Immigration and U.S. economic growth

Make Me Smart March 22, 2024 Transcript

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Kai Ryssdal 

Yikes. Hey everybody, I’m Kai Ryssdal. Charlton, turn on the microphone on. Just a second. Surely no, I’m kidding. It was me. I wasn’t ready. This is Make Me Smart. We make today make sense. That’s our tagline, one of many. Anyway, it is Friday today, the 22nd day of March 2024.

Nova Safo 

I’m Nova Safo filling in for Kimberly Adams. Thanks for joining us on the podcast and on the YouTube stream. It’s Friday and that means it’s time for our weekly happy hour episode. One of my favorite times of the week.

Kai Ryssdal 

We are going to do some news as we always do on a Friday. We’ll take a break, and then we’ll play Half Full/Half Empty. Drew Jostad I’ve been told is in my studio downtown, which will be the subject of grievance that I will be filing momentarily. Nova, what are you drinking?

Nova Safo 

Okay, I’m going to be that guy this week, and I’m having not alcohol. Sorry, Kai.

Kai Ryssdal

Look, that’s fair.

Nova Safo

It’s been too long a day. I’m having Fortnum & Mason Royal Blend tea.

Kai Ryssdal

Nice.

Nova Safo

And as it sounds, that is in fact, I’m told the tea that the British Royal Family imbibes.

Kai Ryssdal 

On a day when there is a British Royal Family news; involves some news about Catherine the Princess of Wales. So, there you go.

Nova Safo 

Well, you know people have been talking about it a lot today, by the way.

Kai Ryssdal 

Absolutely. Totally. So, I too, Nova, am drinking you know, a non-alcoholic beverage. I’m drinking water because I have some things to do this afternoon. I have some driving to do. Do I have my phone in front of my screen? Anyway. What was I going to say? Oh yeah. People who will listen to this podcast should know that Nova Safo when he’s on here at Friday afternoon 3:30 Pacific time 6:30 on the East Coast, has been up since midnight? One in the morning, Nova? What time do you get out of bed?

Nova Safo 

One in the morning. And normally, I get a nap in, but I didn’t get one in today. So, that’s why tea.

Kai Ryssdal 

Well, there you go. Fair enough. I’m going to run real quick through the live chat on the YouTube. I’m going to start with Chuck Kleinknecht, “Knob Creek nine-year-old single barrel reserve bourbon and a couple of ice cubes.” Nicely done. Paul in Minnesota, where I just saw you Paul, say you had six inches of snow. What is that? Paul has been drinking lots of tea lately, the last couple of weeks. I know. Folk, he’s drinking Bell’s Oberon Eclipse citrus wheat beer. Jefferson Nail having a five o’clock coffee. I hear you there. Let’s see, what else? Kate Gilbert, gin and tonic with Stockholms Branneri Pink Gin. I don’t even know what that is. Gin is the devil. There’s a shout out to the absent Kimberly Adams. All right, last one. Susana Roaming drinking water to prepare for mucho margaritas with a bunch of Girl Scout moms to celebrate the end of cookie season. Oh, I hear you there.

Nova Safo 

Oh, that’s awesome. That is wonderful.

Kai Ryssdal 

Totally. And can you imagine? It’s gotta be like frowned accountants.

Nova Safo 

Which cookie flavor would go well with a margarita is the question.

Kai Ryssdal 

That’s a good question. That is a good question. What’s your news item, Nova Safo?

Nova Safo 

Okay. The Congressional Budget Office came out with an analysis yesterday that I thought was interesting, and that is that the budget outlook for our deficit and the debt that we will have has improved a bit. A bit in that, you know, they look forward 30 years and anything can happen in 30 years. But as of this moment, should things stay the same 30 years from now, our projected publicly held government federal debt would be 166% of gross domestic product, which would be a heck of a lot, but it’s better than what was projected only last June by the same Congressional Budget Office, which was 181%. So, progress. And what do they credit for the progress? More immigration than previously expected into the country, which increases the labor force, which is something we absolutely need to do. This is not new information. But it’s very interesting that they’re tying this together in such a concrete way with the deficit and the debt pile that’s happening now, and that’s going to be continuing to happen. And the other thing is the deal last year between McCarthy and President Biden. Former speaker Kevin McCarthy and President Biden, who restrict the budgetary spending for this fiscal year and next fiscal year, I believe, as well. And apparently that’s working at the moment, and today, Congress is supposed to vote on the last parts of a bill that would be mostly in line with that agreement, which was from May of last year. And should that hold, we would be now in a new trajectory that’s better than where we were. So, there is progress to report, just far too slow progress, but progress.

