Washington tangos with another government shutdown

0:28Today's markets move fast.

0:33Good morning from the Financial Times. Today is Monday, September 29th, and this is your FT News Briefing. Negotiations to prevent a U.S. government shutdown are coming down to the wire, and Denmark is temporarily banning drones after airspace violations it says it hasn't seen since World War II. Plus, Americans have a need for speed, even when it comes to our morning coffee fix. You've got these drive-thru outfits that in many cases have no chairs at all. You are not welcome to sit there, and they're growing by leaps and bounds. I'm Victoria Craig, and here's the news you need to start your day.

1:19Wall Street's top watchdog is fast-tracking President Trump's plan to end mandatory quarterly earnings reports for U.S. companies. Writing for the Financial Times today, Paul Atkins, the head of the Securities and Exchange Commission, said the government should provide, quote, the minimum effective dose of regulation needed to protect investors while allowing businesses to flourish, unquote. A pillar of the SEC's agenda to reduce regulation is a proposal to cut the requirement for companies to disclose their financials from every three months to every six. Such a move would change more than 50 years of precedent.

1:54Atkins contends the change won't hurt transparency, but opponents worry it'll starve investors of timely information about company performance.

2:08The U.S. government is once again on the brink of a shutdown. The federal government is due to run out of funding on Wednesday. If lawmakers fail to strike a stopgap deal before then, hundreds of thousands of public employees will be furloughed and a wide range of services suspended. President Trump is due to meet with congressional leaders today to try to come to some sort of solution. And that's where this shutdown fight differs, in a sense. It's not just about a battle over funding, but also about cutting a deal with the president himself. Lauren Fedor is the FT's deputy bureau chief in Washington.

2:41She joins me now to break this all down. Hi, Lauren. Hi, Victoria. So first of all, funding the government is going to have to be a bipartisan exercise. So what are the sticking points for each side and maybe some of the proposals to bridge those divides? So the first thing I would say is you're completely right. It does have to be bipartisan. And I would acknowledge that that's a little confusing because the Republicans do control Congress and the White House. But what they need to do is come to some sort of agreement that can get sign-on from at least seven Democratic senators because you've got to hit that 60-vote threshold over in the Senate.

3:17As it stands, there hasn't been much negotiation at all. There's been a lot of each side standing in their corner, kind of refusing to compromise. This meeting today will be the first time that we're seeing the congressional leaders sit down with the president and try to hammer out some sort of agreement with, you know, 48 hours to go. So no one's really willing to budge, but there is a meeting in place. Are people on the Hill optimistic that they might come to some sort of deal in the next couple of days? You know, hope springs eternal, and we have been to this kind of precipice many, many times before.

3:52But the two sides do seem pretty far apart. You know, the Republican position is they want a short-term funding deal, something called a continuing resolution. That basically keeps government spending at its current levels until later this year. The Democrats are really concerned about subsidies for health insurance that are due to expire at the end of the year. and they say that they won't sign on to a funding deal until those subsidies are reinstated in some way. If we can get a little bit into the nitty gritty here, we were in this similar situation back in March and a last minute deal was agreed to stay off a shutdown.

4:30But there were concerns then that if funding ran out, the White House was gonna use that as an opportunity to sort of stage a power grab. Are there similar concerns this time around? So last week, the White House really kind of raised the stakes. The Office for Management and Budget, the OMB, circulated a memo basically saying that if the government were to shut down, not only could federal workers be furloughed, but they could actually be fired altogether. That obviously made a lot of people in Washington, people whose jobs could be on the line, very nervous. And it also raised the stakes for the Democrats, right?

5:07Because if they're going to hold their ground, could they ultimately be blamed for those people losing their jobs permanently. It kind of remains to be seen. So this time around, do you think there is more pressure on Democrats to mount a more forceful response to Trump and the Republican Party's negotiation tactics and try to stop them from using this as an attempt to use more executive power? I think within the Democratic Party, within the Democratic base, there is an appetite for a fight, right? You know, we're now nine months into the Trump administration. And I think there is a lot of discontent among the Democratic kind of electorate that people feel as though the Democratic politicians aren't doing enough to fight Trump, to stand up to him.

5:51This meeting this afternoon, it's a real moment to see whether or not there is a possibility for some sort of compromise here. You know, the last time the government shut down was actually in the first Trump administration. It lasted for more than a month. And there were a lot of knock-on effects, not only for those individuals who lost their jobs, but for the U.S. economy. And that could be a pretty big story going forward if we end up with a shutdown that drags on for some time. Plenty to keep you busy then, Lauren. Lauren Fedor, the FT's Deputy Washington Bureau Chief. Thanks for your time.

6:24Thank you.

