Marketplace Morning Report – Episode: Introducing the Artificial Meteorologist Release Date: June 4, 2025

Hosted by David Brancaccio, this episode of the Marketplace Morning Report delves into three major topics shaping the economic and technological landscape: the latest tariffs on steel and aluminum imports, the White House's proposed funding cuts, and the emergence of artificial intelligence in weather forecasting.

1. New Tariffs on Steel and Aluminum Imports

Timestamp: 00:01 – 01:51

President Trump has intensified his tariff strategy by imposing a new $500 import duty on steel or aluminum items valued at $1,000, effectively increasing the cost for importers to $1,500 per item. This move doubles the previous tax and employs a strategy designed to withstand potential legal challenges.

Key Insights:

• Manufacturers' Response: Aaron McLaughlin, Senior Economist at the Conference Board, remarks that "manufacturers aren't just going to switch to domestic suppliers" because expanding domestic steel and aluminum production is not feasible in the short term. (00:33)

• Economic Constraints: McLaughlin emphasizes the challenges in scaling up production, noting, "You need capital, you need labor, you need good infrastructure. All of those things are sort of under constraint right now." (00:46)

• Impact on Consumers and Exporters: The increased costs are expected to be passed on to U.S. consumers. Additionally, Jason Miller from Michigan State University highlights concerns for U.S. exporters. He explains, "a European machinery manufacturer is now more competitive, which hurts US Manufacturers selling in global markets." (01:08)

Conclusion: The tariffs are likely to lead to higher prices for consumers and pose challenges for U.S. manufacturers competing internationally, without a swift shift to domestic production.

2. White House's Proposed Funding Cuts

Timestamp: 01:51 – 03:26

The White House has formally requested Congress to rescind over $9 billion in funding, targeting areas such as foreign aid and public broadcasting.

Key Insights:

• Rescission Process Explained: Nancy Marsh Genser from Marketplace outlines that rescission involves the President requesting the return of previously appropriated funds. Congress then has 45 days to approve these cuts with a simple majority vote, bypassing potential Senate filibusters. (02:10)

• Breakdown of Cuts: Approximately $1 billion would be withdrawn from the Corporation for Public Broadcasting, affecting public radio and PBS. The remaining $8 billion targets foreign aid, including programs related to reproductive health and support for LGBTQ communities. (02:46)

• Legislative Prospects: Historically, rescission requests are often rejected since lawmakers initially authorized the funding. However, this particular request has support from House Speaker Mike Johnson, who announced it would be brought to the House floor. Nevertheless, some moderate Republicans in the Senate may raise objections. (03:05)

Conclusion: While the White House is pushing forward with significant funding cuts, the success of this initiative hinges on congressional support, which remains uncertain due to potential opposition within the Senate.

3. Artificial Intelligence in Weather Forecasting

Timestamp: 03:26 – 06:38

As hurricane season approaches, technological advancements in weather forecasting are taking center stage. Companies like Microsoft, Google, Nvidia, and Huawei are leveraging artificial intelligence (AI) to enhance the precision of their weather predictions.

Key Insights:

• Shift from Physics-Based Models: Traditionally, weather forecasting relies on complex physics-based calculations. Daniel Ackerman explains, "for years, weather forecasting has been based on physics... millions of calculations about how heat and moisture move through the atmosphere." (04:28) However, AI models bypass these calculations by recognizing patterns from historical data.

• AI's Predictive Capabilities: Amy McGovern, Professor of Meteorology at the University of Oklahoma, states, "They're trained on 40 or 50 years of data, and so they are learning... what's going to happen next." (04:51) These models can often match or surpass traditional forecasts in accuracy and speed.

• Advantages and Limitations: AI provides faster forecasts, potentially extending warning times. McGovern notes, "If you could get your hailstorm warning up from 15 minutes to an hour, you would have more time to prepare." (05:12) However, Renato Molina, an Environmental Economist at the University of Miami, points out that AI struggles with predicting small-scale events like tornadoes and accurately forecasting wind speeds, which are crucial for assessing storm damage. (05:26)

• Economic Implications: Tatiana Darugina, Finance Professor at the University of Illinois, highlights the economic value for sectors like insurance. She mentions, "seemingly small differences in the model can make big differences for insurers." (06:08) Accurate risk modeling is essential to prevent significant financial losses.

• Trust in AI Forecasts: The effectiveness of AI in weather forecasting also depends on public trust. Darugina asserts, "If people are going to decide whether they evacuate or not, how much they trust the forecast is going to matter." (06:22) Without trust, even the most accurate forecasts may fail to prompt necessary actions.

Conclusion: AI-enhanced weather forecasting offers promising improvements in speed and accuracy, especially valuable for industries like insurance. However, challenges remain in predicting localized events and building public trust to ensure actionable forecasts.

Final Thoughts: This episode of the Marketplace Morning Report underscores the interplay between policy decisions, economic impacts, and technological innovations. From the ramifications of increased tariffs on global competitiveness and consumer prices to the potential reshaping of weather forecasting through AI, listeners gain a comprehensive overview of current events influencing the business and economic environment.