Making waves

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Speaker 3 How many ways do you suppose can Jay Powell say

Speaker 3 nothing?

Speaker 3 From American Public Media, this is Marketplace.

Speaker 3 In Los Angeles. I'm Kyle Risdahl.
It is Tuesday today, the 11th of February. Good as always to have you along, everybody.
We begin with the long and the short of it from Fed Chair Jay Powell.

Speaker 3 Quite literally, the long and the short, actually.

Speaker 3 The head of the central bank went up to Capitol Hill today for one of his regularly scheduled sessions in front of lawmakers, the Senate today, the House tomorrow.

Speaker 3 And Jay Powell being Jay Powell, he clearly had every intention of sticking to his monetary policy knitting, saying in his prepared remarks that the economy is strong and that the Fed's still keeping a close eye on inflation and, in turn, what it ought to do with interest rates.

Speaker 3 Senators, though, had other ideas about what they wanted to talk about. The vibe was more political than economic.
Here's Powell the longer after a question about tariffs.

Speaker 6 It's not the Fed's job to make or comment on tariff policy. We, you you know, really,

Speaker 6 that's for elected people, and it's not for us to comment. Ours is to try to react to it in a thoughtful, sensible way and make monetary policy so that we can achieve our mandate.

Speaker 3 Knitting, sticking to it. Another question, same vibe, just shorter.

Speaker 6 I'm not going to comment on things that the president says.

Speaker 3 This, too, should be said. Powell did tell senators that the administration's government deficiency group has not yet tried to get into the Fed or its systems.

Speaker 3 We got an update today on how small businesses are feeling amidst all the economic ajada.

Speaker 3 The National Federation of Independent Business is out with its monthly Small Business Optimism Index down in January, but those small businesses are still more optimistic than they usually are.

Speaker 3 The index, though, also measures business uncertainty, which hit its third highest level ever. And among the biggest challenges, hiring.

Speaker 3 More than a third of businesses surveyed said they had job openings they couldn't fill last month. Marketplace's Megan McCarty-Carino has that one.

Speaker 7 The good news is that small businesses want to hire, says Holly Wade at the NFIB Research Center. The bad news?

Speaker 8 It's been a really tough road over the last number of years to find applicants for those high-level job openings that they continue to have.

Speaker 7 The survey found 90% of the small business owners trying to hire in January reported few or no qualified applicants.

Speaker 7 Federal data show the ratio of open jobs to unemployed workers has been around one to one in recent months, but several industries, like construction, are struggling with a shortage of skilled labor.

Speaker 9 You don't even get people to apply anymore. I've pretty much given up.

Speaker 7 Bruce Jovag owns Norse Construction in St. Louis, Missouri.
His crew of three to four guys do mostly kitchen and bathroom remodels, room additions, and basement finishes.

Speaker 7 But if you're dreaming of updated cabinets, you'll have to be patient. His wait list is about four months long.

Speaker 9 I would love to be able to run a much shorter wait time, but I just simply can't.

Speaker 7 He says finding specialized workers like carpenters is basically a lost cause. So he turns to subcontractors.

Speaker 9 I just had an interview recently with a gentleman, but his demands were just astronomical. You know, health insurance and vacation right away and all this stuff.

Speaker 9 I can't afford that.

Speaker 7 There's been a labor shortage in the skilled trades for years, but it's particularly tough for small firms, says Nick Tremper, senior economist at payroll platform Gusto.

Speaker 12 Small businesses have to compete with the big guys on labor costs, and a lot of times they just can't do that.

Speaker 7 And questions about tariffs and immigration policies are making it even harder to plan for the future. I'm Megan McCarty Carino for Marketplace.

Speaker 3 Speaking of which, planning for the future, Wall Street today, traders were of mixed minds. We'll have the details when we do the numbers.

Speaker 3 I made a quick mention of this at the end of the program yesterday: that amid all the stuff that he is doing in Washington, Elon Musk has somehow found time to make a bid to buy Open AI for just under $100 billion.

Speaker 3 Sam Altman, the CEO of OpenAI, not so politely declined the offer, saying, and this is a quote, I think he's probably just trying to slow us down.

Speaker 3 It can feel in these early days of 2025 like nothing can slow AI down. And there is a group of techno-optimists in Silicon Valley that wants to push even harder on the gas pedal.

Speaker 3 Marketplace's Matt Levin has more now on the AI Accelerationists.

