Is a Recession Coming For Us...Or Not?

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Brian Lehrer: It's The Brian Lehrer Show on WNYC. Good morning, everyone. This may go down as a historic week for the US economy. Yesterday's tentative agreement averting a UPS strike by 340,000 workers could help set a new template for how many workers get paid in this country when the companies that employ them are making really big profits.

There's other meaningful money news too, like the 6% jump in Google stock price yesterday being attributed in part to artificial intelligence not eating the search engines' lunch this year, as much as some people feared. Does that indicate human beings are beginning to draw guardrails that establish who's in control, us over the machines, or are things like ChatGPT coming for us inevitably, just maybe an economic quarter or two down the road? Since when is Google's algorithm something to get sentimental about, anyway? There's the Federal Reserve Board meeting today at which they may raise interest rates another quarter point or so even though inflation seems to be cooling. On those interest rate hikes, you may have noticed that the economy has not gone into recession as some people predicted from the benchmark rates going to 5% or so.

In fact, an article in The Atlantic proposes that today's US economy is the best US economy ever. Yes, ever. It's by Annie Lowrey, Atlantic staff writer and author of the 2018 book Give People Money: How a Universal Basic Income Would End Poverty, Revolutionize Work, and Remake the World. Annie Lowrey joins us now and will compare notes with New York Times economics opinion writer Peter Coy who, sorry to spoil the party, predicts we're still headed for a recession eventually maybe next quarter. Who knows, maybe by then an AI robot will be the president of the New York Stock Exchange. If the companies we know as Facebook, Google, and Twitter are now really called Meta, Alphabet, and X, I guess any kind of change that seems to make no sense is possible. Let's talk. Annie Lowrey and Peter Coy welcome back to WNYC.

Peter Coy: Thank you.

Annie Lowrey: Thanks so much.

Brian Lehrer: Listeners, you can call or text us at 212-433-WNYC, or I'm saying this for the first time, X us @BrianLehrer. That's what Musk actually wants people to say now. Apparently, you don't tweet us anymore, now you X us. Though, maybe the way things are going over there, investors are going to X the company out. Annie, I'll bite on your premise, you actually wrote "This is the best economy ever." You wrote those words. Want to make that case for our listeners?

Annie Lowrey: Absolutely. It's not a case that I would make without a bunch of asterisks. Median household income is sitting pretty close to a brand-new high, it's about $6,000 per household higher than it was in the late 1990s. We started to see really promising wage compression, which means that we've had a real increase in real wages, even accounting for inflation, among the lowest-paid workers. We have very, very low unemployment and secondary measures of financial stress, things like credit card defaults, or bankruptcies, those are as low as they've ever been.

Real disposable income is the highest it's ever been. I think it won't come as any surprise to your listeners that again, there's a ton of caveats here. The price of housing is just crushing for folks, we're spending a lot of money on health care, on child care, on higher education. I wouldn't necessarily say that this feels like a wonderful economy, but in a lot of hard numbers, it seems like it is.

Brian Lehrer: Those caveats, are they bigger than the thing they're the caveats on? When you talk about housing and higher education expenses, those are so defining for people's household income, that I wonder, how can it be the best economy ever. Also, wouldn't it have to mean that everything we've been talking about here and elsewhere for decades is wrong, like that there's been stagnation and decline of the middle class for the last 50 years?

Annie Lowrey: Absolutely. I think I pull out two things here, maybe even three things. One as we mentioned, there's this real cost of living crisis. It's just really tough for people. A second factor is that we just had this big inflation shock and inflation is receding, but not until after it's raised the price level of a lot of goods. It also takes people a little bit of time to adjust to inflation declining. It's been really stressful over the course of the past two, three years that every time you went to the grocery store you felt like you needed to put one or two things back on the shelf, that's really upsetting for people.

Then the third thing I would also draw out is that, yes, we've seen this really nice wage compression in the past five years or so, but we are a very high inequality country, especially in terms of wealth inequality. The 1% continue to do remarkably well, as they always have, and asset prices continue to be really high. With all of those things, I think that we're headed into subjective territory as opposed to objective territory. We've seen increases in consumer confidence and that kind of thing. I think it's reasonable for people to say, "Okay, maybe a lot of these headline numbers are good, but my life doesn't feel that great, and I'm working really hard."

