Catherine Rampell: Trump Would Be Bad News for the Economy

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Speaker 14 Hello, and welcome to the Bulwark Podcast. I'm your host, Tim Miller.
It is Super Tuesday, and so we are going to just take a little step back from politics.

Speaker 14 Since tomorrow, we'll have plenty of breakdown of what happened in our various primaries to the extent that they're still actually happening.

Speaker 14 So, today, I wanted to talk a little bit about the economy and related issues with one of my favorite Bulwark guests ever, Catherine Rappelle, syndicated opinion columnist at the Washington Post.

Speaker 14 She's also an economic and political commentator for CNN and special correspondent for PBS News Hour. I'm always clicking when Charlie had you, Catherine, so I'm happy that you're back.

Speaker 10 Delighted to join you. Thanks for having me again.

Speaker 14 It'll be good. Okay.
So I wanted to start with the biggest picture economy question, as it does kind of relate directly to our politics, really.

Speaker 14 And my colleague Jonathan Last has been on this for a while now.

Speaker 14 What he says is that we're living in an economic mass delusion that the economy is actually quite good and that people's sentiments about the economy are the problem. He points out that

Speaker 14 in the entire history of the optimistic index survey, which is a survey of small business owners and how optimistic they feel about the economy, we're currently in the widest gulf between what's actually happening in business and what they think is happening in their business.

Speaker 14 If you kind of just look at profit margin versus sentiment, that is true of consumers, it's true of everybody, really.

Speaker 14 It's starting to change a little bit, but I'm wondering how you kind of assess that. Is that true? Are we living in a times that are better than people think? Or are people right to be concerned?

Speaker 14 Where do you fall on that question?

Speaker 10 I think it's not exactly black and white. So it is true that on paper, the economy looks pretty damn spectacular.
If you're looking at unemployment, for example, we've had unemployment below 4%

Speaker 10 for two years now, which is the longest stretch, I think, since the 50s or the 60s, a long time in any event. GDP growth keeps beating expectations.

Speaker 10 Inflation, still not great, but has been coming down. And by a lot of other metrics, of course, we have been beating expectations.

Speaker 10 We're doing even better, for example, than had been forecast to be the case at this point before COVID happened.

Speaker 10 So like if you look at the forecasts that the Congressional Budget Office put out in January of 2020 and how many jobs they thought we would have and how big they thought the economy would be in inflation-adjusted terms, we are surpassing those numbers.

Speaker 10 So on paper, yes, looks great. That doesn't necessarily mean that consumers are delusional.
I think people really, really hate inflation.

Speaker 10 It is psychologically destabilizing beyond the sort of obvious direct financial and economic impacts, you know, that it means that your dollar doesn't go as far, that any wage increase that you get gets at least partly eaten up by higher price growth.

Speaker 10 I think there's also sort of a subtler psychological tax that we don't entirely understand how to quantify.

Speaker 10 Like when I've talked to consumers, you know, a number of them have mentioned things like, well, now when I go to the grocery store, it's not just a routine visit.

Speaker 10 Like I have to pay attention to which brand of peanut butter I buy. Things like that.
Like things that were once once routine become a little bit more complex.

Speaker 10 Or when gas prices are high, for example, and they've been coming down, but I remember talking with people about this, I guess it was about a year ago. Gas prices are high.

Speaker 10 You have to sort of do these mental calculations about whether a trip to whatever, to Johnny's school play or something like that, how much that's going to eat up in your budget, or whether some other get together with a friend is going to be a road trip or whatever.

Speaker 10 Right, exactly. So there are these other ways that it is mentally taxing.
And I think that again if you look at wage growth relative to inflation recently wage growth has been beating inflation

Speaker 10 but there is this sort of i don't know if i want to call it a conventional wisdom in economics but there's this sort of understanding that that's not how normal people think about it they think that when they got a raise they deserved it

Speaker 10 and inflation is something that happened to them i've been waiting for this raise for a while exactly It was overdue.

Speaker 14 I was at the store the other day and I bought my child a cookie and it was like a $6 cookie. You know, I didn't expect it.
It was behind the thing.

Speaker 14 It's like $4.50 and they're tacking on the tip for the person behind the counter.

Speaker 10 You're like, what's happening? And this is like these random little annoyances do happen. Right.
And even though, as I said, inflation has been cooling.

Speaker 10 What that means is prices are not rising as quickly. It doesn't mean that they're going down and we don't want them to go down.

Speaker 10 I think there's a lot of misunderstanding among the general public about this. And I get asked all the time, like, when are prices going to go back down? And I always say, no, they're not.

