Dan Woods talks with NPR's Chief Economics Correspondent Scott Horsley. Horsely shares about his career in journalism and public radio, his time at the Cape Chamber's SEEDS event, as well as his thoughts on the economic impact of the upcoming administration.
Woods:
Welcome to Focus on Southeast the program on issues, events and people impacting Southeast Missouri State University. I'm Dan wood with KRCU Public Radio. On today's program, we have a special guest, NPR Chief Economics Correspondent Scott Horsley. He reports on the ups and downs of the national economy, as well as fault lines between booming and busting communities. Horsley spent a decade on the White House beat covering both the Trump and Obama administrations. He's visiting the SEMO campus and NPR member station KRCU. Scott, welcome to the program.
Horsley:
Great to be with you. I’ve had a great visit to Cape Girardeau.
Woods:
We have a lot to talk about, of course, this half hour. Let's start with some of your background and how you got into journalism. Start there.
Horsley:
Sure. Well, I guess I kind of got into radio before I got into journalism. When I was in high school—I grew up in Denver, Colorado—and I worked for a couple of radio stations there that had started radio programs that were sort of aimed at a younger audience. One was a call-in show and the other was kind of a news magazine. I just found that I liked hanging out in radio studios and talking to people and being a part of this interesting communication medium. And so, when I went to college, I worked at the college radio station. Again, just as a kind of avocational thing. I certainly didn't think I was training for a career or anything. I continued to enjoy it, and that's when I kind of started doing more of the news-oriented programming. And I thought, well, maybe I should just see how this plays out, and I was able to get an internship and then a paying job in radio. I thought, well, at some point, I'm sure I'll have to go off and get a real job, but I've been at this for 30+ years now, and I haven't had to get a real job yet. It's been a lot of fun.
Woods:
We could probably talk forever on the simplicity, the beauty of radio…I mean, speak a little bit about just the power of the human voice for storytelling and for relaying information. It's very powerful, wouldn’t you say?
Horsley:
It really is, and it will also…if you're sort of a shy egomaniac like so many of us are, it's a way that you can oblige both those parts of your personality. You can be a little shy. You're not instantly recognizable to everybody, although this might change that, I suppose. But you also can, you know, plant your voice and your story in lots of years around the world. Even when I was working for the program in Colorado as a teenager, and it aired at like five o'clock on Sunday mornings, I thought, well, nobody's going to hear this. But then it turned out my insomniac neighbor heard it, and my scouting buddy heard it while he was off on a hunting trip and so forth. And I certainly was ham enough to like having people hear my stuff on the radio. Over time, I've just learned that, yeah, the human voice—my own, but more importantly, the people I talk to—is very powerful. I think what's happened now is a lot of people have discovered that, you know, we, for a long time, radio, had kind of a monopoly on the audio storytelling business. Lots of other people have discovered now that that's a powerful way to tell stories. And so, we've had this explosion of podcasting, and everyone and his brother now wants a little piece of the audio story telling market. It's made for a lot more competition, but it's also sort of validated that this is important work that we do.
Woods:
It used to be that, you know, lot of people wanted to be a radio host. They thought they could be a radio host. And now, with a podcast, they really can try it out, right? They can go ahead and do it. You have to worry about getting on the station in town. You can get some gear and start your own podcast if you want to.
Horsley:
Oh, right. The gear has become quite inexpensive, and the technology has gotten better and better. So, it's very difficult, really now to distinguish, just in terms of audio quality between, you know, National Public Radio and Joe in his basement. Hopefully, there's still some distinction in terms of thoughtfulness and quality of content. But just in terms of the audio method, of the sound quality, there’s not a whole lot of difference.
Woods:
Let's talk a little bit about NPR. For folks who may not be as familiar with the network, tell us a bit about what it does, the reach that NPR has, member stations, and that kind of thing.
Horsley:
So, I'm based in Washington, DC, and that's where we're headquartered. But the real backbone of public radio is the hundreds of member stations that we have all over the country, in communities big and small, like KRCU here in Cape Girardeau. They are both antennas for beaming our national programming out to the local audience, but they're also receiving antennas that we can receive how people are feeling and what they're doing all over the country. So, when news happens anywhere in the country, we probably have a member station close by who can help us in bringing that news to the rest of the country. We've been in business since the early 70s…is when we sort of set up as a nationally chartered organization. A lot of folks might have heard of our flagship program, All Things Considered. That was our first national program. We supplemented that with a morning program, Morning Edition. And, of course, now we have broadcasting throughout the day and on the weekends. And plus, we are playing in the podcast space. We're big podcast producers now. Certainly, now that's important, because a lot of younger people just never formed the habit of listening to FM radio, but they very much formed the habit…maybe it can be habit forming…of listening to podcasts on their cell phone rather or their other listening device. And so, we want to be both on the on the radio and on podcast, on your laptop and wherever you get your audio programming, that's what we want to be.
