National

Sneak Peek

Axios Sneak Peek

Sen. Kyrsten Sinema's decision to leave the Democratic Party was long in the making, but she waited until after the midterms to avoid interfering in ongoing races, sources familiar with her move tell Axios.

Why it matters: Sinema has long been seen as a renegade in her party — and a major headache for Democratic leadership. 

Her official announcement, released with a two-minute video, came just days after Democratic Sen. Raphael Warnock defeated Herschel Walker in the Georgia Senate runoff.

Sinema told Politico that Warnock's victory “delighted” her. She supported Warnock's re-election and gave money to his campaign.

Zoom in: Sinema hopes her switch to the new label will free her from partisan pressures and the expectations of her caucus as she attempts to remain a key bipartisan broker, the sources said.

"Her registration is now catching up with her reality. She was always miraculous at not caring about media reports and criticisms, but it's just one less thing to worry about," former Sinema aide John LaBombard told Axios.

"It's kind of a helpful reset of expectations. Anyone who assumed at any point that moderates in our party would always just fall in line and do what the most vocal and loudest voices in our party wanted them to do was never a reasonable expectation," he added.

Between the lines: Sinema prides herself on having been a crucial, bipartisan dealmaker over the last two years — helping cut compromises on infrastructure, gun reform, the CHIPS bill and more — and often did so without the support of her Democratic colleagues.

While her success in 2018 can in large part be owed to the Democratic Party's support, Sinema maintains she's always considered herself a separate entity. 

On the campaign trail in 2018, she often touted bipartisanship and ran an ad titled "Independent."

What this means for the Senate: Sinema maintains her new party identity will not impact the way she votes or how she operates, including continuing to support President Biden's nominees.

She will not caucus with Democrats, and she rarely attends caucus lunches and meetings now. She also chose not to show up to the vote electing Sen. Chuck Schumer as majority leader.

For committee purposes, she plans to continue to “caucus” with the Democrats. Schumer said Friday she will stay on her current committees.  

Both the White House and Schumer say Sinema's switch won't overly impact the Senate majority and day-to-day operations.

What's next: The big question is how this move will affect Sinema's potential re-election in 2024 as well as the fundraising and protection she's so far enjoyed from Democratic infrastructure and outside groups.

She declined to say whether she's running again, and her new affiliation will avoid a nasty primary with Democrats if she were to run again.

Rep. Ruben Gallego (D-Ariz.), before Sinema's announcement, was making preparations to run for her Senate seat. His campaign teased a bid today.

Why Kyrsten Sinema left the Democratic Party

The decision has been long in the making, sources told Axios.

Sen. Kyrsten Sinema smiles while talking to reporters after leaving the Senate chamber on Nov. 16. Photo: Kent Nishimura/Los Angeles Times via Getty Images

Kyrsten Sinema

Politics & Policy

Former Minneapolis police officer J. Alexander Kueng was sentenced Friday to 3.5 years in prison over state charges for his involvement in George Floyd's death.

Driving the news: Kueng pleaded guilty to aiding and abetting second-degree manslaughter in October.

Kueng agreed to the 3.5-year sentence under the plea deal after prosecutors said they would drop one count of aiding and abetting second-degree murder.

As part of the plea agreement, Kueng admitted that he knowingly assisted in restraining Floyd by holding his torso despite knowing the substantial risk of death due to positional asphyxia. He also acknowledged that such a restraint was unreasonable under the circumstances and constituted an unlawful use of force.

Worth noting: Kueng and fellow former Minneapolis officer Tou Thao had previously rejected a plea deal.

Thao, who told the court that pleading guilty would be a "lie and a sin," has not changed his plea, per the Star Tribune.

The big picture: Floyd's death sparked mass protests against police brutality and anti-Blackness across the country.