Speaker 10 I mean, individual things may fluctuate. Like I said, gas prices have gone up, they've gone down.
Egg prices, when there was a bird flu, went way up, then they came back down.

Speaker 10 But in general, the overall price level goes up and it just couldn't go up more quickly or more slowly. And we kind of want it to continue going up because

Speaker 10 when prices are actually overall falling, that's usually a very bad sign for the economy. That's a sign that like we are in severe crisis.

Speaker 10 This is what happened during the Great Depression, for example. Prices go down.
People wait to buy things because why buy today? You'll be a sucker. You can wait till tomorrow.

Speaker 10 And that kind of feeds on itself and spending collapses. In any event, I think...
The price growth that we have already seen to date is what ticks off consumers.

Speaker 10 They have been expecting that prices would fall. As I said, they won't, or at least in general, they will not.
And so

Speaker 10 maybe you saw the price of that cookie today, and maybe it'll be the same price a week from now.

Speaker 10 That doesn't mean the price has gone up, but you're still going to be mad a week from now because you remember when it was cheaper. And look.
Over time, prices generally go up in general, right?

Speaker 10 Like over decades, but we have more time usually to acclimate to those higher price levels than we've had recently.

Speaker 10 So I think what's going to happen is assuming knock on wood that we continue to see the pace of inflation like in the 2%-ish range, which is what we've had recently.

Speaker 10 It's not quite at two, which is what the Fed wants, but it's close. People will become more accustomed to that high cookie price.
They'll get less mad. over time.

Speaker 10 The sticker shock will wear off and we'll go back to, you know, just sort of mentally mentally resetting okay i guess a cookie costs six bucks now or whatever i mean hopefully not but but you get the idea so i think some of it was like even it wasn't that good i just it was fine well then you should substitute downward to a different cookie and that's a whole different conversation but i guess my point is people

Speaker 10 understandably are shaken by the economic uncertainty that comes with inflation and they're still kind of resentful for the higher prices that they have to pay even if their wages have gone up and it will take some time

Speaker 10 for

Speaker 10 that grumpiness, whatever you want to call it, resentment to fade, assuming that, again, like we don't have a recession, the Fed gets inflation lower, inflation, not prices. Again, different things.

Speaker 10 Assuming we get back on track, I think eventually that unhappiness will fade. And we're already seeing it fade.

Speaker 10 In fact, if you look at consumer confidence numbers, consumer optimism numbers, assessments of the overall economy, they are improving.

Speaker 10 You know, they're not spectacular, I would say, but they are definitely picking up.

Speaker 10 Actually, just before we hopped on this call, I was looking at the share of Americans who I think it was who rate the economy as good or excellent, something like that from a recent survey from, I think it was YouGov and The Economist.

Speaker 10 I was looking at their time series data. So like over the past few years, and it's been going up.
It's still low. It's still, like, I want to say in the 30s or 40s, and it was a bit lower.
So,

Speaker 10 people are getting less unhappy, even if they are not like effusively happy. You know, I assume we're talking about this in the political context.
What does this mean for the election?

Speaker 14 This is the question, right? Like, does it happen before the election?

Speaker 14 You know, the Wall Street Journal poll that I was going to just ask you about had 43% said their personal finances are heading the right direction.

Speaker 14 In the most recent poll late last year, it was 34%, right? And it was, so you've seen some movement in that direction. The question is, how long of a lag are we talking, right?

Speaker 14 Because if people start feeling better about their economic standing during the Donald Trump autocracy next spring, that's not really that great of timing.

Speaker 10 Yes. And I don't know the answer to that.
As I said, there has been some uptick in recent months in assessments of the economy. And then there are two follow-up questions.
One is, does that continue?

Speaker 10 And the other question is, does it break through? Is there some reflected glory upon Biden? And I think

Speaker 10 that is the more troubling question for me right now. So, like, on the first question,

Speaker 10 does it continue? If you look at a precedent from 2012, for example, a little over a year before

Speaker 10 Obama was up for reelection in 2012, his chances of winning re-election were considered to be relatively poor, or at least risky. Also, views of the economy were quite dour.

Speaker 10 And then as views of the economy picked up, you know, approval ratings for Obama kind of moved upward in tandem. We so far have not seen that with Biden.

Speaker 10 And I'm talking about, I think, the same Wall Street Journal poll, they actually talked about this, that so far there is some pickup in economic confidence, people's assessment of their own personal finances, as you cited.

Speaker 10 but that doesn't seem to be translating so far for Biden. And the puzzle is a little bit about why.