Brian Lehrer: Peter Coy you get a choice now. You can respond to any of that, or just go on and make the basic case and your latest piece, which is called Sorry, but I think a recession is still coming.

Peter Coy: I want to start out by engaging with Annie. By the way, very glad to be on with Annie. I've admired her work for many years. I think that the case that things are the best they've ever been would have been easier to make right before COVID. The real median household income, which is a number Annie cites, is high now, but it's actually down a little bit from right before COVID. That's because of inflation. People always compare themselves to the way things used to be, and what's your baseline? If your baseline is pre-COVID, then things don't look so great, they actually look slightly worse because inflation has eroded our incomes. Overall, I agree that things are pretty good, and that segues into what I'm saying now.

I'm not arguing that things are bad right now, you see a lot of surveys of consumers who are complaining about the Biden administration, high inflation, and so on and saying, that's why they don't want to vote for a Democrat in 2024. I would argue that actually, things are pretty good, but they might not stay that way. If the Democratic Party is worried about the reaction of the voters today, imagine how much more worried they'll be, if indeed, there is a recession sometime in the next year.

Brian Lehrer: Peter, I want to talk about one of the metrics that you bring up in the article, which I think might be interesting for people. This is one of the reasons you think a recession is still looming, it's the inverted yield curve, that you write about. Now, as a non-expert in these things I've been confused by this just walking down the street in my neighborhood, and no, listeners, I'm not such a geek that I walked down the street thinking about inverted yield curves all day. Again, I've noted--

Peter Coy: I do.

Brian Lehrer: You do that's your job. I can't help noticing in all the bank windows that a short-term CD pays a higher interest rate now than a long-term CD, which makes no sense because usually, they'll pay you more for getting to keep your money and invest for themselves for longer. Maybe it's worth parsing the idea of the inverted yield curve for our listeners. Yes?

Peter Coy: Well, first of all, Brian, that is just an excellent way of telling the story with a real-world example. Thank you very much for setting that up. That's exactly what an inverted yield curve is. It means when short-term interest rates are higher than long-term interest rates, which is an inversion of the usual pattern, usually, as you say, the people who take your money will pay you more for it if they get to hold on to it for longer, making up for the risks of say inflation eroding the value of their securities. Why would it be inverted now? Well, think about it. The Federal Reserve has been raising short-term interest rates, that pushes up the short-term, and then you ask, "Well, why would the long-term be low?" That would have to do with people predicting, see either lower inflation or lower growth, or the Federal Reserve needing to turn around and start cutting interest rates because it fears recession, some combination of those things.

Usually, when you see this pattern of an inversion, it's a pretty reliable sign that a recession is coming. The economy is going to slow down because the Fed is working so hard to slow it down by raising short-term rates. Then you'll see that investors in fact do expect that to happen because they have a lower expectation for long-term rates. This is a pattern that pretty much every recession we've seen, or every time we've had a steep inversion of the yield curve, we've seen a recession following. This one is more inverted than any yield curve we've had since like 1980.

Brian Lehrer: Annie, one of the metrics in your best-economy-ever case is that unemployment is at a 60-year low, jobs are more plentiful than at any time in a generation also. Can I ask if you think that's an underlying reason for this tentative UPS settlement with the Teamsters union, which is generally getting reported as favorable to the workers? I'm not sure that that's what it is. That's going to be up to the rank and file, but that seems to be the pattern. From what I read, starting pay for part-time as it UPS would go up from $15.50 an hour to $21, full-timers with longevity will go up to $49 an hour from I think the low $40s now. Is this partly because workers have more leverage generally in today's job market, or is this very specific to UPS?

Annie Lowrey: Absolutely. I think that you cannot disentangle this deal from the broader economic environment. We went through almost a decade-long period in the wake of the Great Recession, in which there was just tremendous slack in the economy, and businesses had their pick of workers. It wasn't terribly hard for them to hire. Workers had very little leverage to negotiate wage increases. There was just a real malaise that typified the Obama economy. That started to go away, as Peter wonderfully pointed out, really, during the Trump years that the labor market got tight enough, things were getting better, and that was what brought us forward to the COVID economy, and that shock.

Brian Lehrer: Can I stop you there for just a second and do a little parenthesis here because I know what some listeners are thinking right at this moment? Wait, you're blaming Obama for a lackluster economy, which I don't think you actually are, but that was just the beginning of the slow recovery from the financial crisis that finally picked up speed like 10 years later when Trump happened to be the president.

