Making News: Two Podcasts of National Radio Trade War & Economy Interviews…& an Eye-Opening Look at Amazon.com!

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Amazon.com, Breitbart News Tonight, economy, election 2020, Gordon G. Chang, Henry George School of Social Science, Hong Kong protests, Jobs, jobs report, Making News, manufacturing, publishing, Rebecca Mansour, Rick Manning, Robin Gaster, Smart Talk, The John Batchelor Show, Trade, trade war, Trump

I’m pleased to announce that just out on-line are two podcasts of national radio interviews on the Trump trade wars and a video on an especially startling aspect of Amazon.com’s stunning rise to business titan status.

The latest interview now available was conducted last night on “Breitbart News Tonight” and can be found at this link.  Once you’re there, scroll down a fair ways till you see my name on a December 6 segment – a discussion with hosts Rebecca Mansour and Rick Manning that ranged from the last (excellent) U.S. jobs report to the Hong Kong protests to the intensifying presidential election campaign.

The previous interview was broadcast Wednesday night on “The John Batchelor Show.”  Click here to listen to a conversation with John and co-host Gordon G. Chang on how well the U.S. manufacturing sector is faring as President Trump keeps trying to revamp U.S. trade policy.

The video shows me reversing roles and interviewing economist Robin Gaster on the implications of Amazon.com’s efforts to disrupt yet another major U.S. industry, and one playing an especially important role in American culture – the book publishing industry.  Click here to watch, and keep in mind that the interview is posted in two parts.

Incidentally, this interview is the latest in the “Smart Talk” series sponsored by the Henry George School of Social Science – a New York City-based economic research and education institute on whose Board I’ve served as a Trustee for several years.  “Smart Talk” has featured some of the world’s leading economic thinkers, and if you search around its section on the website, I’m sure you’ll find some fascinating and important material.

And keep checking in with RealityChek for news of upcoming media appearances and other developments.

(What’s Left of) Our Economy: Why Amazon.com Could Kill the Entire Economy

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Amazon.com, bubble decade, bubbles, consumption, credit, Financial Crisis, gig economy, Great Depression, Great Recession, Henry George School of Social Science, housing, housing bubble, production, productivity, Robin Gaster, {What's Left of) Our Economy

Yesterday I was in New York City, on one of my monthly trips to attend board meetings of the Henry George School of Social Science, an economic research and educational institute I serve as a Trustee. And beforehand, I was privileged to moderate a school seminar focusing on the possibly revolutionary economic as well as social and cultural implications of Amazon.com’s move into book publishing.

You can watch the eye-opening presentation by economic and technology consultant Robin Gaster here, but I’m posting this item for another reason: It’s an opportunity to spotlight and explore a little further two Big Think questions raised toward the event’s end.

The first concerns what Amazon’s overall success means for the rough balance that any soundly structured economic needs between consumption and production. As known by RealityChek readers, consumption’s over-growth during the previous decade deserves major blame for the terrifying financial crisis and ensuing Great Recession – whose longer term effects have included the weakest (though longest) economic recovery in American history. (See, e.g., here.)

Simply put, the purchases (in particular of homes) by too many Americans way outpaced their ability to finance this spending responsibly, artificially and unprecedentedly cheap credit eagerly offered by the country’s foreign creditors and the Federal Reserve filled the gap. But once major repayment concerns (inevitably) surfaced, the consumption boom was exposed as a mega-bubble that proceeded to collapse and plunge the entire world economy into the deepest abyss since the Great Depression of the 1930s.

As also known by RealityChek regulars, U.S. consumption nowadays isn’t much below the dangerous and ultimately disastrous levels it reached during the Bubble Decade. And one of the points made by Gaster yesterday (full disclosure: he’s a personal friend as well as a valued professional colleague) is that by using its matchless market power to squeeze its supplier companies in industry after industry to provide their goods (and services, in the case of logistics companies) at the lowest possible prices, Amazon has delivered almost miraculous benefits to consumers (not only record low prices, but amazing convenience). But this very success may be threatening the ability of the economy’s productive dimension to play its vital role in two ways.

First, it may drive producing businesses out of business by denying them the profitability needed to survive over any length of time. Second, Amazon’s success may encourage so many of its suppliers to stay afloat by cutting labor costs so drastically that it prevents the vast majority of consumers who are also workers from financing adequate levels of consumption with their incomes, not via unsustainable borrowing. Indeed, as Gaster noted, it may push many of these suppliers to adopt Amazon’s practice of turning as much of it own enormous workforce into gig employees – i.e., workers paid bare bones wages and denied both benefits and any meaningful job security. And that can only undermine their ability to finance consumption responsibly and sustainably. 

I tried to identify a possible silver lining: The pricing pressures exerted by Amazon could force many of its suppliers to compensate, and preserve and even expand their profits, by boosting productivity. Such efficiency improvements would be an undeniable plus for the entire economy, and historically, anyway, they’ve helped workers, too, by creating entirely new industries and related new opportunities (along, eventually, with higher wages). Gaster was somewhat skeptical, and I can’t say I blame him. History never repeats itself exactly.

But to navigate the future successfully, Americans will need to know what’s emerging in the present. And when it comes to the economic impact of a trail-blazing, disruption-spreading corporate behemoth like Amazon, I can think of only one better place to start than Gaster’s presentation yesterday –  his upcoming book on the subject. I’ll be sure to plug it here on RealityChek as soon as it’s out.