Speaker 10 And in fact, there was a series of polls that came out over the weekend, or at least in the past week, that looked at this question of like, how do you write the economy?

Speaker 10 And then there were other questions about how do you feel about Biden's handling of the economy? Or do you think Biden or Trump would be better for prices?

Speaker 10 Do you think Biden or Trump would be better for the economy, et cetera? And I think it's kind of troubling so far that even though people are happy, are happier, I should say, with the economy.

Speaker 10 They do not seem to be happier with Biden's handling of the economy.

Speaker 10 And in fact, if you look at things like CBS News, I believe it was, had a question on, do you think prices would go up or down in a second Trump term or in a second Biden term?

Speaker 10 And people were about twice as likely to say prices would go down under Trump.

Speaker 14 Maybe they're accidentally right because Trump would kind of usher in

Speaker 14 the pressure for Saturday.

Speaker 14 The Great Depression. A lot of these questions, vibes, and psychology, which is part of economics.

Speaker 14 But you posted the other day about Trump's actual proposals, which I think are important to kind of enter into the discussion here as well. He obviously wants to increase tariffs.

Speaker 14 He wants to reduce the labor supply, cracking down on legal and illegal immigration. He wants to continue to expand deficits, though he's not exactly clear on that, but more tax cuts would be coming.

Speaker 14 Wants to, you wrote, kneecap the independent agency tasks with price stability. All these things are on the margin inflationary.
Trump is not actually proposing any deflationary, right?

Speaker 14 Like there's no actual substantive proposals for tackling inflation. In fact, all his proposals would be inflationary.

Speaker 14 And yet, you know, sometimes this gets lost in this conversation, the actual policy proposals.

Speaker 10 Yeah. So to be fair, there is little that presidents can do to reduce inflation or reduce prices outright.
Sure. You know, I have plenty of qualms with things that Biden has done.

Speaker 10 I think that there are things that he has left on the table that would, you know, on the margin help a little bit.

Speaker 10 They're mostly things like reversing the existing Trump era tariffs that we still have. But, you know, there are

Speaker 10 things on the margin that can help a little bit. There's a lot more that they can do to screw things up.
And the four things that you just mentioned that

Speaker 10 I've written about before and tweeted about before most recently are things that could be quite bad. We don't know the magnitude.
There have been some attempts to quantify it.

Speaker 10 So like Evercore ISI, which is a private economic analysis organization, they had looked at, I think, the first three of those, those being the trade wars, reductions to labor supply through mass deportations and ending various forms of legal immigration, and more expansionary fiscal policy, whether through tax cuts or additional spending, or probably both based on his track record.

Speaker 10 Probably both. I mean, that's what he did before.

Speaker 10 If you look at, like, everybody thinks about, oh, the main way that he expanded the deficit was through these unfunded tax cuts actually he added a lot of additional spending as well even before covet like well before covet he added trillions to deficits just through spending anyway so evercore looked at this and i believe they estimated that in the in the near term those kind of inflationary policies would cause the Fed to raise rates by about a quarter to a half a percentage point.

Speaker 10 And, you know, more jargony speak, they would raise the neutral rate by about that much. And that's just the first three.

Speaker 10 The thing that I am most concerned about is how Trump might meddle with the Federal Reserve, which it's a politically independent agency today.

Speaker 10 It needs to maintain its political independence in order to be a credible fighter against inflation.

Speaker 10 You can look at all sorts of other countries in which the central bank was under the control of politicians: Argentina, Venezuela, pre-Euro, Italy, various other places, where

Speaker 10 if the public perceives the central bank as not independent, it's much harder to keep inflation under control, particularly once inflation has already gotten up.

Speaker 10 Because there's always going to be this temptation to just print more money to do what the people in political charge want.

Speaker 10 So I'm very concerned about that when Trump was president, he tried to install a bunch of clownish cronies in Fed jobs. Fortunately, was not successful.

Speaker 10 His first few Fed choices, I think, were actually quite good, including Jay Powell, as it turns out, who is currently the chair of the Federal Reserve and whom Biden reappointed.

Speaker 10 But then towards the end of his term, he started nominating very silly people and people who like pretty deliberately wanted to just have the president run things.

Speaker 10 So I think it's pretty likely Trump would do that again.

Speaker 10 And the result of that potentially could be that even if the Fed actually maintains its independence, it may have to raise rates more than it would otherwise to demonstrate to markets that it is credibly independent.

Speaker 10 So anyway, all of those things put together are ban. And the fact that Americans overwhelmingly view Trump as better for

Speaker 10 the thing that they claim to care the most about, inflation, is troubling, given that he would overwhelmingly be worse.