Annie Lowrey: Yes, absolutely. This was not the economy that the Obama administration preferred. They tried to get Congress to pass more fiscal stimulus numerous times. They went back again and again and again, and they couldn't get it past. What you had was very, very loose, and accommodating monetary policy, and you didn't have enough fiscal policy helping the economy to get out of the hole that the Great Recession left. That wasn't really what happened when we had the COVID recession. We had really loose monetary policy. The Fed stepped in to shore up financial institutions, interest rates dropped again, but you also had a ton of fiscal stimulus, much more fiscal stimulus than you had during the Great Recession.

That is what allowed this rebound from that COVID recession to happen quickly, much faster than it did during the Great Recession. I think that I really see the Teamsters in the UPS deal within that bracket. Importantly, the United States still has a very, very low private-sector unionization rate. I happen to be a unionized worker, but again, among private sector workers, it's about 6%. That's very low compared to a lot of our peers. The Teamsters were able to negotiate this really, really strong new contract for these UPS workers, but relatively few workers have the Teamsters on their side doing that for them. That's a reason that we tend to see more wage inequality in the United States than again in some of our peers. Nevertheless, this actually should have spillover effects to non-unionized workers because there's open competition for workers.

If we continue to see growth, and I think Peter is right to raise some alarm bells about what we might be looking at coming forward, this in an indirect way will benefit all workers.

Brian Lehrer: Peter, let me get your take on that. Does it set a template at all, in your opinion, for companies that are doing really well as, apparently, UPS is since the pandemic boosted shipping demand so much, it's down from its lockdown peak, people are back in stores, but still way up, compared to before the pandemic, so UPS may be a more profitable company long term now. There are other companies where the owners do great and the workers feel underpaid and exploited because the labor market just left them at a disadvantage, and the company didn't care to share the wealth any more than they had to. Do you think this changes that in any watershed kind of way for American workers?

Peter Coy: I don't think so, and it's because of what Annie said, which is that UPS is an exception in having a largely unionized workforce. 1/3 of all Teamsters in the nation work for UPS, so it's a hugely important employer for UPS. Conversely, the UPS relies heavily on the Teamsters to keep its cargo moving. This doesn't work so well at say, Amazon. Amazon is increasingly shifting away from relying on UPS for delivery of its packages and started to get into the business of delivering for other companies, in other words, moving in the direction of competing with UPS. They're non-unionized almost entirely. Brian, I know you've had programs about attempts to unionize Amazon job sites in places like Staten Island, and it's been incredibly uphill struggle.

I think as long as the American workforce remains private workforce that is almost entirely non-unionized, we should not expect that the tight labor market will translate directly into better wages for American workers.

[crosstalk]

Brian Lehrer: Go ahead, Annie. Go ahead.

Annie Lowrey: Oh, I was going to say, to add one other thing, one thing that I think is interesting is, we've had really public strike activity. With the Hollywood workers, the writers, and then the actors, with the UPS workers threatening to strike with strikes at Starbucks stores, for instance, we've had a lot of public strike activity, but we haven't seen an actual increase in the private sector unionization rate. I think that people can think, "Oh, unions are really turning the dial," but for precisely the reason that Peter pointed out, it's like there's more noise than there is signal at this point. You would really want to see that rate go up and more workers falling under a union banner, because unions, they do a lot of things, but we really do know that they do deliver wage increases for workers.

Brian Lehrer: You don't think Annie that this settlement could put wind under the sails of workers at FedEx? I've no idea if workers at FedEx are trying to organize, but if they wanted to, the main competitor UPS, I presume is FedEx, and workers there could say, "Hey, look what they just got now. Maybe we should have the Teamsters in our shop too," and somehow be a little more successful than they might have been yesterday at bringing that to bear?

Annie Lowrey: Yes. Interestingly, the group of workers at FedEx that is unionized are their pilots, but that's a relatively small share of their workforce. I do wonder if the public nature of some of these labor fights might lead more places to be interested in unionizing. That might be a long and a slow process. Biden administration is very pro-union and has wanted to increase the private sector unionization rate, but it's been very low for decades and decades and decades now. I think it's just going to be a long and a slow process. I'd note that American businesses tend to be quite anti-union, and I think that even American workers tend to be less pro-union than those in some other countries, in part, because I think a lot of workers just have no experience with a union. There's a natural skepticism there about, "Am I giving up some autonomy? Am I going to make less money? The company hates it." It's not been generally a pro-union environment in the United States.