After a separate federal civil rights trial, Kueng and Thao, along with former officer Thomas Lane, were convicted in January of violating Floyd's civil rights by failing to intervene as their then-colleague Derek Chauvin kneeled on Floyd's neck for over nine minutes.

Thao has agreed to a trial by stipulated evidence, meaning he waived his right to a jury and to testify. A judge will decide the verdict.

Go deeper: Minneapolis marks 2 years since George Floyd's murder

Editor's note: This story has been updated with additional background.

Ex-Minneapolis officer sentenced to 3.5 years over George Floyd charges

J. Alexander Kueng pleaded guilty to aiding and abetting second-degree manslaughter in October.

Former Minneapolis police officer J. Alexander Kueng walks by protesters after a hearing on Sept. 11, 2020 at the Hennepin County Family Justice Center in downtown Minneapolis. Photo: Anthony Souffle/Star Tribune via Getty Images

George Floyd

Black History Month

Axios AM

Sen. Kyrsten Sinema of Arizona said in remarks published at 6 am ET Friday that she's leaving the Democratic Party and registering as an independent.

Why it matters: It's a political earthquake that will shake up the Senate — and a gut punch for Democrats just three days after they secured a 51-49 majority.

Our thought bubble, via Axios' Josh Kraushaar: Sinema views activists in the Arizona Democratic Party as extreme as the state Republican Party.

She's up in 2024, and risked a primary from Rep. Ruben Gallego (D-Ariz.) on the left. 

"Arizonans — including many registered as Democrats or Republicans — are eager for leaders who focus on common-sense solutions rather than party doctrine," Sinema says in an op-ed in The Arizona Republic, her state's largest paper.

"That's why I have joined the growing numbers of Arizonans who reject party politics by declaring my independence from the broken partisan system in Washington."

Sinema — ever unpredictable and inscrutable — told Senate Majority Leader Schumer of her decision yesterday, a Democratic aide told Axios' Andrew Solender.

Schumer said Sinema will keep her committee assignments in a statement later Friday, adding, "Kyrsten is independent; that’s how she’s always been."

"We will maintain our new majority on committees, exercise our subpoena power, and be able to clear nominees without discharge votes," the New York Democrat said. 

"I know some people might be a little bit surprised by this," Sinema told CNN's Jake Tapper. "But, actually, I think it makes a lot of sense. ... I've never fit neatly into any party box. I've never really tried. I don't want to."

"Removing myself from the partisan structure — not only is it true to who I am and how I operate, I also think it'll provide a place of belonging for many folks across the state and the country, who also are tired of the partisanship."

Reality check: Punchbowl News notes that Sinema leaving the party gives Sen. Joe Manchin (D-W.Va.) "outsized sway once again."

What they're saying: "Senator Sinema has been a key partner on some of the historic legislation President Biden has championed over the last 20 months," White House press secretary Karine Jean-Pierre said in a statement.

"We understand that her decision to register as an independent in Arizona does not change the new Democratic majority control of the Senate, and we have every reason to expect that we will continue to work successfully with her."

Worth noting: Gallego teased a Senate bid Friday after Sinema's announcement, saying he was “thinking of running," per a fundraising text his campaign sent out.

 Editor's note: This article has been updated with new details throughout.

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Kyrsten Sinema goes independent, scrambles Senate

It's a political earthquake that will shake up the Senate.

Sen. Kyrsten Sinema during a news conference at the Capitol on Nov. 29.

Sen. Kyrsten Sinema during a news conference at the Capitol on Nov. 29. Photo: Kent Nishimura/L.A. Times via Getty Images

Sen. Kyrsten Sinema speaks to reporters after leaving the Senate floor.

Russian President Vladimir Putin said Friday more U.S.-Russian prisoner swaps may occur if the two countries can continue to reach compromises, according to Russian state media.

Why it matters: The comments come one day after WNBA star Brittney Griner was exchanged for convicted Russian arms dealer Viktor Bout.

