Business
L.A. County supervisors seek aid for hundreds of workers affected by Phillips 66 refinery closure
With a major oil refinery in Wilmington and Carson scheduled to close next year, Los Angeles County officials are looking to shore up resources for hundreds of workers who will be left without jobs.
The Los Angeles County Board of Supervisors unanimously passed a motion Tuesday asking county staff to work with local partners such as the city of Los Angeles and the South Bay Workforce Investment Board to develop a plan to provide hiring fairs, training and other job placement resources for affected workers.
Oil giant Phillips 66 announced in October that the century-old complex, which sprawls across 650 acres and produces about 8% of the state’s gasoline, would cease operations late next year. Its closure will affect some 600 employees and 300 contract workers that keep its operations running.
Supervisor Janice Hahn said at the meeting that more than half of the affected workforce is Latino and includes skilled workers such as operators, welders, engineers and safety compliance experts that would bring “years of specialized training and certifications” to other jobs. She said they should receive support to help them make the transition to similar jobs in renewable energy, infrastructure development and advanced manufacturing.
“This is a time the county needs to lean in and support them as they face this abrupt transition,” Hahn said.
Supervisors Hahn and Holly Mitchell introduced the motion, which also asks various departments to identify career pathways for “hard-to-hire” skilled trade positions within the county itself.
“We have the responsibility to ensure that displaced workers can smoothly transition … not just by partnering with the private sector but also by opening up doors here at the county,” Mitchell said at the meeting.
The county’s Director of Economic Opportunity has 60 days to report back to the board with an action plan.
The announcement of the pending closure came amid community concerns of harmful emissions and high pollution levels. Mark Lashier, chairman and chief executive of Phillips 66, said in an October news release that the long-term sustainability of the operation was “uncertain and affected by market dynamics.”
“We understand this decision has an impact on our employees, contractors and the broader community,” Lashier said. “We will work to help and support them through this transition.”
The closure will leave the state with eight major refineries, three in the Bay Area and five in Southern California, operated by Chevron, Valero and others.
Business
Trump is threatening to raise tariffs again. Here's how China plans to fight back
TAIPEI, Taiwan — President-elect Donald Trump has threatened to impose new tariffs on Chinese imports when he takes office, a move that would deepen a trade war he started six years ago.
He has not offered many specifics, but China is already arming itself for economic battle.
“Six years of really intense, focused preparatory work has gotten the top leaders in Beijing ready to deal with whatever comes down the pike,” said Even Pay, an analyst with research firm Trivium China.
Here’s a look at how the showdown between the world’s two largest economies played out the last time Trump was in office and where things might be headed now.
What happened during Trump’s first term?
Trump kicked off a trade war in 2018 by imposing 25% tariffs on imports from China — including industrial machinery, cars, auto parts and television cameras. Those goods accounted for about $50 billion of the $540 billion the United States spent that year on Chinese-made products.
The aim was to spur U.S. manufacturing, reduce a trade imbalance and punish China for trade practices Trump said were unfair. China imported just $120 billion in U.S. goods in 2018.
China responded with its own 25% tariffs on about $50 billion of those goods.
Despite trade talks over the next year, each country continued to impose more tariffs. By 2020, tariffs had been applied to a total of $550 billion in Chinese goods and $185 billion in U.S. goods.
Experts said the trade war did little to mitigate the U.S. trade deficit or boost U.S. exports. Instead, they said it weighed on economic growth and cost jobs in both the U.S. and China.
In the final year of Trump’s term, the two nations agreed to a truce, signing a trade deal that scrapped some tariffs and reduced others. China also agreed to purchase an additional $200 billion in U.S. goods and services — a pledge it failed to fulfill.
Did things cool off after President Biden took office?
Not really. The rhetoric coming from the White House was less hostile, but getting tough on China had become a political necessity for whoever was president, and the trade war only intensified.
Biden kept the Trump-era tariffs and added some of his own, including a 100% tax on imports of electric cars from China, a 50% tax on solar panels and a 25% tax on lithium-ion batteries and steel and aluminum products.