Speaker 10 Now, it's really hard to explain that to the public in part because we didn't have problems with inflation when Trump was president. And in fact, we didn't have it for several decades.

Speaker 10 That's part of the reason why it's been so disruptive lately because we're like not used to it. So it's really hard to say, like, well, it would be really bad.

Speaker 10 And then they're like, well, but it wasn't so bad before. And you have to look at, well, like, how has the landscape changed? What are his actual policies?

Speaker 14 I feel like I'm like, I'm doomed to live this cycle because as a young Republican, I was always like, Clinton's getting credit for the Bush and Reagan recovery. And like, he's getting credit for it.

Speaker 14 And now I'm like, Biden is getting blamed for stuff that happened. Anyway, I'd be interested in your actual assessment on that.

Speaker 14 It's some of the, I think, obviously COVID, some of the huge spending, as we discussed during Trump's era. Then Biden does the additional spending package.
It was probably overkill.

Speaker 14 And then some of it's out of his control versus

Speaker 14 Ukraine and what's happening. So how do you kind of assess all those factors factors if you were grading people looking back?

Speaker 10 Yeah. So there are a number of things that contributed to the bout of inflation we have been experiencing and are still trying to work our way out of.

Speaker 10 And I think it's really hard to assign exact credit or blame to specific factors, but I can tell you generally what I think the factors are.

Speaker 10 Major supply chain problems that, you know, led to big bottlenecks. And that happened here.
That happened around the world.

Speaker 10 People remember that, of course, how difficult it was to get toilet paper, among other things.

Speaker 10 Two, is that at the same time that

Speaker 10 supply was very constrained, demand was really strong, meaning people really wanted to buy stuff and had the means to buy stuff. Why did they have the means to buy stuff?

Speaker 10 Partly it was about lockdowns limiting how much people were going out to restaurants and how much they were traveling. They had a lot of forced savings

Speaker 10 and a lot of desire to buy stuff and

Speaker 10 the means to buy it. Part of it was government policy, giving people a lot of cash.
And there are good things about that and there are bad things about that.

Speaker 10 So I think it's generally a good thing that the government served as a backstop for people who lost their jobs out of no actual wrongdoing on their part, but because the restaurant they worked at was closed.

Speaker 10 for example. Right.

Speaker 10 Or some other business that they used to work for, you know, could no longer operate or lost a lot of customers.

Speaker 10 I think it's good that we have that as a safety net. There were a lot of other things that we did that I think are, I'm more dubious about their merits, or I think were obviously a bad idea.

Speaker 10 So I think, for example, you know, the universal checks, or I should say near universal, almost everybody got them, two of which went out under Trump, one of which went out under Biden.

Speaker 10 I think those were not a good idea. They were not targeted based on need.
They gave people a lot of cash.

Speaker 10 When higher income people, in particular, again, had forced savings and predominantly had not lost their jobs. You know, there was sort of this white collar, blue collar break to some extent.

Speaker 10 So you had a lot of high income, white-collar people working from home, didn't lose their jobs, had a lot of savings. You just gave them more cash to spend.
And it was expensive.

Speaker 10 So there were a lot of things like that. I think the Fed did not raise interest rates quickly enough to deal with the problem.
That was in 2021.

Speaker 10 I think the Fed started raising interest rates not until March of 2022. So they were a little bit behind the eight ball.
And then there were other things, you know, like the war in Ukraine, right?

Speaker 10 That disrupted energy markets around the world. Candidly, like Europe was much more exposed to that than we were.
We have our own energy sources here, but it did help drive up gas prices.

Speaker 10 So there were like a bunch of these shocks, you know, bird flu, various other things that that made us unlucky or that made those things more salient i guess than they might have otherwise been so there are a number of contributors like i said to what extent is it about too much fiscal stimulus or monetary stimulus versus supply side issues i think economists will be debating that for years California has millions of homes that could be damaged in a strong earthquake.

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Speaker 14 On just the economic side, projecting out ahead the next six months. I think that there was a period of time where people were deeply concerned we're going to have a recession.
We haven't had one.

Speaker 14 You hear less about that now. Like, what worries do you have? You mentioned the energy shocks.

Speaker 14 Obviously, I think that there are going to be a lot of foreign powers that would be keen to have Donald Trump win, that might try to put their thumb on the scale.

Speaker 14 What for you are like the economic worries as you kind of look at the data and project out over the next six months, nine months?

Speaker 10 So I should say my worries are mostly for the health of the Republic than for the health of the economy. I think the economy is in a better place than it has been.

