Morning news brief
STEVE INSKEEP, HOST:
Negotiators are playing a game of telephone across the Middle East. Israel is discussing a pause in its war with Hamas, except Israel does not talk with Hamas, nor does its ally, the United States. So the way this works is Israel or the U.S. gets a message to a diplomat from the Middle Eastern nation of Qatar. The Qataris pass the message on to a Hamas political leader, and they pass the message to Hamas military leaders, and eventually a message comes all the way back. In this tortuous way, negotiators are trying to stop a war that kills more people every day. Lives are at stake every day.
Leila spoke with a man in the middle of this, Qatar's Prime Minister Mohammed bin Abdulrahman bin Jassim Al Thani, who is here in Washington, D.C. Leila, what kind of pressure is he under?
LEILA FADEL, HOST:
You know, Steve, a lot of pressure because an agreement between Israel and Hamas actually still seems quite far off. We met him at his ornate residence here in Washington, D.C., where he's been in town meeting with U.S. officials about these negotiations.
Now, Qatar is a small but wealthy nation in the Middle East, and it plays a strategic role as the friend of enemies, so it can be the go-between of parties who don't speak to each other. In this case, that role has been tough. Israel and Hamas want very different things. Israel wants the right to resume the war after a pause to continue its goal of, quote, "eradicating" Hamas in this hostage-for-prisoner exchange that people want to get done, as well as aid getting into Gaza. Hamas wants not just a pause, but a full cease-fire, an end to the war, and it wants Israel to pull all its troops from Gaza.
So I asked the prime minister if they can move past what appear to be deal-breaker conditions. And here's what he said.
PRIME MINISTER MOHAMMED BIN ABDULRAHMAN BIN JASSIM AL THANI: We cannot predict that is it going to have a breakthrough and will move forward very fast or how fast it will go. It will all depends on both parties. Our aim is to finish this as soon as possible and to put - to bring the hostages back, but to put a closure for the war as well.
FADEL: You don't see this in days or in the next week...
AL THANI: Well...
FADEL: ...Some type of cease-fire and return of hostages.
AL THANI: Sometimes the negotiations can surprise us and can finish in days.
AL THANI: And - but some other times, also, we get stuck into details.
INSKEEP: I have to ask, in all this complexity, Leila, are Qatar's diplomats even able to safely meet Hamas leaders knowing that Israel has promised to target Hamas leaders anywhere they can find them?
FADEL: Yeah, I was curious about that. I mean, Hamas has a political office in Qatar and - not military leaders of Hamas.
FADEL: And as you know, Steve, there was a Hamas leader killed in Lebanon in recent weeks, and the assumption is Israel did that.
FADEL: So Qatar's prime minister told me they've made it clear to all parties that Qatar's sovereignty must be respected, along with its role as a mediator.
AL THANI: That has been the only way that's been yielding for everyone in that conflict and the process proven successful. It released 109 hostages. The military operation didn't do it. It was the contrary, actually. It killed some of them.
INSKEEP: OK, so they are negotiating. They've made some progress. But is he worried about this conflict getting bigger instead of smaller?
FADEL: Yeah. I mean, very worried, especially after this drone strike in Jordan that killed three U.S. soldiers, wounded dozens more. Here's what he said about that.
AL THANI: We were warning that the situation will be exploited by others and might lead us to a wider regional war, and that's what we've been preventing, talking to everyone in order to de-escalate and to contain the situation.
FADEL: Now, he says the U.S. has the right to retaliate, but he hopes cooler heads prevail and put diplomacy first.
INSKEEP: Leila, there are a lot of reasons that Qatar is influential - its position, its money, the way that it tries to be everybody's friend.
INSKEEP: And also that they have Al Jazeera, this really influential, huge TV channel. Are they flexing that media power?
FADEL: You know, I've been curious about reports that the U.S. and Israel have actually pressured Qatar, which funds Al Jazeera, to tone down the coverage of Gaza. So I asked if they're feeling that pressure. Here's that exchange.
AL THANI: Al Jazeera is an independent network. They have their own editorial board. They have their own journalists. And we expect from them that they cover everything and they report professionally.
FADEL: But has it been brought up?
AL THANI: Well, I prefer to keep it this way.
FADEL: So I think that nonanswer, Steve, says a lot.
INSKEEP: OK. The prime minister of Qatar - and we'll hear more from him on NPR's MORNING EDITION.
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INSKEEP: Some other news now - the Federal Reserve has spent much of the last two years raising interest rates in an effort to fight inflation.
FADEL: So what does the Fed do now that inflation is dropping? We could get some clues this afternoon, when Fed officials wrap up a two-day meeting.
INSKEEP: Which NPR's Scott Horsley is covering. Hey there, Scott.
SCOTT HORSLEY, BYLINE: Good morning, Steve.
INSKEEP: What do you expect to hear?
HORSLEY: Well, it's all but guaranteed the Fed is going to hold interest rates steady today. Not a lot of suspense about that. The big question is what kind of smoke signals do we get about possible rate cuts in the future. And it's a balancing act. You know, the Fed doesn't want to cut rates too soon and run the risk of rekindling inflation, but it also doesn't want to wait too long and take a chance on slowing the economy more than it has to.
Fed policymakers probably are not going to say explicitly when they plan to start cutting rates today. They want to keep their options open. But Fed watchers will be reading between the lines of the policy statement that comes out this afternoon, parsing every word that Fed Chairman Jerome Powell says at his news conference. If Powell talks a lot about the recent drop in inflation, that might suggest the Fed is going to start cutting rates sooner rather than later. If, on the other hand, Powell focuses on the strong job market and consumer spending and economic growth, well, that might point to a more cautious, patient approach.