Biden has also continued the first Trump administration’s use of export bans to curb China’s access to U.S. technology. Last week, the U.S. expanded restrictions on sales of semiconductors and related manufacturing equipment to China and added 140 Chinese entities to a blacklist that limits trade with U.S. businesses on national security concerns.
What might Trump do this time?
For months he has advocated for raising tariffs on imports from China by 60% or more. He said on social media last month that he would impose a 10% tariff, “above any additional tariffs,” on all products from China.
His motivations are not entirely based on leveling trade or boosting U.S. manufacturing. Trump has also talked about using the threat of tariffs to spur China — as well as Mexico — to do more to help curb the U.S. opioid crisis. The two countries are the top sources of fentanyl and the chemicals used to make it.
How is China preparing for more tariffs?
China has already taken numerous steps to protect itself.
The country, which typically buys corn, soybeans and sorghum from the U.S., has been diversifying its sources and stocking up. Brazil has been one of the big winners. The damage could be significant for U.S. farmers, who sell about 77% of their sorghum exports to China.
China, though, is more vulnerable than the United States when it comes to tariffs — for the simple reason that it exports so much more than it imports.
The current economic situation in China doesn’t help. Growth has stagnated as the country struggles with a real estate downturn, growing debt, rising youth unemployment and a slowdown in consumer spending.
Larry Hu, chief China economist at the Australian bank Macquarie Group, estimated that a 60% tariff hike from the U.S. would reduce Chinese exports by 8% and GDP by 2%. If the U.S. enacts tariffs on goods from other countries as well, that would exacerbate the effect on China, which has been able to circumvent some tariffs by exporting products destined for the U.S. through third-party nations.
How can China go on the offense?
Perhaps China’s biggest weapon in the trade war is its dominance in crucial materials that the U.S. needs to make products such as semiconductors and missiles. After the latest round of tech trade restrictions last week, China retaliated by banning exports of the rare elements gallium, germanium and antimony — cutting off at least half the U.S. supply, based on data from the U.S. Geological Survey.
The move was widely seen as a warning shot to the next administration of its ability to stall U.S. advancements in key strategic industries.
China can also fight back with monetary policy. During the last trade war, the country allowed the yuan to depreciate against the U.S. dollar, effectively making Chinese exports to the U.S. cheaper. The U.S. labeled China a currency manipulator, an accusation Beijing denied.
And after the U.S. began blacklisting Chinese companies during the first Trump administration, China launched its own list of entities deemed a threat to its national interests. This means the Chinese government can swiftly sanction U.S. individuals and businesses in retaliation for trade restrictions or other efforts to constrain development.
In September, China launched a probe into PVH Corp. — the parent company of apparel brands such as Calvin Klein and Tommy Hilfiger — which it said has unfairly boycotted Xinjiang cotton. The U.S. has accused China of genocide against Muslim ethnic groups there and prohibits companies from using products suspected of being made with forced labor.
And on Monday, China opened an antitrust investigation into U.S. semiconductor giant Nvidia, whose value has soared this year amid an AI boom and increasing demand for advanced microchips. The U.S. has barred Nvidia from selling some of its most powerful chips to China.
If the trade war intensifies, the scope of targeted companies could broaden and China might also try to inconvenience U.S. businesses with operations in China by banning staff, restricting sales or initiating onerous compliance inspections or audits.
What are the downsides for China?
China may have the power to inflict serious damage on the U.S. economy, but it has to be careful about using it.
Ja-Ian Chong, associate professor of political science at the National University of Singapore, said that punishing U.S. operations in China could chill foreign investment and accelerate plans to move to other countries at a time when China is trying to attract more international business.
And preventing all crucial materials from reaching the U.S. would be difficult to enforce, considering the complex global supply chain, and might alienate other trade partners such as Taiwan or South Korea in the process.
“Beijing has options, but these options are not cost-free,” Chong said. “It comes down to how far China is willing to go.”