Speaker 10 As you note, there had been a lot of fears about recession. A year ago, I want to say, like the baseline case among Wall Street economists was like a 60% chance of recession within the next 12 months.

Speaker 10 And we're 12 months on it. We haven't had one.
Oops. Yeah, exactly.
I mean, it's good. It's good.
I was worried about a recession, too.

Speaker 10 So I think generally the economy is in a better place. I think, again, there are ways that a future leader or

Speaker 10 Congress could screw stuff up.

Speaker 10 If we have a recession, let's say. Maybe it's something I haven't noticed.
Maybe it's some shock.

Speaker 10 war gets worse. And besides the humanitarian toll, maybe that has bigger effects on energy markets.
Who knows?

Speaker 10 I am concerned about how that would be handled, both because we don't know who's going to be president. If Trump is president, I do not trust any of his instincts.

Speaker 10 I also worry about how dysfunctional Congress is to be able to respond to anything such as a major period of economic pain. It seems unlikely that they'd be able to get anything done.

Speaker 10 I'm worried about, again,

Speaker 10 meddling with the independence of the Fed.

Speaker 10 I'm worried about a lot of these things are sort of Trump specific, but I'm worried about Trump's instincts or desire to have these global tariffs, 10% global tariff on all goods, and then 60%,

Speaker 10 apparently, on Chinese goods. That's going to be bad for our economy.

Speaker 10 That's going to be bad for our relationships with our allies and our ability to join with our allies to sort of gang up on China about policies that they're practicing that we don't like.

Speaker 10 So there are a lot of things that I'm concerned about. And then there's some like kind of

Speaker 10 narrower issues.

Speaker 10 For example, House Republicans have been trying to cut funding for a WIC, which is a program that provides nutritional support for pregnant women, new moms, babies, and toddlers who are found to be at nutritional risk.

Speaker 10 This is a program that has had bipartisan support. for 25 years to be fully funded.

Speaker 10 House Republicans, not Senate Republicans, I should clarify, have been trying to cut it for reasons I don't quite understand.

Speaker 10 But a of the things that I think House Republicans are for these days are hard to map onto specific principles. Trolling, owning people

Speaker 10 to own poor women.

Speaker 14 It's just part of the poor moms. Yeah, poor moms need to be owned, I think, is the main policy principle there.

Speaker 10 Yeah. So I have a number of concerns about what happens to specific vulnerable populations in addition to what happens to the macroeconomy and our relationships with our allies and partners.

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Speaker 14 All right, I want to continue our concern for vulnerable populations in our neoliberal power hour here by talking about your recent immigration article, something that I'm obsessed with.

Speaker 14 You write that voters and political strategists have treated our country's ability to draw immigrants around the world as a curse. could be a blessing if only we view it as that way.

Speaker 14 Talk about how this recent surge in immigration has been a gift to the economy. I also would add on top of that, which you mentioned the inflationary aspects of this.

Speaker 14 I don't understand why that doesn't seem to get mentioned very often about

Speaker 14 the fact that having increased workforce is helpful.

Speaker 14 I remember back towards when we were coming out of the pandemic, when people were simultaneously complaining about inflation, complaining that they weren't getting good services at restaurants or coffee shops that they were going to, and also complaining about immigration.

Speaker 14 I was like, these things don't combine.

Speaker 14 So anyway, talk about your recent article about immigration and what you think kind of the best thing that Biden could do to kind of match economic interests, political interests.

Speaker 10 Yeah, it's interesting. So like I said, I have my grumbles about how Biden has handled inflation to the extent that he can have any impact whatsoever, which I think is modest.

Speaker 10 Again, it's mostly up to the Fed.

Speaker 10 I think the one unsung thing that the administration has done, they don't really want to talk about, is that they have made the legal immigration system in particular a lot more functional.

Speaker 10 than it was when they came into office. Our immigration system and how we handle illegal immigration has been broken for many decades.

Speaker 10 So, like, there's a limit on how much they can actually improve it.

Speaker 14 We're grading on a curve here, an improvement curve. You know, exactly.

Speaker 10 We're not running efficiently.

Speaker 14 It's not Germany, but we're grading on an improvement curve.

Speaker 10 Yeah, right. I don't know that Germany is the paragon of all this stuff, but that's a different podcast.

Speaker 14 Anyway, Canada, would you Canada have been better?

Speaker 10 Canada's been having some problems too, but they've done a better job.

Speaker 10 Yeah. So when Trump was on his way out of office, he did a bunch of things to just like totally destroy the system.

