.5tn in capital support and €3.7tn in liquidity support for the financial system. Europe’s economy shrank 4.3 per cent in 2009 as the crisis took its toll.

“It’s good to remember why we did that in the first place,” Elderson said in an interview, adding: “We need not be complacent and say the next decade will be rosy — so we have to be wary about doing away with supervisory functions that could lead to this situation repeating itself.”

Elderson told a banking conference in London last week: “The debate on competitiveness should not be used as a pretext for watering down regulation.”

Instead of lowering regulatory requirements he said the EU should focus on harmonising them across its 27 members. “Don’t cut rules, harmonise them,” he said.

The ECB executive told the FT he supported “simplification in a nuanced way” of sustainability disclosure rules, but he warned if this went too far it could deprive banks of the information they need from companies to assess their own exposure to climate change risks.

“Was all this perfect? Probably not,” he said. “Can we do better without paying too much of a price? Possibly.” But he added: “If it were to lead to banks not having the data they need to assess these risks, that would be a problem for banks and would make our work as a supervisor more difficult.”

The ECB has been pushing Eurozone banks to address risks from floods, droughts, wildfires and the transition away from fossil fuels, threatening to fine those that drag their feet.

The central bank has the power to impose “periodic penalty payments” on lenders worth up to 5 per cent of their average daily turnover every day for up to six months.

Elderson said there were “a few banks” for which such penalties were still “a concrete possibility” after they missed the first of a series of deadlines to take steps to tackle climate risks in their balance sheets. 

“There are a small number” of other banks that have been told they could also face penalties for missing the ECB’s second deadline on climate action set for the end of 2023, he said. A final deadline expired so recently it is “too early to say” if any banks could be fined over this.

FT : Turning round Rolls-Royce: ‘If you don’t score quickly, you lose people’

Turning round Rolls-Royce: ‘If you don’t score quickly, you lose people’
How CEO Tufan Erginbilgiç restored growth at the 119-year-old British engineering group

Tufan Erginbilgiç took the helm of Rolls-Royce as a relative unknown, viewed by many as an unexpected appointment to one of the most prominent jobs in British industry.

Two years on, investors in the engineering champion, whose engines power many of the world’s biggest airliners as well as submarines and military jets, know exactly who Erginbilgiç is. Rolls-Royce’s share price has risen eightfold since he started as chief executive in January 2023 and dividend payments have resumed. Full-year figures published last month showed the company was on track to hit its underlying operating profit and free cash flow guidance two years ahead of plan.

The speed of the turnaround has stunned long-term followers of the 119-year-old company, whose recent history before Erginbilgiç’s arrival was marked by profit warnings, a series of unsuccessful restructurings and a monumental blow from Covid-19. The pandemic stopped airlines flying and crippled Rolls-Royce’s revenues.

The company, says Erginbilgiç in an interview at the group’s London headquarters, was “absolutely a turnaround candidate”. The former BP executive took the job not to embark on another restructuring but to engineer a full-scale transformation: “Some people think it was about Covid. I actually went 10 years back. It wasn’t about Covid. This company had struggled for a while,” he says. 

“Our vision is to create a company that is high performing, competitive, resilient and growing. I would argue Rolls-Royce was hardly any of that, at any time.”

A recovery was perhaps always on the cards once flying resumed after the pandemic. But Erginbilgiç dismisses the idea he has been a lucky general. That argument is “not credible any more”. Engine flying hours last year — a key metric for Rolls-Royce as it makes most of its money when its engines are in the air — were 103 per cent of 2019 levels. Operating margins, a measure of profitability, in its civil aerospace business have done much better — 16.6 per cent, up from 2.5 per cent in 2022. 

Similarly, he points out, in Rolls-Royce’s power systems division, where “flying hours don’t matter” as it builds diesel and gas engines used in ships and power generation, profitability has doubled.

What is clear is that Erginbilgiç did his homework before starting the job. From September 2022, he spoke to shareholders, visited sites and even paid an external consultant for a benchmarking exercise against competitors so he could hit the ground running. Investors, he says, were impatient to see results after years of frustration. By the time he started, he knew what needed to be done.

The chief executive identified seven areas of improvement, including reducing working capital, increasing efficiency and optimising commercial terms. Erginbilgic had already begun to renegotiate lossmaking sales and supply contracts with airline customers. 

