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States stunned as Trump begins dismantling Department of Education

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The Trump administration says its plan to dismantle the Education Department offers a fix for the nation’s lagging academics — a solution that could free schools from the strictures of federal influence.

Yet to some school and state officials, the plan appears to add more bureaucracy, with no clear benefit for students who struggle with math or reading.

Instead of being housed in a single agency, much of the Education Department’s work now will be spread across four other federal departments. For President Donald Trump, it’s a step toward fully closing the department and giving states more power over schooling. Yet many states say it will complicate their role as intermediaries between local schools and the federal government.

The plan increases bureaucracy fivefold, Washington state’s education chief said, “undoubtedly creating confusion and duplicity” for educators and families. His counterpart in California said the plan is “clearly less efficient” and invites disruption. Maryland’s superintendent raised concerns about “the challenges of coordinating efforts with multiple federal agencies.”

“States were not engaged in this process, and this is not what we have asked for — or what our students need,” said Jill Underly, Wisconsin’s state superintendent. Underly urged the Trump administration to give states greater flexibility and cut down on standardized testing requirements.

Education Secretary Linda McMahon said schools will continue receiving federal money without disruption. Ultimately, schools will have more money and flexibility to serve students without the existence of the Education Department, she said.

Yet the department is not gone — only Congress has the power to abolish it. In the meantime, McMahon’s plan leaves the agency in a version of federal limbo. The Labor Department will take over most funding and support for the country’s schools, but the Education Department will retain some duties, including policy guidance and broad supervision of Labor’s education work.

Similar deals will offload programs to the Department of Health and Human Services, the State Department and the Interior Department. The agreements were signed days before the government shutdown and announced Tuesday.

Inking agreements to share work with other departments isn’t new: The Education Department already had dozens of such agreements before Trump took office. And local school officials routinely work with other agencies, including the U.S. Agriculture Department, which oversees school meals. What’s different this time is the scale of the programs offloaded — the majority of the Education Department’s funding for schools, for instance.

Yet Virginia schools chief Emily Anne Gullickson, for one, said schools are accustomed to working with multiple federal agencies, and she welcomed the administration’s efforts to give states more control.

Where some see risk of upheaval, others see a win over bureaucracy

Response to the plan has mostly been drawn along political lines, with Democrats saying the shakeup will hurt America’s most vulnerable students. Republicans in Congress called it a victory over bureaucracy.

Yet some conservatives pushed back against the dismantling. U.S. Sen. Lisa Murkowski, an Alaska Republican, said on social media that moving programs to agencies without policy expertise could hurt young people. And Margaret Spellings, a former education secretary to Republican President George W. Bush, called it a distraction to a national education crisis.

“Moving programs from one department to another does not actually eliminate the federal bureaucracy, and it may make the system harder for students, teachers and families to navigate and get the support they need,” Spellings said in a statement.

There’s little debate about the need for change in America’s schooling. Its math and reading scores have plummeted in the wake of COVID-19. Before that, reading scores had been stagnant for decades, and math scores weren’t much better.

McMahon said that’s evidence the Education Department has failed and isn’t needed. At a White House briefing Thursday, she called her plan a “hard reset” that does not halt federal support but ends “federal micromanagement.”

Randi Weingarten, president of the American Federation of Teachers union and one of McMahon’s sharpest opponents, questioned the logic in her plan.

“Why would you put a new infrastructure together, a new bureaucracy that nobody knows anything about, and take the old bureaucracy and destroy it, instead of making the old bureaucracy more efficient?” Weingarten said at a Wednesday event.

Schools fear the impact of lost expertise on education laws

The full impact of the shakeup may not be clear for months, but already it’s stoking anxiety among states and school districts that have come to rely on the Education Department for its policy expertise. One of the agency’s roles is to serve as a hotline for questions about complicated funding formulas, special education laws and more.

The department has not said whether officials who serve that role will keep their jobs in the transition. Without that help, schools would have few options to clarify what can and can’t be paid for with federal money, said David Law, superintendent of Minnetonka Public Schools in Minnesota.

“What could happen is services are not provided because you don’t have an answer,” said Law, who is also president of AASA, a national association of school superintendents.

