Justin Wolfers Breaks Down the Week: Spirit, US Debt, and the AI Economy (with Stacey Vanek Smith)

Here's the thing. The economy doesn't pause. This week. Like
most weeks, there was an avalanche of news and data
and headlines, and a lot of it seemed important. If
you're an actual human being with a job and a life,
it may be called a third of it, and you
probably feel vaguely anxious about the rest. So today I'm
going to try something a little bit different. We're going
to slow things down and talk through some of what
actually mattered this week. And to do this, I'm joined
by my friend Stacy VANX Smith. Now, I want to
be upfront. Stacy is a brilliant economics journalist, whereas I
am a nerdy economist who only occasionally cost plays as
a journalist.
I think you have a pretty good cost if you're
cast playing justin. And I'm very excited to be here,
congratulations on platypus, Very excited to be a guest on
your show. And here as in my capacities as a
real human and a journalist for Bloomberg Business Week, where
I'm a columnist and co host of their Everybody's Business podcast,
and I'm excited to talk about this week in economics
because it was not uneventful.
Yeah, so our goal for today's show simply this. We
want to tell you what to worry about, and hopefully
we'll make that small. It's the economy, mate, there's no
other way of get around it.
The dismal science, I would expect nothing.
No, I want to get on dismal. I want to
tell you what you can safely ignore and maybe, just maybe, Stacy,
where there might be room for some optimism. So we're
going to cover three big stories this week. The sudden
depth of Spirit Airlines, rist In Peace, a recent milestone
for the public debt, And what the latest numbers on
productivity do or do not tell us about AI's impact
on our economy or right, Stacey, what a weeke?
Yes, although, as you point out, it does feel like
that this is something we could say every week. But
I do think knowing what you should worry about, what
you should be losing sleepover, is a very valuable public service.
Oh you're depressing me already, Sticy.
Let's get into it, right, Okay, Okay, Spirit Airlines justin
What is your take? Is this something that we should
be worried about or not?
I think look really important story. I think what gave
it so much narrative flare. Now I'm taking the journalists
job here, Stacey. Look out you know is the you know,
people stranded in airports all around the country. What's going
on the economics is at one level, a whole lot simpler. Right,
Oil prices are really high. Oil is essential part of
jet fuel spirit, which as far as I could tell,
would you know, fly across the country for a dollar
ninety nine seven ninety nine if you want popcorn with it,
its margins will raise a thin so raise the costs.
All of a sudden, it's out of business. So rest
in peace, dispirit airlines.
Airlines are very susceptible to fuel prices. It's one of
their biggest expenses. But I think, you know, businesses and
people all over the world are dealing with this, and
in some ways, you know, if the street of hormones
remains closed, and if the flow of oil around the
world continues to be blocked, I think more than Spirit
Airlines is going to suffer.
In points right, this is a story that we can
hold on to that illustrates very clearly what's happening on
the other side of the world affects our lives right here,
and so to be able to draw that line from
the stratiform wors to people stranded at the airport. One,
that's the power of economics. I find that very interesting. Two,
it is that canary in the coal mine, which is
that story is going to play out over and over.
So where is it going to play out? You said
something really smart, I thought, which is airline's one of
the biggest expenses is fuel. So this is a shock
to every business, but it's particularly a shock to businesses
that particularly reliant on fuel. And so that is back
to the first ripple in the pond. The first ripple
in the pond is you know, oil out to gasoline
and also jet fuel and then out to transportation. Not
just that we're going to see movement through fertilizer plastics.
I don't When I read my introductory economics textbook, I
told the story as being of the nineteen seventies oil shark,
as being what drove the price of Barbie up. Yeah,
Barbie dolls are largely made of oil. Plastics. Oil is
essential to plastics.
Rethinking my childhood right now.
Oh, come on, you're a supporter of opek from a
very young age.
I didn't know.
Look, we all were and That's exactly the point. And
so if you can tell the story of Barbie this
there is Spirit Airlines. The rest of that is the
set of ripples, and it's going to continue over the
next few months. I think the other interesting thing about
Spirit Airlines is just to bite about whether the government
should have filed out the airline. What are you been seeing,
thinking or hearing the am.
I I mean, I sort of thought it was going
to happen. Spirit Airline does serve kind of an important
market function, one might say, because they are often the
very cheapest carrier in a market, and there aren't that
there's not that much competition in the airline market. There
aren't a ton of airlines, as I can tell you
because I fly back to Idaho quite often to see
my parents and they just have you, and they really
squeeze the They really just squeeze the prices. It's terrible.
