What A Day - Pandemocracy!

Episode Date: March 17, 2020

Covid-19 has hit the US economy hard, devastating the stock market and prompting limited hours and layoffs around the country. We talk to Annie Lowrey, a staff writer at the Atlantic, to help us parse the economic impact of the virus. Florida, Illinois, Ohio, and Arizona were set to go to the polls today on yet another important day of voting in the presidential primary. We go through the different ways states are planning to hold a vote (or not) during a pandemic. And in headlines: France fines Apple $1 billion, Starbucks doesn’t want you to stick around, and the SCOTUS postpones arguments due to Covid-19 concerns.

it's tuesday march 17th i'm akilah hughes and i'm gideon resnick and this is what a day coming to you on the first ever stay at home st patrick's day i'm calling it st patrick's day i will be rationing my one guinness for the next two weeks dark a sip every hour. Ew. On today's show, we're talking to economic policy reporter Annie Lowry about the coronavirus, then how states are switching up their elections in response, and as always, some headlines. But first, here's the latest. Yeah, if you're talking about the virus. Yes, we are always talking about the coronavirus, sir.

Literally, like, what does he think this is even about? All right, never mind. Here's the news. All right, so Trump is now recommending that we avoid hanging out in groups of 10 or more. The EU is planning to seal itself off from almost all international travel. The Bay Area, so that's San Francisco, Oakland, and extending slightly further out, is now doing something called, quote, shelter in place, which is the strictest large scale lockdown to happen so far in America. Congress is still working on a relief bill. So just for a refresher, there was the initial $8 billion bill, which you may remember

from Trump saying it would be too much to address the crisis. Now, Congress is working on a second bill that is still in the House to provide paid leave and free testing. And Senator Schumer has proposed a third aid bill of $750 billion with a B dollars before that second bill in the House has even been figured out. So lots of money happening. In business news, Amazon says it's going to be hiring 100,000 more workers as the crisis will mean more people having to shop online during the lockdowns. But layoffs are starting to sweep across other areas of the economy. The travel industry, entertainment industry, and restaurant industries are all taking a hit. The stock market has now raised three years of gains in the past two weeks. And economists say we're headed into a recession. But I could have

told you that. But thank you so much, economists, for sticking your neck out there and pointing it out. Yes, thank you. So we wanted to take a moment today to get a grip on everything that is happening in the economy. And to do that, we're bringing in Annie Lowry. She's a staff writer at The Atlantic, where she covers the economy and policy related to that, we're bringing in Annie Lowry. She's a staff writer at The Atlantic where she covers the economy and policy related to it. She's joining us remotely in a crazy setup that we've rigged here between all of us. Annie, thank you so much for being on the show. Thanks so much for having me, guys. Awesome. Thank you for joining us. So hey, Annie, it's Akilah. It's obviously not Gideon anymore.

All right. So Congress is trying to pass an economic response bill, which they really haven't quite figured out yet. You know, the Fed is taking actions to put money into the markets. It quickly goes back out. There's been talks of bailouts for different industries. And, you know, the markets are just still falling and people are starting to lose pay and their jobs. So why is it so hard to figure out how to stabilize things? This is a really unusual recession because this is all coming isn't to say that we haven't had pandemics before that haven't caused economic problems, but not in this immediate, globalized, sudden way where we've had all of this information in real time and we've had these shock measures to stop people from talking with each other and seeing each other and transmitting in real time. And so basically what's happening is we're kind of shutting the economy down. It's as if there is like a hurricane that's hitting everywhere in the United States and frankly around the world all at once.

So to get on the other side of the health crisis, we're going to take a giant economic blow, and the hope is that it'll be pretty short lived. And so then the question is kind of how do you get people over that bridge? Because rent payments keep on going and you need to get food on the table, right? So the economy has stopped, but people's financial lives haven't stopped. And so you probably need kind of like a multi-pronged, really big response to kind of just bridge us over the next six months or so, maybe longer until we can get the economy back to normal and we get the kind of public health part of the crisis behind us. So it's

just really unusual in that this is not due to some economic problem, really. This is just necessary to save lives. And so it should be really painful, but hopefully fairly short-lived, unlike the Great Recession and the really crummy recovery we had after it. Yeah, for sure. Yeah. And today we saw, or rather on Monday, we saw Mitt Romney, of all people, voicing support for a universal $1,000 handout to every American, an idea that Democratic presidential candidate Andrew Yang built his campaign around. And a bunch of other Democrats like Sherrod Brown are also pushing that idea. Do you think that that's what we should be doing at this stage? And if the government were to do bailouts at this point, who should actually get them?