Driving the news: Putin said Friday that “everything is possible" when it comes to potential future prisoner exchanges, adding that “compromises have been found” that led to the Griner-for-Bout deal.

“We aren’t refusing to continue this work in the future,” Putin said.

Putin added the prisoner exchange did not include discussions on other issues between the two countries, but it did establish a chance for future deals, AP reports.

“Whether this could set stage for a dialogue with the U.S. is a separate issue,” he said. “We didn’t set the task to move from those talks to something else, but they do create a certain atmosphere."

Catch up quick: President Biden announced Thursday morning that Griner was in U.S. custody. She landed in the U.S. on Friday morning.

The exchange did not bring home former Marine Paul Whelan, an American currently detained in Russia. Biden said his administration was committed to continuing efforts to secure Whelan's release.

The U.S. had proposed deals to free both Griner and Whelan. However, Russia views Whelan as an alleged spy and rejected every proposal involving him, Axios' Dave Lawler writes. 

What they're saying: Ned Price, spokesman for the State Department, told CNN Friday morning that he agreed with the Russian president's recent comments.

"It's not often we can say that we actually agree with something President Putin said, but today I can say that," Price told CNN. "President Putin himself has said that these discussions will continue. These discussions absolutely will continue."

Go deeper... How the Biden admin says Brittney Griner's release happened

Putin: More prisoner swaps with U.S. "possible" after Griner-Bout exchange

“We didn’t set the task to move from those talks to something else, but they do create a certain atmosphere."

Russian President Vladimir Putin attends a ceremony.

Russian President Vladimir Putin attends a ceremony in Moscow. Photo: Sergei Karpukhin/Sputnik/AFP via Getty Images

WNBA

Russia

China is becoming the most formidable rival America has faced, and the risk of confrontation with Russia, North Korea or Iran still looms. Authoritarians are rising, the chaotic Afghanistan exit revealed the limits of U.S. power, and the pandemic, climate change and other critical challenges continue to pose grave threats.

World

Salt Lake City

The International Olympic Committee (IOC) is putting off choosing a host for the 2030 Winter Games, saying it needs to further investigate how climate change will affect venues for snow sports.

The big picture: The delay gives the committee time to revamp how it will choose host cities in coming decades, with "climate-reliable" venues expected to decline. 

Why it matters: Salt Lake City is one of three finalists for the 2030 games, and a final answer had been expected next September or October, during the 2023 IOC Session.

Yes, but: With the delay, the international committee is also looking more seriously at creating a host rotation.

That could guarantee that Salt Lake City will host the games repeatedly — as long as it's cold enough and snowy enough.

Catch up quick: Salt Lake City and Sapporo, Japan, are the two likeliest candidates for 2030.

By the numbers: The IOC is considering requiring hosts to show average minimum temperatures below 32° F at snow sports venues over a 10-year period.

Salt Lake's organizers say the city will meet those requirements until at least 2050.

Details: Climate researchers at the University of Waterloo in Ontario teamed up with athletes this year to determine what conditions are necessary for safe competition — not just temperature, but also snow texture, rain and ice.

Sapporo was the only previous host city that would remain reliable through the 2080s even if greenhouse gas emissions are not reduced, the study projected.

Salt Lake City would only be suitable for athletes if emissions decline in accordance with the Paris climate agreement; otherwise, conditions here will be "marginal" by 2050.

What's next: The IOC may announce host cities for 2030 and 2034 simultaneously, though it's unclear when that decision might be made. 

Choosing the two cities together "would win some time to … establish a sound rotation system," Thomas Bach, the committee's president, said in a news conference Thursday.

Between the lines: Salt Lake organizers and U.S. Olympic and Paralympic Committee have said they would rather host in 2034 than 2030.

With Los Angeles hosting the summer games in 2028, organizers are worried that two U.S. games in less than two years would drain sponsors and other sources of funding, The Deseret News reported.