So I know personally what happens when there's not enough
competition in a market, and it goes worrying me that
this could kind of bleed out into airfares and start
to push prices up even more than they already are up.
I think that is the case for a bailout, which
is competition is a precious thing. Let's keep it as
much as we can. Let me give you the counter.
And I'm not sure if I believe myself yet, but
the only state of nature in which the federal government
ends up buying or otherwise bailing out Spirit Airlines is
effectively going to buy it is where every other private
sector firm said we don't want it.
And if oh, like United an American we're like, we
don't want to buy it.
Or private equity firms or Wall Street or anyone who
could come and restructure the company. Right, So, if you know,
there's a pile of stuff, management and planes and so on,
and anyone else could have come along and said, I
like what you've got there. I think it's profitable. I
can make it work. No one did that. And the
fact that no one did that all of a sudden
makes me think, well, if no one else thinks they
can make this pile of stuff work, I really think
the federal government can. That doesn't lead answer that's not
a satisfying answer to your question, Stacy, which is what
do we do about competition? That's where my textbook answer,
which is not a real world answer is competition is important,
and what we need is careful regulation of competition. And
what we need is to encourage entry and not allow
airlines to keep others out through monopolizing gates and things
like that. In a perfect world, I would trust regulators
to do an amazing job of that, in which case
I wouldn't be at all worried that Spirit Airlines went bust.
If it went bust, it's because it was selling its
stuff the only you could only sell its services at
a price that didn't cover its costs. People didn't value
what it was doing enough. But the competition thing really
does worry me. So I was anti bailout, and then
I woke up and it went bust, and then I
felt sad, and then I started rethinking my life choices.
What's next on the menu space.
It's not called the dismal science for nothing, justin next
up on the menu is the debt. I believe because
we have had interesting milestone, US debt is now equal
to GDP. GDP is basically the sum total of all
the goods and services economy produces, basically what we earn,
and our debt has hit it. It's now equal to that.
It's about thirty one trillion dollars from what I understand.
Yeah, so exactly right. Look, first of all, I'm just
going to put in a plug. We launched Platypus Economics
this week, and the very first video was trying to
understand the debt and the arguments beout the debt. I'm
sure we could link that somewhere or something, but let's
go to that. So debt got ahead of JDP. Another
way of saying that is the debt to GDP ratio
exceed one hundred percent.
And this is right, like this is considered to be
like quite a milestone. This kind of caught people's attention
in a way that I think people.
Are worried, right, and should it be? So? I think
the answer is no, and then it's yes, and then
every argument about two handed economists too. Should we be worried?
Should we also be losing sleep over this? In addition
to Spirit Airlines.
No, I'm not losing sleep. I have of Spirit Airlines.
Oh say nothing and do it's in the past, sunk costs,
debt to GDP ratio. Look, what I worry about is
when the debt to GDP ratio is one hundred percent
I'm not worried about the economy. I'm worried about people
misunderstanding it. They might think that means our whole economy
is owed elsewhere.
Right, you're not worried about the economy.
Well, I am worried about the economy. I'm paid to
be worried about the economy. But this one hundred percent number,
there's nothing magical about it. Let me just say that.
It sounds magical.
So explain this, right, Okay, great, So, debt to GDP
is basically, we take how much money does the government? Oh,
that's a stock, Like what is our debt right now?
It's like a fixed number. Well it's not fixed, but
it's sort of a chunk. It's a one n It's.
Like the level of the bath. Right, yes, And the
reason we compare it to GDP is we want to say,
is that something we can afford to repay? So we
want to compare it to our ability to pay. We
use GDP, which is another fancy way of saying income,
which is a flow. So it's like the water in.
The bath, money coming in all the time.
Debt to GDP ratio, so our debt exceeds our Another
way of saying it, and I think it's a more
important way of saying it is the level of our
debt is equal to one year worth of income.
Okay.
Now, in fact, our debt to GDP ratio has been
four hundred percent for the last year. Right now, it's
one hundred percent. Our debt is equal to four quarters
worth of our income. And so if we thought about income.
At the general, is that like make it better?
It's worse. The point is it's the same, okay. So
that point is this number. There's nothing magical about this number. Okay.
It's saying the amount that we owe is equal to
one year's income. I'm going to tell you right now
on my house, the amount I ow is equal to
three years of income.