Kai Ryssdal 

There is progress. And they did pass it this morning. The House passed it, and the Senate is really trying to get it done by midnight. That, of course, is when spending authority expires. So, you know, fingers crossed that there’s no silly government shutdown. I would also say, and full disclosure, I did not read the CBO thing because I was in Phoenix most of the week and sort of out of the news loop. I wonder what their expectations are for interest rates on that because while they’re high now, relatively speaking, they are going to be coming down at some point. And that, of course, will play into how much the government has to pay for money because the government pays for its money the same way that we pay for ours. You know.

Nova Safo 

Indeed. Well, for the most part. Oh, I would say one thing. One gripe though, if I find may, and this has to do with the budget bill. And while I was researching all of this, and thinking about oh well, it’s really aligned with what was agreed to last year, then what was the point of the last year? Well, that’s a bigger question. But apparently, one of the things they were using to sell holdouts in Congress on this bill, at least on the right side of the aisle, was that they got the Biden administration to agree to not fly any flag but the US flag on embassies in foreign countries, and apparently this is a gripe over the Biden ministration allowing the LGBTQ flag to fly at certain times in foreign embassies, which leads me to ask really, was this the most pressing issue?

Kai Ryssdal 

Yeah, I think the thing with Congress is that everybody’s got.

Nova Safo 

Very, very disappointing. It’s just very disappointing that’s that. First of all, as a gay man myself, I’m very biased on this issue. One, not progress. And two, how was this at all pressing in any way whatsoever? I’m very disappointed personally. I must say. All right, sorry. I’m all done.

Kai Ryssdal 

No, look that’s why this podcast exists for, you know, personal perspectives on what’s going on in this country. I’ve certainly done it. Kimberly does it. Molly did it. That’s the way it goes. Literally, by the way, that’s why this podcast exists. So, we can have sort of a different outlet, and people can get a different side of the people who are Marketplace. Okay, so here’s mine. Much less consequential but of interest, nonetheless. I’ve talked many times on this podcast. Well, mostly it’s me about commercial real estate and the challenges that commercial real estate is having post pandemic, and what is going to happen with commercial real estate. And I suggest to your attention, a news item. We’ll put it on the show page, obviously, from a business publication called Bisnow. Business Now, the Washington DC version of that, talking about the sale of a place in Washington DC head of office buildings, prime location, right between the Capitol and the White House called Market Square right near the Navy Memorial if you’ve been there. It was just sold. And it was sold for something like $323 million, which is a nice price for an office building in the nation’s capital. Except the last time this building was sold in 2011, it was sold for $613 million. So, $613 million 13 years ago, $323 million today, because people aren’t going back to the office. It’s give or take, half as much per square foot, as it was 12 years ago. I am here to tell you, there is a reckoning coming in commercial real estate because the people who bought it for $613 million 12 or 13 years ago financed it, right? They took out loans to do it. And now they have sold it for give or take half the price, but they still owe $613 million, broadly speaking, right? They paid off some of it, and they can refinance and all that jazz. But the debt doesn’t disappear. The debt doesn’t disappear. So, as these buildings, and we’ve talked about buildings in Los Angeles. We’ve talked about buildings now in Washington, and also in New York, as these buildings sell for much less than they were originally bought for, that’s going to be a problem. It’s going to be a problem for the investors. It’s going to be a problem for the banks who financed it. Don’t sleep on commercial real estate. It’s what I’m saying.

Nova Safo 

It’s really interesting. Recently, the treasury secretary said they’re paying attention, obviously to this, but that they don’t think it’s going to pose a systemic risk. But you wonder how that’s possible when you see such huge discounting.

Kai Ryssdal 

Right. Right. Right. And look, you get where Janet Yellen is coming from. She can’t actually come out and say everybody panic. But you gotta believe that there are people in treasury who are just like, hmm this maybe ain’t great. You know?

