The Week Evening Review
Delaware's changing business laws, falling cognitive capacities, and the future of Amtrak

 
TALKING POINTS

How will Musk's Delaware 'Dexit' impact US business?

Delaware's capitalist-friendly approach to taxes and regulation has long made it a lynchpin of the American economy: More than 1.5 million global businesses are incorporated there. But Elon Musk's "Dexit" to Nevada could change all that, and state legislators are scrambling to respond.

Musk moved Tesla's incorporation to Nevada after a Delaware judge ruled last year that his $56 billion pay package "should be rescinded," said CNBC. The world's richest man also "smeared the judge" in social media posts and encouraged other business leaders to follow him out of the state. Meta and Walmart, among others, are "reportedly considering leaving."

That's why the Delaware state Senate "easily passed" legislation loosening corporate requirements last week, said WHYY. The bill "reduces the amount of internal due diligence" companies must do to review pay deals with powerful executives. Critics are calling it the "billionaires' bill."

'Race to the bottom'
Musk has "triggered a corporate deregulation bomb," said Luke Goldstein at The Lever. The new bill would "shield many of the country's most powerful corporate executives" from scrutiny by shareholders and workers. It's part of a "race to the bottom" that could have "sweeping consequences." 

Shareholder lawsuits like the one that reversed Musk's pay package are often used by minority stockholders to "hold corporations accountable for misconduct," said Goldstein. The result would end up "fundamentally eroding corporate governance" in the U.S.

Some of the companies leaving Delaware "share a crucial characteristic," University of Nevada Law Professor Benjamin Edwards said at the Financial Times. They are "controlled" companies in which the founder "still owns or controls much of the corporation's voting shares." 

Delaware law has until now made it easier for minority shareholders to sue such companies: Controllers can "enrich themselves at the expense of other shareholders" but they also "have more skin in the game," said the FT. Controlled businesses "must consider whether Delaware is worth the drama."

'Reducing costly litigation'
Corporate law "isn't about fairness — it's about creating value," said University of New Hampshire Law Professor Seth Oranburg at Bloomberg. The new legislation would benefit all shareholders by "reducing costly and unpredictable litigation."

The Delaware bill could spark "wholesale looting of retirement and pension funds across the country," said Ryan Cooper at The American Prospect. If executives at controlled companies can "run roughshod" over minority shareholders, they "can't be said to meaningfully own it after all."

 
 
QUOTE OF THE DAY

'It's horrifying what they are doing, not only to the trans community but also to migrants, to communities of color, to so many marginalized communities that are being systematically targeted by the new administration.'

Vivian Jenna Wilson, Elon Musk's estranged daughter, on the direction American politics are going. "It's cartoonishly evil," she said to Teen Vogue. "It's terrifying."

 
 
THE EXPLAINER

Have we reached 'peak cognition'?

After more than a century of steady increases, IQ test scores are plateauing or even falling. And the limited data available on "cognitive capacity" — the ability to apply intelligence to real-world uses — suggests the average person's problem-solving capability "peaked in the early 2010s and has been declining ever since," said the Financial Times. 

What could be behind the decline? 
Our "underlying human intellectual capacity" is probably "undimmed," said the FT. But "outcomes are a function of both potential and execution," and for "too many of us, the digital environment is hampering the latter." As we increasingly become passive consumers of a "torrent of content," we see "broader erosion" of our capacity for "mental focus and application." 

The lingering effects of long Covid could also be at play. A 2024 study compared the cognitive performance of people who had recovered from Covid-19 with that of a similar group who had never contracted the virus. The Covid-19 group "did worse," said Time, "equivalent to a deficit of about 3 IQ points." 

Could the cause be environmental? 
Air pollution has a huge negative effect on cognitive ability. In a 2018 study of 20,000 people in China, scientists found that higher air pollution levels significantly impeded performance on verbal and math tests. Polluted air could have an equivalent impact to reducing a subject's level of education by a year, said study co-author Xi Chen to The Guardian. 

