Would Denmark Ever Sell Greenland?

SPEAKER_1 (0:00)

Tax Act can think of a million things more fun than filing taxes. Tax Act is going to name some now. Sitting in traffic. Folding a fitted bedsheet. Listening to your co-worker talk about his fantasy team. Digging a hole. Digging an even larger hole next to that original hole. Unfortunately, Tax Act's filing software can't make taxes fun, but Tax Act can help you get them done. Tax Act. Let's get them over with.

Luke Vargas (0:32)

The White House talks tough on Greenland, but is it just a pretext for negotiations over a sale of the island? Plus, what 50 million barrels of Venezuelan oil could mean for US refiners? And big banks seem to shrug off bubble fears, predicting another strong year for markets.

Caitlin McCabe (0:51)

There's also concern that some of the trades that really powered the market higher last year could struggle this year, namely, AI is top of the list there. And I think a lot of investors have some concern that we could see more of that happen again this year.

Luke Vargas (1:06)

It's Wednesday, January 7th. I'm Luke Vargas for The Wall Street Journal, and here is the AM Edition of What's News, the top headlines and business stories moving your world today.

We are exclusively reporting that President Trump may be seeking to buy Greenland and that recent threats made about the island amount to rhetoric intended to push Denmark to enter into negotiations that would see it hand over control. That is according to remarks by Secretary of State Marco Rubio to US lawmakers on Monday. Fierce of an aggressive American action led six European leaders yesterday to issue a joint statement with Denmark's Prime Minister that called on Washington to collectively work with allies over security concerns in the Arctic. Polling also shows that most Greenlanders oppose becoming part of the US. But is that the end of the story or just the backdrop for diplomatic dealings? Daniel Michaels is the Journal's Brussels Bureau Chief. Dan, how should we be interpreting these statements from Copenhagen as well as from other European capitals and for that matter what we're hearing from the US.?

Daniel Michaels (2:12)

There are two levels to this. One is the geostrategic picture and the other is just the politics and international relations of the day. Since Russia has become more aggressive in Ukraine and beyond, fears of Russia have increased and part of that includes growing fear of nuclear attack, which involves missiles launched from Russia towards North America. Later on top of that, China is very quickly expanding its nuclear arsenal and any missiles launched from China to the US would pass over the high North, including over Greenland. So the US has very serious real national security concerns that Greenland fits into in a big way. But then there is the diplomacy of this, which is obviously rubbing Denmark and Europeans the wrong way because the way the Trump administration is going about presenting its case for a greater US presence in Greenland, which basically is that we need to own it in order to do something there.

Luke Vargas (3:20)

Right. And on the diplomatic front, I noticed the Danish prime minister warning yesterday that the country's NATO alliance with the US could collapse were the US to invade Greenland. That could well be true, Dan, but should we not bear in mind that there's reason to think Trump, if he is thinking about some sort of purchase here, seems to view close relationships as the ones that can be most tested.

Daniel Michaels (3:43)

Trump does seem to take a maximalist approach with allies fairly often. He did it with NATO itself last year, where NATO had been targeting spending 2% of gross domestic product on defense, and he pushed that to 5%.

And almost nobody this time last year would have predicted that by the end of June, NATO would unanimously agree to do that. So, it does seem that with Greenland, Trump and his administration are taking, again, a maximalist approach at the same time that Secretary of State Rubio and some other people close to the administration more quietly seem to be taking the approach that no, we're not going to invade Greenland, we want to own it, we want you to sell it to us, and that the more muscular rhetoric really is a negotiating tactic.

Luke Vargas (4:37)

That's the context around the US approach here. Are you hearing anything that would suggest there's a path in which a deal could happen?

Daniel Michaels (4:44)

There is a potential path. Nobody in Europe seems amenable to it yet. It may be one of these things where what one day seems impossible not long after is actually achievable. That is an approach that is getting mentioned more and more often for Greenland, that the US might strike some kind of compact of free association with Greenland. Denmark hasn't signaled any openness to that yet. Greenlanders themselves don't seem open to it. It does seem that the US administration is looking for potential friends in Greenland and Denmark, trying to identify Greenlanders who might work with it and might lead a what one might call an independence movement even if it would only be independence from Greenland and then dependence on the United States.