That feels different somehow.
It does. It does, Yeah, why.
Because it feels like an investment that you and Betsy
have with your family that's like potentially going to increase
in value, but also you can get use out of it,
as opposed to government debt, which seems I don't know,
it seems more it seems like less of an investment
and more of a liability. Because the debt is accruing
interest all the time. We have to be all this
money to service the debt. It seems like more of
a sinkhole than your house.
So actually, the analogy if the national debt is my mortgage,
my mortgage is not beautiful. That's my sinkhole. I hate
my mortgage. I love my house. Right, So the debt
is the same as the debt. Sorry, it is the
same as the mortgage. You feel quite comfortable about the
mortgage because it's got a beautiful house attached to it.
And I think, then your question is our debt does
it have a beautiful house attached to it? I mean
it could. The government does invest in beautiful things, sometimes
research and development, early childhood education, things that have a
really big payoff in the future. My house has a
big payoff, right, it's going to provide a roof over
my head every year for the rest of my life.
Is the government spending its money that way? If it
is making serious investments, then we shouldn't be worried about
the debt. And in young, spunky economies whose best days
are ahead of them, you might think that they should
be investing a lot, because we're going to be The
more we invest, the richer will be in the future.
These are where we're doing is investing in things that
help grow the economy.
But right now, like one of the biggest expenses I
think it's fast becoming the second largest expense in our
country is servicing our debt, which doesn't really seem like
it's building anything or productive. It sort of seems like
if instead of a mortgage, you were paying off a
huge credit card debt every month. That s not feel
like a good place for us to be. It feels worrisome.
Yes, So now this is the point where we move
from macroeconomics to microeconomics, just saying whether you worry about
debt depends on not complicated macroeconomics that could put you
to sleep and end dazzle you, but it depends on
something much simpler, which is if we're making investments in
the future, it can be worth going in debt for that,
And if we're blowing our money on beer and skittles,
it's not worth going into debt, absolutely not. The fundamental
question is what are we spending it on. What are
we going into debt for. If we're going into debt
to invest in the future of our people or in
the future of infrastructure, which you're going to make it
easy to pay off in the future, right, then it's
really worth it. If we're spending it on beer and
skittles much less so. And so I mean, it's a
question for you. Do you think a ballroom is more
like beer and skittles or an investment in our future.
I'm just going to leave that cheekily hanging out there.
I think, obviously, spending on interest is not an investment
in our future. I also think, by the way, arguments
about the military is a really open question. At at
one level, every day that I wake up and spend
a lot on the military through my taxes, like it
doesn't create a road I drive down, our school I
send my kids to. But at another level, if what
the military is doing is defending freedom in our way
of life, then it's an immensely important investment. And that
partly therefore depends on how you think we stand in
the world. If you think we have, you know, a
bigger military in the outside threats than it's beer and skittles,
you think that that could go a whole bunch of
different wives.
I think the thing that makes me nervous and maybe
justin you have thoughts on if I am being too
nervous about this is that it seems like it makes
us less flexible. I mean we've just been through I
mean I've been calling you up to talk about stories
for a long time, and I feel like we'd started
during the housing crisis. So we've now gone through two
massive economic crises together.
Is the housing crisso cybers sticing.
Well, now we're in a new housing it's it's it's era.
But the original housing crisis and.
War it went for fifteen on.
It's requoted is in both cases there were huge government
bailouts and our economy had the ability and the funds
to come in and save the day. And it feels
like the ability to do that gets more precarious because
a lot of the way the US makes money is
by selling US debt, and as the debt to GDP
ratio gets higher, if you're an investor sitting around in
the world looking at a safe place to invest your money,
the US seems a little less safe because we owe
a lot compared to what we earn. I don't know
that is what magnhumocent.
Yes. Word for the day, then, friends, is fiscal space.
The word fiscal space is basically saying do we have
that flexibility. So let's bring it back to personal terms,
and then we'll go back to macroeconomics. I actually think
it's a good idea for everyone to have a credit card.
Here's why. If you lose your job, you'll be able
to spend. Now you might say, well, when you're without
a job, then not spending is a terrible idea. Sorry,
going into debt is a terrible idea. But the only
thing worse than that is going hungry. So the credit
card gives you some fiscal space, the ability to borrow
enough to keep eating that you're healthy enough to go
out and look for a job. If you entered a recession,
if your credit cut limits two thousand dollars and you
already own nineteen hundred dollars, you don't have much fiscal space.