Management changes followed, as did 2,500 job losses among ranks of middle managers. Erginbilgiç has appointed new heads to lead Rolls-Royce’s commercial aerospace division, its defence unit and the power systems business. He also brought in a new chief financial officer from BP. 

This is the third transformation for Erginbilgiç, a British and Turkish national with a background in engineering. At BP, where he spent more than 20 years, including five years in its executive team, former colleagues credit him for being a good operator with a record for delivery, notably in turning round the oil company’s refining and marketing business. He left the oil major in 2020 for a role in private equity after losing out on the top job to Bernard Looney.

“I actually learnt by doing . . . you know what works, what doesn’t work that well and then you sort of build that,” says Erginbilgiç.

Rolls-Royce’s transformation is underpinned by a carefully worked out framework of four “pillars” — an approach he has used before. The first of these, Erginbilgiç describes as “holding up a mirror” to make clear to staff the reality of the company’s position. Shortly after arriving he told staff Rolls-Royce was a “burning platform” and this was “our last chance”.

The bleak assessment shocked many but Erginbilgiç insists the purpose was not to depress his employees but to show them the reality of the situation, backed up by data he had gathered. He says he had gone on to talk about his vision for the group.

“Everything has a purpose here. Transformations don’t happen by being a cowboy.”

Given the size of Rolls-Royce’s workforce — it employs around 42,000 people — “you need to reorient people . . . and you need to be very clear”.

His second pillar is to set a clear, granular strategy that engages employees. “If you don’t have a strategy that can cascade down to 42,000 people it won’t get delivered,” he says. 

Rather than developing its strategy in a “dark room with consultants,” Rolls-Royce held workshops with around 500 employees to brainstorm options and decide on the best path. Strategy, he says, can “often become too tidy . . . you need to make it chaotic” to allow different options to emerge.

He describes his third pillar as “performance management” — which flows from the strategy and is about how you manage the business, with very clear targets. The fourth is to do all three with “pace and intensity” to show you are delivering.  

“If you don’t put scores on the board quickly, you will lose people,” he says. “When you continue to deliver, suddenly more and more people believe.”

Erginbilgiç acknowledges the process is “intense” but in a “very positive way”. “People are very energised.” Rolls-Royce, he adds, did not lose anyone he wanted to keep during the transformation.

Today, the company tracks 17 strategic initiatives. “Everybody knows what to do,” he says. One of the initiatives is to improve “time on wing” of its large engines — the longer they are in the air, rather than on the ground getting serviced, the more money Rolls-Royce earns. 

Erginbilgiç’s time in charge has not all been plain sailing. There has been criticism from some of its big airline customers — notably British Airways — about the performance and reliability of some engines. Some industry insiders have also pointed out the potential risks of being too ruthless in renegotiating contracts.

Erginbilgiç says he would “never” describe himself as ruthless. “I am a good operator and I am a strategic thinker,” he counters. 

It is not easy to see where this personal drive comes from: Erginbilgiç is reluctant to talk about himself. His father was in the Turkish military and his mother still lives in Istanbul. He is more comfortable talking about his interest in playing competitive tennis. “I go out there to win. But if I played brilliantly that day and I still lost, I am happy. I need a purpose.”

Last month, he set even more ambitious financial targets, and is keenly aware of a big challenge facing the company. Boeing and Airbus have begun work on new versions of their best-selling single-aisle aircraft, the 737 and A320 respectively. Rolls-Royce does not power either of the current aircraft — its engines exclusively power larger wide-body jets — and the company would love to provide engines for the next generation of single aisle jets.

It is an enormous commercial opportunity, and Rolls-Royce thinks it has the right technology — UltraFan, a new, fuel-efficient engine. It has started work on a scaled-down demonstrator of the engine it wants to offer for the next generation of single-aisle jets.

The scale of the challenge is such, however, that the company is unlikely to go it alone, and will seek a commercial partnership. “Everybody is talking to us and we are talking to everybody,” Erginbilgiç says.

Harsh Jhaveri, investment analyst at Orbis Investments, which bought into Rolls-Royce nearly 10 years ago and owns 0.9 per cent of the company, says the company has made “outstanding progress on its transformation”. 

Orbis, Jhaveri adds, had been “encouraged by the push to institutionalise a performance-driven culture,” adding that it would like to see the team capture growth in existing business and new areas including its small modular reactor business and narrow-body engines. 

Erginbilgiç is adamant the revived Rolls-Royce will grow with or without a return to the narrow-body market. In defence, the company is involved in the trilateral Aukus submarine programme between the UK, the US and Australia. Military spending is also on the rise.

