IRS Christmas gift, prisoner exchange, and 2023s best books.

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Big Stories

Warner Bros. Discovery in talks to merge with Paramount Global

Warner Bros. Discovery (WBD) CEO David Zaslav and Paramount Global CEO Bob Bakish met in New York City to explore a potential merger.

• Big deal: The potential merger is significant because it would create a massive news and entertainment entity, likely sparking more consolidation in the industry. Zaslav has also talked with Shari Redstone, Paramount's parent company owner, regarding a potential deal.

• Details: In the meeting, the CEOs discussed how their companies could compliment each other. For example, they could combine their main streaming services, Paramount+ and Max to better compete against Netflix and Disney+. However, with WBD's market value at around $29 billion and Paramount's at just over $10 billion, any merger would not be an equal partnership.

• Strategic thinking: Combining these companies could have advantages, like reaching more people internationally, merging news outlets like CBS News and CNN, and putting together sports programming. And while there are numerous reasons why a merger make sense, Paramount stands to gain the most from the deal. It’s currently struggling under intense debt pressure and needs to find a strategic partner or buyer. NAI, Paramount’s parent company, has already offloaded Simon & Schuster, and is looking to do the same with BET.

IRS delivers Christmas gift: $1 billion in tax penalties waived

Just before Christmas, the IRS shared some good news, saying it will forgive $1 billion in tax penalties for around 4.7 million people and businesses who owe back taxes.

• Why it matters: On average, each affected taxpayer will get $200 in relief and about 70% of those affected have household incomes below $100,000, according to the IRS.

• Who it affects: People who owe taxes for 2020 and 2021 could be eligible for relief depending on how much they owe. The IRS is waiving the penalties because they stopped sending reminders in February 2022 due to the pandemic. And the penalty for not paying on time kept adding up for those who didn't pay after the first notice. The IRS plans to start sending normal collection notices again for 2020 and 2021 taxes.

• How it works: Getting help is automatic, and people who qualify don't need to do anything. The relief applies to those with assessed tax under $100,000 for each return. You still have to pay your taxes, but you won't have to pay the extra fees. If you already paid penalties for 2020 and 2021, you'll get your money back or get a credit. The IRS will start giving refunds from now until January 2024.

U.S. releases Maduro ally in exchange for 10 American prisoners in Venezuela

On Wednesday, the U.S. released an ally of the Venezuelan President in exchange for 10 Americans and a former Navy contractor involved in a major bribery scandal.

• Details: Venezuela released Leonard Francis, commonly known as "Fat Leonard," as part of an agreement with the U.S. which also included the release of 10 Americans imprisoned in Venezuela, six of whom were considered to be wrongfully detained. Francis pleaded guilty in 2015 to handing out more than $500,000 in bribes in exchange for the ability to overcharge the Navy by at least $35 million for his services. He escaped house arrest in San Diego in 2022 but was arrested in Venezuela. 

• The U.S., in return, released Colombian businessman Alex Saab, accused of stealing $350 million in a bribe scheme against the Venezuelan government. He is also accused of being a financial fixer for Maduro. Saab was arrested for money laundering in Cape Verde in 2020 and was extradited to the U.S. in 2021. In response, Venezuela's government called off political negotiations with opposition officials and put six U.S. oil executives under house arrest.

• State of play: The release occurred amid the Biden administration's efforts to improve relations with Caracas. Sanctions on Venezuela's oil and gas sector were eased after Maduro’s regime agreed with the U.S.-backed opposition party to hold democratic elections in 2024. Though Biden insists he will reinstate them if Caracas doesn’t honor its election commitments. Many Venezuelan opposition hard-liners are criticizing Biden’s decision, saying that he didn’t get enough in return for the release of Saab. They argue it could encourage other countries to ask for outsized returns in exchange for Americans being held in their prisons.

Little Stories

U.S. News

• New York City lawmakers approved a bill that bans solitary confinement in its jails. The legislation comes amid an increase in inmate deaths. (More)

• In California, toilet and shower wastewater will no longer be dumped into the Pacific Ocean or used for farmland. The Water Resources Control Board is starting the Direct Potable Reuse program, which will funnel the clean recycled water directly into the public drinking water system. (More)

• A Republican-led U.S. House committee is broadening its investigation into Harvard, now including allegations of plagiarism against Harvard's president, Claudine Gay. Despite The university clearing Gay of "research misconduct" last week, the Education and the Workforce Committee is reviewing Harvard's handling of the allegations. (More)

World

• The U.N. Security Council has delayed voting on a resolution to halt the conflict in Gaza and increase humanitarian aid for a third time this week. President Biden said that the U.S. support for the resolution is still undecided, reflecting hesitancy to potentially criticize Israel's ongoing military actions in Gaza. (More)

• Houthi leadership promised to attack U.S. warships if they target the Iranian-backed militia. The threat comes after the White House announced a multinational force to deter Houthi attacks on commercial vessels in the Red Sea. (More)

• Over 250,000 people have fled the fighting in the Sudanese state of al-Jazira, previously considered a safe haven. The paramilitary Rapid Support Forces have entered the city of Wad Madani, forcing the mass exodus. Many residents are now fleeing without a clear destination. (More)

Business & Economy

• U.S. stock markets closed lower on Wednesday (S&P -1.47%, Nasdaq -1.50%, Dow -1.27%). (More)

• Toyota is recalling 1 million cars in the U.S. because the front passenger airbag may not deploy correctly in a crash. The recall affects multiple Toyota and Lexus vehicles made in 2020-2022. (More)

• Electric scooter company Bird Global filed for bankruptcy Wednesday as it tries to stabilize its finances. The company has lost more than $430 million since the end of 2021. (More)

Sports & Entertainment

• Lionel Messi will launch the 2024 Major League Soccer season with Inter Miami hosting Real Salt Lake in South Florida in February, marking the earliest start in the league's history. (More)

• One-named singer Huntley won the 24th season of The Voice on Tuesday night with a soulful rendition of Creed’s “Higher”. (More)

• Former NBA G League player Chance Comanche allegedly admitted to strangling a woman whose remains were found in Las Vegas earlier this month. (More)

Science, Health, & Tech

• NASA streamed a cat video from deep space for the first time using a laser. The video beamed from nearly 19 million miles away, 80 times the distance between the Earth and Moon. (More)

• Apple’s $3,499 mixed reality headset could be launching as early as February. The product will be the company’s first new hardware platform in years. (More)

• NASA’s space telescopes captured new images of star groups that resemble a Christmas tree, and a snow globe. (More)

Extra Credit

The 100 best books of 2023 according to authors.

Visualizing how big tech companies make their billions.

All-American brands owned by foreign companies.

Universal studios has bought land in the UK for a new theme park.