If you lose your job, you're literally going to go hungry.
So now let's move back to macroeconomics. We don't, at
any formal level have a credit limit, Like, no one
said you're allowed to borrow this much, but we sort
of do. And so your point, I think it's one
hundred percent right, is if we needed to borrow huge
amounts as we did during COVID in order to keep
things roll on. We may not be able to do it,
or we may not be able to do it cheaply.
And so I seven hundred and fifty percent agree. One
of the most important reasons to worry about our national
debt is the lack of flexibility that comes out of it.
I want to add one more, Can I do one more?
Because fiscal stuff worries me. Oh it is ya tell me,
and it's vulnerability and not in the I'm a modern man.
I want to tell you about my feelings, but I mean,
is there something you want to ask me. I'm happy
to be vulnerable. It's fyscal vulnerability. I'm not predicting the
US's and he's going to enter a fiscal crisis, but
I want people to understand how they play out so
that they can understand why we're at risk. So right now,
the US borrows a ton of money, as you said,
one hundred percent of GDP a year's income, and we
have to make payments on it, the interest payments, and
we can do that because interest rates are really low.
So even with really low interest rates, though as you said,
it's the biggest part of the federal budget. And so
when we're in a world where interest rates are low,
so therefore we can repay our debt. Because we can
repay our debt, everyone's willing to lend us money, and
therefore interest rates are low. So in this virtuous cycle,
Now here's the thing. What if everyone woke up tomorrow
and they said, I'm worried the US can't repay their debts.
Oh, they're going to charge much higher interest.
They're going to jack up the rates. And if they
jack up the rates, what happens to our monthly interest spending?
It gets even higher. It's already so high, but it
gets even higher, and then we can borrow less. It
gets more expensive to borrow. It's like a you know,
it's like when your credit card interest rate goes up.
Absolutely so if interest rates go up, the interest payments
go up. And now it may actually become the fact,
a new reality that because interest rates are high, we
can no longer afford to pay the debt. And if
that's the fact, that'll cause industrates to go even higher.
And so you'll notice in this vicious cycle that if
you had a very small debt and interest rates went up,
it wouldn't be a big deal because monthly interest payments
aren't much of your budget, so you can always make
that adjustment. But if you've got a big interest payment,
a big debt, then uest payments are really large, and
then a small change in interust rates becomes a really
big fiscal place. And so we now have out of
one hundred percent of GDP. It's not the highest among
the advanced countries. I think Japan is at one hundred
and thirty six percent, But you know, we're sort of
on the leaderboard and that's probably not the best place
to be.
Our whole, like, all the economic growth for our economy
seems to be sort of resting on the shoulders of AI.
Does this So let me just give you a very
simple fact. The last two quarters of GDP growth, if
you look at spending on AI related categories, it accounts
for essentially all of the economic growth. Now that's one
amazing or maybe greed, and then two, I want to
be a little bit more thoughtful about it. It's a
great talking point. Reality is a little more complicated. A
lot of the money we spend on AI, that stuff
is imported, and GDP does not include imports. So when
I also said accounted for. There's a different question as
so literally as in, if you took that money away,
we would have had no GDP growth. But if there
were no AI sector, that would have freed up a
lot of work is to do other things. So saying
that nothing would have happened instead is sort of the
wrong thing. So I'm being both a little bit provocative
and a little bit glib and roughly equal measure. But
your points still right, which is AI is a big
part of our current economic cycle.
Well, here's what I want to ask you about. Justin so,
I have an article about this topic. So I was
writing about this topic. I talked to two economists who
made a bet about this topic, Eric Briniolfsen at Stanford
and Robert Gordon at Northwestern. They made a bet about
how much AI would fuel productivity growth, and they there
were there seems to be like, I have two interesting
things that happen with productivity growth, and I feel like
we're sort of processing them all right now. One is
there's like the technology and the adoption of the technology,
and then there's like a pause and then productivity rises.
So yeah, productivity is like I guess it's how much
we make divided by hours worked? Is that right?
Yes?
Okay, right, So once you know we're all like at
there's like a pause, like everybody gets AI. Then there's
a pause. Then all of a sudden, we're all producing
a ton more every hour, and then like what you
said when you said all the jobs eventually get replaced,
there seems to be a gap there too, like there's
a lot of job loss when there are new technologies
and then there's this space and then there are new
jobs created. Can you talk about these gaps because it
seems like this has been happening ever since the steam engine,
and these gaps seem really scary. It's like AI is
going to save the economy and destroy your job.