One uncertainty on the horizon is the impact from Donald Trump’s trade war. Rolls-Royce is assessing whether it could increase production for US customers at some of its sites in America as a way of limiting the damage done by any levies. The Department of Defense, Boeing and Lockheed Martin are among its key US customers. Rolls-Royce also builds diesel generators used to generate power for data centres in the US.

Asked how he would like to see the company positioned whenever he decides to leave — he is 65 — Erginbilgiç says he wants it to be “really sustainably distinctive”. Analysts have speculated he may look to retire after 2028 — he has lucrative share awards that vest in 2027 and 2028.

After years of the company not delivering, Erginbilgiç says he and his team are “unlocking the potential” of the venerable Rolls-Royce name. “We are now catching up with our brand.”

The New Yorker : Inside Trump and Musk’s Takeover of NASA

Inside Trump and Musk’s Takeover of NASA
So far, NASA has been spared the sweeping cuts that DOGE has unleashed on other federal agencies. Is that about to change?

On January 20th, in his Inaugural Address, Donald Trump spoke rapturously about space exploration. “We will pursue our manifest destiny into the stars, launching American astronauts to plant the Stars and Stripes on the planet Mars,” he said. Later that day, Elon Musk, owner of the aerospace firm SpaceX and a longtime proponent of Mars settlement, addressed a post-Inauguration celebration. The President had made him the leader of the Department of Government Efficiency (DOGE), which was about to start slashing the federal bureaucracy. “It is thanks to you that the future of civilization is assured,” Musk told Trump supporters. “We’re going to take DOGE to Mars.”

NASA headquarters, in Washington, D.C., observed Inauguration Day as a holiday, but many of its employees worked anyway. The agency had astronauts in orbit, rockets to launch, and astronomical data to decipher. Major changes were coming, however. Bill Nelson, the administrator of NASA under the Biden Administration, stepped down from his post. NASA had briefly indicated that Jim Free, its highest-ranking civil servant, would take over as interim director while Trump’s nominee, the billionaire and private astronaut Jared Isaacman, awaited Senate confirmation. But, at 9:41 P.M., an e-mail was sent to NASA employees with the subject line “A Message from Acting Administrator Janet Petro.” Free had been passed over, though it wasn’t clear why. Petro, a graduate of West Point, had previously overseen the Kennedy Space Center, in Florida. She introduced herself by saying, “We do hard things every day, and this will be no different.”

The hard things began on January 22nd. In a second e-mail, Petro announced that NASA would be complying with an executive order by shutting down all contracts and offices related to Diversity, Equity, Inclusion, and Accessibility (D.E.I.A.). “These programs divided Americans by race, wasted taxpayer dollars, and resulted in shameful discrimination,” Petro wrote. Many federal agencies had sent out similar letters, but she signed her name to it. (Fox News later reported that such programs had cost thirteen million dollars between 2021 and 2024—which, if true, would be on the order of one ten-thousandth of NASA spending.) During the first Trump Administration, NASA’s strategic plan had prioritized the targeted recruitment of a diverse workforce; managers within the agency had been tasked with advancing equal-employment opportunities and implementing D.E.I. policies. But the second Trump Administration would punish people who had carried out these orders.

At NASA headquarters, a longtime employee read Petro’s message at her desk, dumbfounded. She went straight to a friend’s office. “What the fnck?” the employee mouthed.

The friend motioned at her to come in and close the door. They found one detail in Petro’s e-mail particularly chilling: NASA employees were to report co-workers who edited D.E.I.A. descriptors out of job titles or contracts. Failure to do so within ten days would result in “adverse consequences.” “Where are we working that this is what we are doing?” the employee said. They wondered aloud whether Petro deserved a measure of sympathy; she was the first woman to lead NASA, and wouldn’t the D.E.I.A. letter have gone out regardless of who was in the job? Then they began to discuss some samples from outer space. This was NASA, after all, and the work went on.

NASA headquarters, a bland stone office building that is currently owned by a Korean investment firm, is situated a few blocks southeast of the National Mall. Darren Bossie, the new White House liaison to NASA, arrived shortly after Trump’s Inauguration. Bossie was more or less unknown at the agency, but employees soon found his LinkedIn profile. He had spent four of the past seven years bouncing around conservative politics, with a stint as Trump’s White House liaison to the Department of Veterans Affairs, and had worked as a senior consultant for unnamed companies. For the bulk of his professional life, however—from 2006 to 2018—he had been an assistant manager at a Total Wine & More in Palm Beach County, Florida. “That didn’t seem very promising,” a senior NASA official told me. (A total of seven current and outgoing NASA employees spoke with me on condition of anonymity, citing fears of retaliation.)