Brian Lehrer: Peter, want to add anything to this?

Peter Coy: Yes, actually, I do. One thing is that the FedEx workers in the Express Service are governed by different labor law, the Railway Labor Act versus the National Labor Relations Act that governs the Teamsters at UPS, and it's a harder set of laws to organize under. I'd also like to make a point that the UPS-Teamsters relationship has over more than a century going back to 1907, been fairly productive relationship. I wrote about this in my newsletter in the opinion section of The Times that we shouldn't just think of it as purely an antagonistic relationship between management and labor. A well-run relationship between a union and an employer can be good for both sides in promoting worker loyalty, on the job training, safety, and overall, it can work and I think they're showing that it is working.

Brian Lehrer: I read that article of yours and I thought it was fascinating. Is that is there any specific example you can give for people who might assume that labor negotiations, labor relations at a unionized company are by nature antagonistic? An example of that collaborative relationship that that company and its union have managed to foster?

Peter Coy: Well, I would go with UPS. Let's just stick with that example. The negotiations were quite antagonistic. The president of the Teamsters repeatedly threatening, "Were going to go on a strike. UPS is not respecting us." It was a lot of bluster. Then suddenly, as soon as the contract is agreed to, not yet ratified, suddenly the tone completely changed. It was like, "We've just scored a huge victory for workers," [laughs] because of course, they wanted to get it ratified but now the tone has much improved.

Brian Lehrer: Listeners, first of all, are any UPS workers listening right now who would like to say if you plan to vote yes or no on this tentative contract? We had some very dramatic calls last time we talked about working conditions there, as some of you listeners may remember. TK in Rockland, are you out there today? Antonio, from Brooklyn, or any other UPS worker? Is this very good? Good enough? You don't yet know? Help us report this new story of the rank and file vote about to come. 212-433 WNYC, 212-433-9692, text or call, and any business owner with your eye on recession, no recession in your business or your industry, 212-433 WNYC, help us report that story as the Fed considers another interest rate hike today, or who wants to stand on your head and talk about the inverted yield curve [laughs], or anything less econ wonky than that.

Who wants to support or challenge Annie's assertion that this is the best US economy ever with asterisk or tell us your housing story that backs up the title of her article, which is called The Wrong Apartment Problem? 212-433 WNYC 212-433-9692. While your calls are coming in, I mentioned the unforgettable TK from Rockland call. He told us he's a UPS warehouse worker, and here's just about 30 seconds of how he unloaded on the job of loading the trucks when he called this show.

TK: They run through warehouse workers like you run through tissue at a funeral. You jump in and out that truck every minute, somebody standing at the end of the truck going, "Stop, next truck." Let me tell you something. There is nothing in this world like being treated like a mule. 2023, and they are treating human beings like mules. That's if you are in the union.

Brian Lehrer: TK or anyone else who works for UPS full or part-time, chime in along with business owners on recession prospects. Anyone else with a comment or a question for Annie Lowrey from The Atlantic, Peter Coy from the New York Times 212-433 WNYC, 212-433-9692, call or text, or any of you can X us, what we used to call Tweet us but as of this week, Elon Musk says, no, it's called X now. X us at Brian Lehrer, and we'll continue with your calls and Annie and Peter right after this. Brian Lehrer on WNYC as we compare economic notes with Peter Coy, economics columnist for the New York Times, and Annie Lowrey who writes about the economy a lot for The Atlantic, and is also the author of the book, Give People Money: How a Universal Basic Income Would End Poverty, Revolutionize Work, and Remake the World.

Of all the things that we've talked about so far, Annie, what broke out a little bit among our callers was that brief reference that we made, that brief exchange that we had over how much to blame Obama or credit Trump for the slowness of the recovery early in the 2010s and the more rapid pace later on. Let's take a couple of callers on that. First. Margot in Manhattan, you're on WNYC. Hi, Margot.

Margot: Hi. Thank you for taking my call. I just wanted to say that Obama made a choice about what kind of rescue plan he wanted to have. He took the advice of Larry Summers and Tim Geithner and not of Elizabeth Warren. He bailed out the banks. He didn't do anything for people generally in the economy, and we have a slow recovery as a result. I also want to point out that President Obama had huge majorities in both houses at the time he was president. He could have done much more progressive things than he did. I contrast that with what President Biden has done, which actually has brought our economy back much faster than similar economies in Europe, let's say. He did that with razor-thin majorities in both houses. It bothers me that people just gloss over actual choices that President Obama made. He was really a centrist. Whatever. I think that's all I need to say.