INSKEEP: Lower interest rates presumably means more economic growth. And I noticed the stock market has been going up. Are investors already betting that interest rates are going to be dropping?
HORSLEY: Yeah, the Dow closed at another record high just yesterday. Some investors do think we're going to get a rate cut pretty soon. Right now, the market odds of a rate cut at the next Fed meeting in March are a little over 40%. Now, a month ago, the odds were closer to 75%. So investors' enthusiasm has waxed and waned.
Fed policymakers have been warning investors not to get too cocky. Raphael Bostic, who heads the Federal Reserve Bank of Atlanta, says even though the inflation data's been pretty encouraging of late, he and his colleagues have been burned before, so they're not ready to relax just yet.
RAPHAEL BOSTIC: The pandemic has thrown curveballs repeatedly. I'm not comfortable even contemplating declaring victory.
HORSLEY: Fed officials are pleasantly surprised that inflation has come down more quickly than they expected. But, you know, the economy's also growing pretty fast. The job market is still pretty tight. And before they start cutting interest rates, policymakers want to be sure inflation is not going to rev up again.
INSKEEP: What would it take to convince the skeptics?
HORSLEY: Well, they're going to be keeping a close eye on the economic data as it comes in over the next few months. You know, if inflation continues its downward trend, it's conceivable the central bank will feel comfortable cutting rates as early as March. If, on the other hand, inflation comes in a little hotter, or if consumer spending's really strong, then the Fed may decide to hold off. Bostic told the Atlanta Rotary Club, right now, the numbers look pretty good, but there's still a lot of uncertainty, so he and his colleagues aren't going to let their guard down.
BOSTIC: We have history on this. So in the '70s, the Fed started removing accommodation too soon. Inflation spiked back up. Then we had to tighten. Inflation came down. Then we removed it again. It went back up. And by the time we were done with that, all Americans could think about was inflation.
HORSLEY: The Fed doesn't want to rerun that '70s show. So they're going to be watching the wage data that comes out later today and the January jobs report that we'll get on Friday.
INSKEEP: I sort of liked "That '70s Show," to be honest with you. But anyway, NPR's Scott Horsley, thanks so much.
HORSLEY: You're welcome.
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INSKEEP: Sales of electric vehicles are going down.
FADEL: The auto industry has a lot riding on the transition to electric vehicles. In fact, the whole world has a lot riding on it because cleaning up cars is a key part of fighting climate change.
INSKEEP: NPR's Camila Domonoske is going to take us for a ride on this story. Good morning.
CAMILA DOMONOSKE, BYLINE: Good morning.
INSKEEP: What's happening?
DOMONOSKE: Well, big picture, EV sales are going up. Last year was a record year. They're expected to rise again this year. But they notched down at the start of the year after leveling off. And there's been a flurry of bad headlines, right? Hertz is selling off a bunch of EVs after a high profile pushed into them. Ford is cutting production of the electric F-150 Lightning. GM - slowing its pace. Tesla, which dominates the U.S. EV market, recently warned investors that next year is going to be a little slower. Elon Musk used the phrase, between growth waves.
INSKEEP: OK (laughter). All right, that sounds like a spin, but is there anything to the idea that they're just, you know, pausing between a huge growth and huge growth?
DOMONOSKE: Yeah. I mean, I eye roll at lots of things that executives say on earnings calls. But this one, there really is something to it, right? Analysts talk about something called the adoption curve, which is the pattern of how any new technology takes off. And so first, you have the early adopters who buy it, and then it expands into the mainstream, which is a much bigger market. And the auto industry right now is kind of trying to make that leap from early adopters to mainstream, and it's tricky. It's tough to cross over. Early adopters - they'll put up with inconveniences, like charging hassles. They'll put up with extra costs. So the people that the auto industry is trying to sell EVs to next, you know, they're more worried about charging and they are more focused on prices.
INSKEEP: I'd heard that prices were generally drifting down for EVs.
DOMONOSKE: They are. They've come down really quite dramatically. And that's partly because batteries got cheaper. Tesla cut prices aggressively, which brought down prices across the board - but not enough. Some vehicles are really at parity with gas-powered cars now, but some of them aren't. And so to take one example - I mentioned the F-150 Lightning is getting production cuts. This is a vehicle that can run power tools. It can be backup power for your house. It's stupid fast. The bare-bones version of it - and most people don't buy the bare-bones version of a truck.
DOMONOSKE: They buy fully loaded bells and whistles.
DOMONOSKE: But the absolute cheapest you can get is $50,000. That is a lot cheaper than an F-150 Lightning used to run, but it's still 15 grand more than your bare-bones gas F-150. And at these prices, Ford is losing money on them, right?
DOMONOSKE: So they're not cutting prices more. They're cutting production - for now. They're going to cut prices over a few years after they get better at making them for cheaper. Even companies that are making money on EVs right now, pretty much all of them are making more money on their gas-powered cars. So they're trying to do a balancing act.
INSKEEP: Is all the news bad, then?
DOMONOSKE: No, the EV boom is definitely not over by a long shot, and not every company is slowing down. Volvo vowed to phase out gas-powered cars by 2030, and Volvo USA's president, Michael Cottone, says this.
MICHAEL COTTONE: I still feel very good about that target. I mean, we're committed to being fully electric by 2030.
DOMONOSKE: So bigger picture, there is a race to build chargers, to bring down these vehicle prices and for more companies to be in the place that Volvo says they're in, where they feel good about what they're making on EVs, and they're scaling up as fast as they can.
INSKEEP: NPR's Camila Domonoske. Thanks for the insights.
DOMONOSKE: Yeah. Thank you. Transcript provided by NPR, Copyright NPR.
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