Marketplace - American Public Media

Indian PM Manmohan Singh to retire after 10 years

Fri, 2014-01-03 06:41

Today, Indian Prime Minister Manmohan Singh announced his plan to retire after 10 years in power. BBC business correspondent Sameer Hashmi looks at his complicated complicated legacy.  Click the audio player to hear more.

Cheerios goes no-GMO

Fri, 2014-01-03 06:31

Soon, you will be able to buy a box of Cheerios that is GMO-free. General Mills says it will use corn and sugar that have not been genetically modified.

Companies that use genetically-modified ingredients maintain they are safe, and the federal government has no problem with them. But some Americans are wary.

“They can shop for organic products that are GMO-free, but this is an expansion of that GMO-free market,” says Julie Caswell, an economist at the University of Massachusetts Amherst.

General Mills says it is responding to what consumers want. But Alberto Alemanno, a food policy expert at NYU Law School, says there is a reason why the company picked Cheerios, instead of Chex or Wheaties.

“Cheerios contain oats,” he explains. “Oats is not a GM crop. So, it is pretty clear they have targeted this product because it is going to be easier for them to deliver.”

In the U.S., most packaged foods contain ingredients that are genetically modified. Recently, Whole Foods announced it is going to stop selling Chobani Greek yogurt, because the company uses milk that’s not organic. Chobani says there just isn’t enough organic milk available to meet consumer demand.

Obamacare backlog: Walgreen's offers month of drugs

Fri, 2014-01-03 05:53

With the new year come millions of people who will be newly insured under the Affordable Care Act, and pharmacies are among the many companies competing for their business.

This week several drugstore chains offered temporary supplies of medications for those still sorting out their coverage. Walgreens, CVS, Walmart, and Kroger are among the retailers offering to fill prescriptions for people who enrolled in new health plans but don’t have ID numbers yet. They’ll settle the bill later.

“The key is to drive traffic by any means possible,” says analyst Ross Muken with research firm ISI Group.

Once those customers are in the door, drugstores hope to sell them not only pantyhose and bubble gum, but other health care services, Muken says -- like flu shots and even physicals.

“They want to be the place that you think of first when you think of health care,” says Robert Field, a professor of law and public policy at Drexel University. “If they can be friendly for a 30-day bridge period, it’s a small investment to make in terms of that long-term relationship.”

How long-term? Field says customer loyalty isn’t what it was in the days of the corner drugstore. People tend to go to the closest pharmacy their insurance plan allows.

Is the World Bank a victim of its own success?

Fri, 2014-01-03 05:43

Twenty years ago, if you calculated what fraction of the world’s poor lived where, 90 percent lived in the poorest countries. But today, three quarters of the world’s poor live in countries that have graduated to middle income status -- like India and China. This has complicated things for aid agencies, like the World Bank, which provide billions of dollars of loans meant to help the poor.
 
Every three years it’s graduation time at the World Bank and this year is one of them. That means this is the time when countries find out if the bank is going to move them up from poor to middle income. If residents are living on an average of less than a $1.25 a day, the country is considered poor, but if residents have more -- the country moves up to middle income.  And that’s when the World Bank cuts off the cheapest aid -- like zero interest loans.
 
India just graduated to the rank of middle income, but it still has about 300 million poor residents, which Ravi Kanbur, a professor of economics at Cornell, says could pose a problem.  

“Take two groups of poor who are equally poor. But one group happens to live in a country which is above this cutoff. And another group which happens to live in a country which is just below this cut off. At least from my perspective, I can’t see how we can make a sharp  differentiation between those two groups of poor,” he says.  
 
“The poor,” he says, “are still poor… The poor of course, haven’t moved, it’s just the classification of the countries, in which they live has changed.”
 
According to the World Bank’s current rules Kanbur says hundreds of millions of poor could be cut off from the cheapest aid. India got a reprieve, but  Ghana, Vietnam and Nigeria are heading towards graduation.
 
Laurence Chandy, a fellow at the Brookings Institution, says the rise of these countries are success stories. The poor living in middle income countries, he says, do have some advantages.
 
“They’re living in economies that are moving fast. So even if the poor are poor today, there’s probably fairly good prospects that they won’t be poor in five to ten years time, or their children won’t be poor.”
 
That’s something, Chandy notes, we can’t say about the world’s poorest countries.
 
“Secondly,” he says, “they’re in countries either are able to access commercial markets for finance, or have large domestic resources already. Or maybe both.”

“The problem however, is not so simple,” says Federico Bonaglia, head of policy dialogue for the Organisation for Economic Co-operation and Development in Paris. A newly-labeled middle country may not have the fiscal resources to take care of its poor.  

“Taxation in many of these countries is very low,” he said, “it’s not easy to reform the taxation system.”

Joachim von Amsberg, vice president of concessional finance and global partnerships at the World Bank, notes that the World Bank continues to provide assistance for countries in the middle income rank.   “It is just a different type of support that’s most useful for those countries,” he says.
 
The funding the bank provides to middle income countries, says von Amsberg, is a “catalyst” for aid from other sources. And he says the criteria that rank a country’s financial status are working well. “We plan to continue using those criteria,” he says, as the rules are “fair and efficient.”
 
Laurence Chandy agrees. “What appears to be the problem,” he says, “is that aid won’t go to those people greatest in need, right?” 

