National / International News
Minister of Environment, Water and Climate Oppah Muchinguri wants Palmer to face justice in Zimbabwe, wire services report. U.S. authorities are investigating whether any American laws were broken.
The fate of pockets of Bangladeshis and Indians living on opposite sides of the border was left unresolved after the partition of the former British colony in 1947. A new agreement has changed that.
One report shows that state courts are twice as likely to incarcerate Native teens for minor crimes like truancy and alcohol use. Another, that alternatives like treatment programs are more effective.
In a small trial, an experimental vaccine protected 100 percent of people at high risk for Ebola. But more data are needed to figure out exactly how well the vaccine works.
This Friday marks the 10th anniversary of Kai Ryssdal hosting Marketplace.
To celebrate, Marketplace Senior Producer Sitara Nieves and and Executive Producer and Vice President Deborah Clark surprised him with a pop quiz:
What was his lead story 10 years ago?
What was the music for the numbers?
What was his personal admission on the broadcast?
To hear the answers, click on the audio player above.
The returns will show that she and her husband Bill Clinton paid nearly $44 million in federal taxes since 2007, according to her campaign. "We've come a long way," she said.
Hollywood studio Relativity Media has filed for bankruptcy after reportedly amassing more than $1 billion in debts. The company's assets amount to half of that, according to reports. Relativity founder Ryan Kavanaugh wanted to move away from the blockbuster-centric economy that rules the big studios and concentrate on smaller films that could be spun into additional revenue streams on television and the web. But "absent any significant hits, it's hard to maintain this kind of enterprise for a long period of time," says John Sloss, an entertainment industry lawyer and film producer. Relativity's creditors will now have to get in line to get paid.
Click the above audio to hear the full conversation.
The Labor Department reports that employee compensation — wages, salaries and benefits — increased 0.2 percent in the second quarter of 2015. The employment cost index increased 0.7 percent in the first quarter, and economists expected about the same pace of growth for the second quarter. The annual rate of compensation inflation was 2 percent in the second quarter, compared to 2.6 percent for the first quarter. Compensation for private-sector employees was unchanged in the quarter; compensation for government workers rose 0.6 percent.
A separate measure of employment income from the Bureau of Labor Statistics’ monthly employment situation report has shown hourly earnings increasing at 2 percent (the annual rate for June 2015), the same anemic growth rate as reported in the second quarter employment cost index.
These labor-cost measures inform an ongoing debate as to whether the job market has largely returned to health after the Great Recession or if it is still weak, leaving behind millions of people who want to work or earn a better income.
Economist Ozlem Yaylaci at IHS Global Insight says the weak second quarter ECI report contradicts evidence of an employment market that has mostly returned to health.
“It’s a big shock,” says Yaylaci, “because we see employment numbers very solid month to month, and the unemployment rate has been declining. We are now close to full employment.” The unemployment rate fell to 5.3 percent in June.
Labor economist Jesse Rothstein at University of California, Berkeley says in such a positive labor-market scenario, it would be easier for people to find jobs and harder for employers to attract and hire qualified workers. He says employers could be expected to lower their requirements for job applicants and to offer new hires more training, rather than expecting them to have job-specific skills and capabilities when they apply.
“We’d also be looking for evidence that wages are increasing as employers need to pay more to attract workers to jobs,” Rothstein says. “We’re not seeing evidence of any of these, which suggests that we really are still in a situation with a lot of slack in the labor market.”
Rothstein believes there is a shadow labor pool that isn’t showing up in the standard unemployment data but is strengthening employers' bargaining power and helping them maintain lower wages without suffering labor shortages. This shadow labor pool includes people who have dropped out of the labor force or never entered because of poor job prospects, but who might start job hunting if their prospects improved. Labor market slack is also fed by people working part time who can’t find full-time work, and people working in jobs below their training, education or experience level.
Yaylaci says this economic scenario worries Federal Reserve Chair Janet Yellen as she steers the Fed toward higher interest rates.
