Marketplace - American Public Media

Free trade on the agenda for Obama's Asia trip

Fri, 2014-11-07 02:00

President Barack Obama will be in Asia starting Monday with an itinerary that includes attending the APEC CEO Summit, a state visit with Chinese President Xi Jinping and the G20 summit in Brisbane, Australia.

Among the top items on the agenda is the Trans-Pacific Partnership (TPP), a 12-country free trade agreement that has proven difficult to hammer out between the U.S. and Japan before being presented to the other 10 countries, says Derek Scissors, an Asia scholar at the American Enterprise Institute.

"There are a lot of really contentious issues,” says Scissors. "Can American farm goods freely enter the Japanese market? The Japanese have resisted this for years. Can Japanese autos freely enter the American market? The United States has resisted.”

If the U.S. and Japan were to settle their differences, that would be a major success story coming out of this latest trip, says Scissors. 

For a president that may be looking at a tough road ahead on his domestic agenda, it makes sense to switch focus to foreign policy, says Russell Riley, a presidential historian at the University of Virginia.

"Towards the end of the term, when presidents are thinking about legacies, they do become focused on places abroad, where they feel like they can make a difference,” Riley says.

The timing may work out for the president, as a recovering economy offers the U.S. a renewed leadership role in global trade.

“We’re the only one doing well,” says Scissors. “So everyone is looking to the United States for wise economic policy, which we don’t always deliver…And the TTP is a good step in that agenda.” 

Silicon Tally: So many penguins

Fri, 2014-11-07 01:14

It's time for Silicon Tally! How well have you kept up with the week in tech news?

This week, we're joined by Ashkan Soltani, newly appointed Chief Technologist at the FTC.

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A losing battle

Thu, 2014-11-06 11:14

There's a little-known Army panel whose decisions can have an enormous impact on the lives of current and former U.S. service members: the Board for Correction of Military Records. The Board is supposed to correct errors or injustices in a service member’s records, like a discharge that denies a vet medical benefits or forces a soldier out after reporting a sexual assault. It’s there to keep the Army honest, but a Fusion investigation found it's doing anything but.

We found that when service members file appeals that could lay blame on the Army or result in significant benefit payments to the veteran, the default answer is often no. Fusion analyzed thousands of Board decisions, reviewed hundreds of internal documents, and conducted nearly 50 interviews and found a system that’s so impenetrable and the results so often negative, that many veterans have given up hope for justice.

“Each case has its own outrage,” said Michael Wishnie, a professor and deputy dean at Yale Law School. “They routinely ignore the evidence, the medicine, the rules and the law to deny veterans benefits.”  

The Army Board says it grants relief in about 41 percent of cases it reviews. Most of those cases involved requests to correct clerical errors, and other purely administrative matters.  We analyzed publicly available decisions for veterans appealing three common discharges between 2001 and 2012 that disqualified them from receiving Army medical benefits. We found that only about 2 percent were granted a medical evaluation, which would be just the first step in getting medical benefits from the Army.

Veterans and lawyers say the system is broken. Board members spend an average of about three minutes and 45 seconds per application, even though some are hundreds of pages long. In most cases they rubber stamp draft decisions prepared by Army staff. While the Board’s decisions can be appealed in federal court, that only happens in an estimated 1 percent of cases, lawyers say.

Discovery's new show: Watch a snake eat a guy

Thu, 2014-11-06 11:00

Step aside, Nicki Minaj, there's a new anaconda in town.

The Discovery channel will debut a new series called "Eaten Alive" in December.

Apparently, on the premiere episode a guy will be swallowed alive by a giant snake after covering himself in pig's blood while wearing a custom-built suit. Seems suspicious.

Is it animal abuse? Is it criminal stupidity? Is it possible?

Whatever, just don't watch.

Microsoft makes Office free on mobiles

Thu, 2014-11-06 11:00

All aboard, Microsoft is jumping on the freemium bandwagon. In the past their product, Office 365,was subscription-only if you wanted to do anything other than read your documents on your mobile device. 

Now the updated free Microsoft app will allow you to change, or write new Office documents on your iPhone or iPad. The version for Android tablets will be available early next year. 