Speaker 13 At parties or conferences or pretty much anywhere in the Bay Area, the AI accelerationists are kind of everywhere.

Speaker 14 I mean, I think you cannot avoid it in Silicon Valley, I guess.

Speaker 13 Song Yee Yoon is managing partner at Principal Venture Partners, which invests in AI companies.

Speaker 13 She says there's degrees of accelerationism, and most people in tech want AI to get better in one way or another.

Speaker 13 But for louder and prouder accelerationists, the working definition is something along these lines. Let's make superhuman intelligence as quickly as possible.
And...

Speaker 8 Anything that slows down the adoption of the technology is viewed as roadblock and negative.

Speaker 13 It's especially true of regulations and guardrails, which AI accelerationists view as unnecessary and overcautious. Hamza Chowdhury is national security lead at the Future of Life Institute.

Speaker 12 One thing that's been really interesting to see in the accelerationist discourse is there's a notion that AI can't cause large-scale harm.

Speaker 13 It's not just tech bros on X posting accelerationist memes. Venture capitalists and major Trump donor Mark Andreessen counts himself as an accelerationist.

Speaker 13 And while Chowdhury says it's too early to tell what President Trump will do on AI, the technology is getting better every day.

Speaker 12 We're unfortunately much closer to getting to advanced AI than knowing how to control it or to make it work for folks.

Speaker 13 This week in Paris, billionaires and policymakers gathered for an AI summit similar to one held held in London a couple years ago.

Speaker 13 Although Chowdhury noticed one important difference in the conference declaration: the complete absence of any language on large-scale risks from AI systems.

Speaker 13 Chowdhury says that's not necessarily a sign of accelerationist winning, but things are shifting. I'm Matt Levin for Marketplace.

Speaker 3 Five years ago, as the pandemic was really starting to bite, the American labor force was one of the early signs of big trouble coming.

Speaker 3 Specifically, the proportion of the population that was either working or actively looking for work. That cratered.
And the proportion is officially called the labor force participation rate.

Speaker 3 And after that sharp drop in the spring of 2020, it has been climbing back pretty steadily, except in the six states of New England. The Federal Reserve Bank of Boston lays it out like this.

Speaker 3 Between 2019 and 2023, in the country as a whole, the labor force participation rate was down a half a percent. In New England, it was off 2.3%.

Speaker 3 The Boston Fed says a big portion of that recovery gap, as they call it, is thanks to the region's aging population, which is a reality that could hurt the area's labor force in the years ahead as well.

Speaker 3 From Vermont, Marketplace's Henriette reports.

Speaker 10 Not long after Kelly Kraiwski took over as general manager of Windows and Doors by Brownell in Williston, Vermont last year, she realized something about its employees.

Speaker 18 We have about a third of our workforce will retire in 10 years, and that's across the organization.

Speaker 10 Carpenters, salespeople, lots of long-time employees, and all of their institutional knowledge will be heading out the door.

Speaker 18 It's not like I can hire somebody in and bring them up to speed in six weeks on what these folks are doing.

Speaker 10 Folks like Charles Pelsu in the sales department. He's been at the company so long, he says, that he got the job through a classified ad in the newspaper.

Speaker 19 And it was literally about three-eighths of an inch tall by an inch and a quarter wide. And my friend Tom had cut that out and he handed it to me.
And he said, I think you should go talk to this guy.

Speaker 10 Over 30 years later, he's still here. But he's starting to think about retirement and how he could help the company find somebody to replace him.

Speaker 19 I think that's a big piece of the puzzle of not just saying, okay,

Speaker 19 I just turned 65 and I'm done. Yeah, that's probably not my gig.

Speaker 10 He expects that finding the right people to fill his role won't be easy. Some recent openings at the company have gone unfilled for months.

Speaker 10 So Pelsu might eventually cut back his hours and stick around for a while.

Speaker 19 I would probably spend a little bit of time working a little bit less than a full week before I completely segue into retirement.

Speaker 10 If Pelsu decides to stay in the labor force past traditional retirement age, he'd be doing the opposite of what many workers in the region chose to do when the pandemic hit five years ago.

Speaker 17 If you had had more people in the right age range who would have been like, oh, I lost my job, I'm age 60. I'm going to retire five years early.

Speaker 10 Mary Burke is a senior economist at the Boston Fed and co-authored the report on the region's labor force participation rate.

Speaker 10 Because the population of New England is older, so-called excess retirements in the pandemic had a big impact on its participation rate.