Speaker 10 There were huge backlogs in processing work permits, again, for people who were here illegally.

Speaker 10 There were, you know, lots of changes to the system for how skilled workers came here to like add tons more bureaucracy and paperwork and red tape.

Speaker 10 It's funny because People have this idea of Trump as mostly having gone after undocumented immigrants, but really where he was most effective was at slashing levels of legal immigration.

Speaker 10 And you can see that in the numbers. I'm not making this up.

Speaker 10 You know, there are official government reports about how many people come here on visas, how many people get a change of status to a green card, things like that, get naturalized.

Speaker 10 And on almost all of those metrics, the system was just like in tatters.

Speaker 10 Biden and some of his appointees came in and can't fix everything, but they did get a bunch more funding for the agency that handles most legal immigration called USCIS.

Speaker 10 They made a bunch of policy changes to undo some dumb things Trump did, to try to make processes more efficient, like boring stuff.

Speaker 10 But the net result is that the system is sort of back to where it was pre-Trump. And on top of that, obviously, you have a surge of people coming to the border, applying for asylum.

Speaker 10 Many of them them are, they're now like allowed to be here temporarily while their case works through the system. Some of them are waiting for their work paper.

Speaker 10 Some of them are not eligible yet, whatever, but some of them are making their way into the workforce. And that increase in the foreign-born population is pretty much entirely responsible for the

Speaker 10 last few months to a year of job growth, like on net. If you look at the number of native-born Americans who are in the workforce, workforce, who have jobs, it has been declining.

Speaker 10 The number of foreign-born workers has been increasing. And that's just a matter of demographics.

Speaker 14 Interesting.

Speaker 10 Native-born Americans are much older. They're more likely to be aging into retirement.
Those who are foreign-born are disproportionately working age.

Speaker 10 Overall, this has been a very useful thing to the economy.

Speaker 10 And as you point out, there are certain sectors that are disproportionately reliant on immigrant labor, you know, whether we're talking about undocumented immigrants or documented, things like food services, agriculture, hospitality, et cetera.

Speaker 10 And those were a lot of the sectors that were experiencing the biggest labor shortages and had, for a while, very high price growth.

Speaker 10 And when I talk about the things that Trump would do that are not just about the undocumented population, but also about the population of people who are here lawfully, food is a great example. So

Speaker 10 Trump has gotten a lot of attention for talking about how he would round up everybody who's undocumented and engage in these mass deportations, maybe with a concentration camp thrown in there somewhere for a whole bunch of reasons.

Speaker 10 I find that very troubling. But he would also dismantle the legal system that we have that brings seasonal agricultural workers here.
There's a whole program for that.

Speaker 10 Again, legal system, he would get rid of it. So I think there are a lot of problems with our immigration system that could be fixed.

Speaker 10 We have so far benefited from the fact that parts of it are more functional than they were when Biden came into office.

Speaker 10 And over the longer sweep of American history, the fact that the United States has been able to draw global talent to us has been a blessing.

Speaker 10 So it's not just about the last few years with the pandemic and the labor shortages.

Speaker 10 And this is true if you look at the contributions, the disproportionately large contributions immigrants have made to our entrepreneurship rates, to our RD, to other metrics of innovation, like how many patents do people file.

Speaker 10 There's been a ton of research looking at this and looking at various periods of American history where we've had more restrictive or less restrictive immigration policies, like the Quota Acts early in the 20th century and how that affected various parts of our sort of scientific institutions in the United States because those were disproportionately hurting hurting certain areas of scientific inquiry.

Speaker 10 You know, like there's been a bunch of research on this.

Speaker 10 All of which is to say there are a lot of dimensions in which this infusing of new blood and new talent into the United States has been overwhelmingly good for us.

Speaker 10 And the piece that you are referring to, you know, I talked about a recent CBO, Congressional Budget Office report that found that they revised upward their forecasts for GDP, the size of the the economy over the next decade by trillions of dollars because we've had more immigrants come in than they had forecast the last time around.

Speaker 10 But I also concluded, as you may recall, with a quote from Reagan, where in one of his very last speeches as president, he spoke about how I don't remember the exact verbiage he used, but it was something about like the reason why we have, as a country, been able to renew ourselves and been able to have this sort of economic miracle that we have enjoyed is partly that generation after generation, we have the ability to attract new talent here.

Speaker 10 And that message, you know, whether like in sort of the more poetic version or the more prosaic version, just looking at the data, has been lost in this debate over immigration, where everyone sort of seems to start from the premise that immigration is a problem to be solved rather than a gift to be channeled to our economic advantage and, frankly, our moral standing in the world.