Some question whether other federal departments have the capacity to take on an influx of new work. The Labor Department will take over Title I, an $18 billion grant program that serves 26 million students in low-income areas. It’s going to a Labor office that now handles grants serving only 130,000 people a year, said Angela Hanks, who led the Labor office under former President Joe Biden.

At best, Hanks said, it will “unleash chaos on school districts, and ultimately, on our kids.”

In Salem, Massachusetts, the 4,000-student school system receives about $6 million in federal funding that helps support services for students who are low-income, homeless or still mastering English, Superintendent Stephen Zrike said. He fears moving those programs to the Labor Department could bring new “rules of engagement.”

“We don’t know what other stipulations will be attached to the funding,” he said. “The level of uncertainty is enormous.”

Other critics have noted the Education Department was created to consolidate education programs that were spread across multiple agencies.

Rep. Bobby Scott, D-Va., the ranking member on the House Education and Workforce Committee, urged McMahon to rethink her plan. He cited the 1979 law establishing the department, which said dispersion had resulted in “fragmented, duplicative, and often inconsistent Federal policies relating to education.”

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AP education writers Moriah Balingit in Washington, Bianca Vázquez Toness in Boston and Makiya Seminera in Raleigh, N.C., contributed to this report.

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The Associated Press’ education coverage receives financial support from multiple private foundations. AP is solely responsible for all content. Find AP’s standards for working with philanthropies, a list of supporters and funded coverage areas at AP.org.



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Netflix–Warner Bros. deal sets up $72 billion antitrust test

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Netflix Inc. has won the heated takeover battle for Warner Bros. Discovery Inc. Now it must convince global antitrust regulators that the deal won’t give it an illegal advantage in the streaming market. 

The $72 billion tie-up joins the world’s dominant paid streaming service with one of Hollywood’s most iconic movie studios. It would reshape the market for online video content by combining the No. 1 streaming player with the No. 4 service HBO Max and its blockbuster hits such as Game Of ThronesFriends, and the DC Universe comics characters franchise.  

That could raise red flags for global antitrust regulators over concerns that Netflix would have too much control over the streaming market. The company faces a lengthy Justice Department review and a possible US lawsuit seeking to block the deal if it doesn’t adopt some remedies to get it cleared, analysts said.

“Netflix will have an uphill climb unless it agrees to divest HBO Max as well as additional behavioral commitments — particularly on licensing content,” said Bloomberg Intelligence analyst Jennifer Rie. “The streaming overlap is significant,” she added, saying the argument that “the market should be viewed more broadly is a tough one to win.”

By choosing Netflix, Warner Bros. has jilted another bidder, Paramount Skydance Corp., a move that risks touching off a political battle in Washington. Paramount is backed by the world’s second-richest man, Larry Ellison, and his son, David Ellison, and the company has touted their longstanding close ties to President Donald Trump. Their acquisition of Paramount, which closed in August, has won public praise from Trump. 

Comcast Corp. also made a bid for Warner Bros., looking to merge it with its NBCUniversal division.

The Justice Department’s antitrust division, which would review the transaction in the US, could argue that the deal is illegal on its face because the combined market share would put Netflix well over a 30% threshold.

The White House, the Justice Department and Comcast didn’t immediately respond to requests for comment. 

US lawmakers from both parties, including Republican Representative Darrell Issa and Democratic Senator Elizabeth Warren have already faulted the transaction — which would create a global streaming giant with 450 million users — as harmful to consumers.

“This deal looks like an anti-monopoly nightmare,” Warren said after the Netflix announcement. Utah Senator Mike Lee, a Republican, said in a social media post earlier this week that a Warner Bros.-Netflix tie-up would raise more serious competition questions “than any transaction I’ve seen in about a decade.”

European Union regulators are also likely to subject the Netflix proposal to an intensive review amid pressure from legislators. In the UK, the deal has already drawn scrutiny before the announcement, with House of Lords member Baroness Luciana Berger pressing the government on how the transaction would impact competition and consumer prices.

The combined company could raise prices and broadly impact “culture, film, cinemas and theater releases,”said Andreas Schwab, a leading member of the European Parliament on competition issues, after the announcement.