Nova Safo 

And it takes time for this all to filter through, right?

Kai Ryssdal

Oh, totally.

Nova Safo 

Of the way the cordial market works. And do you suppose these buildings will stay offices?

Kai Ryssdal 

Oh no. No, there are moves afoot all over the country to turn these offices into residences or apartments, right? I mean, you know, condos or apartments. But the problem and the New York Times did a great piece on this, like a year and a half ago, about the way some of these buildings were built, right? Where the bathrooms can be where the plumbing is. You got elevator shafts in the way. Not everybody has outside access to a window. So, it’s going to be really expensive and challenging to turn some of you know, some of them are fine with it, but it’s going to be expensive to turn some of these buildings into apartments. You know?

Nova Safo 

Then the question becomes, is it cheaper to knock them down and build a new building?

Kai Ryssdal 

Right, knock them down and actually build apartments. Great. Maybe we’ll get there. I don’t know. Really good point.

Nova Safo 

But then when you’re talking about changing the skylines in cities.

Kai Ryssdal

Yes, you are.

Nova Safo

It’s fascinating, as we see this sift through. Really.

Kai Ryssdal 

You know, what’s funny is, you know, we are post pandemic, right? But the economy is not done with it, and big parts of the economy are not done with it either. One of which is real estate, commercial real estate specifically, you know? Anyway. All alright. So, we’re going to move on. First though, I’m going to say something that you guys all know is coming. Well, that’s right. But all y’all know what’s coming because this is the week for it. This is the last day of our spring fundraiser. We’ve got those 35th anniversary gifts. We have a sticker, glass mug, a tote bag, and a T-shirt, all featuring that retro logo, the original logo, which frankly, I prefer to anything that corporate HQ has come up with.

Nova Safo

I love it.

Kai Ryssdal

They disappear for the donation form at midnight tonight. That’s my test for anybody in St. Paul, who’s listening, corporate HQ. Anyway, we are in the last hours, they disappear as I said, at midnight tonight, over 1,300 of you have stepped up so far to give what you can. We appreciate it. We need it. We thank you for it. We are though, only 65% of the way to the goal. So, if you can get us there, we appreciate it. It’s marketplace.org/givesmart. It is important that we hear from you because this is how we do what we do, marketplace.org/givesmart. We’re coming right back. Half Full/Half Empty is the game. Drew Jostad is the studio interloper at 261 South Figueroa in downtown Los Angeles,

Drew Jostad 

It’s pretty nice in here.

Kai Ryssdal 

I want to put everything back.

Drew Jostad 

Not even sitting on your side of the table.

Nova Safo 

Hey Drew, just remember to really turn his volume knob on his headset up as much as possible. He loves that.

Kai Ryssdal 

I expected, but everything’s back exactly the way it found it. That’s all I’m saying.

Drew Jostad 

All right. Let’s get down to business. Sold out of Trader Joe’s stores and going for hundreds of dollars on eBay. Are you half full or half empty on tote bags as a fashion accessory?

Nova Safo 

What? I missed this story.

Kai Ryssdal 

So, did I. Drew, some background?

Drew Jostad 

Those Trader Joe’s canvas tote bags are hot items right now. They came out with a line of multiple different colors, and they went quickly.

Kai Ryssdal 

Wow. Look, this is public radio, so I have to be pro-tote bag. It’s in my in my contract. Otherwise, I get fired. So, yay tote bag.

Drew Jostad

You were just selling the tote bags before the break.

Kai Ryssdal

You know, I’ve got like, three tote bags in my garage. I’m sure we’ve got more other places. Yay. More tote bags, but okay I’ll be half full.

Nova Safo 

These are cute. I just Googled these, and they look lovely. And talk about retro, lovely, bright, retro looking colors. Totally helpful. Absolutely.

Kai Ryssdal 

All right. There you go. Now we know.

Nova Safo

Easy one.

Drew Jostad 

Okay. You’ve heard of little free libraries. Are you half full or half empty on the little free Blockbuster DVD lending libraries?

Kai Ryssdal 

So little free libraries for those who don’t know are literally little, they look like they’re built to look like houses and they’re up on a you know, five-foot-tall pole or whatever. And some there’s one in somebody’s front yard in my neighborhood. There’s sometimes in business centers or there actually used to be one at Marketplace world headquarters. I don’t know if it’s still there post pandemic. I’m half full. Sorry. What’s the question, Drew?