Of note: The finalists for 2030 have all hosted before, so there is little concern that the cities won't have time to prepare for the games if the decision is delayed.

"​​They have the venues. They have the expertise as well, hosting competitions," Christophe Dubi, executive director for the games, said in a news conference this week.

Climate change sets back Winter Olympics decision for Salt Lake City

The IOC wants to find out which cities will actually be snowy enough for competition.

Cross country skiers compete at the Olympics.

Cross-country skiers compete at the 2002 Winter Olympic Games in Salt Lake City. Photo: David Madison/Getty Images

Winter Olympic Games

News

Sports

Markets

Axios Markets

A new artificial intelligence thingamajig called ChatGPT set the internet abuzz this week.

Why it matters: Essentially an artificial intelligence (AI) interface that texts you like a know-it-all human, ChatGPT could portend major disruptions ahead for Big Tech — particularly for the business of search. 

How it works: Simply type a prompt into its interface, not unlike how you would use Google — and instead of returning links, ChatGPT writes you back in paragraphs.

When asked "how do you crush inflation," ChatGPT gave an answer that Jerome Powell would probably feel OK about:

"There are a few different ways to try to crush inflation, but most of them involve using monetary policy to manage the money supply and demand in the economy," went the opening of the bot's answer. 

State of play: Experts are hailing ChatGPT, developed by a company called OpenAI, as a major breakthrough in the decades-long push to create a bot that texts with humans as though it were a person, too.

ChatGPT works well enough that people are starting to grasp just how powerful a chatbot could be, as tech writer Alex Kantrowitz told me on the podcast What Next: TBD on Friday. 

"For years we've been hearing from tech companies like Meta, like Google or even Amazon, that voice and chat talking conversationally with computers is  the future — and the actual products never really measured up," he said. "Now we're starting to see actually there is powerful tech here." 

ChatGPT is much farther along than, say, the awkward text interaction you might have with a bank or airline. 

In its first five days, more than 1 million users signed up to try the ChatGPT, according to OpenAI president Greg Brockman.

🍪 The intrigue: When asked how to make chocolate chip cookies, ChatGPT gave me a short, clear recipe that looked pretty standard. Compare that to Googling, which returns links to long, overwritten blog posts that require endless scrolling before you get a recipe.

Those recipe websites are part of a whole ecosystem of businesses built around optimizing for Google searches — including finance sites like Investopedia, media outlets and other services.

This is part of why Google has spent so much money on chat AI. The tech giant pulled in $149 billion from its search business last year, more than half of total revenue. 

Yes, but: ChatGPT has no idea whether anything it says is true.

Between the lines: Writers and teachers are already fretting about the AI's ability to spin out essays.  

The New York Times' Paul Krugman is asking if ChatGPT is coming for skilled jobs — he's one of several writers who used the interface to crank out a column in the past week. 

Axios' Ina Fried calls it "scary good," but also worries about the fact that ChatGPT doesn't say where it's getting its info and can be "confidently wrong."

Zoom out: Notably, this new AI was not released by a Big Tech company, but by a risk-taking startup. OpenAI made a splash earlier this year when it released Dall - E2, an AI you can use to create art images. Artists freaked out. 

That a small, private player is the one making waves with AI makes sense; these companies can release something experimental with less risk of angering users or shareholders or advertisers if mistakes arise.

 Open AI does have some powerful friends in the biz, though. It announced a partnership with Microsoft in 2019.

Reality check: The future isn't here yet. Users already dug up flaws — like getting the bot to tell you how to shoplift. 

And, there are big red flags to watch for: AI is prone to reflecting the biases that humans have and to manipulation (like when a Microsoft chatbot started cheering Hitler.) ChatGPT seems to have done a somewhat better job of avoiding this so far.

What's next: Expect to see more bots from bigger players. "It's game time for Google," Kantrowitz said. "I don't think it can sit on the sidelines for too long." 