Right. So that's a really good question. And so the reasoning behind sending everybody helicopter money all at once is that people's needs are going to be really different. And it's going to be really hard to tell who has what needs. So for instance, you could expand unemployment insurance, which is an existing safety net that we have for all workers who, who, for workers who lose their job through no fault of their own, but that doesn't cover like gig economy workers, right? It's not covering, you know, your landscaper who comes to your building, who gets paid in cash. It's not covering Uber drivers. It just misses a lot of people. And so the idea behind sending everybody money is that the government doesn't need to figure out who needs money for what.

You can just give people cash and they can solve their own economic problems. So you don't have to worry. It's just really fast and you're making sure that everybody is getting it. So that's the argument for that. And then we'll probably need some other policies like expanded unemployment insurance, expanded food snaps, maybe some measures like restrictions, moratoriums on evictions. We can suspend mortgage payments. We can suspend things like utility payments maybe. And then as far as the bailouts go, certain industries are going to take just an unbelievable economic hit here. And there's a lot of them that probably actually won't really have the financial resources to survive without some kind of bailout.

And so the question there, it's a little bit thornier. You know, should these companies have been doing their own rainy day planning? What is the taxpayer going to get into in return? Those are going to be tough and those are going to be politically really, really difficult conversations to have. And we're going to start having them. We've already started having them now. I think it's now five industries that they're discussing bailing out. Yeah. And I think what's pretty interesting about that as well is, you know,

we have all of these corporate tax cuts and we have all of these tax cuts for very wealthy people. And they're not the people who are kind of the most affected by this immediately. And so I think it will be interesting to see how that plays out. But, you know, all of these things we're talking about in terms of economic relief, you know, is that even going to be enough? Like, are these going to be bandages in the sort of way that we're seeing, you know, these, you know, rate cuts for the market and all of that? Are these things that are only going to last a day? How can we sort of predict what's going to happen with the recession? It's really hard.

This is a really hard recession to model because it's so unusual, right? We really don't know how big it's going to be. But the current estimate is that in annualized terms, the economy is going to shrink about 10% in the second quarter. So if it did that, that would be a bigger, sharper downturn than ever happened in the Great Recession. So the Great Recession was much longer and top to bottom was much bigger, but it was never so acute in terms of its pain. And so you want the federal government to spend as much as it can and to charge it to the deficit, right? We don't want to pay for anything about commensurate with the loss of economic activity. So that's like a trillion dollars,

maybe, maybe more. And the risk of doing too little is way bigger than the risk of doing too much. The Fed has said, we are going to do everything we can to keep financial markets calm and to make sure that we're not having big credit crunch, bank runs, that kind of thing. We're going to support other central banks too, to help that as this really scary thing happens, because recessions that are combined with financial crises are much worse. So they're doing what they can. And now it's on Congress to do the spending part, right? The like helicopter money, the bailouts, all of these things. There's going to have to be like a lot of loans to small businesses to keep them afloat. Federal government is going to have to give money to states to help manage the loss of sales taxes. So it's going to be complicated, a lot of pieces to it. But the most important thing is just that it's really big, really, really big. Yeah. And then, you know, we got the first set of economic data from China

in, you know, the aftermath of Corona sort of beginning there. That gives us a sense of how this has impacted their economy. Is there anything that we can learn from that data that we have? And, you know, maybe kind of think about how that could be prescribed to the American economy? Yeah, I think that there's a lot to learn from other countries that are going through this. And I think that two big lessons. One is that the more you can do to bend the curve down, to flatten that curve out, to make sure that people are healthy, the better this is going to go. You're not going to need these really, really painful measures, hopefully, as long as you're doing right in terms of public health. And so I think that that's one important thing. There's

not a trade-off between public health and the economy in this case, because we have a lot of tools to help the economy. So it's okay to do really drastic things to make sure that we're preserving lives. That's really important. The second is that after this is over, we're probably going to have kind of a nasty garden variety recession, because the whole world is dealing with this. And so we know a lot about how to fight those kind of just common demand side recessions. And we just need to be able to keep on pushing until the whole world is kind of recovering from this. Because it's not just us.