In hopes of understanding Bossie’s ascent to the national stage, I called every Total Wine & More location in Palm Beach County and spoke to half a dozen employees. One of them worked briefly with Bossie but could tell me only that he was knowledgeable about wine, good with people, and efficient. The others didn’t recognize his name.

A review of public records, however, suggested that Darren is the brother of David N. Bossie, the president of Citizens United—the conservative group whose litigation before the Supreme Court empowered mega-donors and corporations to make unlimited contributions to political candidates. During Trump’s first Presidential run, David was the deputy manager of the campaign; in 2017 and 2018, he was known for fund-raising efforts in support of conservative candidates. During that period, his brother was hired into what appears to have been his first federal job—deputy director of the Office of Secretarial Boards and Councils at the Department of Energy. (In 2019, Trump distanced himself from David Bossie after he was accused of profiting off the President’s likeness; at the time, David said he was being “unfairly targeted by left-wing smear tactics.”) In response to questions, a White House official said that Darren Bossie has “extensive experience” and “is playing a key role in ensuring NASA realigns its priorities to deliver on [Trump’s] vision.”

Shortly after President Trump began his second term, he directed all federal employees to return to the office for in-person work. His Administration also gave agencies four days to share lists of various “probationary” employees—typically those with less than one or two years of service—with the Office of Personnel Management. The memo noted that probationary employees could be terminated without triggering an appeals process; it didn’t take a rocket scientist (seventh floor, perhaps?) to see what Trump wanted. “One plus one equals fire them,” a NASA manager said.

On January 28th, the O.P.M. sent an e-mail with the subject line “A Fork in the Road” to more than two million federal employees. It contained a pre-written “deferred resignation” letter. By replying with the word “resign,” workers could instantly accept administrative leave but, the e-mail claimed, maintain full salaries, benefits, and retirement accruals until September 30th. (An e-mail with the same subject line had gone out to Twitter employees after Musk took over the company.) It was a one-time offer. Employees had a little over a week to decide.

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When Trump’s second term began, about a third of the employees at NASA headquarters typically worked in the office. Because the agency encompasses more than a hundred and fifty active missions at twenty major centers and facilities, many staffers spend their days on video calls. Over the course of several weeks, however, workers began to show up. Bossie walked the hallways and dropped in on meetings. “If you leave your office, put a Post-it note on the door,” the manager and others were advised. “Put several. Look busy.”

Staffers told me that water-cooler conversations had changed for the worse. The longtime employee heard tell that people were actually e-mailing the address from the January 22nd message and ratting each other out. NASA employees had historically put everything important into writing, but some higher-ups were now trying not to document anything that might invite scrutiny, and some staffers were following suit. Group chats proliferated on Signal, the encrypted-messaging app. Some had hundreds of members.

Two of my sources said that, in early February, an unfamiliar man walked around the Science Mission Directorate, the NASA branch that oversees space telescopes, Mars rovers, and other robotic missions. He was seemingly taking pictures of pride flags in employee workspaces. One of them heard that it was Bossie. According to the manager, a supervisor passed along a verbal instruction: “Scrub the area so that nobody gets fired.” Asked for comment, a White House official said that Bossie was documenting empty offices. “While he did notice the flags—including Biden-Harris, Ukraine, and pride flags—he never recommended enforcing removal of them,” the official said.

On February 7th, NASA employees again received “A Message from Acting Administrator Janet Petro.” “I know the recent executive orders and subsequent guidance are weighing on many of you,” she wrote. She noted the fortitude and dedication of NASA employees, then got down to business. The deferred-resignation offer—what some NASA scientists were calling “the derp”—had been extended. Employees were no longer able to note their pronouns in e-mail addresses and signature lines. “Taking some inspiration from the spirit of the ‘Department of Government Efficiency (DOGE),’ ” Petro wrote, “NASA should lean into this opportunity to maximize efficiencies” and “find new ways to work smarter.”

Next came an executive order that outlined a “Workforce Optimization Initiative” led by DOGE. It instructed federal agencies to prepare “large-scale reductions in force.” They were to prioritize the termination of anyone whose job was not legally mandated, including those who worked on D.E.I.A. and those who were not designated as “essential” during government shutdowns. DOGE would soon arrive at NASA headquarters.