Brian Lehrer: Margot, thank you very much. Hold that thought, everybody in your heads. I'll ask Annie to address it in a minute, but we'll get the one more call on this topic. Brian in Randolph, New Jersey, you're on WNYC. Hi Brian.

Brian: Hi Brian. Good morning, to your guest. Good morning to you. Yes, I agree with what Margot said to a point. I just think the comment that Trump just happened to be president 10 years after the Great Recession-- I'm no Trump supporter, but I do think there was some impact to his administration rolling back various regulations. As I sit in financial services I see various industries and how they're impacted by government actions. I think that really opened the door to some economic growth. It may have done so leveraging the health and safety and unity of the country, but I definitely think that there was more than just his presence in office

Brian Lehrer: The tax steps too under Trump?

Brian: I think that certainly put more money into the economy. He made decisions with the economy in mind it seems. The economy stupid seems to be a way to win an election and maybe that was what was in his mind. Telling voters to inject bleach maybe wasn't such a good idea down the road. Again, I'm no Trump supporter. I think the last time I was on your air, I was railing against him, but I just feel that it's an unfair comment to make given the topic-- [crosstalk]

Brian Lehrer: [crosstalk] That was my comment. I appreciate it. Nuance, welcome here. Annie, pretty interesting couple of comments. One, blaming Obama more than I did in my question to you, the other praising Trump more than I did in that same question.

Annie Lowrey: I think that there's some nuance here. In terms of Obama, I think you can clearly understand Biden's presidency as something of a repudiation of Obama's centrism. Biden really took the left critiques of the Obama presidency to heart. I do think that the whole party moved to the left, but I do want to say one thing, which is that it's not true that Obama had control of Congress for very long. Republicans retook the House in 2010. There was that huge Republican wave election. They gained seats in the Senate and that functionally meant the end of Obama being able to pass anything [laughs]. I would note that I think what might come up historically is that Obama used a tremendous amount of political capital after the stimulus bill to get the Affordable Care Act passed.

That was the last big thing that they were able to do. Those democratic losses were partially attributed to that because it was a very unpopular bill at the time that it was signed. Then when they tried to go back for additional stimulus later on they were incapable of doing so. They also got lost in this process of trying to do long-term deficit reduction, which I think a lot of them now think was in error. Those are the notes that I would make on Obama's presidency there. Then in terms of Trump, look, I think that there are two things that we really have to credit the Trump administration for doing that were positive for the economy. The Tax Cuts and Jobs Act probably contributed some growth on the margin. I think that that's certainly true.

Whether it was worth it in terms of adding to the debt is a very complicated thing, but the Caress Act passed under Trump. It was a $2.2 trillion stimulus bill. Then it gets followed up by additional Biden bills. I do think that it had a pretty profound impact in terms of helping keep folks stable. Most American adults got a $1,200 cheque. Families with kids got more. I do think that that had a big effect in that but that was a Trump bill.

Brian Lehrer: Peter, want to weigh in on any of this?

Peter Coy: Yes. Christina Romer was advising Obama that he needed a big, big stimulus to get out of the deep recession. He was advised by Larry Summers and just thought, "There's no way we can get this passed politically." Whether he was right or wrong, it's hard to say now, but there's a good chance he was right because even the stimulus that did pass barely got through. I don't think Obama was wrong so much on the economics as he was maybe on the politics. As Annie said, Biden learned from that, that you don't hold back, you just go in guns blazing. Things had changed by then. Also, just from the experience of the jobless recovery from that previous recession, they said, "We're not going to make that mistake again."

Republicans went along, especially because Trump was president at the beginning of the COVID. They said, "We're going to go big this time." It worked. People complained about the inflation that resulted and that was a problem. It might have gone even too far, but the idea was, let's err on the side of doing too much rather than too little." I would say probably that was the right decision.

Brian Lehrer: Here's Molly in Queens calling in on the UPS and Labor generally stretch of the conversation we were having before. I think she's an organizer with the UAW, she told our screener. Molly, you're on WNYC. Hello.