Is AI affecting IQ? 
Artificial intelligence is revolutionizing the world's industries, but a "less-discussed consequence" is its contribution to the "decline of human cognitive skills," said Forbes. Earlier tools, such as calculators, simplified tasks but "did not erode our ability to think critically," whereas AI is already "diminishing our reliance on our cognitive abilities." A University of Pennsylvania study published last year found that U.S. high school students who regularly used ChatGPT to help with their assignments performed worse on tests than those who didn't. Effectively, AI is "'thinking' for us."

 
 

Statistic of the day

$6.1 billion: The valuation at which the Boston Celtics have been sold — the highest price ever paid for a North American sports team. The basketball club is being sold to a private equity group led by businessman Bill Chisholm. The previous record for a sports team sale was held by the Washington Commanders, which were sold for $6.05 billion in 2023.

 
 
IN THE SPOTLIGHT

Amtrak is the latest company under DOGE scrutiny

America's national railway service could be heading off the tracks, as Amtrak CEO Stephen Gardner announced on Wednesday that he was stepping down from his position. His resignation comes amid a flurry of criticism aimed at Amtrak from the Trump administration, specifically from Elon Musk and his Department of Government Efficiency.

Push to privatize
Amtrak is one of several institutions, along with the U.S. Postal Service, that Musk has suggested privatizing, claiming that a national rail service is a burden on taxpayer dollars. President Donald Trump hasn't spoken on the privatization issue, but this anger toward Amtrak isn't new for his White House. 

Trump "tried to cut federal funding for the company in half during his first administration — but it has taken a sharper turn this time around," said Gizmodo. Billions of federal dollars for Amtrak "got caught in Trump's federal funding freeze," putting further strain on the country's train commuters. 

Gardner had "tried to go along with as much of the Trump administration's demands as possible," but it "seemed inevitable that he and the company would continue to receive significant scrutiny," said Gizmodo. His resignation came at the specific request of the Trump administration, said Reuters. 

Musk reportedly "called Amtrak 'kind of embarrassing' — while comparing" it to "bullet trains in China," said The Associated Press. He has claimed that privatization is the "only way to fix the national rail system," said The New York Times. Amtrak has indeed "struggled with aging infrastructure and frequent delays" and has never turned a profit. 

Amtrak's future
The company is the nation's largest high-speed rail provider, and privatizing it "could have a huge impact on the technology's future," said Newsweek. Such an effort "could prompt investment and improve services for passengers," a spokesperson for AmeriStarRail, a company considering a private sector investment with Amtrak, said to Newsweek.

However, the company seems to be heading in the right direction, at least on paper. During the 2024 fiscal year, Amtrak said it saw an all-time ridership record, and ticket revenue reached $2.5 billion, a "first in Amtrak's history and 9% higher year-over-year," the company said in a statement. And while "profitability is not Amtrak's objective," it expects to make a profit sometime during the next four years. 

 
 

Good day 🪸

… for the blobfish. The funny-looking animal has been named New Zealand's fish of the year. Made of gelatinous tissue, this deep-sea creature was once crowned the "world's ugliest animal." But despite its "unfortunate frown" and "squishy disposition," said The Mountains to Sea Conservation Trust, which runs the contest, New Zealanders "truly believe that blob is beautiful."

 
 

Bad day 💺

… for jet-setters. Tens of thousands of travelers in Europe and beyond are stranded miles away from their desired destinations after a fire at an electrical substation caused a power outage at Europe's busiest airport, London Heathrow. Power has now been restored, but it's not clear when the airport will reopen, with authorities warning flight disruptions could last for days.

 
 
Picture of the day

Watch his dust

Japanese driver Takamoto Katsuta drives his Toyota GR Yaris Rally1 with co-driver Aaron Johnston during the World Rally Championship in Gilgil, Kenya. The WRC is one of the oldest International Automobile Federation championships, second only to Formula One.
Luis Tato / Getty Images

 
 
Puzzles

Test your general knowledge with The Week's daily crossword, part of our puzzles section, which also includes sudoku and codewords

 
 
The Week recommends

Spring drinking requests that your beverages be perhaps light and definitively refreshing. It's the season for simple sours, low-ABV drinks with punchy herbaceousness, and maybe some cheeky infusions with, yes, bubble gum.