It's adopting a strategy companies like LinkedIn have been using for ages - giving stuff away for free to get more users, then charging a premium for extras.  

“There’s a recognition that like, better to get everyone in the tent and then later you can figure out how to make money off of them," says Jeff  Howe, head of the Media Innovation Program at Northeastern University.  

If you want to get fancy – with say, advanced editing – then you have to pay. 

So why is Microsoft shifting their strategy?

“Well, you know, the world has changed,” says Michael Atalla, director of product management at Microsoft. “People expect to be able to use their favorite apps, on their favorite device, wherever they are. And we’re enabling that.”

Another big reason for this enabling is competition from Google Docs and other free software for document writing. Microsoft has to find a way to keep Office users using their product. 

“This will help Microsoft maintain its customer relationships and reduce the likelihood that existing customers will try to move to Google Docs,” says Frank Gillett, Vice President and Principal Analyst at Forrester Research.

At least that what Microsoft hopes. The impact of their decision is still to be determined. 

Who shares the growing productivity pie?

Thu, 2014-11-06 11:00

Productivity in the latest quarter came in 2 percent higher. That’s an increase from an average of about 1 percent the last three years. Rising productivity means workers are cranking out more goods and services every day, or every hour.

Productivity, by quarter

(US Bureau of Labor Statistics)

The latest numbers are not the surge of 5 to 10 percent in the late 1990s and early 2000s, but a hopeful sign. And gains do not appear to be simply bosses cracking whips on the backs of a couple workers.

Productivity in the postwar era

(US Bureau of Labor Statistics)

“Sometimes employers raise productivity simply by squeezing more output out of fewer workers, and that very much was the story in the earlier part of the recession,” says labor economist Harry Holzer of the Georgetown University Public Policy Institute. “It doesn’t look like that’s happening now, because we know the employment numbers are growing.

Employment is up, and so are wages. So part of the pie is going to workers, and part going to company profits and investors.

Zooming back, workers’ share of the fruits has been relatively low for decades. Many say the fates of companies and employees have “decoupled.”

Productivity and Employment: Decoupling?

(Jared Bernstein, Center on Budget and Policy Priorities/US Bureau of Labor Statistics)

So, are they re-coupling?

Brookings Institution senior fellow and economist Gary Burtless doesn’t think so.

“Just like a snowflake doesn’t bring Christmas,” Burtless says, “seeing one quarter of pretty good wage gains is not a signal that those wage gains are going to continue forever.”

And any gains are not shared evenly across workers. To some degree, productivity is about machines. Are you the worker getting replaced by a more efficient machine? Or designing the next one?

Labor economists see a complex shakeout underway.

“There are more high-skilled workers versus less-skilled workers,” says MIT Sloan School business professor Erik Brynjolfsson, author of "The Second Machine Age." “There are capital owners and employers versus labor. And there are superstars versus everyone else. In each case, the first group recently has been doing quite well.”

The second group, he says, has fared far less well.

Facebook will solicit donations to fight Ebola

Thu, 2014-11-06 11:00

It seems like $25 million was just a start.

You may recall that Facebook's co-founder Mark Zuckerberg and his wife pledged that much last month to help fight Ebola. A few weeks later, Zuckerberg’s company is now rolling out a fundraising pitch at the top news feeds for Facebook users in more than 30 countries. The money will go to three groups working in West Africa: the Red Cross, International Medical Corps and Save the Children.

Helping stop Ebola in its tracks is clearly a philanthropic act, says Facebook executive Naomi Gleit. But really, she says the company’s mission to make the world more open and connected.

“And when the world is more open and connected, together we can do really great things,” she says.

Facebook hopes its campaign will jump start a wave of philanthropic giving that’s been slow coming. After the Haitian earthquake, for example, the International Medical Corp. received more than 8000 donations, for Ebola it’s been a tenth of that. Yale’s Nicholas Christakis sees two reasons why Facebook’s campaign may work.

“They have the scale which is enormous, you know countless millions," he says. "But also they have the ability to use peer effects to magnify the impact, because of course you are more likely to respond to something if your friends have also responded to it,” he says.

The World Health Organization says containing the virus will require $1 billion dollars as well as hundreds of healthcare worker volunteers. It’s clear Facebook founder Mark Zuckerberg has taken that challenge to heart, says Jim Ferris of the USC Center on Philanthropy and Public Policy.