Woods:
And that can be challenging to try to be everywhere, right? I mean, there's a lot of production time, a lot of staffing goes into making all of that happen.
Horsley:
It is. I mean, we try to repurpose stuff so that we are efficient, and we tell stories once and publish them everywhere. But sometimes you have to tailor things for different audiences or different formats or different devices. So, there is a lot of work involved. And at the same time, it's our radio audience that's still paying most of the bills, so we definitely don't want to forget about them, even as we try to cultivate new audiences and new places and new ways for you to listen.
Woods:
So, when NPR started in 1970-1971, it was a small, little fledgling network, but it’s grown to be a big player in the media space, right?
Horsley:
We are, and that's both, I think, by virtue of our growing and deepening our reporting resources, which is great. Sadly, it's also the result of a lot of our first-mile competitors leaving the field. You know, when I when I started out, for example, I worked at a member station in San Diego for seven years back in the 1990s. When I first got to San Diego, there were four radio stations doing serious local news programming, and we were the smallest. Our staff was the smallest by the time I left San Diego in the mid-aughts, two of those stations have stopped doing news altogether, and the lone remaining competitor was significantly downsized. So, we've grown, but we've also unfortunately lost a lot of other people who were doing the kind of strong, serious news that we do. It's the same with lots of other news media. Newspapers have struggled. Television news is not as strong as it once was. Some of this is driven by changes in business model and advertisers taking their business elsewhere. Some of it is driven by listeners and viewers and readers going elsewhere. But the news landscape has shifted a lot and continues to shift. But we've become a big player, partly because we've grown, and partly because a lot of others have gotten smaller.
Woods:
So, let's talk a little bit about post-election. One of the things we know now from exit polling and some of the coverage that's been done, is one of the driving factors determining voters…the choice that they made was the economy.
Horsley:
Yes, as economics correspondent at NPR, that's not a surprise to me. Economics is always a big issue on people's minds, and it certainly has been in this election cycle. I knew that from talking to people over the last year, and I think when we say the economy, I think it's even maybe a little simpler than that. I think what people were really focused on was the high cost of living. We’ve wrestled now with an extended period of high inflation. Inflation has cooled off a lot. It hit nine plus percent in 2022, and it's down in the two and a half percent range now. But even though prices aren't still going up as fast as they were, for the most part, they're not coming down. That means they are at a place where they're a lot higher than people really like. And I heard over and over again about people's frustration with the high cost of rent, the high cost of insurance, the high cost of groceries. Even though wages have also been rising on average and depending on how you calculate…if their wages have either almost kept up, or more than kept up, with the higher cost of living, people just really are frustrated with the high prices. And what we know from looking at other countries around the world in this episode and other inflationary episodes through the decades, when the price of everyday living goes up sharply and stays up for an extended period of time, very often, the party in power gets punished for it. We've seen that around the world in this episode where governments have been toppled, left-wing governments, right-wing governments. Whoever happened to be in power when we had this post pandemic inflationary spike, very often got tossed out of office. And in this case, Kamala Harris was sort of saddled with the incumbent label, and she got punished.
Woods:
Whenever you look at some of the some of the potential policies from the upcoming Trump administration, there are a lot of things that have been sort of floated…some maybe not completely formed yet. But how much influence does the president have where we're shaping some of these issues of cost of food and different things? There's only so much that can be done, at least quickly.
Horsley:
I think that's right. I think presidents always get more credit and more blame for economic conditions than they probably really deserve, but that kind of comes with the territory, I guess. President-elect Trump has proposed, has promised to sharply reduce the cost of living. He hasn't said a whole lot about how he plans to do that other than through increased energy production, which might make a difference at the margin. Although, keep in mind, we've already got record high oil and gas production in this country, but there might be some potential there for cost savings. Also, he's talked about cutting regulations which could, at the margin, reduce cost to some extent. On the flip side, he's talked about slapping tariffs, 10 to 20% tariffs on all imports. Now, maybe he's not going to really go through with that. Maybe that's kind of a bargain chip, but if you literally slapped a 10 or 20% tariff on all imports, and an even higher tariff on imports from China as President Trump has promised to do, that would significantly raise costs for businesses and consumers here in the United States. Trump has insisted that the foreign competitors pay the price of those tariffs, but in general…I mean, it's not 100%, but in general, at least a substantial portion that cost is passed along to businesses and consumers here in the US. We saw that during Trump's first term in office. He's also, of course, promised mass deportation of people who are living in the country illegally. Again, we don't really know how far that's going to go or what shape that's going to take. But if you literally deported millions of people, that would have a significant impact on impact on the on the workforce in this country and could also raise prices. If you're bothered by the high cost of groceries, deporting the people who pick and process our food is maybe not the best strategy for bringing those costs down.