“She’s concerned because measures of the labor market, such as the unemployment rate, sometimes don’t measure the slack in the labor market correctly,” Yaylaci says. If that diagnosis is correct, the economy might not be strong enough yet to take the medicine of lower interest rates.
Joining us to talk about the week's business and economic news are Linette Lopez of Business Insider and Fusion's Felix Salmon. The big topics this week: the possibility of an interest rate hike this year, Federal Reserve Chair Janet Yellen's dependence on data and corporate profits in the tech world.
Another surprise in the IPO-announcement department: SoulCycle, a boutique cycling studio with locations concentrated around New York and California. It's been doing well, especially with the celebrity set, tripling its studios from 2012 to last year to 36. Profits more than tripled during that time to $26 million in 2014.
Here's a riddle for you: What do Chelsea Clinton, Lady Gaga, and Kelly Ripa have in common? They all love SoulCycle. This company doesn't have to advertise.
"They've done a great job of branding themselves and marketing themselves," says Jim Thomas, of Fitness Management and Consulting. He says one of the biggest challenges facing fitness studios is that they eventually fade into obscurity. That's not likely to happen with SoulCycle anytime soon, he says.
Just ask Ryan Michael Shaw, a former dancer in New York City. Two or three times a week, Shaw elbows his way past people to make sure he gets into a class. Forty-five minutes later, "I leave those classes and I feel amazing," he says.
Shaw says when the music and the energy are right, class is like a religious experience. An expensive religious experience.
"Oh, I drink the juice," he says. "Let's be clear, I walk out and buy the $80 Lululemon SoulCycle tank top."
The question is, how much longer will people drink the juice, asks John Atwood, managing director of the Atwood Consulting Group.
"This kind of enthusiasm is very hard to maintain with the American public, and especially the city American public," he says.
Big cities are where SoulCycle does best. Ninety-five percent of its revenue comes from New York, Los Angeles and San Francisco.
"Then the question is, what about Peioria, Illinois, you know, and all these other towns?" Atwood says.
People there might be wowed, he says, but that doesn't mean they'll pay $32 for one session.
Groups of federal contract workers have been walking off the job and holding protests every few months.
It’s part of a campaign called Good Jobs Nation, backed by organized labor. It's pushing for a $15 an hour minimum wage for federal contract workers and union representation. The most recent demonstration was in Washington, in late July.
Sontia Bailey is one of the government contract workers speaking out at the rallies. She’s a cashier in a Senate cafeteria, working for a contractor hired by the government. It pays her $10.59 per hour.
Sontia BaileyGood Jobs Nation
I met her recently in a park down the hill from the Capitol.
“I’ve worked at the Capitol for two years and seven months,” she told me.
Bailey says her Capitol paycheck didn’t pay all of her bills. So, two years ago, she got a second job at Kentucky Fried Chicken.
She says she had a miscarriage recently because she was working so much.
“I do, probably like 40 hours plus at the Capitol, then 30 plus hours at KFC," she says. "So I really didn’t have time to rest, because I never had a day off.”
The government started replacing full-time federal workers with contract employees back in the '80s, under the Reagan administration. The idea has had bipartisan support over the years and is part of initiatives to control government spending.
Supporters of privatization say it does save the government money. Among them: Adrian Moore, vice president of the free-market Reason Foundation, says contractors are more efficient than the federal government.
“Contractors don’t use as many workers to do the same work," he says. "They run with leaner workforces.”
But Moore also says contracting has to be done well to save money. Contractors have to be supervised.
Jeffrey Miron is an economist at Harvard and the libertarian Cato Institute. He says supervision is needed from the moment contractors submit bids to the federal government.
“The bidding process can be somewhat messy and complicated," he says. "It can sometimes be rigged, it can sometimes be manipulated. So it’s not a completely fail-safe approach.”