Speaker 10 Burke says if more people like Pelsu decide to stay on a bit longer, then that would offset a little bit of this demographic pressure.

Speaker 20 It would not be enough to create no drag.

Speaker 10 Meaning, New England is likely to have a worker shortage unless the region sees some big demographic changes, which is exactly what Kevin Chu of the Vermont Futures Project thinks needs to happen.

Speaker 21 Specifically, we set a goal to grow Vermont's population to 802,000 by 2035. It's currently at about 648,000.

Speaker 10 Chu is the executive director of the project affiliated with the state's Chamber of Commerce. He says the state needs to attract more working-age people and and add to its housing stock.

Speaker 21 Because Chu says if it doesn't, it's going to be harder to find medical appointments. It's going to be harder to dine out because restaurants are only open three days a week.

Speaker 10 And it's going to be harder for businesses here to grow. That's already apparent at OnLogic, a company that makes computers built to withstand harsh environments.

Speaker 10 It opened new headquarters last year in South Burlington with growth in mind.

Speaker 10 In part of its building, it has three assembly lines set up, But there's room for more, says Lisa Grunevald, the company's co-founder.

Speaker 22 We can push these lines closer to each other and add in, I believe we have planned

Speaker 22 six lines total to fit in this space.

Speaker 10 But finding qualified local workers is challenging, she says. So is attracting people from out of state.
Mostly, she says, due to Vermont's high cost of housing.

Speaker 22 Some of the more recent recruits we've had, that they've had to be very high paid in order to feel like they could make Vermont swing. And so those are our, you know, executives.

Speaker 22 But people in the middle, it's just Vermont's just not working for middle-income Americans.

Speaker 10 So a few years ago, the company opened a second U.S. location in North Carolina, and it's already found it easier to fill some positions there.

Speaker 22 Ultimately, OnLogic is going to do what's right for the overall corporation. And if that means we need to shift hiring to North Carolina, that's what we're going to do.

Speaker 10 As a native Vermonter, she says, it breaks her heart. I'm Henry App for Marketplace.

Speaker 3 At the peak, 90 some odd years ago, there were 6.8 million farms in this country. Today, just under two.

Speaker 3 Fewer but far bigger farms growing more grains and more produce and more meat. Kenny Torella wrote about the rise of the mega factory farm for Vox the other day.
Kenny, thanks for coming on.

Speaker 16 Thanks for having me.

Speaker 3 We all know the phrase, I think, factory farms, but mega factory farms was a new one for me. Give me a sense of scale here, would you?

Speaker 16 Yeah, so a sense of scale is 7.5 million egg-laying hens at one farm in Malcolm, Iowa. That is 90 times larger than what the U.S.
Environmental Protection Agency considers a large egg farm.

Speaker 3 The thrust of this piece is the people living near these farms, and we'll get there in a second. I do want to talk, though, about regulation of these things, because

Speaker 3 with all 50 states, as you say, having right to farm laws, regulation becomes

Speaker 3 a little challenging, yes?

Speaker 16 That's right. Yeah, the agricultural industry kind of benefits from something called agricultural exceptionalism, where they've been carved out of a lot of key laws.
So just as an example,

Speaker 16 the EPA enforces the Clean Air Act, and yet the agricultural industry is generally exempt.

Speaker 16 And when it comes to the Clean Water Act, only about one-third of large animal farms have to get clean water permits.

Speaker 16 So the laws that we should have in place to prevent agricultural pollution just aren't doing the trick.

Speaker 3 Let's get then to the air and the water part of this. You spend a good amount of time, I gather, meandering around sort of the Midwest and the upper Midwest near some of these farms.

Speaker 3 First of all, you get close to one.

Speaker 3 Give me a sense of what it smells like.

Speaker 16 It's overwhelming, especially on days when they're moving the manure.

Speaker 16 It just stings your nose and you want to get inside as fast as you can.

Speaker 3 And in fact, there are people you talk to who basically stay inside. This one woman bought a grill and can't use it because she doesn't want to go outside.
Tell me about her.

Speaker 16 Yeah, that's Jennifer McNeely in Decatur County, Indiana. And she has one farm near her that has 8,000 cows.
And then she has about 13,000 hogs on a number of different farms around her.

Speaker 16 And for her, the stench is just overwhelming. When she gets home from work, she many days has to cover her nose with her t-shirt or with a scarf and run indoors.

Speaker 16 She even has to take the long way to work because she doesn't want to drive by these factory farms and get a a whiff of them.