Woods:
One of the things is the way costs have gone up on food price and different things. I think most consumers have probably noticed the same size of a bottle or a bag. The bags are smaller and that there's less in them, but the price is still a little higher. Will that ever go back, and things could adjust? Will the bag get bigger? Will the prices come down?
Horsley:
Yeah, the economists call this shrinkflation. I know for me I noticed it most in my dog food. I have two pretty good sized dogs. I buy the big bag of dog food, and I used to buy a 50 pound bag of dog, and it cost $30. Now I buy a 40 pound bag of dog food, and it costs $50. I will say I've made a lot of changes in my grocery buying habits. I've switched from Diet Pepsi to the store brand soda pop. I've switched from Hellman's mayonnaise to the Safeway brand mayonnaise. I've definitely traded down in a lot of ways, but Ribsie and Ellie, my dogs, are still getting brand name chicken and rice mini chunks, and they love it. And I'm not going to take it out on them, I guess.
Woods:
You want to keep them happy. So, you've been here in Cape Girardeau visiting with KRCU. We had a membership breakfast that you spoke at with some of our listeners. You went to a SEEDS conference about entrepreneurship and economic drivers in Southeast Missouri. What takeaways did you pull from that SEEDS conference about Southeast Missouri's economy?
Horsley:
It was very interesting. We had a panel discussion this morning with some folks—all of them sort of on the natural resources side of the economy. We had a farmer; we had a sawmill operator; we had a cobalt miner; we had a cement producer. One of the things that…and it was really valuable because, you know, they were talking in very concrete terms about their business, their markets, what they expect from the economy, some of their challenges, some of their advantages. One of their advantages, for sure, is the transportation network that's here in Cape Girardeau, between the railroads and the Mississippi River, that allow them to tap into markets all over the country, but more importantly, all over the world. When you look at, for example, soybean producers in this country. We can't eat all the soybeans that we grow in America, even if we count the ones we feed to the hogs. Domestic hogs and domestic people are not enough to keep up with the production of this country, so, we need to export. We need to tap into export markets. And here again, we saw in the first Trump administration that a trade war can be really detrimental, not only by raising costs for US consumers and businesses, but also making it harder for US exporters, including farmers, to export their products. You know, other countries may say, “Well, you know what? We're going to slap a tariff on us soybeans or US bourbon or Harley Davidson motorcycles or whatnot.” And we saw all that happening. Trade wars are very hard on exports. But I was also very interested to hear about just how important those transportation networks are to reaching markets and some of the advantages that you have here in Southeast Missouri. That's always interesting to me as an economics reporter. I'm kind of a kind of logistics geek, and one of the things that's so interesting about transportation and logistics is it's 99% of time, it's invisible to people who aren't directly involved in that process, right? We just expect that when we go to the grocery store, the product that we need, that might be manufactured 12 states away, somehow just miraculously shows up on the shelf right when we need it, in the quantities that we need it. And maybe the price is a little higher than we like, but it shows up, right? I mean, if you if you think toilet paper is expensive, remember when we didn't have it? That's worse, right? And the logistics network is…it's a miracle. We only really think a lot about it, those of us who aren't directly involved in the business, when there's a hiccup, when, for example, dock workers on the east coast go on strike and we’re suddenly faced with the prospect that, uh oh, what if we can't get bananas, because all the bananas come through the Port of Wilmington. If they're not getting unloaded, in about three weeks’ time, there might not be any more bananas on the shelves in the supermarket. Or, you know, a manufacturer that's waiting for component parts that are coming over from Europe on a ship, and if they don't get there, they're going to have to shut down an assembly line in the Midwest someplace. So, we don't think about those most the time, but they're critically important. It was interesting to hear these folks talk about it. Some of them, you know, that's a that's a man-made thing when we have a labor dispute. We've seen on the Mississippi River in recent times, when water levels have fallen so low that the barges have to carry only half as much as they ordinarily would. Last year, we saw significant slowdowns in the Panama Canal, also because of drought, maybe more severe drought. You shut off the Panama Canal, folks either have to go a long way around or they wait, and they go much more slowly. Of course, we have national security problems in the Red Sea, with the Houthi Rebels taking aim at shipping over there. All these, all these trade routes, both domestic and international, that most of the time we just kind of take for granted…we get a reminder every so often that, you know, those could be those can have hiccups. And then we all, we all, if we're if we're lucky, all we face is a slightly higher price. If we're unlucky, we face real shortages.
Woods:
So, we talked a little about some of the things you learned from Southeast Missouri's economy. And we had some information from the Federal Reserve Bank of St Louis. Speak to that a little bit and what jumped out at you from his presentation?
