aacj

June 26 2025

Fragile peace holds; Trump reaffirms NATO; Nippon's Steel Saga; AI training on copyrighted work deemed legal; 'AGI'?; Firms face rare earth shortages

Greg Loving

26 Jun 2025 • 7 min read

Ukrainian Presidential Press Service/AFP/Getty Images

Fragile Peace Holds as Israel-Iran Ceasefire Enters Third Day

Trump Reaffirms "Ironclad" NATO Pact After Securing Historic Spending Hike

Nippon's U.S. Steel Saga Reveals Political Perils of Investing in America

AI Training on Purchased Books Deemed Legal, Shaping Future IP Law; Future of OpenAI-Microsoft Partnership Hinges on Defining 'AGI'

Western Firms Face Shortages as China Drags Feet on Magnet Exports

1. Fragile Peace Holds as Israel-Iran Ceasefire Enters Third Day

Students returned to Israeli schools and Tehran residents trickled back to their homes Wednesday as a U.S.-brokered ceasefire between Israel and Iran held for a second day, ending a brief but devastating two-week conflict that began with Israeli strikes on Iranian nuclear facilities. Both nations claimed victory in the war—with Iran's Supreme Leader Ali Khamenei emerging from hiding to declare triumph over Israel in his first public statement since the fighting began June 13, while President Trump asserted that joint U.S.-Israeli strikes had "obliterated" Iran's nuclear capabilities.

The extent of damage to Iran's nuclear program has sparked fierce debate in Washington, with conflicting intelligence assessments fueling a political firestorm. While Trump and CIA Director John Ratcliffe maintain the strikes "severely damaged" Tehran's nuclear infrastructure, a leaked Defense Intelligence Agency report suggests the attacks may have only delayed Iran's nuclear efforts by months, with damage ranging from "moderate to severe" across three targeted sites. The controversy prompted an FBI investigation into the leak and highlighted the challenge of assessing wartime damage remotely.

Editor's Note: The debate over damage assessments is somewhat irrelevant, and any assessment should be treated as uncertain. No matter what intelligence reports say, the assessment will be remote and not certain. What do you do in the face of that uncertainty? You get on-the-ground inspections as part of some kind of negotiation.

2. Trump Reaffirms "Ironclad" NATO Pact After Securing Historic Spending Hike

A. Nato allies have pledged to meet Donald Trump’s demand to raise defence spending to 5 per cent of GDP by 2035, in a historic rearmament shift aimed at convincing him to maintain US commitments to protect Europe from attack. At a summit designed to win over the American president, Trump assured his 31 allies he was “with them all the way”, assuaging concerns he was seeking to renegotiate a mutual defence pact that has formed the bedrock of European security for eight decades. Wednesday’s summit at The Hague also issued a joint statement that reaffirmed Nato governments’ “ironclad commitment to collective defence” and committed them to providing “annual plans showing a credible, incremental path” to the 5 per cent target.

B. Donald Trump has shown sympathy towards Ukraine’s Volodymyr Zelenskyy, describing him as “very nice” after meeting him on the sidelines of the Nato summit, while striking a tougher tone on Russia. “Vladimir Putin really has to end that war. People are dying at levels that people haven’t seen before for a long time,” Trump said. He added that the Russian leader had offered to mediate in the Iran-Israel conflict, to which he responded: “No, you can help me with Russia.” The US president has oscillated in his attitudes towards his Russian and Ukrainian counterparts, culminating with an Oval Office bust-up with Zelenskyy in February after which Washington temporarily suspended its military and intelligence assistance to Kyiv

3. Nippon's U.S. Steel Saga Reveals Political Perils of Investing in America

Nippon Steel’s announcement in December 2023 that it would take over U.S. Steel seemed doomed from the start: a deal, cut by a foreign company, involving workers in an iconic American manufacturing industry, in the swing state of Pennsylvania, in a presidential election year. The Japanese steelmaker’s executives appeared to underestimate the political ramifications in those early days, a miscalculation they would spend the next 18 months rectifying through an unusually hands-on campaign to secure the deal, according to three people familiar with the company’s outreach who like others in this story spoke on the condition of anonymity to discuss private conversations. Nippon Steel declined to comment for this story. In the months before President Joe Biden blocked the sale in January, citing national security concerns, the company’s executives held meetings in the Pittsburgh-memorabilia-filled garage office of Mayor Chris Kelly in West Mifflin, home to a U.S. Steel plant; held town halls; cheered on the Steelers; and won over local and state officials whose appeals, Nippon Steel said, to President Donald Trump were key to the eventual acquisition, finalized this month. The whiplash ordeal revealed how investing in America could come with a significant risk even for a staunch U.S. security ally like Japan and that doing business in an increasingly protectionist and politicized environment could be fraught regardless of which party is in the White House, Japanese analysts said. “Washington is now using national security as pretext for a lot of things, but, actually, many of those things are not [a threat],” said Taro Kono, a Japanese lawmaker and former foreign minister. “Nippon Steel could have invested years ago, and it took so long. … Politics intervened. And that is not a good sign.”

Washington Post

4. AI Training on Purchased Books Deemed Legal, Shaping Future IP Law; Future of OpenAI-Microsoft Partnership Hinges on Defining 'AGI'

A. A federal judge found that the startup Anthropic’s use of books to train its artificial-intelligence models was legal in some circumstances, a ruling that could have broad implications for AI and intellectual property. Judge William Alsup of the Northern District of California ruled Monday that Anthropic’s use of copyrighted books for AI model training was legal under U.S. copyright law if it had purchased those books. The ruling is set to help shape future litigation against AI companies, legal experts said.

B. The future of the OpenAI-Microsoft partnership—one of the most storied in tech history—hinges in part on the meaning of an amorphous AI buzzword that divides many in the industry. The contract between the tech partners, who have been locked in acrimonious negotiations, stipulates that when OpenAI’s systems reach “artificial general intelligence,” or AGI, the startup will be able to limit Microsoft’s access to its future technology. Microsoft is fighting hard to prevent that. Many AI experts see AGI as the point at which generative AI systems achieve humanlike intelligence, but OpenAI and Microsoft are at odds over the issue. OpenAI executives including Sam Altman believe they are close to being able to declare that their AI tools have achieved the AGI level of proficiency, according to people familiar with the matter. Microsoft Chief Executive Satya Nadella has expressed skepticism that reaching such a benchmark is possible. Their disagreement mirrors a debate among Silicon Valley’s elite about just how sophisticated cutting-edge tools can become.

WSJ

5. Western Firms Face Shortages as China Drags Feet on Magnet Exports

Two weeks after China promised the U.S. it would ease the exports of rare-earth magnets, Chinese authorities are dragging out approval of Western companies’ requests for the critical components, a situation that could reignite trade tensions between Washington and Beijing. Western companies say they are receiving barely enough magnets for their factories and have little visibility of future supplies. Firms are waiting weeks as Chinese authorities scrutinize their applications—only to be rejected in some cases. And applications for raw rare earths, which are used to make magnets, are rarely granted. As a result, Western companies are concerned that the shortages could soon affect manufacturing. Companies are so desperate for magnets that they are opting for expensive airfreight whenever licenses are granted to prevent costly production shutdowns. Some manufacturers are experimenting with workarounds that would allow them to make their products without the most powerful magnets. “It’s hand to mouth—the normal supply-chain scrambling that you have to do,” said Lisa Drake, a vice president overseeing Ford’s industrial planning for batteries and electric vehicles, earlier this week. Although she said the situation had improved, the scarcity of the rare-earth magnets is forcing Ford to “move things around” to avoid factory shutdowns, she said.

WSJ