It's everywhere that's seeing really dramatic declines in economic activity. Because this is a really, really awful health crisis and people are losing people that they love. And so I think that those are two of the things that we're going to watch. You know, we are still going to be in a really tough place a year from now. That's for sure. Sort of going back to businesses, the worst segue in history, but you know, we got to talk about the business. All right. So what are you hearing from businesses about their ability to keep up supply, you know, making things, selling things, delivering things? We're living in a really convenient time and now we're suddenly forced to be separated. And so is there a concern on, you know, that sort of front of like what we're even able to make? Yeah.

So this is going to be really hard in particular for small businesses that don't have the financial resources and the cash piles. Like, you know, Apple, for instance, they have literally a trillion dollars of cash. We don't really need to worry about them. Facebook don't need to worry about them, but little companies, they don't, they have small margins. They're small. They don't have those financial resources. And this is kind of a tough piece of this, but they're going to have to lay workers off so that those workers can go to the unemployment insurance system. We used to, in this country, do something where you would get a temporary layoff. It was, it used to be kind of like more common and more sort of socially acknowledged, right? We're going to lay you off,

but we're going to hire you back. And so I think that those kinds of arrangements are going to be kind of like more common and more sort of socially acknowledged, right? We're going to lay you off, but we're going to hire you back. And so I think that those kind of arrangements are going to be common so that businesses can offload their labor costs and people can go into the unemployment insurance system with the understanding and the faith that they're still going to have a job when this is over. So that's important. And then especially, again, small businesses are going to need loans. So maybe like a really low interest rate, almost free 10 year loans so that they can spread out this pain.

And there's a lot of work happening right now to set up facilities so that like your neighborhood bookstore, your, you know, chiropractor, your yoga studio, your little cafes, your bars are going to have financial resources because they're still going to have to pay rent. They're going to have to keep the lights on. Maybe they've bought a bunch of food that went bad, that kind of thing. And so you want to take care of the workers and then give loans to those businesses to help them out. But these businesses, they're like the lifeblood of local economies. They're beloved and they're really vulnerable right now. Uh, cause they're, they're going to see just a, you know, in some cases a complete stop of all revenue and it's, it's not their fault, right? It wasn't something that they did. This is totally, totally exogenous to them.

And that's, that's a really unusual thing too. Yeah. Right. Right. And it's just like a byproduct of everything that is happening and how things are changing so swiftly. Um, is there lastly any advice that we can pass on to listeners right now about all this? Yeah. Um, I would say, you know, obviously I think the public health advice is the most important thing to listen to. But in economic terms, call and advocate for really big policies here, right? Push for really big policies. That's what's gonna be necessary

to help people get through this. We're gonna need a really communitarian response. We're gonna need to be watching out for each other. And that means like staying at home and washing your hands and then pushing for, for supportive economic policies to help the most vulnerable, um, the people with, uh, who are living, you know, paycheck to paycheck, the people who have no savings accounts, right? Like no money saved up, um, families with kids, uh, kids, families with members who are elderly. And so we know a lot about fighting recessions and it's really important that we do it right this

time. Yeah, that's correct. Millennials graduated from college into like the height of the 2008 through like, you know, 2010, 2011 and recession And so we've seen that generationally, we're behind, you know, Gen X boomers, and even Gen Z in terms of like our earning capacity. Now we're in our 30s. And we're also in the midst of what is looking to be a kind of sharp recession that's going to hurt this gig economy that is propped up by millennials. So in your perspective, do you think, you know, decades from now that this is going to have some sort of fallout in terms of what millennials are able to do, considering that, you know, we haven't had the bed of wealth to even have fallout from under us? Yeah, this is going to be so bad. It's going to be so bad. It's really, really badly timed. So millennials are

entering their prime earning years. We're getting to middle age, fighting to be in the middle class, and this is going to be brutal. And it's why it's important that we do everything we can in terms of stopping the virus and saving lives and that we have really big economic policies to help. Millennials were just getting to the point, just getting to the point of being okay. And this is going to be really painful. So yes, this is going to hit incomes. It is going to delay wealth building if it was happening for any millennials to begin with. And so, you know, I think pushing for better social insurance programs as a general point, more paid leave, higher minimum wages, those kind of things is going to be important after this. But, yeah, the millennials are really pretty screwed.