Drew Jostad 

Little free Blockbuster for DVDs.

Kai Ryssdal

Oh, yeah. Why not?

Nova Safo

If anybody has a DVD player, yeah. I love it.

Kai Ryssdal 

Well, right. That presupposes DVD players. Whatever. Use your Xbox.

Nova Safo 

I have one. But you know, I actually did a survey once of the Marketplace Morning Report team. And yeah, wouldn’t you know it, literally almost no one else. Nobody else besides me had a DVD player.

Kai Ryssdal 

I’ll bet you David has one because he’s like you and me. But none of the young folks. I’ll tell you that.

Nova Safo 

The young’uns didn’t. Yeah.

Kai Ryssdal

Yeah. Exactly.

Nova Safo

Sabri didn’t either, you know.

Kai Ryssdal 

Hey, you know, I mean. Nevermind. Nevermind. Let’s move on. Young in spirit.

Drew Jostad 

Half or half empty on the Encyclopedia Britannica IPO.

Kai Ryssdal

Seriously?

Drew Jostad

Seeking a $1 billion valuation, could go public assume now this June, I’m reading the reports.

Kai Ryssdal 

So, Encyclopedia Britannica is a company, and it’s not put out by a publishing. Wow.

Nova Safo 

It’s its own company. It’s the only one that survived. And in fact, for Marketplace, I went to their headquarters in, I want to say 2014, 2015. I did a story about them trying to reinvent themselves in certain ways. They’re still struggling now, but they’re trying to, I guess, enter a new era.

Kai Ryssdal 

Yeah, I’m going to echo the live chat here. “How does it make money?” “What do they sell?”

Nova Safo 

Education. Education materials. They’ve tried to pivot. They still have their encyclopedia. They still obviously put that out. They’ve been trying to go digital. They have gone digital. But they have put a lot of heavy investment on education materials.

Kai Ryssdal 

Interesting. That’s interesting. Well, look just in the spirit of being pro-education. I’ll be half full on that. Totally interesting. I had no idea.

Nova Safo 

I’m glad they’re still around, you know?

Drew Jostad 

All right. Are you half full?

Kai Ryssdal 

Sorry, wait. Is this the poll? No, one more, okay.

Drew Jostad 

Are you half full or half empty on a Voodoo Ranger TombStone Pizza collaboration called the I(Pizza)A?

Kai Ryssdal 

So, Voodoo Ranger is a beer, some of which are good, some of which are not. And they’re doing a Voodoo Ranger pizza. It’s a what?

Nova Safo 

There’s a lot happening in that question.

Drew Jostad

Pizza flavored IPA.

Kai Ryssdal 

Pizza flavored IPA. That’s honestly, that’s dumb. All those pizza flavored this or beer flavored that. You know, no.

Nova Safo

That was a Kai question.

Kai Ryssdal

It was a Kai question. But honestly, no. Why do you need? What? It’s a pizza flavored beer, right?

Drew Jostad

Yeah.

Kai Ryssdal

Okay, no, absolutely not. Absolutely not.

Nova Safo 

Half empty, as well, even though I’m not a beer drinker because that’s just gross.

Drew Jostad 

Kai’s more of a beer flavor pizza kind of guy?

Kai Ryssdal 

Yeah, absolutely not. All right, this is the poll, right, Drew?

Drew Jostad 

This is the poll. I gotta get the hat tip out to Diana in Colorado for that last topic. I forgot to mention that was a listener submitted question.

Kai Ryssdal

Nice. That’s very cool. That’s awesome.

Drew Jostad 

Moving along. Wal-Mart announced they’re going to renovate more than 800 locations to feature higher end products. Are you half full or half empty on Wal-Mart selling luxury goods?

Kai Ryssdal 

Oh, that’s so interesting. That’s a Kristin Schwab story for us. She did a little bit today, a little bit this past week on sort of mid-line value retailers going upscale as a way to survive. It’s a thing they’re doing right? I mean, Macy’s doing it. Everybody’s doing well.

Nova Safo 

Well, how do they define upscale or luxury because it’s Wal-Mart, so I’m going to need a definition here.