Molly: Hello. Thank you for taking my call. Yes, I'm a labor organizer with BUAW--

Brian Lehrer: [crosstalk] That's United Auto Workers, just to spell it out, right? United Auto Workers?

Molly: Yes, thank you. Correct. I was involved in the part-time faculty strike at the New School last fall and have been watching a lot of the unionizing and striking and organizing generally that's been going on across the country. I just wanted to make a comment around-- I think Peter was talking about the ability of this to really impact non-union workers and union workers across the country. I think from my perspective, it's less about only 6% of the private workforce being unionized and more about the amount of workers that are organizing outside of that legal framework that you need to be a union. Unionizing and striking and economic justice, in general, is in the public eye more than ever now that we have actors and celebrities on picket lines and talking about these things on TV, on TikTok, and workers are organizing.

The reason there aren't enough unions in this country is because of labor law and federal policy that has restricted that largely since the Reagan administration. It's not for lack of trying. Workers are seeing all of these efforts that are happening right now and saying, "Oh, we can do that. We can do that. We can fight for a $21 minimum wage." I can tell you that undergraduate student workers at -- oh, I'm blanking on the name of the university, just won a $21 minimum wage as well. It's happening around the country. It's a slow movement because of the laws around unionizing, but it's happening.

Brian Lehrer: Peter, want to react?

Peter Coy: No. She made a great point, which is that when actors start going on picket lines, suddenly it's faces people recognize, people like, and it really might make a difference. I think that's a very good point.

Brian Lehrer: Annie, almost in relation to the Obama-Trump stretch of discussion, I want to ask about another recent article of yours that suggests that debt might be a looming problem for the US after all. Usually, people in your camp, if I can identify your camp as meaning people who think the government can supply a guaranteed income for all Americans as you describe in your book, that would be people like Bernie Sanders, think debt is a political weapon for low-tax conservatives that they trot out when Democrats are in office, but not really a big threat to this country. Do you have an evolving take on debt?

Annie Lowrey: The thing that gives me pause and broadly, I think that we can look back at the discussion of debt and deficits that happened 15 years ago, 13 years ago in Washington, and it was like everybody had gotten ergot poisoning. Here we're in this absolutely miserable recovery from a really, really deep recession, people are hurting, it's having all sorts of terrible health effects and effects on kids and we're worried about the long-term debt. We went through a long period of time where interest rates were really low and now they're really high. That does change things. I think that the thing that I would caution is-- The thing we would really worry about is investors no longer seeing American debt as the safest option for them and decreasing demand for American debt. It's hard to see that because they would have to be buying those safe assets somewhere.

I don't think that we have a viable alternative, but I do think that it's the sort of thing that Democrats have placed themselves in the position of being unwilling to raise taxes on roughly 98% of Americans. They have not focused on convincing folks like in other peer countries, that we could be raising taxes in order to pay for benefits that would benefit all of us. A lot of our wealthy peer countries in Europe have higher spending and higher taxes, and none of it is, I think, a crisis. I think that you could overstate all of this, but it's just something that I'm keeping in mind and watching going forward because if the debt load does lead to higher interest rates, I think that's something to take seriously. It's more something that I'm watching and thinking about than something I'm panicked about at the moment.

There's very clearly no bond vigilantes out there that are really problematic right now. We have other problems to think about. I think it's just something interesting to watch.

Brian Lehrer: Suzanne in Maplewood, you're on WNYC. Hi, Suzanne.

Suzanne: Hi. Good morning. I am a longtime union member. Started at 16 at the AMP, became a teacher, was a public school teacher union member for a long time. I think the basic issue that we need to keep going back to is that without unions we would not have a middle class. If we don't support unions, and if we do not encourage unions to protect people, we are going to see a dwindling middle class, which we have seen. I think that at this point, we don't have the luxury of time because we need to build up a middle class. The middle class was only built by unions.

Brian Lehrer: Thank you very much. A lot of the 94% of the private sector that's not unionized, are they ready to hear that? That's the question after the UPS settlement. We've been inviting people to what we used to call Tweet us. Now, I guess we're supposed to say X us. Here's one for you. From that, Peter, it says, Peter Coy implied that we were better off pre-COVID, but we had and are dealing from there. Isn't the fact that we're doing well now the info that is most useful in assessing what's going on?