I hate to say that. Love it. Yeah. All right. Also, you know, we'd love to shout out Gen Z who can now relate to us as millennials. They get our struggle. It's shared. But Annie, thank you so much for taking the time to be on our show. We know it's a crazy time. So we really appreciate you. Yeah. Thanks to you guys and hope everybody is surviving at home. That was Annie Lowry, staff writer at The Atlantic, where she is covering the economy and all of the impacts that coronavirus is having on it. Yes, and if you're in a position to buy gift certificates from businesses that you want to support,

perhaps some of those small businesses Annie was mentioning, you should do that now because they'll get the cash up front and you can redeem it later when you're able. Also, check out Feeding America, which is helping people in need of food right now. Hey, gang. So we're a few days into a national emergency for coronavirus, and it still feels pretty crazy. So let's take a sec to switch out of news person mode and talk about how we're processing all of this. Gideon, how you doing, man? I'm okay. You know, I could have gotten more sunlight today, could have gotten any sunlight,

but I didn't. And I'm gonna have to adjust that tomorrow to stay more sane. But how are you? What have you been up to? Oh, man, I've had a great day. I had lunch. I had a little stir fry with some ginger and garlic. So the house smells great. The food was good. And yeah, I've been redecorating my home, which has been pretty nice. So can't complain. Things are looking nice around here. I have a lot to learn from you. So obviously it's the night before we record the show, the night before the show comes out. So that's why I've already had lunch, if you're listening to this first thing in the morning. But you knew that.

But this was life during lockdown. That's what we're thinking for now anyway. So we got some alt titles in our tweets, which thank you for sending them. We got stuff like, why do you up to a micro dose of chill? How I spent my Corona-cation. And, you know, we're still figuring it out. So please keep sending us suggestions. And thank you to everyone who sent those in.

Y'all are great. Florida, Illinois, Ohio, and Arizona were set to go to the polls today on yet another important day of voting in the presidential primary. Call it Little Tuesday. The only issue, of course, is that there is a global pandemic happening. In the midst of this, the states have all taken steps to prepare. But given the daily updates on the coronavirus and its spread, this is a fluid situation to say the least. On Monday, Ohio's Governor Mike DeWine took the boldest action of any of these states. Gideon, what did he have to say? Okay, so DeWine and state officials were hoping to move their primary to June 2nd with absentee balloting continuing up until then.

Just no in-person voting today. So on Monday afternoon, DeWine said that he didn't have the authority to delay the election outright, but that there would be a lawsuit in court seeking to do just that. The lawsuit was filed by people who believe that they're vulnerable to the virus and the governor and secretary of state supported it then fast forward just a few short hours later a judge denied the request saying that rescheduling the election would quote set a terrible precedent then just a few short hours after that dewine and the ohio secretary of state put out a response saying in part quote it simply isn't possible to hold an election tomorrow that will be considered legitimate by Ohioans. Okay, then a few hours later, the health department issued orders to close all polling locations. And DeWine said that he would make efforts to extend voting

past today through the courts. So in essence, the election hasn't been moved, at least not yet. But the polls have been ordered closed. And remember, Ohio was one of the first states to close all of its schools and has since closed bars and restaurants. The confusion here at the literal 11th hour approaching 11 p.m. in Ohio is the exact type of thing that you would want to avoid in a scenario like this. Yeah. And, you know, the other three states are still planning to hold their primaries, right? But the coronavirus is complicating things. So what's really up with that? Yeah. So in Arizona, a bunch of polling locations had to be closed due to a shortage

of cleaning supplies. That's per the Washington Post. And some voters will now have access to multiple voting locations, not just in their specific precincts. So that is good. In Florida, there have been some concerns about poll worker shortages, obviously, with people having some degree of trepidation about being at a location throughout the day. Yet at the same time, people seem to be responding by voting early and by mail in large numbers. For instance, in Illinois, Chicago broke the World War II record for vote by mail applications and early voting has hit a new high. And there is a bill that Oregon Senator Ron Wyden is introducing this week that would allocate $500 million in federal spending to help states institute vote by mail in cases of widespread emergency like the one we're in right now. Again, the purpose of

all of this is to ensure that everybody can continue to participate in democracy without having to stop and think whether they're putting themselves or others at risk by doing so. Yeah. And all of this comes as Georgia, Louisiana, and now Kentucky have all postponed their primaries. So it's just really tough to know what to even expect. Yeah, absolutely. I mean, we have never seen anything like this. I think that's fair to say. And, you know, broadly speaking, after today, this presidential primary overall, which

has already seen candidates suspending in-person events and voting actually being delayed, is going to kind of feel a little bit like it's in suspended animation. There's just no real precedent for how to proceed because everybody is updating their information as they get it in. But we will keep you updated on the results that do come in on our show tomorrow. And for now, if you live in a state that hasn't voted yet, and you want to keep track of what's going on, head over to votesaveamerica.com where they're updating with all the latest changes as they come in. And now for some ads. We all want to do the right thing to keep our bodies healthy in the long run.

