Government Shutdown Talks Stall; Autoworkers Could Strike More Plants

    enSeptember 22, 2023

    Podcast Summary

    • Global leaders gather for new connections and insights at Qatar Economic ForumCentral banks take varying approaches to inflation and interest rates, with potential shifts from Bank of Japan and pause from Bank of England, while labor disputes and AI discussions add to economic challenges for US and UK leaders.

      Global leaders, including heads of state, ministers, and CEOs, will convene at the Qatar Economic Forum in May for new connections and unique insights. Central banks, including the Bank of Japan and the Federal Reserve, are taking different approaches to inflation and interest rates, with the Bank of Japan signaling a potential policy shift if inflation goals are met, while the Federal Reserve intends to keep rates higher for longer. The Bank of England paused its rate hikes after 14 consecutive increases. In the US, a labor dispute at General Motors and potential spread to other facilities could impact thousands of workers. Meanwhile, in the UK, Jeremy Hunt discussed the importance of dialogue with China about artificial intelligence. Despite economic challenges, UK and US leaders expressed optimism that corrective actions and staying the course can help bring down inflation.

    • Government shutdown and work stoppage impacting economyThe US government shutdown and ongoing work stoppage could negatively impact the economy, with negotiations at a standstill and Microsoft's acquisition moving forward despite antitrust concerns. Apple's new products went on sale, while Huawei sees a boost in sales with its new chip. However, a tragic bus crash left people dead and critical.

      The ongoing work stoppage in the US could negatively impact an industry that contributes around 3% to the nation's GDP. Meanwhile, the government shutdown could add to the economic woes, with negotiations at a standstill. House Speaker Kevin McCarthy's efforts to pass a funding bill have hit a roadblock due to opposition from two ultraconservative lawmakers. In the tech sector, Microsoft's acquisition of Activision Blizzard is moving forward after the company agreed to sell certain gaming rights to Ubisoft Entertainment to address antitrust concerns. Apple's new iPhone 15 and watches went on sale today, and the tech giant is expected to disclose smaller raises for its retail employees. Overseas, Chinese tech giant Huawei is experiencing a boost in smartphone sales due to its new Kirin 9000 chip, which supports 5G wireless speeds. However, the global economic landscape is not all positive, as a tragic bus crash in New York State has left at least 2 people dead and others in critical condition. Stay tuned for more global headlines and a check of sports.

    • Two tragic incidents and notable eventsA bus crash left two dead and dozens injured in New York, a toddler died from Fentanyl exposure at a daycare, Zelensky visited Washington for military aid, Murdoch stepped down from Fox and News Corp, the 49ers won, and Bloomberg News covers global events 24/7

      Two tragic incidents occurred in different parts of the country, causing harm and loss. In New York, a bus carrying high school students and their band director crashed, leaving dozens injured and two people dead. In the Bronx, a toddler died and three others were sickened after being exposed to Fentanyl at a daycare center. Elsewhere, Ukrainian President Volodymyr Zelensky visited Washington to request military aid and thank the US for its support, while 92-year-old Rupert Murdoch stepped down as head of Fox and News Corporation amid controversy. In sports, the San Francisco 49ers, who lost in the NFC championship game last season due to injury, showed their potential as a Super Bowl contender by defeating the Giants in their home opener. Despite the losses, the Giants' coach Brian Daboll encouraged learning from both the good and the bad experiences. Meanwhile, Bloomberg News continues to provide global coverage, 24/7, with over 27,000 journalists and analysts in 120 countries. Stay informed with Bloomberg News Now, available on various platforms.

    • UAW Strike Continues with No Significant ProgressThe UAW strike against Detroit automakers persists, with key issues being wage increases, eliminating job tiers, and reversing past concessions. The union may expand the strike if no substantial progress is made by Friday.

      The UAW strike against the Detroit automakers continues with no significant progress in negotiations, and the union has threatened to expand the strike if substantial progress isn't made by noon on Friday. The main points of contention include wage increases, eliminating job tiers, and calling back concessions made during the companies' financial struggles in the late 2000s. Meanwhile, on the sports front, the Jets prepare to host the Patriots, who have won the last 14 meetings, while the Mets lost to the Phillies and the Twins are on the brink of clinching the AL Central. In business news, the S&P futures rose 0.1%, Dow futures remained unchanged, and NASDAQ futures gained 0.3%. The UAW strike has already severely disrupted the auto industry, and a potential expansion could cause further damage. Craig Trudell, the global car czar for Bloomberg News, will provide updates on the negotiations.

    • Autoworkers' strike impacts retiree healthcare benefits negotiationsAutoworkers' strike at Ford, GM, and Stellantis plants leads to renegotiation of retiree healthcare benefits. Companies reluctant to change due to job security concerns and supply chain disruptions. Union strategic in adding plants to strike, affecting inventory and strike fund.