Okay, So I'm gonna stop by just helping people understand.
There's actually two separate II stories that should be tightened
completely separately. I actually laid with the least interesting one,
which is if you wanted to understand what'll TEP me
in the specific quarter of GDP in twenty twenty five
or twenty twenty six, I always got a lot to
do with it. That's basically, you've got to build a
lot of data centers and they're just big empty rooms
full of wally basically, and there's hard leading people and
there's lots of beeping lights. Building them is like the
least interesting part of AI, But it's the part that's
sustaining the economy right now, the most interesting part. And
I'm going to say, as a labor economist, this is
the most revolutionary moment I've seen in my life, the most.
It belongs in the same sentence. And if you'd said
to me justin do you think you're going to use
the word industrial revolution ever again in your life? I
would have said no. Three years ago. It's stunning the
magnitude of change that this will cause. I understand not
everyone agrees. That's my judgment, So that, I think is
the really interesting question. What happens to the future productivity,
the future of work, the future of our economy. When
I talk to parents right now, I teach college. College
enrollment in computer programming is plummeting, so it's it's easy
to see there's a bunch of things you shouldn't study.
Don't study coding necessarily, don't study languages because the last
translated job has been hired. What becomes harder is figuring
out what the future does what you should study rather
than exactly because the truth is we're all under threat.
But then you get a bunch of people right now
as saying, well, look there's something something happening in this
spec of the data, it must be AI. And the
reality is when you look at surveys of firms, but
most folks at home can actually look at their own
firms and say, has my business been fundamentally transformed? AYAI.
I work at the University of Michigan. No, I still
hand into my grades into a spreadsheet from a you know,
not even into a spreadsheet into a page that was
written in the eighteen sixties. Students turn up and they know,
they sit in front of me, and they're wonderful, and
they bring their presence, but they're not reading. They use AI,
of course, but the technology I use for teaching is
fundamentally still looking people in the eye. I have to
fill in my own reimbursement forms, which is unbelievably annoying,
and an AI can do it. So my phone has
not been transformed. I think it will be the fact
that those forms now online, whereas a generation and go
they're on paper. That was the promise of personal computers.
And then subsequently the Internet. So it will happen. And
so the thing that folks like Brent Holsten are looking
at is this is not the first technological revolution and
radical idea and I love e commentis for this, why
don't we simply learn from history. So if you think
through these past revolutions, the industrial revolution, the mention of
the steam engine came, it took sixty years for that
to create prosperity. And the period in between is when
Dickens is writing his novels where children are working in
factories and film. Yeah yeah, really, Blake, you have the
literature mage, you can tell us more about those Dickinsian novels.
Or you could just go out in the straits of Brooklyn.
So we're quite it's not quite Dickensian. It's very posh
in Brooklyn and a lot of parts of it. But
that is that lag is really interesting to me because
I think, you know, if you think of like the
Luddites or something, these were these guys who worked in
textile factories. They brought in these big electric looms and
these workers got together and they broke the machines, and
I think in a certain way they were we talk
about as like an insult to someone who refuses to evolve.
But I think in a certain way they were right,
And I feel like some of the fear around AI
and the resistance of it is not wrong. Like I
don't think it's going to necessarily change much, but it
does seem.
I've done a lot of learning on this, and it's
honestly more about becoming a better person then less about
becoming a better economist. So as an economist, I see
a technology that can take the work I do and
do it twice as quickly, and so therefore either I
can take half my day and go to the beach
or make twice as much stuff, and either of those
sound like magnificent possibilities.
This is like what economists live for, like maximizing.
It really feel like this is the this is the
mind blown Yeah, I love it, and so I've been
very very pro AI. I'm very excited that it's intellectually
exciting and good for the world and blah blah blah.
And then I started talking to my kids, and they're
just sort of they have real fears. They're grown up
knowing life one way and life will be different. They're
thirteen and sixteen.
Okay, so they're they're free job market right now pretty much.
Yeah, but their labor market has has been transformed. And
so once I understood their anxiety, all of a sudden,
they looked around. I saw other people I know, I do.