Peter Coy: Yes, you can decide what your correct baseline is. All I was trying to make the point is that why would it be, as Annie asked, that people are not so happy? I was saying that maybe they're comparing themselves not to say 20 years ago, but to say three years ago, or sorry, four years ago before COVID struck. If that's your basis of comparison, you're not going to be as happy. Yes, if you want to look at it versus how bad things got at the nadir, then yes, it's great. I think different people have different baselines that they use to judge this.

Brian Lehrer: Do you have a quick take by the way, Peter, on the social media platform, formerly known as Twitter? Is Musk crashing the ship?

Peter Coy: Oh man. Even getting rid of the little Tweety bird was a mistake to me. A cute little thing everybody could relate to, and suddenly now it's X. It just feels dark and Musk-like, and that's not, I think, where the company ought to be going. He seems to be wrong-footing it day after day. I don't know what his bigger aim is, or even if he has a bigger aim.

Brian Lehrer: You want to pile on Annie?

Annie Lowrey: Yes. I am mystified by the decision to focus on that, to focus on a rebranding when, say what you will, Twitter had a really strong globally recognized brand, and brands are really valuable to businesses. They really try to tend to them. His entire leadership of Twitter has been pretty perplexing. I would note, just in terms of hard numbers, he paid quite a bit for-- I can't bring myself to call it X, for Twitter. It's having real problems with its business model now. It's going to be interesting to see what happens with it going forward because I think that he's really degraded the user experience quite a bit. I think that a lot of folks are uncomfortable on that platform. Now, there are a number of viable alternatives that are fighting for people's not tweets, but almost tweets. Short posts, whatever it is. We used to call it microblogging.

Brian Lehrer: Are we supposed to use X as a verb, by the way? You probably heard me trying to get comfortable in my skin with saying that. I don't know if, instead of tweet, we're supposed to say X now as a verb. Is that what Musk wants us to do? Does anybody know?

Annie Lowrey: I'm not clear.

Peter Coy: I'm not clear, and I actually don't really even care. He wanted us to just all sign up to get the blue checkmark. A lot of people are saying, "I don't want your blue checkmark." He doesn't get to decide what we do.

Brian Lehrer: Well, maybe people will continue to say tweet because who cares what Elon Musk wants? What people say, what people do, what people call things is up to us. We're almost out of time. I'm curious if you have anything else on these quarterly earnings reports in the tech sector, generally. Peter, I'll go to you for this. I mentioned Google surprising people on the upside with their report yesterday.

Peter Coy: Google had a good number. You asked Brian in your intro, whether this is some kind of a victory for humanity over AI, and I think that would be drawing way, way too much from it. Google is a computer company after all. They themselves are extremely active in AI. How they'll do versus chat GPT, versus Bing, and so on, we don't know yet. I don't think that showed up so much on these quarterly numbers. They just had a nice advertising rebound. AI is something that every company in tech is embracing. There's no company out there that's betting on humanity over AI.

Brian Lehrer: Annie, interest rates going up again today at the Fed meeting, and do we care?

Annie Lowrey: We do care. I think that if we had all been talking five years ago and somebody had told us that mortgage rates were going to go up to 7.5% quite precipitously, do we think that would cause a recession? I think reasonably all three of us might have said, "Well, yes, maybe. That's a lot." We've been in a queasy period for monetary policy for a while now. We have inflation cooling off. It's not clear what the FED is going to do, whether they are going to hold rates. Progressives are now calling on them to reduce them. As Peter points out, there are some other signs of strain in the economy. Another thing I would point at as being a pretty prevalent sign of strain is that we're having a lot of problems with corporate commercial real estate in big cities, and that's going to take a toll on some mid-sized regional banks.

I think there are really worrisome things to watch even as the American consumer and the American worker is doing pretty well now thanks in part to unions. The union-backed campaign to fight for $15 is a big reason that we have the happy economy that we do, as far as it is happy at the moment.

Brian Lehrer: Well, referencing that recession watch metric from before, no inverted yield curve here, good guests yield good conversation. Annie Lowrey, Atlantic staff writer and author of the 2018 book Give People Money: How a Universal Basic Income Would End Poverty, Revolutionize Work, and Remake the World, and New York Times economics opinion writer Peter Coy. He predicts we're still headed for a recession eventually, maybe next quarter. Annie writes in The Atlantic that today's economy is the best economy ever, with a few asterisks. Go read their articles. Thanks both of you for coming on. Thank you so much.

Peter Coy: Thank you, Brian.

Annie Lowrey: Thank you.

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