AJ Johnson's Gin Rickey
Gin, club soda, lime juice, sweetener — at its core, the gin rickey is a simple, essential cocktail. This version from Washington, D.C., bartender Andra "AJ" Johnson amplifies the sweet element by infusing simple syrup with Buddha's hand citron, makrut lime leaves and lemon juice.

Bubblegum Daiquiri
Bear with us. Yes, bubblegum can have a chewy, poppy place in the glass. This daiquiri begins by tossing a bunch of Hubba Bubba gum with the contents of a bottle of light rum. Twenty-four hours later, you are armed with your daiquiri base. Add lime and simple syrup, shake and bust out the Cracker Jack.

Soft Arms
This nonchalant low-ABV cocktail has an all-star roster of personality-driven components. Riesling adds its zippy edge, fino sherry walks in with its dry oxidation, and white vermouth and aquavit are all herby tension. A touch of yuzu vinegar provides acidity.

 
 

Poll watch

Nearly six in 10 American college students (59%) do not believe colleges charge fair prices for what they offer, according to a Gallup survey. The poll of 13,933 students also found that 14% think it takes more than a decade for an investment in college to pay off. 

 
 
INSTANT OPINION

Today's best commentary

'Florida's senators are right. Move NASA from Washington to Cape Canaveral.'
Mary Anna Mancuso at the Miami Herald
Florida may soon "be home to NASA's headquarters," and the move "makes total sense." The "infrastructure, talent and private-sector ecosystem are already here, so why shouldn't the agency's leadership be here too? It makes operational sense." Critics argue NASA "should keep its headquarters in Washington to help ensure funding," but this is "about bringing those who work in the headquarters closer to the heart of the space program." The "decision-makers should be where the action is."

'Why a weight-loss drug could become a geopolitical bargaining chip'
Gillian Tett at the Financial Times
Can a weight-loss drug become a "weapon of war? Once, that question might have seemed absurd. No longer," says Gillian Tett. "One idea floating around the Trump ecosystem is that the drugs could be a bargaining chip in future negotiations with Denmark, perhaps by pushing for a U.S. acquisition" of Danish company Novo Nordisk, the drugmaker of Ozempic and Wegovy. Another "possible tactic would be for the U.S. to demand a krone revaluation, to keep Denmark linked to dollar-based finance." But "plenty of factors might yet derail Trump."

'NATO remains our best defense'
Kay Bailey Hutchison at The Dallas Morning News
Europe is having "serious discussions about how to increase security investments while dealing with uncertainty about America's long-term commitment to the NATO alliance," says Kay Bailey Hutchison. Keeping "our European and Asia-Pacific allies and partners together and strengthening our collective defense should affect how we address the trade issues confronting us today." But "settling the economic issues does not require that we break up our long-term relationships and alliances." We "would be weakening our own security."

 
 
WORD OF THE DAY

sleepmaxxing

A TikTok trend and an umbrella term that describes "hacks that can maximize or improve sleep quality and quantity," said Time. Some of those hacks include "stocking up on supplements like magnesium, eating kiwis before bed or taping their mouths shut."

 
 

Evening Review was written and edited by Theara Coleman, Nadia Croes, Scott Hocker, Anya Jaremko-Greenwold, Justin Klawans, Harriet Marsden, Joel Mathis, Summer Meza and Anahi Valenzuela, with illustrations by Stephen Kelly and Julia Wytrazek.

Image credits, from top: Illustration by Stephen Kelly / Getty Images; Illustration by Stephen Kelly / Getty Images; Luke Sharrett / AFP via Getty Images; Kseniya Ovchinnikova / Getty Images