My therapist is so proud, and I started to see
their anxieties, which is, II is going to do extraordinary things,
but it is going to overturn people's lives up in
them and their response, which I now understand. And you
just gave a sympathetic portrayal of blood art is I
didn't ask for this. It's taken me a while to
get there. Well, I do think the game is going
to be extraordinary. I think these computers are going to
sell diseases and scientific problems and all of that. But
we didn't ask for this, and I sort of get that.
Yeah, I mean, it seems like there's like real growth
and real excitement around AI, and it's certainly one of
the major bright spots in our economy. But also I
think people are very worried about AI and I and
it's showing up in like all these different sectors. I
was like looking around. So I grew up in Idaho
and my My family was my father's family is in farming,
and so I got very interested in, you know, in farming.
And I found like, there's a company in Arizona that
is making robot scarecrows that are powered by AI.
I love that. And what's great about that is always
doing is putting scarecrows out of business.
So I spoke with this farmer in Surprise, Arizona. His
name is David Voss. He runs this organic farm, Blue
Sky Organic Farms, and he actually has to right now
hire people to be scarecrows. He says, there's like this
horrible bird problem. He grows all these organic vegetables and
so then the birds come and they will like descend
on his crops and then just devour them.
So he says, they love kales and charreds and collars
and let anything. They'll lead anything, and they don't leave.
They just won't go away no matter what you do
unless you stand in the middle of your field and
every planting, you have to stand in the middle of
it like a scarecrow. You have to be a moving scarecrow.
So I have full time people.
And all they did was walk around a forty acre
field chasing birds. Wow, I know, first of all, the
birds love Kyle.
They love I wish I felt the way about I wish.
I find they sound like Brooklyn birds. Really. Oh, these
are the human scarecrows.
Yeah, they're human scarecrows. And on other farms, he says
his farm is pretty small, he's about sixty acres, but
on other bigger farms, he says, they have teams of
people who walk around the fields banging buckets with baying
five gallon buckets with sticks just to scare the birds off.
When those when the plants are young, otherwise they lose
their whole crop. And so now they have this this
company called Padma Agrobotics developed this AI powered scarecrow that
like steers itself around the crops and scares off the birds.
It has one of those tube people on it.
And wow, like he used car dealership.
Yes, and David said, this is not gonna lose any jobs.
He will take the money he would have spent because
he pays twenty two dollars an hour, so it's like
ten fifteen thousand dollars a year for him to hire
people to work as scarecrows. But he said he would
immediately hire people with higher skills.
But right, so that's great. There's the good news story
and the bad news story. That right story.
So talk about the other side of it though, because
I think that's what everyone's worried about.
I mean, it's so interesting. I mean, this is the
direct thing, right, the mechanical scarecrow. At first, I didn't
realize it was people scarecrows. And it's amazing. I've works
as a labor economs for this long and not understood
the labor marketed. All. Well, I apologize to the human scarecrows.
So those people they can all lose their jobs. This
is just one for one. A robot that looks like
you a bit taller and skinnier comes along and does your.
Job, never takes sick days, doesn't take over time.
Yeah, and that way of telling the story is terrifying.
The other way of telling the story is working as
a human scarecrow is not a source of immense pride.
It's not using people to their best capacities. It's not
allowing them to give full expression to themselves. If we
can have a good demn robot do that stuff, you
have freed those people up and in a beautiful world.
We've freed them up to go and write poetry, and
now we get just as many birds scared away, plus
we get poems.
But if you're freedom unemployment, that's not so great, right.
And the truth is both stories are true. For some
period of time, those folks are going to be able
to employed. And we also know that over the long
period of time the long history, technology leads people to
move into different industries, and just as the latter it's
were wrong, technology did not lead to mass unemployment. We
have four point three percent unemployment right now. Over the
long run, those people will get redeployed, but in the
short run it can be painful. And the real debate
then is how short us the short run and how
do we make get less painful.
I did notice something along those lines in the jobs
numbers that came out this week, which is that all told,
it was a positive job support, which is great. One
hundred and fifteen thousand jobs were added. But when you
look deeper in the report, the jobs that were added
were in healthcare, which has been growing a lot, but
also retail and warehousing, and a lot of the jobs
that were lost were in eye to tech and financial services.
And things like that. So those jobs are like I
feels like tech and financial services were jobs that paid
a lot better and required a lot more education than
necessarily jobs and warehousing and retail. I mean, it depends
on the job, but it does seem like there's a
little bit of like that sort of freeing up the
economy for better jobs. It seems like that freedom. I
mean in the case of the personal computer, from what
I understand, it was about ten years, so not sixty
like with the industrial rep but still ten between the
time when adopted computers and when those computers started when
actually you saw things companies get more productive and new
jobs get created. I mean that's a decade.