Business
Rupert Murdoch cannot hand control of his media empire to son Lachlan, commissioner rules
Rupert Murdoch has been dealt a setback in his bid to steer control of his empire to his son Lachlan after the media mogul dies.
Murdoch, 93, had sought to change the terms of his irrevocable family trust to ensure his older son, Lachlan, would have sole control over his media companies News Corp. and Fox Corp. News Corp. owns influential publications such as the Wall Street Journal, the New York Post, Investor’s Business Daily and Dow Jones. Fox Corp. is the parent company of Fox News and the Fox broadcast network.
But a Nevada probate commissioner rejected the request to amend the trust that had been opposed by three other Murdoch children named in the trust — Prudence, James and Elisabeth. In the current version of the trust, the four eldest siblings, including Lachlan, were set to jointly inherit control of the businesses.
That commissioner, Edmund J. Gorman Jr., said in a ruling over the weekend that the elder Murdoch and Lachlan Murdoch had acted in “bad faith” in their attempt to rewrite the trust, according to a sealed court filing obtained by the New York Times.
“The effort was an attempt to stack the deck in Lachlan Murdoch’s favor after Rupert Murdoch’s passing so that his succession would be immutable,” Gorman wrote in the filing. “The play might have worked; but an evidentiary hearing, like a showdown in a game of poker, is where gamesmanship collides with the facts and at its conclusion, all the bluffs are called and the cards lie face up.”
While the Nevada proceedings were behind closed doors, the outcome had enormous implications because Murdoch controls the world’s most influential conservative-leaning media empire.
The trust was established following Murdoch’s divorce from his second wife, Anna Torv Murdoch Mann, the mother of Elisabeth, Lachlan and James. As part of that 1998 divorce settlement, Murdoch agreed to set up the trust that would give control of his empire to his then-four adult children after the mogul’s passing.
The trust gave Anna’s children and Murdoch’s eldest daughter from his first marriage, Prudence, equal voting shares — in a bid to establish a power-sharing arrangement to oversee his corporate empire. Murdoch’s two daughters from his marriage to Wendi Deng were given economic stakes in the trust, but not voting shares.
News Corp. and Fox Corp. declined to comment. Rupert Murdoch’s lawyer, Adam Streisand, said in a statement: “We are disappointed in the Commissioner’s ruling and, of course, plan to appeal.”
Prudence, James and Elisabeth Murdoch said in a separate statement that “We welcome Commissioner Gorman’s decision and hope that we can move beyond this litigation to focus on strengthening and rebuilding relationships among all family members.”
Murdoch’s proposed trust change revealed a deep rift is the family.
The elder Murdoch had claimed changing the trust was necessary to preserve the conservative bent of his media properties, which would maintain shareholder value for all the heirs. Lachlan is known for sharing his father’s political views, and since last year has served as sole chairman of News Corp. and executive chairman of Fox. The three other siblings are more politically moderate.
Business
OpenAI's controversial Sora is finally launching today. Will it truly disrupt Hollywood?
OpenAI’s controversial text-to-video artificial intelligence tool Sora sent shock waves through the entertainment industry when the company unveiled it earlier this year.
The technology promised to revolutionize filmmaking by automatically creating short movies based on written commands. For example, users could type in descriptions, such as “a stylish woman walks down a Tokyo street,” and Sora would provide up to 60-second videos based on that information. Workers feared that it was a prelude to a future in which AI displaced jobs throughout Hollywood.
But until now, Sora has been available only to people participating in research, testing and previews for artists.
On Monday, Sora faces its next big test as OpenAI, best known for the ChatGPT text bot, makes it available to the broader public. In the U.S., consumers can use Sora with a ChatGPT Plus subscription, which costs $20 a month. It can generate up to 50 videos of up to 20 seconds long. Customers can get more Sora usage, higher resolution and longer videos with a ChatGPT Pro subscription.
OpenAI executives say Sora will lead to new possibilities for artists and creatives.