“It’s what I would call all-in philanthropy. Really being out there, entrepreneurial, it’s not just writing a check,” he says.

He says Zuckerberg’s entrepreneurial approach is part of a new trend where individual donors and foundations throw themselves into their own causes.

Given the scale of the threat in West Africa, it might be good that one of the world’s richest people is locked in.

'The Simpsons' and 'Marketplace' are the same age

Thu, 2014-11-06 10:05

You might have heard of a little show called "The Simpsons."

Like Marketplace, the show turns 25 this year. Let's do the numbers: "The Simpsons" premiered on December 17, 1989. It's still going strong at 557 episodes and Hank Azaria has voiced at least 100 characters like Moe the bartender, Chief Wiggum, and Apu.

Listen to the full conversation with Azaria, from our stage show "How I Learned to Stop Worrying and Love the Numbers," in the audio player above.

Marketplace's road show wraps up in Los Angeles Saturday, November 8.

The numbers for November 6, 2014

Thu, 2014-11-06 09:40

With the euro at a 26-month low, the European Central Bank is readying new efforts to buy bonds and stimulate the eurozone's languishing economy. The move comes as Fed prepares to phase out quantitative easing, and Japan announced its own stimulus efforts last week.

The announcement has quieted concerns over President Mario Draghi's leadership, Reuters reported. Draghi said he'd like the ECB's balance sheet to look the way it did in March 2012, which would mean buying about a trillion euros in bonds.

As we keep an eye trained on the eurozone, here are some other stories we're reading — and numbers we're watching — Thursday:

733

That's how many days away we are from the 2016 election, and fundraising has already begun. The day after a resounding midterm victory for Republicans, Dreamworks executive Jeffrey Katzenberg is seeking donations for his Hilary Clinton-backing super PAC Priorities USA Action, the Washington Post reported. The group had a big impact on the 2012 election and political strategist Andy Spahn said he expects donors to "double down." They certainly have time to.

350,000

The number of time Chinese Mac users downloaded apps infected with "Wirelurker." The malware attaches itself to legitimate iOS apps to infect iPhones, Quartz reported. Wirelurker was discovered overnight Thursday, and it's notable as the first malware able to crack iPhones that aren't jailbroken or otherwise messed with by users. It's limited to Chinese users, as the bug stems from third-party app stores known to be awash with viruses.

3 million

That's how many "Frozen" role-play dresses Disney has sold in the year since the film came out, the Wall Street Journal reported. The mega-hit has pulled in nearly $1.3 billion at the global box office, and merchandise sales are expected to drive up Disney's third quarter earnings, out Thursday. That number will get even hire over the holidays, as retailers are expected to carry double the "Frozen" products they did last year. For what it's worth: customers prefer Elsa, whose merchandise outsells her sister Anna two-to-one.

Colleges put career centers on the map

Thu, 2014-11-06 08:35

At Washington College on Maryland’s Eastern Shore, most students never visited the career center until senior year. It was tucked away in a dorm across the street from the main campus. Students needed a key fob to get in.

“It wasn’t very welcoming and inviting, and certainly wasn’t on the admissions tour,” says Joe Holt, chief of staff at the small liberal arts school.

But when prospective students and parents visit these days, Holt says, they ask about the career center. They want to know what the college is doing to help students get internships and land jobs after graduation.

Come January Holt will have something to show them: a new $1 million career center in a converted boiler house. The new center will have a comfy lounge and rooms with built-in cameras, so students can watch how they do in mock interviews. It will be right in the heart of campus.

“Now you just have to stop in on the way to class,” says Holt. “It also sends a powerful message to prospective students about the value we place on this, by giving such important real estate to this function.”

As college gets more expensive, schools are under more pressure than ever to produce graduates who can get good jobs. The pressure doesn’t just come from students and parents. The Obama Administration is working on plans for a college rating system, which could factor in things like employment and student loan repayment rates.

Most colleges just haven’t invested enough in career services, says Edwin Koc, director of research at the National Association of Colleges and Employers. He says the typical career counselor serves 1,500 students.