The unstable climates, says Chandy, political or environmental, in countries like Haiti or the Democratic Republic of Congo, can mean lenders are reluctant to make any loans at all. So he says, while middle income countries may pay more interest that means more aid freed up for the poor in the most fragile states of all.

Boeing's Washington workers vote on contract for 777X. Again.

Fri, 2014-01-03 05:29

More than 30,000 machinists could vote today on Boeing’s latest contract proposal. At stake is production of the 777X aircraft, which Boeing threatened to move out of Washington State when machinists rejected the initial labor contract. And while it might sound crazy to potentially vote yourself out of a job, the stakes are high all around.

Under the revised deal, machinists would get an extra bonus and a few other concessions. But Professor Leon Grunberg of the University of Puget Sound says their biggest concern remains: “Losing the guaranteed pension that they had,” he says. “One of the few last remaining blue collar workers in the private sector that have these guaranteed pensions.”

In fact, the local union didn’t push for today’s vote; the union’s international leadership did. It doesn’t want to risk losing thousands of union jobs to a “right-to-work” state.

Aviation industry consultant Scott Hamilton says that’s a definite possibility, though moving is risky for Boeing too. He says that, in its request for proposals, Boeing asked competing sites to basically replicate its Washington facilities, to the tune of ten billion dollars.

“I don’t see any state in the union that has the ability to go out and write ten billion dollars worth of checks to build buildings,” Hamilton says.

There’s also the risk of delay. Boeing wants to bring the 777X to market in 2020, which might not happen if it has to start from scratch.

New Year's hangover edition: This week's Silicon Tally

Fri, 2014-01-03 05:03

It's time for Silicon Tally. How well have you kept up with the week in tech news?

This week, Katy Ansite, co-host of the web series “Just the Tips: Taking the Internet’s Advice Seriously,” talks tech and takes the test.

Play along at home, below.

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China tells party officials to stop smoking in public

Thu, 2014-01-02 23:56

The new Party directive says smoking, “damages the image of the party and the government.”

So does rampant corruption – but smoking seems to be a more manageable vice among China’s ruling elite.

"The leadership wants local officials to change their style and become closer to the people," says Wu Yiqun, who helps head an anti-smoking NGO in Beijing. "Part of this is setting a good example by not smoking."

But old habits die hard.

When I approach three well-dressed smokers in their 50s outside a tobacco shop in Shanghai with my microphone, one of them drops his cigarette and dashes off. The second one retreats into the shop, and the third one, Gu Ziheng, takes a long drag of his cigarette before explaining the other two were "leaders," dodging the question of whether they’re government officials.

Gu thinks this smoking ban is a good idea. "To build a civilized society, you need economic support as a foundation," he says, conjuring Party talking points, "China’s developed into a stronger nation, so it must take care of its image."

As Gu says this, his friend who dashed off peeks his head out from behind a wall, and whispers loudly enough so we all can hear: “Don’t say anything bad about the party!”

Gu and I both nod, the man disappears, and we resume the interview.

Gu tells me this smoking ban has a lot to do with Xi Jinping’s crackdown on corruption. "Now - in China, you have high-end, and low-end, cigarettes," Gu explains, exhaling smoke. "Smoking high-end cigarettes means you’re corrupt."

Local officials in China have been caught using public money to buy expensive cigarettes as gifts to other officials. After Gu puts out his cigarette, his friend who retreated to the tobacco shop comes out with a red, shiny carton of Chunghwa cigarettes. They’re certainly not the highest-end cigarettes.  But Chunghwas, which cost a hundred dollars a carton, are commonly used as bribes in China.

As I stare at the candy apple red box, both men say awkwardly “we bought these with our own money.”

The third man remains partially hidden behind the wall, avoiding the microphone, unable to enjoy a smoke.

2014 Resolutions: Eric Sawchak

Thu, 2014-01-02 14:28

Happy New Year! In 2014, Marketplace Money will follow a few listeners from around the country who’ve resolved to make over their personal finance lives. We’ll be checking up on their financial New Year’s resolutions periodically throughout the year and see if they're achieving their goals!

Name: Eric Sawchak, 21
Location: Williamsburg, Virginia
Resolution: “I'm going to get a job this year after I graduate, hopefully. And I would like to start saving for all the long-term goals that I have, most specifically: retirement and planning ahead for the family that I'm probably going to have. My parents set me up with a Roth IRA a few years ago, so I kind of got the bug early."

"I'm not going to graduate with any debt because my parents set me up with a 529 [college savings plan], for which I owe my parents a whole load of thanks. I have a part-time internship, that provides me about $10 an hour for the 10 hours a week I work there, so I have a little bit of extra income. But when I graduate that's all pretty much going to stop, if I can't find a real job, full-time job, then ... geez, I don't even know what I'm going to do. But for the present, I'm in a pretty good situation."

Carmen says: “We can plan all we want, but it's gotta be: Start with now! So what are those immediate needs? What's going to happen is that your income ... that is going to fuel the expenses for your family in the future, your retirement. So without thinking about how that job is going to happen, you can't get at that money. Think about the practical about getting that job, which means living on your own. And what would those costs be? And you can estimate, 'How much would my budget be for rent? I would have to save up for first and last month's payment."

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