Hyundai-LG raid sparks alarm among overseas companies in US

Good morning and welcome to White House Watch. In today’s newsletter I’m covering:

• Reverberations from the Hyundai-LG crackdown

• Trump’s alleged birthday message to Epstein

• US energy secretary’s pitch to Europe

You’ll probably have seen the dramatic images of last week’s raid at a battery plant being built by Hyundai and LG in Georgia, which led to the detention of 475 workers, mostly South Korean nationals.

Now multinational companies with foreign employees in the US are seeking legal advice and pausing some travel as a new front opens in the White House’s crackdown on illegal immigration.

“Clients are flooding our inboxes asking if they too have exposure,” said Matthew Dunn, head of business immigration for the US at the law firm HSF Kramer. “They ask if corporate headquarters should be concerned, they ask if their US managers are at risk, and they wonder if their foreign national population here on work sponsored visas will be targeted by [the] government.”

Some immigration lawyers said they believed many of the arrests were of individuals who entered the US on so-called B-1 visas used for business meetings, or arrived under a related visa waiver programme.

But the rules around these terms of entry have been somewhat ambiguous. Seoul-based executives and industry groups said South Korean companies have routinely used unsuitable visas for workers sent to the US to build advanced manufacturing sites.

Homeland security secretary Kristi Noem said the raid would not deter investment in the US, but companies building out their US presence are paying close attention.

“Those videos and those photos have played not just in Korea but in Japan, in Taiwan, in other trading partners of the US who also have large investment going on in the US,” said Tami Overby, an international trade consultant with DGA Group and former president of the US-Korea Business Council.

Border tsar Tom Homan told CNN on Sunday that there would be “a lot more worksite enforcement operations”, saying that knowingly hiring foreigners who were in the country illegally undercut Americans’ salaries.

The latest headlines

• Democrats published a birthday note that Donald Trump allegedly sent Jeffrey Epstein decades ago, as the US president faces renewed pressure over his links to the late convicted sex offender.

• Trump must pay an $83mn penalty for defaming the writer E Jean Carroll who accused him of rape, a New York appeals court ruled.

• The US terminated international agreements to combat disinformation from countries such as Russia, China and Iran, according to European officials.

• US health insurers are raising insurance premiums by the most in 15 years, with at least one company citing Trump’s tariffs as one of the causes.

• Japan has agreed to let Trump decide where $550bn worth of its capital is invested in the US as it seeks to avoid high tariffs, according to an unpublished memo seen by the FT.

What we’re hearing

If Europe really wants Washington to tighten sanctions on Moscow, it should stop buying Russian oil and gas, Trump’s energy chief told the FT’s US energy editor Jamie Smyth.

Chris Wright, US energy secretary, said that European countries should buy American liquefied natural gas, gasoline and other fossil fuel products rather than fund Russian President Vladimir Putin’s “war machine”. [Free to read]

“If the Europeans drew a line and said: ‘We’re not going to buy more Russian gas, we’re not going to buy Russian oil’. Would that have a positive influence on the US leaning in more aggressively [on sanctions] as well? Absolutely,” he said in an interview ahead of talks with his EU counterpart in Brussels this week.

“We think it’s good economically for Europe. You want to have secure energy suppliers that are your allies, not your foes . . . the other reason is a huge goal of the Trump administration, and I believe of the EU, is to end the Russia-Ukraine war. Russia funds its war machine off oil exports and natural gas exports and if you cut off European purchase of those, it shrinks their money.”

Brussels wants Washington to impose tougher economic sanctions on Russia to increase pressure on Putin to agree a peace deal with Ukraine. But even though Trump has become increasingly frustrated with Moscow, the US president has stopped short of imposing additional penalties on Russia.

Meanwhile, the US wants something from Europe too. As part of the US-EU trade deal, EU countries must buy $750bn of US energy by the end of 2028. But Wright has said that the bloc’s climate rules would create “huge legal risks” for US companies selling fossil fuels in Europe unless they underwent “massive modifications”.

Wright is scheduled to meet EU energy commissioner Dan Jørgensen on Thursday to discuss the bloc’s plan to wean itself off Russian energy — and how it plans to buy $250bn a year of US energy products.

Viewpoints

• Trump’s genius is to keep pushing Democrats into reactive conservatism, writes Edward Luce. They look like permanently outraged grandparents, he says.

• Europe’s Trump-whisperers might get the US to tighten Russia sanctions and increase aid to Ukraine, but they still need a plan B, writes Gideon Rachman.

• The Federal Reserve should not cut interest rates now, argues Ruchir Sharma in the FT. In fact, he says, there’s a strong case for a rate increase.

• Trump is trying to renovate the White House to make himself look regal and high class, but he is managing to do just the opposite, says Jemima Kelly.

• Some effects of Trump’s tariffs are actually likely to be positive for climate change, James Meadway says, even if that wasn’t the administration’s intention.