Horsley:
Yeah, we had a terrific economic status check from the St Louis Fed. And, of course, that's one of 12 regional Fed banks around the country, who are a little bit like public radio stations. They serve as kind of the on the ground, you know, nerve system of the Federal Reserve, kind of keeping an ear to their local economies, and reporting upstream to the bosses in Washington about how things are really going. And it's really valuable. Part of my job as Chief Economics Correspondent is to track the movements of the Federal Reserve, and it gets a little bit like a logistics system. When everything's great, nobody has to pay too much attention to the Federal Reserve. We just assume that the money gets printed, and the coins show up where they need to be. And then, you know, when something like the pandemic happens and we run out of coins, everyone's panicking. And when inflation takes off, the Fed has to crack the whip with higher interest rates to try to get prices under control. So, part of my job is to keep tabs on the Fed, and they have an awful lot of economists who are keeping tabs on the rest of the economy.
Woods:
Talk a little bit about the Fed, specifically with the chairman, Jerome Powell, and his relationship with the incoming president. Because there's been a little talk about the president-elect would like to get rid of Jerome Powell. Powell says he can't. Talk a little bit about their relationship from the first term, and, I guess, what may happen in this upcoming term.
Horsley:
Well, it was Donald Trump who appointed Jerome Powell as Fed Chairman last time he was in the White House. Powell was initially appointed to the Federal Reserve by former President Barack Obama. But he was elevated in the chairman's post by Donald Trump over Janet Yellen, who had been Fed chair at the time. And, I think, Trump felt like Jerome Powell looked more like a Fed Chairman than he thought Janet Yellen did. He’s tall, distinguished looking, gray hair. Silver hair, I should say. And Jerome Powell has broad bipartisan respect on Capitol Hill. I think he'd be the first to admit that the Fed missed it a little bit, but they were too late to respond to soaring prices. They, like lots of other economists, thought that the inflation that we saw at the beginning in 2021 was transitory. It would come and go, and they shouldn't overreact and raise interest rates. And, I think, by common assessment that that turned out to be a misjudgment, and they'll take their lumps for that. But I think since then, they've responded pretty well to get prices back under control. And either through great talent or great luck or mostly some combination of the two, we've seem to be on the verge of achieving a soft landing, which is to say getting inflation down without tipping the economy into a recession. Nevertheless, President-elect Trump has sort of bristled at the idea of Fed independence, with the notion that the Fed should operate independently of the president. And the reason that the Fed was granted that independence was sometimes you have to make unpopular decisions. As the Federal Reserve, you got to raise interest rates, which nobody likes, but in the long term is the right thing to do for the economy. It's also usually painful for the president. Whoever happens to be in office, they often get penalized for rising interest rates. So, the idea was to insulate the central bank from the political people who might not have the fortitude to make the tough decisions, the unpopular decisions. But Donald Trump has definitely bucked the idea of Fed independence, and Jerome Powell has been a defender of Fed independence. I think Jerome Powell is trying hard not to provoke the president. He's not in any way picking a fight with Donald Trump, but he has sort of said, well, if Donald Trump picks a fight, he's said…it's been dragged out of Jerome Powell that if Donald Trump picks a fight with him, he will defend the Fed’s independence. And that's sort of where things stand.
Woods:
We have about 90 seconds or so. I wanted to ask you about a special bike tour that you take.
Horsley:
I've got my bicycle tie on today.
Woods:
Tell us about that.
Horsley:
Well, you know, the Des Moines Register sponsors this wonderful bike ride across Iowa every summer. They start on the Missouri River side, and you go 400 or 500 miles across the state and end up dipping your tires in the Mississippi. We first did it in 2013. We call our NPR team the No Pie Refused team. You sort of eat your way across the state. We thought we'd just do it once, but it's been so much fun that we've done it almost every year since. I'm coming up on my 11th RAGBRAI (Register’s Annual Great Bicycle Ride Across Iowa) next summer. It's always the highlight of my year. One reason is you just can't beat the chance to get out of Washington and come somewhere in the heartland of America and spend some time with people, and it kind of restores their faith in humanity, much like a visit to Cape Girardeau.
Woods:
Some of your colleagues ride with you, some folks that are familiar with NPR may recognize those voices. I would imagine this is a chance to maybe talk with some folks, which may influence and help some ideas for future stories or your reporting?
Horsley:
Oh, absolutely. We don't spend the whole week talking shop, but there's a lot of time to chat as you're basically bicycling 400, 500 miles. Absolutely, people have suggested stories, and we've done stories on the radio about the things that we observed in Iowa, just as I'll probably try to craft a few stories out of the things I've observed here in Missouri.
Woods:
Well, Scott, it's been a real treat to have you in Cape Girardeau, and we're so thankful that you were able to be on our program, as well. So, thanks again for being here.
Horsley:
It's my pleasure.