Paramount has sought to frame the Netflix deal as a non-starter. “The simple truth is that a deal with Netflix as the buyer likely will never close, due to antitrust and regulatory challenges in the United States and in most jurisdictions abroad,” Paramount’s antitrust lawyers wrote to their counterparts at Warner Bros. on Dec. 1.

Appealing directly to Trump could help Netflix avoid intense antitrust scrutiny, New Street Research’s Blair Levin wrote in a note on Friday. Levin said it’s possible that Trump could come to see the benefit of switching from a pro-Paramount position to a pro-Netflix position. “And if he does so, we believe the DOJ will follow suit,” Levin wrote.

Netflix co-Chief Executive Officer Ted Sarandos had dinner with Trump at the president’s Mar-a-Lago resort in Florida last December, a move other CEOs made after the election in order to win over the administration. In a call with investors Friday morning, Sarandos said that he’s “highly confident in the regulatory process,” contending the deal favors consumers, workers and innovation. 

“Our plans here are to work really closely with all the appropriate governments and regulators, but really confident that we’re going to get all the necessary approvals that we need,” he said.

Netflix will likely argue to regulators that other video services such as Google’s YouTube and ByteDance Ltd.’s TikTok should be included in any analysis of the market, which would dramatically shrink the company’s perceived dominance.

The US Federal Communications Commission, which regulates the transfer of broadcast-TV licenses, isn’t expected to play a role in the deal, as neither hold such licenses. Warner Bros. plans to spin off its cable TV division, which includes channels such as CNN, TBS and TNT, before the sale.

Even if antitrust reviews just focus on streaming, Netflix believes it will ultimately prevail, pointing to Amazon.com Inc.’s Prime and Walt Disney Co. as other major competitors, according to people familiar with the company’s thinking. 

Netflix is expected to argue that more than 75% of HBO Max subscribers already subscribe to Netflix, making them complementary offerings rather than competitors, said the people, who asked not to be named discussing confidential deliberations. The company is expected to make the case that reducing its content costs through owning Warner Bros., eliminating redundant back-end technology and bundling Netflix with Max will yield lower prices.



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The rise of AI reasoning models comes with a big energy tradeoff

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Nearly all leading artificial intelligence developers are focused on building AI models that mimic the way humans reason, but new research shows these cutting-edge systems can be far more energy intensive, adding to concerns about AI’s strain on power grids.

AI reasoning models used 30 times more power on average to respond to 1,000 written prompts than alternatives without this reasoning capability or which had it disabled, according to a study released Thursday. The work was carried out by the AI Energy Score project, led by Hugging Face research scientist Sasha Luccioni and Salesforce Inc. head of AI sustainability Boris Gamazaychikov.

The researchers evaluated 40 open, freely available AI models, including software from OpenAI, Alphabet Inc.’s Google and Microsoft Corp. Some models were found to have a much wider disparity in energy consumption, including one from Chinese upstart DeepSeek. A slimmed-down version of DeepSeek’s R1 model used just 50 watt hours to respond to the prompts when reasoning was turned off, or about as much power as is needed to run a 50 watt lightbulb for an hour. With the reasoning feature enabled, the same model required 7,626 watt hours to complete the tasks.

The soaring energy needs of AI have increasingly come under scrutiny. As tech companies race to build more and bigger data centers to support AI, industry watchers have raised concerns about straining power grids and raising energy costs for consumers. A Bloomberg investigation in September found that wholesale electricity prices rose as much as 267% over the past five years in areas near data centers. There are also environmental drawbacks, as Microsoft, Google and Amazon.com Inc. have previously acknowledged the data center buildout could complicate their long-term climate objectives

More than a year ago, OpenAI released its first reasoning model, called o1. Where its prior software replied almost instantly to queries, o1 spent more time computing an answer before responding. Many other AI companies have since released similar systems, with the goal of solving more complex multistep problems for fields like science, math and coding.

Though reasoning systems have quickly become the industry norm for carrying out more complicated tasks, there has been little research into their energy demands. Much of the increase in power consumption is due to reasoning models generating much more text when responding, the researchers said. 

The new report aims to better understand how AI energy needs are evolving, Luccioni said. She also hopes it helps people better understand that there are different types of AI models suited to different actions. Not every query requires tapping the most computationally intensive AI reasoning systems.

“We should be smarter about the way that we use AI,” Luccioni said. “Choosing the right model for the right task is important.”