By Tuesday, February 21st, about nine hundred of NASA’s eighteen thousand employees—five per cent of the agency’s workforce—had accepted deferred resignation. “NASA lost some folks that are true, worldwide-acknowledged experts in their field,” a leader at the agency told me. “You scare people into retiring, and it’s not just that NASA will be slower without them. We are going to lose entire abilities. We don’t understand the long-term implications in a field that’s this hard until it’s too late.”

In recent years, NASA and Elon Musk have become increasingly interdependent. Today, the agency is almost completely reliant on his rockets to launch astronauts to the International Space Station and probes to the outer solar system. SpaceX is one of NASA’s largest contractors—they are building the agency’s crewed moon landers, and would inevitably be central to an American Mars-colonization program. The company’s research and development efforts have often depended on outside investors, and Jared Isaacman, the presumptive future administrator of NASA, reportedly paid hundreds of millions of dollars for multiple trips to space on Musk’s rockets. In late January, Petro announced that Michael Altenhofen, who she said spent fifteen years at SpaceX, was now a senior adviser to the NASA administrator.

NASA has robust conflict-of-interest policies based in the U.S. legal code, but any influence that Musk exerts over his largest customer will call into question NASA’s independence. It’s unclear whether his enthusiasm for space exploration, and his influence with Trump, could help shield the agency from sweeping cuts—or encourage Musk to remake it in his image. Right now NASA doesn’t appear to have the money to pursue its existing lunar program and the Mars program that Musk envisions, and this suggests that a reckoning could be coming.

DOGE has gained notoriety for employing inexperienced and college-age engineers, but its first emissary to NASA was a fortysomething founder of an investment-management fund, Scott M. Coulter. Coulter arrived on Wednesday, February 12th; he appeared to interact only with high-level NASA personnel who work on the ninth floor, and seemed most concerned with federal contracts. By the following week, he had moved on to the Social Security Administration.

The Office of Personnel Management gave federal agencies a deadline of Monday, February 17th—President’s Day—to fire any probationary employees who were not considered mission-critical. (Such employees are often nicknamed “probies.”) But managers were also instructed to rank such workers and, later, to include a justification for anyone who should be kept. “They didn’t know we had to rank them, because that’s horrible,” the manager told me. Many probationary employees in the Science Mission Directorate, expecting not to come back the following week, spent Valentine’s Day and the weekend organizing their work and sending it to others, unprompted. “That made me feel like a bigger sack of shit,” the manager said.

NASA leadership was contemplating cutting as many as thirteen hundred probationary employees, according to reports. At a graying agency where employees cultivate hyper-specific skill sets, every loss, from senior executive to intern, is felt. “Space flight is an art,” the NASA leader told me. Written procedures only go so far. “The fact that Pin 38 on some connector has to be installed at an angle because you’ll scratch Pin 40—that’s never in a procedure. That’s the kind of knowledge you don’t even know you have until you need it, and you can only learn it by watching others.”

Across a series of tense meetings in the first half of February, a small number of senior NASA leaders tried to persuade Acting Administrator Petro to push back forcefully against the order to fire probationary employees. Two of my sources told me that, at one point, Nicola (Nicky) Fox, the leader of NASA’s Science Mission Directorate, and others argued that missions were going to fail—not years in the future but potentially weeks in the future. (The White House official said that my sources’ account was “not accurate.”) Some workers whose jobs were at risk were at Vandenberg Space Force Base, in California, and Kennedy Space Center, in Florida, where spacecraft were being prepped to be launched within weeks. Would they be able to devote all of their focus to life-and-death duties, or would they be worrying about looming mortgage and tuition payments?

According to my sources, Petro listened to the arguments. O.K., she said: We’re going to say we don’t have any expendable workers. It was a bold decision: the Trump Administration would have no qualms about firing an interim appointee such as Petro. (On Tuesday, February 18th, the National Science Foundation had held an emergency Zoom meeting during which it fired a hundred and seventy people—ten per cent of its workforce.) NASA’s scientists and engineers waited for their own Zoom invite, but it never came. The Office of Personnel Management must have accepted her recommendation.

The O.P.M. declined to comment and referred The New Yorker to NASA; NASA, in turn, did not answer written questions or return phone calls. Instead, the White House official responded. “NASA’s probationary employees were not dismissed because as the administration has said, those with mission critical roles will remain in their jobs,” the official wrote. “DOGE’s mission is to make the government more efficient, not eliminate hardworking, innovative employees.”