How ChatGPT could disrupt the business of search

It's go-time for Big Tech if they want to compete

Animated gif of a computer screen that reads "A.I" with the "I" as a blinking cursor

Artificial intelligence

After a record economic expansion, the coronavirus pandemic sent the U.S. economy into a recession as unemployment soared to staggering heights. The country now faces urgent questions about how much stimulus is needed for reeling consumers and businesses, and what a recovery might look like.

Economy & Business

The average 30-year fixed mortgage rate fell for the fourth straight week, to 6.33%, according to Freddie Mac. It's a big retreat since rates went over 7% during early November.

Why it matters: The long stretch of declines is a sign that inflation worries are easing, as the Federal Reserve is expected to start slowing its aggressive rate-hiking campaign.

Mortgage rates could still head back up, of course — but some experts, like Mike Fratantoni, chief economist at the Mortgage Bankers Association, are calling the top. "We think we're now past the peak on mortgage rates," he told Market News International earlier this week.

Zoom out: With rates double their year-ago levels, this recent decline won't snap the real estate market out of its doldrums. But it's not the worst news for anyone looking to buy a home.

Forecasters are betting on more declines next year, maybe getting back to the 5% area.

And home prices are falling — the past three months of declines in the S&P CoreLogic Case-Shiller index have been the steepest since the financial crisis.

What to watch: Next Tuesday, we'll see where inflation is when the Consumer Price Index for November is released.

Mortgage rates are falling

Mortgages

Line chart showing rate on 30 year fixed mortgage over the past year rising and falling

Brittney Griner touched down at a Texas military base early Friday after nearly 10 months behind bars in Russia.

The big picture: The basketball star was exchanged for convicted Russian arms dealer Viktor Bout in the United Arab Emirates.

She's likely headed to a nearby Army hospital after deplaning at Joint Base San Antonio-Lackland.

Catch up quick: Griner was arrested in February after Russian authorities said they found a vape cartridge with hashish oil in her luggage.

Griner pleaded guilty in July and was sentenced to nine years in prison before being transferred to a penal colony. She said she had "no intent" to break the law.

What they're saying: "So happy to have Brittney back on U.S. soil. Welcome home BG!" tweeted Roger Carstens, the special presidential envoy for hostage affairs.

Go deeper: How the Biden admin says Brittney Griner's release happened

Brittney Griner lands in U.S. after prisoner swap with Russia

She's likely headed to a nearby Army hospital.

Brittney Griner deplanes this morning at Kelly Field in San Antonio, Texas.

Brittney Griner deplanes this morning at Kelly Field in San Antonio, Texas. Photo: Eric Gay/AP

Prisoners

Tech Policy

Gaming

Axios Gaming

The Federal Trade Commission's suit to block Microsoft's $69 billion acquisition of Activision Blizzard marks the U.S. government's biggest tech-antitrust move in years.

Yes, but: It's happening on a very different sector of the Big Tech power map than most observers expected when the techlash began five years ago.

At that era's start, an unprecedented accumulation of money and power in a handful of giant tech companies, along with rising concerns over data privacy, misinformation and user harms, led a wave of tech critics to demand government action.

Calls rose to "break up" Facebook and Google. Plenty of people were angry with Apple and Amazon, too. Lawsuits and investigations followed. But Microsoft largely escaped the techlash's bite.

Flashback: The venerable software giant already fought a bitter antitrust war with the Department of Justice that started 25 years ago. Since then, it has largely gotten along with U.S. regulators.

Now, though, it's Microsoft that's squarely in the government's sights. 

The FTC and its chair, Lina Khan, want to break new ground in U.S. antitrust law and shake up the oligarchic tech industry — and once again, the feds are casting Microsoft as competition's enemy.

Microsoft control of Activision and its gaming library, the FTC suit says, would give it "the ability and increased incentive to withhold or degrade Activision’s content in ways that substantially lessen competition — including competition on product quality, price, and innovation. This loss of competition would likely result in significant harm to consumers in multiple markets at a pivotal time for the industry." 