Speaker 14 If you give me an opportunity to read Reagan, I'm going to do it.

Speaker 14 You quote: Thanks to each wave of new arrivals to this land of opportunity, we're a nation forever young, forever bursting with energy and new ideas, always on the cutting edge, always leading the world to the next frontier.

Speaker 14 The other element of this is that I feel like is a really meaningful change for 2016, and I can't figure out why, is there was a big group of high-profile entrepreneurs, particularly in Silicon Valley and the tech industry, that were very vocal in 2016 about how grossed out they were about Trump's rhetoric and how critical immigrant workers were to innovation and to these businesses that have brought so much to the American economy and culture, et cetera.

Speaker 14 And that is like silent. You know, I feel like now you hear much more from the contrarian tech bro that is outraged about the border and asylum, et cetera, et cetera.

Speaker 14 Not that there aren't legitimate concerns about the border, but just the weight of the type of rhetoric that you're hearing, that is something that's frustrating to me.

Speaker 14 And I don't know if people just got bored with this or they don't want to get on Trump's bad side or, you know, it's hard to get into the psychology of that.

Speaker 14 But I do think this argument that you make is kind of absent right now from our discourse, which is frustrating.

Speaker 10 I don't think it's entirely absent. There are still

Speaker 10 some tech leaders. By the way, tech has a very high share of immigrant entrepreneurs and talented workers in that sector themselves.

Speaker 10 There are still tech companies, tech leaders who are vocal about the need for more immigration, you know, whether we're talking about

Speaker 10 protecting dreamers, for example, or expanding opportunities for higher skilled workers to come here.

Speaker 10 I think the political allyship question has grown more complicated, right?

Speaker 10 Because

Speaker 10 the natural party home for that sort of sentiment would lately be Democrats. And Democrats have a terrible relationship with Silicon Valley right now.
You know,

Speaker 10 for better or for worse, big tech has become a punching bag among Democrats and Republicans for that matter. So I wonder if that complicates the ability to work together or the messaging.

Speaker 10 But I don't think it's entirely absent.

Speaker 10 I just think you don't see necessarily as effective an alliance on some of these core public policy issues because like everything has become culture war issues, even economic issues.

Speaker 14 Yeah, the volume maybe is just down a little bit. Okay, two more things before I let you go that you've written about recently.

Speaker 14 One is another issue that Biden did some good things on that he's hesitant to talk about, not just legal immigration changes, but energy, American energy boom.

Speaker 14 You write the secret both parties want to keep about U.S. energy.

Speaker 14 Just talk briefly about that and what we've seen in the economy as far as the increase in energy production in America during the Biden Biden years, and kind of assessing why it seems to be a secret.

Speaker 10 Sure.

Speaker 10 So almost every major source of energy, whether we are talking about solar, wind, natural gas,

Speaker 10 almost everything is at record highs or has recently touched record highs in terms of production. Oil, great example.

Speaker 10 There is this narrative out there, I think mostly propagated by conservatives, that Biden has like turned off the oil spigot.

Speaker 10 And in fact, we have been producing more oil than has been the case at any time on record.

Speaker 10 We have had, you know, to the extent people talk about like energy independence, which I think is supposed to mean the idea that we're exporting more than we're importing.

Speaker 10 At least that's what it meant during the Trump era when Trump talked about energy independence, that we had finally achieved it.

Speaker 10 We are there now and we have been there for over a year, the longest stretch in U.S. history, meaning that we are a net exporter of petroleum and petroleum products.

Speaker 10 So on a lot of different dimensions, you know, with the exception of coal, that's the main exception, we are producing more energy than ever.

Speaker 10 And it's kind of an inconvenient set of facts for both parties to tout.

Speaker 10 For Republicans who want to

Speaker 10 maintain the story that Biden has turned off the oil spigot, that he's crushing our energy production, that we are no longer energy independent.

Speaker 10 It's really inconvenient to acknowledge that, in fact, we are, at least by the metric that they seem to have once adopted.

Speaker 10 For Democrats, it's a little bit hard to blast this story too loudly because Democrats obviously have very complicated feelings about fossil fuels.

Speaker 10 And great that the Biden administration has presided over record high investments in wind, solar, battery production, et cetera.

Speaker 10 But less convenient for the more climate-minded left that fossil fuel production, natural gas and oil, have also reached record highs.

Speaker 10 It's like everybody's telling themselves a story that doesn't quite fit the facts. And that the Biden administration, I think, could stand to benefit from megaphones.

