Good morning,
President Donald Trump’s sweeping changes to the federal workforce could mean taxpayers will have to wait longer for their refunds this year.
Trump signed two executive orders this week that instituted a return-to-office mandate for federal employees, and a hiring freeze for most of the government. That could have immediate consequences for the IRS, as roughly half of the agency’s employees work remotely at any given time. Plus, the agency was actively boosting its staffing thanks to funding from the Inflation Reduction Act, which a hiring freeze would halt.
With reduced personnel, tax returns could take longer to process.
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FIRST UP
Trump called on Russia to “make a deal” or have the U.S. impose new sanctions.
Photo by CHIP SOMODEVILLA/POOL/AFP via Getty Images
President Donald Trump on Wednesday warned he would impose “high levels” of taxes, tariffs and sanctions on Russia unless Russian President Vladimir Putin strikes a deal to end the war in Ukraine. Still, trade between the U.S. and Russia has diminished since Russia invaded Ukraine in 2022, as the U.S. imposed sanctions against several Russian officials and companies for their alleged involvement in the war.
Trump criticized FEMA in an interview on Fox News, saying the agency has not done its “job for the last four years” and that he’d “rather see the states take care of their own problems.” Addressing the wildfires in Los Angeles, the president reiterated his claim that California’s fish conservation efforts were to blame for water shortages in the state, adding that “I don’t think we should give California anything until they let water flow down.”
BUSINESS + FINANCE
Photo by Eric Thayer/Getty Images
Over 18,000 Costco Teamsters voted to strike at the end of January with their contract set to expire, a rebuke to the company’s reputation as one of the best employers in the retail industry. A pending strike will impact only about 50 of the company’s 624 U.S. stores in five states, the largest share of which are in California.
WEALTH + ENTREPRENEURSHIP
JPMorgan Chase CEO Jamie Dimon
Photo by Kevin Dietsch/Getty Images)
Jamie Dimon, the head of the biggest bank in the U.S., lauded Tesla CEO Elon Musk on Wednesday, calling the world’s richest man “our Einstein,” and becoming the latest billionaire to warm to Musk or President Donald Trump. It appears to conclude the long-running feud between the two billionaires, stemming from a 2021 legal fight between JPMorgan and Tesla.
Less than two days into Trump’s term, Musk publicly questioned perhaps the president’s biggest business announcement yet, the $500 billion “Stargate” AI infrastructure deal. Musk claimed on X “they don’t actually have the money,” which OpenAI CEO Sam Altman refuted.
TECH + INNOVATION
AI startup Teal provides help with cover letters, job matching, interview prep, and salary and benefit comparisons, as the company seeks to become the ultimate “career copilot.” Teal recently raised $7.5 million in Series A funding, though it faces a challenge in finding customers willing to pay—the majority of users rely on its free version.
MONEY + POLITICS
Trump said he issued a pardon for Ross Ulbricht, who was sentenced to life in prison nearly a decade ago for creating the Silk Road, a website law enforcement called the “most sophisticated and extensive criminal marketplace” on the internet. It was best-known for sales of illicit drugs, and prosecutors estimate more than $200 million was traded on the site before it was shut down after Ulbricht’s arrest in 2013.
The House of Representatives passed the Laken Riley Act—named for a 22-year-old college student who was murdered last February—on Wednesday, one day after the Senate approved it, setting it up to potentially be the first bill Trump signs into law in his second term. The legislation requires ICE to detain undocumented immigrants who have been charged with, arrested for, or convicted of burglary, theft, larceny or shoplifting.
SPORTS + ENTERTAINMENT
Prince Harry reached a settlement with the Rupert Murdoch-owned publisher of tabloid The Sun, his lawyer announced Wednesday, ending a long-running legal battle the British royal had previously insisted must go to trial to ensure “accountability” for other alleged victims of hacking. It’s reportedly an eight-figure settlement—not much by American standards, but “a staggering sum” in the U.K., NPR media correspondent David Folkenflik noted.
TRENDS + EXPLAINERS
A view of the campus of Harvard University.
Photo by Maddie Meyer/Getty Images
Harvard University settled two complaints Tuesday with groups that had accused university leaders of mishandling antisemitism on campus and failing to protect Jewish and Israeli students, as the university has faced backlash from alumni, high-profile donors and Congress after Hamas’ October 7, 2023 deadly attack on Israel and the resulting campus demonstrations over Israel’s invasion of Gaza. Harvard will adopt the International Holocaust Remembrance Alliance definition of antisemitism as part of its anti-bullying and anti-discrimination policies.
DAILY COVER STORY
This Travel Company Says Google’s AI Search Results Are Already Hurting Its Business
ILLUSTRATION BY EMILY SCHERER FOR FORBES; IMAGES BY MARINA GOLOVINA, CRISPYPORK/GETTY IMAGES
TOPLINE When Google launched AI-generated search results in May, the announcement came with certain chaos: Google’s AI models instructed people to make pizza from glue, eat one rock per day and drink plenty of urine to pass a kidney stone.
But for the legions of businesses that rely on Google for traffic, the change was jarring for another reason. Some companies, like the travel booking site Kayak, said the new product, called AI Overviews, can discourage people from visiting their websites because they get all the answers they need right on Google’s homepage.
Google’s iconic homepage isn’t just the world’s online answer hub. As the most prized real estate on the internet, it’s a bedrock for millions of businesses, which find customers when people type in travel destinations, plumbing questions or food cravings. AI search results could collapse that model by answering more people’s questions without them needing to click away from Google, leaving businesses that rely on those clicks scrambling to find new ways to lure users.
The product change is already hurting some companies. Steve Hafner, CEO and cofounder of Kayak, told Forbes it has had a “small adverse impact on our business,” though he declined to share exact metrics.
Companies in the travel sector in particular are already dependent on the whims of Google search, and AI summaries have prompted them to reevaluate how they’re reaching people. For TripAdvisor, the travel reviews site, it prompted even more internal testing of its methods for SEO, or search engine optimization—something brands that rely on Google do regularly to analyze how the latest changes to its search algorithm impact their visibility.
WHY IT MATTERS Businesses still fear that Google traffic, a revenue stream that has been central to business for decades, is on the decline, said Nadja Sumter, founder of Pepper, a Los Angeles-based creative agency that works with Kayak to create social campaigns. “It’s kind of like, we put our eggs in this basket,” said Sumter. “Now the basket doesn’t exist.”
MORE Google’s Upcoming Ad Change Could Spell Disaster For Millions Of Unprepared Small Businesses
FACTS + COMMENTS
It’s been two weeks since the start of a destructive wave of wildfires in southern California, burning tens of thousands of acres and killing more than two dozen people. It’s one of the worst natural disasters in the state’s history:
Roughly 40,500 acres: The number of acres that have burned
16: The total number of fires in southern California since January 7
$250-275 billion: The cost of damages from the fires, according to a preliminary estimate from AccuWeather published January 13
STRATEGY + SUCCESS
Nearly two-thirds of workers report experiencing burnout, and it can take a toll on our personal relationships, often leading to social isolation. Make reconnecting with the world more manageable by framing your goals as questions rather than statements—try asking yourself, “What small social interaction would feel manageable for me today?” And create a burnout-free zone at home, where discussion of work is prohibited.
VIDEO
QUIZ
Snowfall records were broken in a number of Gulf Coast states after a winter storm slammed the region. For instance, New Orleans has received more snowfall this year than which city?
A. Reno
B. Salt Lake City
C. Buffalo
D. Cleveland
Thanks for reading! This edition of Forbes Daily was edited by Sarah Whitmire and Chis Dobstaff.