Speaker 3 She and others call and complain, and yet it doesn't seem that they get much traction. How come?

Speaker 16 From really the local to the state to the federal level, regulators have really dropped the ball, whether it's at public health authorities or environmental regulators or departments of agriculture.

Speaker 16 And that's not across the board. There are some exceptions.
There are some states that are trying to do better on this. But generally, the problem is, one, that

Speaker 16 the industry is exempt from a lot of key environmental regulation laws. So regulators' hands are tied.

Speaker 16 But the other problem is that policymakers have really enabled kind of the growth of these mega factory farms by not putting

Speaker 16 safeguards in place to protect people from this pollution.

Speaker 16 The ag industry has put an incredible amount of money into

Speaker 16 getting ag-friendly candidates elected.

Speaker 16 And as a result, that means that people who live near these factory farms and suffer from the pollution, the air and water pollution, they don't really have a lot of people standing up for them.

Speaker 3 Yeah. One is obliged to point out here that we American food eaters, we like our eggs, we like our chicken, we like our pork, and we like our beef, yeah?

Speaker 16 That's right. Yeah, this is not just all on the corporations or on the policymakers.
Some of it comes back to us.

Speaker 16 You know, Americans have been pretty quickly increasing their consumption of meat, milk, and dairy and eggs over the years.

Speaker 16 And that has helped give way to these mega factory farms in order to meet the demand.

Speaker 3 Kenny Trilla at Vox, who covers livestock there, writes about it too. Kenny, thanks a bunch.
Appreciate it.

Speaker 16 Thanks for having me.

Speaker 23 Coming up.

Speaker 14 It is really, really difficult to work in the ocean and to have things operate in the ocean.

Speaker 3 Riding the green energy waves, but first, let's do the numbers. Dow Industrials, up 123 points today, 3 10th percent closed to 44,593.
The NASDAQ dipped 70 points, a third percent, 19,643.

Speaker 3 The S ⁇ P 500 inched up two points, less than a tenth percent, 6,068. Gold hit another record high in the past 24 hours.
The OG Safe Haven asset topped $2,950 an ounce at its peak.

Speaker 3 Bonds fell, yield on the 10-year T-note. Also, another Safe Haven asset, by the way, rose to 4.54%.

Speaker 3 You're listening to Marketplace.

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Speaker 3 This is Marketplace. I'm Kai Rizdahl.
It's going to take a while to figure out all of the downstream effects of President Trump's new 25% steel tariffs.

Speaker 3 As a reminder, that is steel from every other country in the world coming into the United States. No exemptions or excuses.

Speaker 3 Domestic steel producers do have something to celebrate in the short term, but even if these import taxes do help the American steel industry, the United States is far from the dominant force in the global steel market it once was, and steel is far from the great American employer that it once was.

Speaker 3 And as marketplace Elizabeth Troval reports, there is not much that's going to change that.

Speaker 25 U.S. steel once dominated the global market.
Raymond Monroe Monroe with the Steel Founders Society of America says before the 1970s, we made more steel than anybody else in the world.

Speaker 25 Then other countries started to lead the pack, like Russia, Japan, and nowadays, China.

Speaker 15 This year we'll make 90 million tons. They'll make 1 billion tons.
They make more steel than the rest of the world combined.

Speaker 25 China really needs steel, says Purdue's Amy David.

Speaker 26 China has been using a lot of that steel as China rapidly, rapidly industrialized.

Speaker 9 But Philip Bell with the Steel Manufacturers Association says the problem is China makes so much steel and doesn't really have a domestic market for all of it.

Speaker 25 So it exports it for cheap in an oversupplied market. And the U.S.
does depend on some foreign steel. Dartmouth's Doug Irwin.

Speaker 27 The import market share was about 25%.

Speaker 25 Most of it comes from political allies like canada uh germany japan korea um who were not going to cut us off from steel if there was a national emergency the u.s was still the fourth biggest producer globally in 2023 according to the world steel association it's just production hasn't grown much and u.s steel employment has shrunk significantly which tom pruscia with ruters attributes to technology yes there's a lot fewer workers is that because of imports or is that because they've gotten way better at producing steel?

Speaker 9 I think it's the latter.

Speaker 25 Brucia says, American steel just takes a lot fewer people to make than it used to, which helps it stay competitive. I'm Elizabeth Troval for Marketplace.