Yeah, And so that's the case that slow down the
role on your optimism or pismism that I always going
to change the world. There's going to be, it's going
to take some time now, Stacey, you introduced this by
saying that some of my friends Eric Brnolfson and Bob
Gordon had a bit.
Yes, he didn't tell me what the bit was, Okay,
So it was on this the site called long Bets,
and it's a ten year long bet. So from twenty
twenty to twenty thirty and bring Offson be that on
average productivity, labor productivity, which is how much the economy
produces divided by hours worked, would grow on average one
point eight percent or more. And Robert Gordon bet that
it would go would be less than one point eight
percent because he just thought the technology would take longer
to really produce. Now, Robert Gordon said to me he
was clearly going to lose, which seems fair. But we
did get new productivity numbers in there a little lower
than we thought. And everyone's talking about AI and all
this adoption of AI, but I think it's not quite
showing up yet. But anyway, so that's their bet, but
it's a ten year long bet, and I wanted to
know if you would be open to a bet, maybe
like a shorter term bet.
I love this. I come from a gambling culture Australia.
We'll bet on two cockrch is flying up a wool.
I was thinking that well. I was thinking of our
first segment on Spirit airlines and fuel prices. So one
thing we could get we could bet on is gas
prices and where they will be, like, I don't know
at the end of the summer.
You know what let's make it interesting. Let's call it
election die.
That's nova an election day, Okay, his day in Novemba. Okay,
looking on, Fred, the average gas price in the US
right now is four dollars and forty five cents a gallon.
Okay, here's hell, we can do this. Okay, I'm going
to say a number and you get to decide to
under arriva. Okay, well, should we both write down a
number and see who's closer. That's probably better. Nope, I'm
gonna I'm gonna come up with a full cast.
Okay, go for it.
What are we betting?
Well, I had any thing about that too. So Eric
and Robert have a bet and they and the winnings
go to charity. So I thought we should do that too.
We could each put in, like, I don't know, two
hundred bucks or something.
Yep. I mean I would have said one hundred because
I'm just an academic, but you know, you fancy.
Right, not a high flying reporter. But I thought we
could give since you have platypus media, I thought, like
a platypust conservat like conservation funder. I love that and
that way when you and Betsy and the family go
to Australia, you could visit the plata pie and you
could send us you know, at the zoo.
At the Sydney so you can sponsor it. Now, my
class did that in the first grade. So if you
lose this bet, I'm going to sponsor the platypus and
we'll get her called Stacy.
And well that feels like if you mean, if I
win the bat and otherwise, okay, if.
You wish that, okay, all right, that's a bet.
All right.
So on election day, I think gas prices are not
going to be as high as they currently are. The
White House is telling us that gas prices are going
to fall very soon and dramatically and go back to normal.
And normal used to be three dollars a gallon, although
the White House always said that three dollars was two
dollars an amazing feed of mathematics. So I think they're
going to stay pretty high, but not that high. I'm
going at three dollars and sixty cents a gallon on
election day, which by the way, would be very bad
news for Republicans. So you're going under and over.
You're saying, oh, I'm comp completely this is good because
I think it's going to be much higher, so I
will take the over bet.
Oh yeah, that's nuts. You're on the wrong side of
this bed, Stacy.
I don't think I am on the wrong side of
this bet.
I just look forward to meeting justin the Platypus.
So the bet is by election day, you are betting
that the price of at the national average price of
gas will be three three dollars and sixty cents a
gallon or below. Yep, And I'm betting three dollars and
sixty one cents or above.
You bet bad?
Okay.
I love this okay, And the Platypus will be named
after me, so I love that right there. Well, Stacy,
Before we wrap up, I just wanted to let our
audience know one more thing. We're still trying to figure
out a name for this show, and we'd really love
to have your inputs. So if you've got thoughts on this,
please drop them in the comments. Beyond that, let me
just say this seems like a great place to leave
things for this week. Stacy, thanks so much for joining me.
This beer was full at the start, it's not anymore,
and enjoy that justin. Yes, So let us know in
the comments how this went. This is an experiment, but
in the meantime Stacey and I are both going to
stay on top of the economic news, so tune in
for more and, as we like to say it, platypus,
stay curious.