That’s led to a backlash against privatization, and assertions that it doesn’t save the government money. Tara Young is an organizer with Good Jobs Nation.
I met Young in the park with the Senate cashier, Sontia Bailey. Young says the contractor employees make so little, they end up on government programs for the poor. Bailey is on Medicaid.
“Workers are on Section 8, they use food stamps," she says. "So we’re paying workers extra money, really, to help them with their low pay.”
Young says taxpayers get hit up twice: once to pay for the contract workers’ salaries and again to pay for government programs they need to get by.
The Obama administration unveiled a pilot program Friday morning that will once again allow some prisoners access to federal Pell grants.
This past week, Elon Musk, Stephen Hawking and about a thousand other artificial intelligence researchers signed a letter calling for a ban on autonomous weapons.
The remote-operated drones that we use in modern warfare can already fly virtually undetected and use advanced targeting systems to drop bombs on buildings and people below — but the key phrase is "remote-operated." A human is usually controlling the weapon from afar.
Professor Noel Sharkey teaches robotics and artificial intelligence at the University of Sheffield in the U.K. and is also chairman of the International Committee for Robot Arms Control. He signed the letter and told us why:
"What the big concern is the step where we delegate the decision to kill people to the machine, and that hasn't been used yet. In the U.K., we have the Taranis, which is a fully autonomous combat aircraft. And that has been tested in Australia, searching for targets on its own. You've got the X-47B in the United States, which looks like something Batman would fly. And that's had very advanced testing. But then China and Russia have developments, and so have South Korea. But America's still the leader here, as far as we know. You've got DARPA there developing things like an autonomous submarine, now in Phase 2 or 3 of testing, which hunts other submarines and sinks them. Then you've got the Crusher, which is a fully autonomous 7.5 ton truck with a machine gun on board.... The developments could escalate at any time and take off depending on the type of conflict."
Ready to build yourself a fallout bunker?
Daniela Hernandez, who writes about AI and autonomous weapons for Fusion, says the debate over AI ethics has been carried on before this letter:
Although the debate has gotten more press lately, thanks to high-profile figures like Musk and Hawking taking notice, it’s been ongoing for some time now. Earlier this year, the United Nations called for an international treaty that would ban fully autonomous weapons. In 2012, Human Rights Watch published a report stating “that such revolutionary weapons would not be consistent with international humanitarian law and would increase the risk of death or injury to civilians during armed conflict."
Part of that “risk of death or injury” comes from the fact that AI systems make mistakes. Earlier this month, for instance, Google Photos mistook images of black people for gorillas. That’s offensive and awful, but no one died as a result of the software flaw. In military scenarios ... people’s lives are on the line.
Beijing will host the 2022 Winter Olympics. The city beat out Almaty, Kazakhstan, which was the only other bid. This will make Beijing the first city in over a century to host the summer and winter Olympics.
These games come at a very different time in China’s economic life than the 2008 games. “China was a very different country in 2001," says Rob Schmitz, Marketplace China correspondent. "Things were looking up. The economy was going crazy. It was going almost at double digit speed,” he says. “In the years leading up to 2008, we had 10 to 14 percent GDP growth. That’s not the case anymore. We’ve got 5 to 7 percent GDP growth and things are slowing down.”
The games will happen seven years from now, and China will have to build the infrastructure to support the Olympics. "China's trying to change the way that its economy is run. They're trying to turn from an infrastructure-led economy to a consumer-growth-led economy. And here we have a huge, huge infrastructure project," Schmitz says. "This is the old model of growth. This is not the direction that China wants to go with its economy on paper at least."
Pollution was a big issue for the Summer Olympics and will affect the Winter Olympics as well. “Beijing has made some significant efforts, some significant movement, on the pollution issue," Schmitz says. "Realistically, there’s going to be a lot of pollution for years to come. What we’ll probably see is a repeat of the 2008 Olympics, where they flipped the switch and basically had all these restrictions on factories, and when it’s done, start it all over.”