Kai Ryssdal 

So, you can apparently you can get, I learned this from Kristin Schwab today on a radio program that we call Marketplace.

Nova Safo

Oh, is that still on?

Kai Ryssdal

Yes, it is still on. Somehow. Maybe not after this podcast when I get fired, but it is still so far on. I don’t know why I’m being really negative about my career. And I’m totally sober, so I don’t know. My subconscious is working overtime. Not for the first time this podcast turns into “Kai Ryssdal’s Therapy Session.” So, Walmart. Kristen Schwab told our listening public today. Number one, you can get a Michael Kors handbag at Wal-Mart. Michael Kors is an upscale guy.

Nova Safo

Mid-level luxury.

Kai Ryssdal

Oh, is he? Do you know more about Michael Kors than I do?

Nova Safo 

No, but it’s not like, it’s not exactly like you know, it’s fine.

Kai Ryssdal 

Alright. Also, you can get caviar at Wal-Mart. Now, you know, maybe it’s lousy caviar.

Nova Safo

Which kind?

Kai Ryssdal 

I don’t know. Okay. Are you the caviar connoisseur? Clearly, you are.

Nova Safo 

No, but just like, I need some labels here people. Some specifics. There’s caviar, then there’s caviar. There’s a Birkin bag, and there’s a Birkin bag. You know, I mean.

Kai Ryssdal 

Yes. Yes. Well, so. Anyway, so there we go. We got 150 votes in. We’re going give you guys 15 more seconds. Yeah, so Jin Pak, “Michael Kors isn’t as luxury as it used to be.”

Nova Safo 

Thank you. Yeah, it’s okay. I mean, it’s a fine brand. But I would say it’s more like mid-level brands. Very nice stuff you can get, but it’s not exactly like high fashion.

Kai Ryssdal

Fair enough. Fair enough. Sorry, I’m just scrolling here.

Nova Safo 

Come on. Keep up, Kai.

Kai Ryssdal 

All right. Yeah, I know right. I’m so lame. Okay, the poll is closed. Wal-Mart selling luxury goods. Half empty, 70% of you. Half full, 29% of you. And I don’t know what the other one percent are doing out there. I don’t know. I don’t know.

Nova Safo 

Wow, I didn’t expect people to be so anti-Wal-Mart selling things that aren’t you know, cheap garbage. But okay.

Kai Ryssdal 

Well, there we go.

Drew Jostad

Sounds like Nova has an opinion on that.

Nova Safo 

I mean, it’s just nice to have some quality things.

Kai Ryssdal 

Well right. That’s exactly right. And look, American consumers are very, very bargain colleges. And so, Wal-Mart’s like, you know what, we’re going to sell you these things. We’re going to sell a little bit cheaper, and you’re going to come in here and you’re going to save a billion dollars at our store.

Nova Safo 

I think that’s nice.

Kai Ryssdal 

Exactly what I thought. Exactly. All right. We are on a Friday afternoon and a very, very, very long day for one Nova Safo.

Nova Safo

I’m done.

Kai Ryssdal

Kimberly and I are back on Monday. In the meanwhile, if you’ve got a question or a comment you want to share with us you know how to do that. Leave us a voicemail 508-U-B SMART. You can email us at makemesmart@marketplace.org. And you can also contribute, should you so choose, marketplace.org/givesmart.

Nova Safo 

And if they’re emailing, I feel like you should include whether you’ve contributed or not, so that we know whether to read your email.

Kai Ryssdal 

So, that we know. Make Me Smart is produced by Courtney Bergsieker. Today’s episode was engineered by Charlton Thorp. Our intern is Thalia Menchaca.

Nova Safo 

The team behind our Friday game is Emily Macune and Antoinette Brock. Marissa Cabrera is our senior producer. Bridget Bodnar is the director of podcasts. And Francesca Levy is the executive director of Digital and On-Demand, and apparently, we’re not crediting today our boss of us all.

Kai Ryssdal 

No, he’s only in charge on Tuesdays. Four other days of the workweek, he’s not in charge at all. You could just disregard anything Neal says. That’s going to be the test of whether he actually listens to the end of this podcast.

Nova Safo 

Well, it was nice knowing you, Kai.