“They toil away with extremely limited resources, and so the students don’t see the career center as central to being successful at the school,” he says. “For a lot of students the career center becomes an afterthought.”

Even if most colleges can’t afford a sparkly new building, more schools are working to change what goes on inside.

In old brick house at Franklin & Marshall College in Lancaster, Pennsylvania, senior Sean Bell McDermott climbs the creaky stairs for an advising session. Three years ago, F & M transformed its traditional career center into an Office of Student and Post-Graduate Development. Along with the usual coaching on resume writing and interviewing, the office does workshops on financial literacy, business etiquette, and other life skills.

Every student is assigned a student development advisor, starting freshman year. Today McDermott talks with advisor Lori Clark about how to network with alumni.

“Once you actually get them on the phone, what do you think will be some of the things that you would ask about?” Clark asks.

“I always ask them what their major was, and how it led them to where they are now,” McDermott says.

She has a ready answer because she’s met with Clark at least a dozen times. She’s already done two internships—one through an alumni connection. McDermott doesn’t seem at all nervous about graduating into a still shaky job market.

“You also know that it doesn’t end when you graduate,” she says. “I can come back here and keep using their resources.”

Beth Throne, associate vice president of student and post-graduate development, led the overhaul at Franklin & Marshall.

Before, she says, just about 20 percent of students interacted with the career center — mostly seniors. Last year almost 75 percent went to a workshop, checked in online, or met with an advisor.

“When students have interacted with us over the years, they will be clearer about what they want to do after college,” says Throne. “They will leave with connections in their industry and beyond who will be there to mentor them long after they graduate.”

And how are students faring after graduation? Throne says nearly 80 percent of the Class of 2014 has landed—in jobs or grad school—less than six months out. It’s hard to say if that’s an improvement, because the college didn’t really track that kind of data until now.

PODCAST: Raising the minimum wage, state by state

Thu, 2014-11-06 03:00

The president of the European Central Bank made the announcement this morning: interest rates are going to stay where they are at record lows. More on that. Plus, four traditionally red states voted to raise minimum wage: Arkansas, Alaska, Nebraska, and South Dakota. A non-binding increase passed in Illinois. So what could this mean for the president's push to raise the federal minimum wage? And podcasting's audience is growing along with its profits. And while some of the most successful podcasts have come from the public radio world, a podcast network that's based in Northern California, is doing *extremely well ... thanks to advertisers.

What GOP victories mean for the Affordable Care Act

Thu, 2014-11-06 02:00

Republicans' strong showing in this week’s mid-term elections opens the door to more calls to repeal President Obama’s signature law, the Affordable Care Act.

And while that is all but impossible given the balance of power in the U.S. Senate, victories in Washington and at the state level could usher in other healthcare changes.

A prime target?

The GOP could look to tweak Medicaid, the healthcare program primarily for low-income people.

To understand what reforms the GOP may propose, first understand this: lots of Republicans oppose Medicaid expansion under the Affordable Care Act on philosophical grounds.

“Medicaid was a program designed for the truly needy, and Obamacare makes it an income-based, and goes much higher for working age able-bodied adults,” says Josh Archambault, with the Foundation for Government Accountability.

Archambault says conservatives tend to think able-bodied adults shouldn’t get government-funded healthcare.

So states—including ones with new GOP governors like Illinois and Massachusetts—may pitch Medicaid reforms that introduce monthly premiums and/or co-pays.

Robin Rudowitz with the Kaiser Family Foundation expects to hear lots of proposals in the coming months.

“[Secretary Sylvia Burwell] spoke and said that she was willing and interested in working with states that wanted to expand. So I think that we will see alternative proposals. How far they go, I think that’s a question,” she says.

Until now, federal health officials have blocked reforms that would make it hard for people to get healthcare, like mandatory work requirements.

That could ultimately mean GOP’s Medicaid worldview is on a collision course with the Administration’s Medicaid philosophy.

 

 

 

A stove that can power your phone

Thu, 2014-11-06 02:00

The state of cooking in much of the developing world continues to be cooking over an open fire.

As a result, a lot of what you might find in cigarette smoke ends up around the food. Biolite is seeking to change that.

Their stove concentrates heat and lowers the amount of wood needed to get a fire going.