In mid-February, a new DOGE official turned up at NASA headquarters. Riley Sennott, a twentysomething tech worker with reported ties to Musk’s electric-vehicle company, Tesla, was processed into the agency as a senior adviser in the ninth-floor administrator’s suite. Rumors spread quickly. “What does he look like?” the NASA manager asked a colleague. He was said to have acne and wear business casual—blazer, button-down, no tie—but no one could say what he looked like. A third DOGE representative later arrived: Alexander Simonpour, reportedly an engineering manager from Tesla.

On February 22nd, the Office of Personnel Management instructed federal workers to “reply to this e-mail with approx. 5 bullets of what you accomplished last week and cc your manager.” My sources described the e-mail as maddeningly amateurish, which is to say that they took it as a legitimate O.P.M. communiqué. But “A Message from Acting Administrator Janet Petro” soon followed. “You are not required to respond, and there is no impact to your employment with the agency if you choose not to respond,” Petro wrote. Apparently, the acting administrator had changed her approach. My sources were divided on whether Petro was a hero or a villain; one praised her for protecting the probationary employees, but I was also sent screenshots of texts and e-mails that denounced her for advancing the agenda of the Trump Administration.

A week later, the courts caught up with the Office of Personnel Management. In one of several legal setbacks for the Trump Administration, a federal judge ruled that a mass firing of probationary workers would be unlawful. According to reports, U.S. District Judge William Alsup said, “OPM does not have any authority whatsoever under any statute in the history of the universe to hire and fire employees within another agency.” (About half of the fired National Science Foundation workers were eventually reinstated.) The manager felt that two phases of DOGE’s cost-cutting were over. If the first phase was about intimidating workers into leaving—ending diversity efforts, forcing a return to office, and threatening terminations while dangling the derp—then the second was about eliminating the easiest-to-fire employees. At NASA, this phase had largely failed.

But my sources anticipated that a more drastic third phase—“reductions in force” that are shrinking numerous federal agencies—would cut significant numbers from NASA’s workforce, not by targeting individual employees but, rather, by eliminating their positions altogether. NASA encompasses eighteen thousand people who work in such places as Huntsville, Alabama; southern Mississippi; and Houston. The Trump Administration could trim twigs from its org chart, or take an axe and lop off entire limbs, erasing whole offices. An early data point came in the beginning of March. After a meeting that involved Sennott, from DOGE, NASA leaders decided to eliminate the Office of the Chief Scientist, a team of six that gave unbiased scientific advice to the administrator. “Now that ability is gone,” the senior official told me. The outgoing chief scientist was also the agency’s climate adviser. The Office of Technology, Policy, and Strategy was dissolved, too. In total, NASA fired twenty-three people at headquarters, including several who worked for a D.E.I.A. office. Employees were not offered the chance of reassignment elsewhere in the agency; they were given thirty days of notice even though sixty is customary.

More layoffs were sure to come. Agency leaders have been meeting with DOGE officials and are collecting information from various departments as they develop a reductions-in-force plan. (NASA was given an extension for submitting its plan to the Trump Administration.) My sources warned of the potential consequences. “As soon as we lose our values, we’re going to kill somebody,” the NASA leader said. “We’re going to blow up a spacecraft.” They added that China’s space program—including its scientific research efforts—is growing rapidly. “If you want to give up your leadership in space, you do what the Administration is doing right now,” the leader went on. “A cut to research doesn’t just affect this year’s budget,” he said. “That’s funding for the person studying dark matter in a black hole at some university. And their Nobel Prize in thirty years is out the window.”

On March 7th, a nonprofit awarded NASA the title “Best Place to Work in the Federal Government” for the thirteenth consecutive year. But nobody seems to care about that anymore, the manager told me. NASA is not the same organization that it was two months ago. Its civil servants have a track record of working fifty-to-sixty-hour weeks, based on spacecraft trajectories rather than terrestrial clocks. Perhaps no longer. “Why should anyone give up hours of personal time every week for an Administration that says you’re dirt?” the manager said. Resignations, layoffs, and disruptions are likely to affect NASA’s work far into the future. “A mistake made today might not come to fruition, so to speak, until an astronaut is on the surface of the moon in a few years,” the manager told me. “Do you want to be the Administration that killed astronauts?”