Details: While a lot of attention has been paid to what Microsoft might do with Activision's lucrative Call of Duty franchise, the FTC's complaint zeroed in on Microsoft's practices regarding games made by Bethesda/ZeniMax, which Microsoft bought for $7.5 billion in 2020.

"Microsoft decided to make several of Bethesda's titles, including Starfield and Redfall, Microsoft exclusives despite assurances it had given to European antitrust authorities that it had no incentive to withhold games from rival consoles," the FTC said in its statement.

Between the lines: The commission voted 3-1, with Republican commissioner Christine Wilson voting no, to file an administrative complaint seeking to block the merger.

The agency is not seeking a preliminary injunction to stop the deal from closing, likely because an ongoing investigation by the European Commission's already prevents that. Regulators in the EU or the U.K. could move to block the deal if they don't come to an agreement with Microsoft over concessions.

What they're saying: "We continue to believe that this deal will expand competition and create more opportunities for gamers and game developers. We have been committed since Day One to addressing competition concerns, including by offering earlier this week proposed concessions to the FTC," Microsoft president Brad Smith said in a statement.

"While we believed in giving peace a chance, we have complete confidence in our case and welcome the opportunity to present our case in court," Smith said.

The big picture: The FTC is also in the midst of a trial in its effort to block Meta's acquisition of tiny VR game studio Within. 

Our thought bubble: Big deal, small deal — the government is putting tech's giants on notice to expect legal challenges over just about any acquisition they might try. 

Microsoft's new antitrust nightmare

The FTC's suit says the Activision deal would give Microsoft an incentive to limit competition.

Illustration of pixelated justice scales with Microsoft logo on one side.

Microsoft

From the Valley to D.C., Big Tech players like Facebook, Google and Amazon are under more scrutiny than ever as new technology develops and privacy and antitrust concerns grow in lockstep with companies’ ambitions.

Technology

Pro Rata

Axios Pro Rata

The U.S. Department of Veterans Affairs is hoping that the recent wave of tech layoffs could help it fill around 1,000 open positions in areas ranging from cybersecurity to software development. 

Why it matters: The VA serves over 9 million veterans in more than 2,000 locations, but its digital transformation efforts have been hampered by tech talent shortages.

One example relates to the PACT Act, recently passed to improve health care for veterans who were exposed to toxic substances like Agent Orange in Vietnam or open burn pits in Iraq.

The VA is trying to better streamline management of these new benefits by accelerating its migration to the cloud. 

What they're saying: "We're the largest integrated health care and financial services infrastructure organization in the country," explains VA chief information officer and assistant secretary for information and tech Kurt DelBene, who spent most of his career at Microsoft. "We also have around a thousand systems that need modernization."

Friday's top stories

Why Kyrsten Sinema left the Democratic Party

Ex-Minneapolis officer sentenced to 3.5 years over George Floyd charges

Kyrsten Sinema goes independent, scrambles Senate

Putin: More prisoner swaps with U.S. "possible" after Griner-Bout exchange

Climate change sets back Winter Olympics decision for Salt Lake City

How ChatGPT could disrupt the business of search

Mortgage rates are falling

Brittney Griner lands in U.S. after prisoner swap with Russia

Microsoft's new antitrust nightmare

VA official hopes laid-off tech workers will take on a new mission

What happens when the COVID national emergency ends

Portable lavatories go upscale

Peru's impeached former president asks Mexico for asylum

Brittney Griner released in prisoner swap for Russian arms dealer

Musk's second "Twitter Files" claims "secret blacklists"

"Boy in Box" identified as police hope to revive case

Axios Finish Line: Why you should start a company

Marjorie Taylor Greene's MAGA power play

Inside the Herschel Walker campaign fiasco

Right-wing demand list further complicates McCarthy's speaker bid