To test the difference in power use, the researchers ran all the models on the same computer hardware. They used the same prompts for each, ranging from simple questions — such as asking which team won the Super Bowl in a particular year — to more complex math problems. They also used a software tool called CodeCarbon to track how much energy was being consumed in real time.

The results varied considerably. The researchers found one of Microsoft’s Phi 4 reasoning models used 9,462 watt hours with reasoning turned on, compared with about 18 watt hours with it off. OpenAI’s largest gpt-oss model, meanwhile, had a less stark difference. It used 8,504 watt hours with reasoning on the most computationally intensive “high” setting and 5,313 watt hours with the setting turned down to “low.” 

OpenAI, Microsoft, Google and DeepSeek did not immediately respond to a request for comment.

Google released internal research in August that estimated the median text prompt for its Gemini AI service used 0.24 watt-hours of energy, roughly equal to watching TV for less than nine seconds. Google said that figure was “substantially lower than many public estimates.” 

Much of the discussion about AI power consumption has focused on large-scale facilities set up to train artificial intelligence systems. Increasingly, however, tech firms are shifting more resources to inference, or the process of running AI systems after they’ve been trained. The push toward reasoning models is a big piece of that as these systems are more reliant on inference.

Recently, some tech leaders have acknowledged that AI’s power draw needs to be reckoned with. Microsoft CEO Satya Nadella said the industry must earn the “social permission to consume energy” for AI data centers in a November interview. To do that, he argued tech must use AI to do good and foster broad economic growth.



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SpaceX to offer insider shares at record-setting valuation

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SpaceX is preparing to sell insider shares in a transaction that would value Elon Musk’s rocket and satellite maker at a valuation higher than OpenAI’s record-setting $500 billion, people familiar with the matter said.

One of the people briefed on the deal said that the share price under discussion is higher than $400 apiece, which would value SpaceX at between $750 billion and $800 billion, though the details could change. 

The company’s latest tender offer was discussed by its board of directors on Thursday at SpaceX’s Starbase hub in Texas. If confirmed, it would make SpaceX once again the world’s most valuable closely held company, vaulting past the previous record of $500 billion that ChatGPT owner OpenAI set in October. Play Video

Preliminary scenarios included per-share prices that would have pushed SpaceX’s value at roughly $560 billion or higher, the people said. The details of the deal could change before it closes, a third person said. 

A representative for SpaceX didn’t immediately respond to a request for comment. 

The latest figure would be a substantial increase from the $212 a share set in July, when the company raised money and sold shares at a valuation of $400 billion.

The Wall Street Journal and Financial Times, citing unnamed people familiar with the matter, earlier reported that a deal would value SpaceX at $800 billion.

News of SpaceX’s valuation sent shares of EchoStar Corp., a satellite TV and wireless company, up as much as 18%. Last month, Echostar had agreed to sell spectrum licenses to SpaceX for $2.6 billion, adding to an earlier agreement to sell about $17 billion in wireless spectrum to Musk’s company.

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The world’s most prolific rocket launcher, SpaceX dominates the space industry with its Falcon 9 rocket that launches satellites and people to orbit.

SpaceX is also the industry leader in providing internet services from low-Earth orbit through Starlink, a system of more than 9,000 satellites that is far ahead of competitors including Amazon.com Inc.’s Amazon Leo.

SpaceX executives have repeatedly floated the idea of spinning off SpaceX’s Starlink business into a separate, publicly traded company — a concept President Gwynne Shotwell first suggested in 2020. 

However, Musk cast doubt on the prospect publicly over the years and Chief Financial Officer Bret Johnsen said in 2024 that a Starlink IPO would be something that would take place more likely “in the years to come.”

The Information, citing people familiar with the discussions, separately reported on Friday that SpaceX has told investors and financial institution representatives that it is aiming for an initial public offering for the entire company in the second half of next year.

A so-called tender or secondary offering, through which employees and some early shareholders can sell shares, provides investors in closely held companies such as SpaceX a way to generate liquidity.

SpaceX is working to develop its new Starship vehicle, advertised as the most powerful rocket ever developed to loft huge numbers of Starlink satellites as well as carry cargo and people to moon and, eventually, Mars.



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