That, you know, enter Ritual. It's the obsessively researched vitamin for women. I chose to take Ritual because I was feeling a little bit like, you know what, I'm 30 now, maybe I should give a crap about what was going on in my body. And I feel good about it. I've been taking it for a couple months. And you know, I just feel good that I'm doing something that I should have been doing a long time ago. Better health doesn't happen overnight. And right now Ritual is offering our listeners 10% off during your first three months. Fill in the gaps in your diet with Essential for Women, a small step that helps support a healthy foundation for your body. Visit ritual.com slash whataday to start your ritual today. That's 10% off during your first three months at ritual.com slash whataday. let's wrap up with some headlines headlines

france just fined tech giant apple for its anti-competitive practices in the country at 1.2 billion dollars the fine broke the record for the country's largest antitrust fine against a single company. This comes after almost a decade of investigations into how the iPhone maker developed an agreement with two wholesalers to control the prices of its products in France, so they couldn't undercut Apple's prices in-store or online. This effectively eliminated competition in the wholesale market for Apple products. Apple wasn't happy with the French competition authority's decision and says they're going to appeal it.

Presumably, they wanted to use that $1.2 billion to improve their phones with more scary clusters of cameras that activate my particular phobias. Truth, they make me a little itchy. All right, the Supreme Court announced it's postponing arguments indefinitely due to coronavirus concerns. The court was set to hear arguments over the next two weeks. One of the most high profile cases include fights over subpoenas for President Trump's tax returns. SCOTUS rarely ever pauses its work. The last time it happened was in 1918 during the Spanish flu outbreak. So it was a long time ago. It's probably a good call for the

justices to stay home, considering that many of them are in the age group most vulnerable to COVID-19. Perhaps the real challenge won't be ruling on America's toughest cases, but instead we'll be getting nine grandparents to figure out a work from home video chat. As for now, a new date for this session has not been released, but the next round of oral arguments is scheduled for late April. I'm going to teach Ruth about Google Hangouts. Okay. For everyone's favorite place for sweet coffee and sticky table, Starbucks is moving to a grab and go model across the US and Canada to promote social distancing during the pandemic. This is bad news for any freelancers who get their best work done when they're in a constant state of panic about losing their spot by the outlet because they have to go to the bathroom. According to a statement released Sunday, Starbucks' plan is to remove all seating in

cafes, changing the way they offer creamers, and temporarily closing stores in high social gathering locations like malls and university campuses. Starbucks told employees last week that they're offering two weeks of paid leave to employees who are infected with COVID-19 or are in extended contact with someone who tested positive. Not everything is going to change because of COVID-19. For example, Russian President Vladimir Putin just paved the way to remain the leader of his country through 2036, when he'd be 84. On Monday, Russia's highest court approved changes to the Constitution that would reset the presidential term limit clock to zero. If Putin gets the vote he wants in a nationwide referendum on these changes next month,

he'll be cleared to serve two more terms after his current term ends in 2024. The Kremlin made a big show of being surprised by this change when it was proposed last week, and state media portrayed subsequent deliberations as a bare-knuckle battle where anything could happen. But most critics say it's basically predetermined. So brace yourselves for 16 more years of our world's most toxic horse guy. Yeah. And those are the headlines.

That's all for today. If you like the show, make sure you subscribe, leave a review, help us find our debit card and tell your friends to listen. And if you're into reading and not just the little message that says tracking when you're watching a VHS tape like me, what a day is also a nightly newsletter. Check it out and subscribe at crooked.com slash subscribe. I'm Akilah Hughes. I'm Gideon Resnick.

And don't be a toxic horse guy. Yeah, be a non-toxic horse. Glue. Oh, glue. What a day is a product of Crooked Media. It's recorded and mixed by Charlotte Landis. Sonia Tun is our assistant producer. Our head writer is John Milstein, and our senior producer is Katie Long. Our theme music is by Colin Gilliard and Kashaka.