      The ongoing strike by autoworkers at Ford, General Motors, and Stellantis plants in the US has resulted in the union taking on retiree healthcare benefits in exchange for workers giving up retirement. Companies are hesitant to renegotiate this agreement due to job security concerns and potential plant closures. The industry has already seen disruptions from the chip shortage and supply chain issues, leading to inventory depletion at affected plants. The union aims to be strategic with adding plants to the strike, as each worker receives $500 a week from the strike fund. The industry is closely watching for any additional plants being added to the strike, with potential implications for inventory and the strike fund. The situation is expected to be addressed in a news conference at 10 AM Detroit time.

    • Exploring the Future of Artificial Intelligence with Industry LeadersJoin Bloomberg for a discussion on the latest news and future adoption of AI with industry leaders from Snap, Microsoft, Open AI, and Stanford.

      Bloomberg's news coverage is widely accessible through various platforms including Amazon Alexa, the Bloomberg Business app, SiriusXM, iHeartRadio, and Bloomberg.com. The Bloomberg Daybreak program from New York provides insights on the latest news from both Silicon Valley and Wall Street, focusing on the promise and perils of artificial intelligence (AI) and its future adoption. AI is a significant topic with many unanswered questions, such as which companies will dominate, and where the risks and unintended consequences lie. To explore these questions, join Emily Chang at Bloomberg Tech in San Francisco on May 9th. The event will feature industry leaders like Snap's Evan Spiegel, Xbox President Sarah Bond, Open AI's Brad Lightcap, and top researcher Doctor Faye Feili of Stanford. For more information and remaining speakers, visit bloomberg.com/techsf.

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    This is the question that Jonathan Gruber and Simon Johnson explore in their book, entitled Jump-Starting America: How Breakthrough Science Can Revive Economic Growth and the American Dream. In this episode, Alexander McCaig sits down with Jonathan Gruber to have a meaningful dialogue on what the government’s missing out on by decreasing funding in research and development. 


    The Effect of RnD on the US Economy


    According to Jonathan Gruber, public investment in research and development played a pivotal role in the economic progress of the United States. All the technological advancements we have the privilege of experiencing today—such as our smartphones and laptops—were, in part, fueled by the amount of funding that was poured into the pursuit of science.


    However, the level of public investment decreased drastically, from about two percent of GDP in 1962 to just under half of that today. In his book, Jonathan Gruber explains that the nation’s renewed support in science and technology would play a significant part in generating economic growth. This is especially important in an era where plenty of citizens are facing job instability, outright unemployment, and health concerns brought about by the COVID-19 pandemic.


    Ushering in a new era for research and development would not just benefit certain industries. Jonathan Gruber posits further that aside from overall growth, it would create better jobs across the economy. This would naturally occur as the market adjusts to accommodate an influx of tech professionals across the country, because they would need these goods and services to support their work as well as their quality of life.


    Decentralizing Opportunities for Innovation



    While the US does have certain cities where tech-based growth is made possible, they are not enough to power the economy. In fact, concentrating opportunities in “superstar” cities such as San Francisco, New York, Seattle, and the Silicon Valley can be counterproductive. 

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    At this point, Jonathan Gruber emphasizes the importance of government involvement in encouraging basic research. Setting aside funding for research and development that is carried out in other areas would help incentivize private investors, or venture capitalists, to take that risk as well. 


    Will Robots Take Over Our Jobs?


    One salient point of discussion in the episode was when Alexander McCaig asked Jonathan Gruber about the impact of robotics on the future of work. Alexander pointed out that there may be some routine jobs that may phase out completely because they would be delegated to robots, who would be more efficient at performing such activities.


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    To illustrate his perspective, Jonathan Gruber explained how the invention of the wheel raised concerns about the viability of horse-drawn carriages back in the day. Fast forward to modern times, it is clear that refining the wheel has led to a plethora of different jobs across transportation, engineering, and construction as people and cities work to make their locations friendlier to vehicles. 


    Planning ahead for new job roles could help the labor market adjust and accommodate accordingly.


    Closing Thoughts: Taking the First Step Forward


    When asked about his parting words, Jonathan Gruber encourages people to take an “if you build it, they will come” mentality. People living in communities tend to go for an incredibly narrow or vague focus, but what they need is an actionable plan that can be carried out step by step.


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    SUBSCRIBE/FOLLOW on Rokfin rokfin.com/aroundtheempire, Patreon patreon.com/aroundtheempire, Paypal paypal.me/aroundtheempirepod, YouTube youtube.com/aroundtheempire, Spotify, iTunes, iHeart, Google Podcasts

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    2. GGG Podcast Episode #75 – Davos and the Week That Changed Everything Part 1
    3. GGG Podcast Episode #76 – Davos, Ukraine and the Week That Changed the World Part II
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    5. The Putin Interviews, Oliver Stone
    6. Tom Luongo: Can Russia Kill the Great Reset? Palisades Gold Radio