Speaker 10 Put him out there, harp hat, on a rig, get some oil on his face. Yes, exactly.

Speaker 10 Yeah.

Speaker 10 But they're too afraid of the left to do that.

Speaker 14 We're going to ask the White House about this when I talk to them later this week. Okay.
Lastly, I would be remiss to let you go without talking about Wendy's.

Speaker 14 As I were discussing having you on the podcast, I saw a social media post from somebody with the quote, won't somebody please think about the poor corporations With a screenshot of your article about Wendy's.

Speaker 14 Your article was titled, Stop Your Populous Grandstanding Over Wendy's Surge Pricing. You could not be in a safer space to make this case than at the Bullark podcast.

Speaker 14 You pointed out Elizabeth Warren called it price gouging and Bob Casey called it predatory and greedy. And it's like, it's happy hour.
It's a fancy word for they're having happy hour.

Speaker 10 Yes.

Speaker 10 Yes, exactly. To be clear, Wendy's actually never used the term surge pricing.
They said they were doing dynamic pricing.

Speaker 14 Okay.

Speaker 10 And dynamic pricing basically just means the prices change. That's it.
They don't say with what frequency. They don't say when.

Speaker 10 Basically, what they meant was happy hour, that they were going to have discounts at certain times of day. Sonic.

Speaker 10 one of their rivals already does this you know there's another burger chain as you point out like lots of restaurants do something similar whether it's happy hour or an early bird special but for some reason i'm eating those early birds specials That's our dinner hour.

Speaker 10 Well, apparently Elizabeth Warren is very against them.

Speaker 10 So yeah, so what happened was there was like this spate of outraged porn media furious at the idea that like Wendy's was going to start price gouging people.

Speaker 10 And then all of these demagogue populist politicians decided this was their moment to like make greedflation happen again.

Speaker 10 If you look at other stuff I've written, I've written a lot making fun of the inflationists.

Speaker 10 Making fun of is too pejorative. Trying to educate people about why greed is not the right way to understand inflation.

Speaker 10 You'll notice that in my, when you asked me before to summarize what was behind inflation, greed was not a word I used. I did know.
Corporations are always greedy. They didn't suddenly get greedier.

Speaker 10 In any event, oh my God. So

Speaker 10 there were a bunch of predictably dumb responses to this Wendy's announcement from people who were, I think, trying to get their names back in the news or whatever.

Speaker 10 I wrote about it and you would not believe the amount of vitriol I got in response to this column being like, hey, guys, this is happy hour.

Speaker 14 You're a pro-corporate Wendy's fascist. What is Dave paying you? Are you on the payroll?

Speaker 10 You know, the irony is I don't even really like Wendy's that much. Who does? I mean, some people do.
No, not.

Speaker 14 I'd like to have a frosty for now and then, but, you know.

Speaker 10 Yeah. But what I said was in the column, like this Wendy CEO kind of stepped in it.
Like he should never have used the term dynamic pricing.

Speaker 10 Like I understand that he was speaking before an audience of potential investors who want to hear higher prices.

Speaker 10 But a surcharge off of a low price is no different from a discount off of a higher price.

Speaker 10 Like they are mathematically the same thing, but one of them is more tolerable to the public than the other, you know, easier to stomach, so to speak.

Speaker 10 And so if they had just started out by by saying, we're going to charge lower prices at certain times of day to like get people in the door when we have spare capacity, I think that would have been a better way to frame it and would have been less of a PR disaster.

Speaker 10 So, I think that they did screw up, but I think the problem was with the PR strategy and not with the, from what we know of the pricing strategy.

Speaker 10 But yeah, like, oh my God, you would not believe the stuff that I've gotten in response to this.

Speaker 10 I get really nasty stuff all the time, but usually it's when I write about like hot button issues like immigration or student debt forgiveness or whatever.

Speaker 10 And this was like about burger discounts and people were very unhappy.

Speaker 14 Well, if you are unhappy with Catherine, go show that by getting your Frosty and burger from somewhere that does not do happy hour and does not do dynamic pricing.

Speaker 14 Find a non-greedy corporation to get your happy meal from. So not McDonald's either, I guess.
You'll find one. There's somebody out there making a cheap burger just for you.

Speaker 14 Catherine Rampel, thank you so much much for doing this. Please come back soon.

Speaker 10 Sure thing. Thanks for having me.

Speaker 14 Appreciate you. Talk soon.
We'll see you all tomorrow with some Super Tuesday talk.

Speaker 10 Bye-bye.

Speaker 14 The Bullard Podcast is produced by Katie Cooper with audio engineering and editing by Jason Brown.

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