In addition, the device is able to harness the wasted heat from the fire and convert it to electricity. This can be used to power fans near the fire and reduce particles and other traces of monoxide that appear in the air, while at the same time being able to use that electricity to power your phone or even your TV.

For more, click the audioplayer above to hear Jonathan Cedar, CEO of Biolite, in conversation with Marketplace Tech host Ben Johnson.

Podcasting's audience (and its profits) are growing

Thu, 2014-11-06 02:00

TWiT was started in 2005 long before there was a Twitter. The network is named for its flagship podcast, a roundtable discussion with tech journalists called "This Week In Tech." Leo Laporte had a long track record in TV and radio before he founded TWiT. He says it’s been successful since day one.

"Being a profitable podcast network is not an easy thing to do, and you can count the number of profitable podcast networks on the fingers of one hand. I’m one of them, but that doesn’t mean it’s an easy thing to do by any means," he says.

Laporte hosts nearly half of TWiT’s 30 shows. A live video stream of the tapings draws an audience of 3,000 to 4,000 viewers, but TWiT makes money because a loyal audience downloads five million podcast episodes a month, mostly as audio. That brings in $6 million in ad revenue a year.

Says Laporte, "I came to this from mainstream media. I had a built-in audience already. We have an ad sales infrastructure. We have a way of counting our downloads. And we have a very devoted community."

That community includes a thousand geeks—some of them IT professionals—active in a chat room that weighs in on the tech topics while the podcasts are being recorded. It’s a boon to Laporte and his guests, which includes tech writer John C. Dvorak.

"I spend all my time monitoring the chatroom because they have good suggestions, and they will correct you if you say something stupid or wrong, and then you can correct yourself on the show in real time. And I find that very valuable," says Dvorak.

TWiT’s audience ranges from tweens to seniors, and includes a sizable segment listening abroad. Fans have been known to turn out in droves when Laporte does personal appearances. In 2011, when TWiT’s new state of the art studio was being built in Petaluma, CA, listeners sent in a quarter million dollars to help build the facility. 

How tobacco farms are going organic

Wed, 2014-11-05 14:13

The federal program designed to help tobacco farmers transition from the depression-era quota system to the free market has officially ended. The last of the tobacco buyout checks were distributed in October. North Carolina farmers and producers received more than one third of the $9.6 billion in buyout payments.

The money helped one tobacco farmer continue his quest to convert his farm to an organic operation. Stanley Hughes and his workers at Pine Knot Farms in Hurdle Mills, North Carolina, has spent the past several weeks bringing in the last of the tobacco out of the fields.

Hughes, 66, has lived on this farm all of his life.  His grandfather purchased the land more than 100 years ago. Tobacco has been grown here ever since. But it hasn’t been easy.

“The only thing about farming, you can keep a job, work all the time and stay broke,” said Hughes.

Hughes and many other smaller tobacco farmers are familiar with "the broke years." U.S. tobacco prices peaked in the mid-1990s and then began falling off.  Cigarette taxes went up, the number of U.S. smokers went down, and tobacco was cheaper abroad. 

Hughes had to do something.  He learned during a workshop that he could get a higher price for his tobacco if it was grown organically.

"We started off with one acre, then we got up about five acres before I went totally organic,” said Hughes.

By 2000, Hughes switched all the way over.  Everything he raised – from collard greens to tobacco – was organic.  And when the tobacco buyout was approved in 2004, he requested his money in one lump sum, instead of in ten yearly payments.

"He’s one of the people that diversified," said Archie Hart. 

Hart is a program specialist with the North Carolina Department of Agriculture. He’s very familiar with Hughes’ operation.

 “He’s known as the collards man, he also does sweet potatoes.  So, he was one of the people that you can look at and say, okay, he took advantage of the buyout and he diversified,” said Hart.  “And he has an income stream coming in as a result of that.”

It has all paid off.  Hughes ships his tobacco directly to Santa Fe Natural Tobacco Company, an independent operation of Reynolds American. It manufactures the American Spirit brand. 

He’s been named Farmer of the Year a couple of times in the Carolinas, and his collards have been featured in Gourmet Magazine.  Despite all of his success, Hughes is not one to brag.

“Ain’t nothing I think I’m doing great or exciting, you know,” said Hughes, with a slight smile.  “Just working.”