6:31Starting today, all civil drones have been banned from Danish airspace for one week. The move comes ahead of two European summits and after unmanned aircraft were caught flying over sensitive military sites on Sunday. Denmark's armed forces said recent sightings were confirmed at two airbases, including locations home to F-16 and F-35 fighter jets. And it's not the first time. Unauthorized drones were first seen last Monday, which resulted in a four-hour closure of Copenhagen Airport. Officials said they don't know who's behind what they call a professional hybrid attack. The Danish capital is due to host an informal summit of EU leaders on Wednesday to discuss establishing a so-called drone wall on Europe's eastern flank.

7:15The idea is to better protect the area after recent Russian aerial incursions of NATO territories.

7:27When you think about modern coffee culture, you might imagine trendy, apron-clad baristas carefully grinding, measuring, and brewing the freshest beans into the perfect shot of espresso. But the latest craze sweeping the states is not about the art of the poor. It's about speed, convenience, and a little fun. Shipping container-sized drive-through coffee stands have been popping up along America's roadways since the pandemic, and they've clearly won us over. Sixty percent of U.S. consumers now get their coffee fix without ever leaving the car. The FT's Gregory Meyer, U.S. consumer editor, hit the road to find out what's percolating at these roadside shops.

8:07Hi, Gregory. Hi, Victoria. So you visited one of these kiosks up in Connecticut. How do they work? What's the consumer experience like? I visited an outlet of Seven Brew, which is one of the many fast-growing drive-through-only coffee chains in America. This one opened a year ago. It consists of a small building with an awning over two drive-through lanes where cars were lined up and a small staff of really entirely young adults darting in and out of the store with digital tablets taking people's orders. and then the drinks would be ready as the cars pulled up to the window. Notably, there was no seating whatsoever, no public restroom.

8:50It's just a small building encircled by two lanes for cars to place their orders, pick up their drink, and leave. And that simplicity is really the key to the business plan, isn't it? Why does the business work financially? How does it work? The principal selling point for these stores is speed. These stores just kind of operate on the assumption that a good portion of people who want their coffee want it fast. Many of these chains are franchised. And because the buildings are small, because the land required might be smaller, they're cheaper to build. Interestingly, while they're hyper-efficient, the different drive-through coffee chain bosses I interviewed for this story, almost to a person insisted they're also providing an experience.

9:35A moment of human connection is something you hear a lot from different coffee shop executives, even if that moment of human connection lasts for 15 seconds or 30 seconds when you're actually picking up your latte at the drive-thru window. I want to sort of widen this conversation out because the U.S. coffee market, it seems, is in a bit of a state of flux. I wonder how the entry of China's luck in coffee in the U.S. this year and the years-long push by Starbucks to drive online orders has really played into the popularity of these coffee kiosks, or maybe how it's shaken up how U.S. consumers order their coffee.

10:11I'd say the coffee shop industry in America, it's in the middle of a shakeup. As you said, Luckin Coffee just moved into the U.S. this summer, opening two stores in Manhattan. Luckin is entirely app-based. You have to place your order on the app and then wait for your drink to be placed out on a counter for you to pick up. There isn't a heck of a lot of human connection going on there. And we'll see how the Luckin model plays out in the U.S. It's too soon to say. Starbucks is by far the biggest chain in the U.S. I guess what's interesting is Starbucks is recognize that Starbucks reputation as a quote-unquote third place between home and work where you can relax and spend time over a nice cup of coffee has maybe become a bit faded.

10:54They're investing heavily in their stores to spruce them up and make them more attractive places to hang out. We'll see if that pays off because, again, you've got these drive-through outfits that in many cases have no chairs at all. You are not welcome to sit there, and they're growing by leaps and bounds. So it's really about what kind of experience consumers want, and that begs the question, does this kiosk model have staying power, or is it really just a trend of convenience that fits the moment now? As long as Americans do most of their traveling by car, which they do now, I do think these businesses certainly have a future.

11:30There's always the risk of oversaturation and how different businesses differentiate themselves, whether by quality, price, service, is going to be really tough. So I don't think drive-thru is going to dominate the world. And there certainly will always be a place, I think, to sit and talk with your friends or working your laptop over a cup of coffee inside of a cafe. It just feels like this already very intensely competitive market is getting even more competitive. Gregory Meyer is the FT's U.S. Consumer Editor. Thanks for your time, Greg. Thank you.

12:07Free coffee, snacks, and ping pong tables have been part of the playbook to lure top talent to the office. But better furniture might also do the trick. Employers in Japan are hoping stylish workplaces will attract desperately needed workers. The aging nation has struggled in recent years with labor shortages and sticky inflation. You can kick your feet up and read more on that and all of the stories in today's show for free when you click the links in our show notes. This has been your daily FT News Briefing. Check back tomorrow for the latest business news.

13:14Thank you. Secure. Authoritative legal AI. Decisions made in Washington can affect your portfolio every day. But what policy changes should investors be watching? Washington Wise is an original podcast from Charles Schwab that unpacks the stories making news in Washington right now and how they may affect your finances and portfolio. Listen at schwab.com slash Washington Wise.