Speaker 3 Renewable energy, solar and wind here specifically, for all their many virtues, have a big drawback. The wind doesn't always blow and the sun don't always shine.

Speaker 3 Yes, batteries, but you know what I mean. The holy green energy grail is a source that's always available.
Ocean waves, for instance.

Speaker 3 There's a steady supply of those, in particular here in Southern California. And there's a company down at the Port of Los Angeles aiming to harness all that power.

Speaker 3 Marketplace's Kelly Wells went to check it out.

Speaker 20 The Port of Los Angeles is a giant maze of birds and keys and channels, and Terry Tammanin weaves through them to get to work work every day.

Speaker 20 The view outside his office has been consistent for more than a century.

Speaker 28 These are the boats that come in from Central and South America with fruit during the winter.

Speaker 20 But the pier Tammanen and I are standing on has changed a lot. He is president and CEO of Alta C which is a non-profit that develops the sustainable ocean economy.

Speaker 20 And right now he's really excited about this blue sedan-sized piece of metal sitting on the pier waiting to get put in the water. Its whole purpose is to bob up and down on the ocean's waves.

Speaker 20 The top of it is connected to a giant piston that acts like a bicycle pump.

Speaker 28 So as the float goes up and down, so does this bicycle pump arm.

Speaker 20 When a bunch of these floats sit next to each other, they look like a series of piano keys that move up and down like scales every time a wave comes in.

Speaker 28 And then the pressure created by that, instead of going into a bicycle tire, goes in here

Speaker 28 into these accumulator tanks.

Speaker 20 Behind the piano keys are a series of what look like really long bright red scuba diving tanks. They're just holding the pressurized air that gets shoved in there every time a wave comes in.

Speaker 28 And when you want the energy, you release the pressure from here. It spins the turbine.

Speaker 10 And now you have stored intermittent renewables without a battery.

Speaker 20 These floats are designed to attach to a breakwater or a jetty. They'll be mounted to a concrete pier on the port's main channel.
They come from a company called Eco Wave Power.

Speaker 20 Its founder, Ina Braverman, says most wave energy companies so far have failed because they've set up installations way out at sea.

Speaker 29 That was extremely expensive because you need ships, you need divers, you need underwater mooring, you need cables.

Speaker 29 It was breaking down all the time because in the offshore you get extremely high waves like tsunami waves.

Speaker 20 In other words, Samantha Quinn with the climate solutions nonprofit Pacific Ocean Energy says there is a lot of breaking and fixing in wave energy.

Speaker 14 It is really, really difficult to work in the ocean and to have things operate in the ocean, especially things that have to move.

Speaker 20 Because yes, the ocean moves floats up and down, but it also jostles them side to side and the saltwater corrodes them.

Speaker 20 On top of all that, different states and countries have different environmental regulations.

Speaker 14 And so then you sometimes have to like redesign parts of your devices to be able to go into a specific location.

Speaker 20 So it's expensive. It can only be built in specific spots.
It's prone to breaking. And this pilot project will generate enough energy to power about 80 households.

Speaker 20 So it's not even close to competing with, say, wind and solar. But Quinn says that's not a fair comparison.
Those technologies are decades ahead in this race.

Speaker 14 Solar and wind didn't just happen overnight. It really did take a long time for those to be developed.
And we are following a very similar innovation path that solar and wind did.

Speaker 20 The floaters at the Port of Los Angeles will get dropped in the ocean and brought online next month. There isn't a penny of federal money going into the pilot project.

Speaker 20 In fact, it was paid for in part by Shell, the oil company. In Los Angeles, I'm Kaylee Wells for Marketplace.

Speaker 3 This final note on the way out today, economists call it the substitution effect. Companies call it, got to keep our margins up.

Speaker 3 This item today from the Coca-Cola Company on its earnings call this morning. If one package suffers some increase in input costs, CEO James Quincy said, we continue to have other packaging offerings.

Speaker 3 For example, he went on, if aluminum cans become more expensive, we can put more emphasis on PET bottles, that is plastic. FYI tariffs, of course, were the subject at hand.

Speaker 3 Companies are thinking about it. Our digital and on-demand team includes Carrie Barber, Jordan Manji, Dylan Metanen, Janet Wynne, Olga Oxman, Ellen Roffes, Virginia K.
Smith, and Tony Wagner.

Speaker 3 Francesca Levy is the executive director of Digital and On Demand. And I'm Ky Rizdahl.
We will see you tomorrow, everybody.

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