Trade Deficits aren't good or bad, just weird

Wed, 2014-11-05 12:00

We’re doing a series of explainers of economic concepts to mark Marketplace’s 25th anniversary, and today we take a look at the Trade Deficit. 

The United States has been running one one every year since oh... 1974. Currently, it’s about $40 billion or so a month, give or take a few billion

A trade deficit, you've probably heard, is when a country is buying more from the rest of the world than it’s selling to the rest of the world—importing more than it’s exporting. That may sound bad. If I personally ran a trade deficit for forty years like the U.S. has, I would be broke. But I am not a country - and the rules are different for countries.

“There’s actually nothing necessarily wrong about a trade deficit,” says Doug Irwin, professor of economics at Dartmouth. “In fact, here’s where economists always have a definitive answer to the question is a trade deficit good or bad and that definitive answer is, it depends!”

Depends on what, exactly?  

Well, before we can answer that we have to explain why it’s so neutral-ish in the first place. The reason is that trade deficits have this whole other side to them that is not obvious at all. 

THE DOUBLE LIFE OF A TRADE DEFICIT

Trade deficits actually have as much to do with international investment and debt as they do with importing and exporting. It’s invisible unless you look at the money, so let’s look at the money.

Let’s say the U.S. and Europe have a trade deficit (which they do)—meaning America imports tons of French wine, let’s say, but exports almost nothing to Europe. 

Wine stores across the U.S. will place their orders with wineries in Europe for massive quantities of Beaujolais and Chardonnay. And they will, of course, need to pay in Euros. French wineries don’t want a stack of Benjamins any more than you want that damn Turkish lira that somehow always ends up in your bag of change when you are trying to pay a toll on the freeway. 

So the wine stores—or the bank or the credit card company the wine stores use—will have to take their  U.S. dollars to an international currency market and convert them into Euros to give to the  French vineyard to buy the wine. Since the U.S. is buying massive amounts of French wine, that bank is going to have to convert massive amounts of dollars into Euros.

THE PRICE OF REJECTION

Here’s the problem: We have a trade deficit. We aren’t exporting much to Europe—As in, Europe isn’t buying our stuff, which means they don’t need dollars. Why would they need dollars? To use as paper weights? 

HOW DO WE DEAL WITH THIS PROBLEM?

Now, you can imagine one way out of this. American banks might have to lower the price of the dollar. They might say ‘Fine, world! What if I give you $110 for $100 euros? $120?  $150?,' until finally someone in Europe decided that was a really good deal and they could use some dollars to maybe buy some American goods. It’s a kind of auto correct feature that trade deficits can have. 

“When the dollar falls, that stimulates U.S. exports, it discourages U.S. imports, and that fall in the value of the dollar will naturally begin to close the trade deficit,” says Irwin.
This can happen with trade deficits—they can push down a currency’s value.  

THE MONEY HAS TO COME FROM SOMEWHERE

But that’s not happening with the U.S., nor is it happening with a lot of countries. The dollar is doing great. And yet we continue to import much more than they export. Somehow we are finding another way to deal with the problem that we can’t get Europeans to exchange our dollars so we can buy European wine.

The fact is, there ARE people abroad who want to give us Euros in exchange for dollars. These are not people who want to buy our stuff, though. These are people who need dollars...because....drum roll.... they want to INVEST in America. They’re investors.

INVESTOR CONNECTION

Investors need U.S. dollars to buy U.S. assets: treasury bills, real estate, stocks, bonds, etc. After all, the NASDAQ doesn’t take Euros, so foreign investors need dollars to park their money in the U.S. and make a profit just like we need euros to buy wine. 

That’s how the U.S. economy finds the euros go import crazy. So if we are having a trade deficit, it is a sign that someone abroad is investing in some part of our economy. A trade deficit and investment are like two sides of a strange coin. We buy goods from the world, the world invests in us.   

This invisible connection between trade deficits and foreign investments is why a trade deficit can be good or bad—all it  means for sure is that other countries are coming to you to invest their money. That can be great if it’s growing your economy or it can be bad if it’s not—you can’t tell what’s going on just from having a trade deficit. 

THE GOOD...

