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The Morning Risk Report: Farmland Becomes Flashpoint in U.S.-China Relations
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Good morning. For more than two years, the mayor of Grand Forks, N.D., backed a Chinese company’s plans to build a $700 million corn mill on the outskirts of town, citing the prospect of new jobs, added tax revenue and another place for farmers to sell their corn.
Then last week Brandon Bochenski reversed course, hours after the release of a letter from an Air Force official declaring the corn-mill project a security risk because of its proximity to the Grand Forks Air Force Base 12 miles away.
“When it comes to national security, I don’t think the economics matter,” said Mr. Bochenski, a former professional hockey player who previously played in Russia and was elected mayor in 2020. “You’ve got to draw a hard line there.”
Mr. Bochenski said he and other officials who had supported the project would now block the development by the U.S. branch of Fufeng Group Ltd., which still owns the 370 acres of land. Fufeng didn’t respond to a request for comment on what steps it may take.
The episode reflects intensifying concerns over whether the U.S. should be restricting the ability of foreigners, particularly from China, to buy American farmland or agricultural businesses.
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Content from our Sponsor: DELOITTE
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How Boards Can Help Companies Avoid the M&A Synergy Trap
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By exercising their responsibilities and providing advice and perspective, boards can help increase shareholder value and ultimately improve the odds of success in M&A efforts. Read More ›
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Rep. Jason Smith, who represents southeastern Missouri, said his policies will focus on ‘real Americans’ over large corporations. PHOTO: ANNA MONEYMAKER/GETTY IMAGES
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Meet the GOP's new tax legislator. Rep. Jason Smith (R., Mo.), the House’s new top tax writer, is promoting an approach he says would favor working-class Americans over large corporations, a shift in tone from his predecessors that raises questions about companies’ ability to push tax cuts through Congress.
As the leading House lawmaker on tax legislation, Mr. Smith's focus could make it harder for corporations to draw attention to their tax-policy goals, such as trying to revive recently expired tax breaks or blocking tax increases on multinational companies that are scheduled to start in 2026. The new chairman said he might hold hearings probing large companies and their ties to China.
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In other compliance-related news...
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A South Carolina judge ruled Monday that prosecutors can present evidence of alleged financial crimes committed by Alex Murdaugh as part of his continuing double-murder trial.
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Air-safety regulators are seeking to fine United Airlines Holdings Inc. more than $1.1 million for allegedly flying its Boeing 777 aircraft without conducting certain required checks of a fire-detection system.
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Robinhood Markets Inc., facing a dire threat from a regulatory plan to overhaul the handling of small investors’ trades, is mounting a counterattack.
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Rescuers carried a body from the rubble of a building in Adana, Turkey.
PHOTO: CAN EROK/AGENCE FRANCE-PRESSE/GETTY IMAGES
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Turkey, Syria launch rescue efforts following earthquakes. Rescuers launched a frantic search for survivors trapped under collapsed buildings across swaths of Turkey and Syria after two powerful earthquakes and their aftershocks shook much of the Middle East, killing more than 4,300 people and destroying thousands of homes.
Civilians clawed through rubble with bare hands to reach loved ones screaming from beneath the debris after a 7.8-magnitude quake on Monday morning was followed by a series of aftershocks and then a separate 7.5-magnitude quake in the afternoon. The quakes were Turkey’s worst seismic event in decades, rocking an area around the city of Gaziantep that is home to millions of Turkish citizens, displaced Syrians and refugees.
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Adani crisis disrupts India’s parliament. India’s opposition political parties stepped up calls for an investigation into allegations of stock-price manipulation and fraud against the country’s Adani Group, disrupting Parliament and staging protests to put pressure on the government of Prime Minister Narendra Modi.
Their actions follow a report last month by U.S. short seller Hindenburg Research that accused the energy and infrastructure conglomerate headed by Indian billionaire Gautam Adani of wide-ranging fraud, including the use of shell companies to manipulate its share prices. His companies’ stocks and bonds plunged following the report’s release, leaving investors with billions of dollars in losses.
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Russian deficit soars. Western oil sanctions and soaring battlefield costs took a heavy toll on Russia’s finances last month, pushing the government budget into its deepest deficit to start the year in more than a decade.
Oil and gas revenues nearly halved, dropping 46% in January from the same month last year, according to data from the Russian Ministry of Finance published Monday. Government spending, driven by military purchases, jumped by 59% from last January.
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Dell said it is taking steps to reorganize its sales, customer-support, product-development and engineering teams. PHOTO: BRANDON BELL/GETTY IMAGES
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More tech layoffs. Dell Technologies Inc. said it is cutting about 5% of its workforce, the latest technology company adding to a wave of layoffs as interest rates rise and financial conditions tighten.
The cuts would amount to some 6,600 jobs, based on the 133,000 total workers that the company reported having in early 2022, its most recent disclosed figure. “Market conditions continue to erode with an uncertain future,” Jeff Clarke, Dell’s co-chief operating officer, said Monday in a memo to employees.
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In other operations-related news...
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Covid-19 vaccinations will no longer be mandatory for New York City municipal workers, Mayor Eric Adams said Monday.
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The test-optional policy was on track to go into effect for students applying for admission to law schools in 2026. PHOTO: TIM TAI FOR THE WALL STREET JOURNAL
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ABA deals setback to LSAT-optional admissions. The American Bar Association’s policy-making body on Monday rejected a proposal to make the LSAT and other standardized tests optional for law school admissions, casting a cloud over a change that has prompted debate about diversity in the legal profession.
The test-optional policy appeared to clear a major hurdle in November when an ABA panel that accredits law schools approved it. It was on track to go into effect for students applying for admission to law schools in 2026. But the ABA’s House of Delegates voted down the policy Monday and sent it back to the accrediting body for further consideration.
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