“We really believe that Sora can open doors for people to explore and share their creativity visually, especially without extensive resources or training,” said Souki Mansoor, Sora artist program lead for OpenAI, in an interview. “As we know, filmmaking is very expensive.”
The tool will be accessible for people 18 or older where ChatGPT is available, except for in the United Kingdom, Switzerland and countries in the European Economic Area. OpenAI said it is working on enabling Sora in those locations. The company is also preparing a free version of Sora.
AI is a major source of tension in the entertainment industry. It was a key issue in last year’s strikes by actors and writers, who sought protections from the rising tech as part of their contract negotiations.
Many have also raised concerns about how AI models are trained and whether intellectual property rights holders and artists are being compensated fairly, or at all, for content digested by the powerful technology.
Entertainment companies meanwhile have been exploring partnerships with AI startups as a way to save money.
Mansoor said that OpenAI is sensitive to the concerns raised by creatives about potential job losses, but is optimistic about the opportunities.
“Sora is designed as a creative collaborator, so the hope is that it helps artists bring very ambitious projects to life without expensive resources,” Mansoor said. “We think that this is raising the bar for what’s possible in video creation.”
Sora’s proponents say it could help artists test bold ideas without as many budget constraints. Alexia Adana, a New York-based creative director and visual artist, made the case that it could enable more stories from people, including underrepresented creators, who lack financial resources or equipment.
“We’re in this age where you can create anything and you can learn anything, and it’s either free or very low cost,” said Adana, who had early access to Sora. “This is such an exciting time for people who wouldn’t normally have the resources to demonstrate their vision.”
Adana used Sora to create a film concept called “Bloomchild,” which depicted a child made of soil and dirt who blooms and struggles to fit in. She said it was influenced by her own experiences as a person from Jamaica who grew up in the suburbs of Connecticut.
“I’m able to use a tool to come up with a full-on trailer,” Adana said. “I would have never been able to do that before.”
Indie pop artist Washed Out used Sora to create a music video. The director said the tool allowed him to show scenes from multiple places at a fraction of the cost of shooting on location. Meanwhile, a video that explained the origins of Toys R Us was made 80% with Sora, said Nik Kleverov, chief creative officer of Native Foreign, a Culver City-based creative agency and production company.
OpenAI said Sora will have safety measures in place to prevent abuses of the tool, such as child nudity.
Rohan Sahai, Sora’s engineering lead, said OpenAI has done “a lot of safety work to better understand how we prevent misuse” since Sora was first announced in February.
Some artists are angry with how OpenAI has gone about testing and developing Sora. Last month, a group of artists posted concerns in an online letter about how many creators, in their view, are being used to test and promote the technology without adequate compensation.
The open letter has received more than 1,170 signatures, including from London artist Jake Elwes.
“While hundreds contribute for free, a select few will be chosen through a competition to have their Sora-created films screened — offering minimal compensation which pales in comparison to the substantial PR and marketing value OpenAI receives,” the artists wrote.
Mansoor said that the group’s comments had no influence on the timing of Sora’s launch. She said that the company focused on giving early access to artists who would be most disrupted by tools like Sora and give them the option of helping shape the tool’s development.
“There was no obligation to even use the tool, much less give feedback,” she said.
Mansoor said she came from the creative industry, spending more than a decade in independent filmmaking. “I came to OpenAI to create the kinds of experiences that I wish I had coming up in the industry,” she said.
Kleverov said the concerns raised by the letter didn’t reflect the views of early testers. “The AI world is already so small and then within the world, those of us who are playing with Sora — it’s such a supportive space,” he said.
Walter Woodman, a director and co-founder of Toronto and L.A. production company Shy Kids, said once people experience Sora, “then everyone will see that it is not a magic bullet.” Shy Kids has used Sora to work on short films including “My Love.”
Many creators who have used AI tools say it takes time to get the hang of the tools and that the technology has important limitations.
“Sora can help, much like a camera, editing equipment, or great performance,” Woodman said in an email. “But without great storytelling and storytellers, it will be just a tool on the shelf. However, those with talent are in for a creative awakening.”
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