An example of a trade deficit that was happening for good reasons was the U.S. during the 19th century, says Robert Lawrence, who teaches international trade at Harvard’s Kennedy School. The U.S. had increasing trade deficits, which were made possible by investors pouring in money from abroad. “The United States used the money to build rail roads and build the U.S. economy—so you can look in retrospect and say that was a pretty healthy deficit.”

THE BAD...

An example of a trade deficit that was happening for less good reasons is Greece, he says. During the financial crisis, Greece was running a trade deficit made possible by investors who were pouring money in to purchase government debt. “During the global financial crisis, in Greece the government accumulated large debts—so large, in fact, that they couldn’t repay them.” 

THE UGLY...

Sometimes it can be ok to finance government debt, but if something scares investors and they all take their money out at once (like happened in Southeast Asia in the late 90s) that can spark a crisis. In cases like those, a trade deficit can be a sign of vulnerability.

So a trade deficit strictly speaking means investors are parking their money with you. Whether it’s good or bad depends on what you (or they) are doing with the money. 

The U.S. is lucky because investors keep coming back. As long as they do, we can import more than we export. 

We've got a bit of a big screen problem

Wed, 2014-11-05 11:47

It is officially holiday shopping season, and though some of us want to invest in covering an entire wall in our house with an interactive video screen, we aren't quite to that point just yet.

Marketplace Tech host Ben Johnson isn't thrilled about that, and he says to blame technology and cost.

Building digital video screens is not easy. Our screens use a layer of glass over these tiny transistors that convert code into images. And to make big versions of these screens is entirely too difficult.

"If you get one little tiny transistor wrong, after you've manufactured this you actually have to throw the whole thing out," says Johnson.

Manufacturers that want to make these screens have to build vacuum chambers into the factory, but that costs a pretty penny.

"It costs like $100 million just to make the factory that makes these things," says Johnson. 

Trucking on, 60 hours a week, for 10 more years

Wed, 2014-11-05 11:27

If you talk to people outside the Washington Beltway, the view of life and the economy is pretty starkly different. 

 

Where economic messages were largely left out of midterm campaigns, the idea that we're growing our way into recovery doesn't resonate with a lot of Americans. 

 

"That's all on Wall Street. If you've got lots of money, you're doing fine. It's just us who are not," said Don Holzshuh. He drives a truck in the upper Midwest, delivering to hardware stories in Iowa and Minnesota. 

 

And, he says, the folks in the hardware stores agree. Things feel "pretty much the same" as they did 18 months ago. 

 

For Holzschuh personally, business is a little worse. What he used to earn in four-and-a-half days now takes six. He's added another run in his truck, bringing him to 60 hours a week on the road. Lower gas prices help with costs, but Holzschuh says the price of diesel along his route in Iowa is higher by about a dollar more a gallon compared with unleaded. He doesn't benefit much from the savings. 

 

"I'll probably be working til I'm 68... another 10 years, another million miles."

 

It's hard to imagine him continuing at 60 hours per week after 36 years on the road. Holzschuh has already clocked 4.5 million miles accident-free, but he doesn't see many alternatives. 

 

"Am I going to work at a gas station? Work three jobs in a gas station to get by?"

 

The extra years of work will go toward paying off the mortgage on his house. And if that doesn't work? 

 

"I'll be over at your house," he joked to Marketplace host Kai Ryssdal. 

Texas oil town votes to ban fracking

Wed, 2014-11-05 11:00

Denton, Texas, a growing, middle-class college town in the heart of fracking country, voted Tuesday to ban fracking. The vote was 59 to 41 percent. Denton is the first city in Texas to ban fracking, and the conflict there has drawn attention from fracking supporters and opponents all over the country.

Here's the story on how the Denton fracking ban came about.

On Wednesday morning the Texas Oil and Gas Association filed a lawsuit against the ban, and more suits are expected. Thomas Phillips, a former Texas Supreme Court justice, represents the association. He argues fracking regulation is the state's jurisdiction. "No city can just take it upon itself to say not in my backyard," he says. Other legal scholars say state law is not that clear on the matter, and that the Denton case represents new legal territory for the Lone Star State.  

Local fracking bans have been upheld in New York state but in Colorado, at least so far,  they're encountering trouble in the courts.  

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