Tariffs, grocery prices and other listener questions

Summary

Planet Money: Tariffs, Grocery Prices, and Other Listener Questions – Detailed Summary

Released January 17, 2025 by NPR’s Planet Money

In this engaging episode of Planet Money, host Amanda Aronczyk and the Planet Money team delve into a series of listener questions that emerged in the wake of Donald Trump’s reelection. Covering a broad spectrum of economic concerns—from tariffs and grocery prices to the potential impact on public broadcasting—this episode provides insightful analysis and expert opinions to help listeners navigate the complexities of the current economic landscape.

---

1. Can President Trump Address Economic Inequality?

Timestamp: 01:20 – 02:10

The episode kicks off with a profound question from Aaron Fountain, an academic historian from Maryland, who queries the feasibility of President Trump continuing to address economic inequality. Fountain’s inquiry reflects widespread voter anxieties rooted in economic disparity.

Quote:

“Do people think that he can actually, you know, continue to address inequality and will it actually get better or will it get worse?”
— Aaron Fountain (01:30)

Host Amanda acknowledges the uncertainty surrounding this issue, emphasizing the long-term nature of assessing economic policies and the limited immediate influence a president may wield over deep-seated economic factors.

---

2. Can the President Influence Oil Prices and Inflation?

Timestamp: 04:15 – 10:03

Listener Michael Mesa poses a critical question about the president’s ability to impact energy prices and inflation through increased oil production—a campaign promise famously encapsulated in the phrase “Drill, baby, drill.”

Key Insights:

• Samantha Gross, an energy policy expert at the Brookings Institution, explains that the president has limited tools to significantly alter oil prices. While opening federal lands for drilling could marginally increase oil supply, it represents only about a quarter of U.S. oil production.

  Quote:

  “So it gets a lot of attention because it's a lever that the president has but it's not where most of our production comes from.”
  — Samantha Gross (05:57)

• The strategic use of the Strategic Petroleum Reserve (SPR) is discussed as a short-term measure to stabilize oil prices. However, the SPR’s capacity is insufficient for long-term price control, as it can only supply the global demand for about a week.

  Quote:

  “They are like sort of mined out caverns made of salt, so you can put the oil in there, you know, as liquid in these big old caverns.”
  — Samantha Gross (08:22)

• Jeff Guo highlights that despite these measures, global oil markets are influenced by broader factors beyond presidential control, such as OPEC’s production decisions.

  Quote:

  “They're holding back their oil production because they don't like the price right now.”
  — Jeff Guo (07:14)

Ultimately, the discussion concludes that while presidential actions can provide temporary relief, systemic changes in oil prices and inflation require more extensive and coordinated efforts.

---

3. Why Are Groceries Still So Expensive?

Timestamp: 10:29 – 15:18

Jen Penzis raises a pressing concern about the persistent high costs of groceries, noting a 25% increase between 2019 and 2023, outpacing overall inflation.

Key Insights:

• Greg Rosalski, the newsletter writer, clarifies the distinction between the price level and inflation. He uses an analogy of an inflatable pool to illustrate how the price level represents the overall cost of goods, while inflation denotes the rate at which these prices increase.

  Quote:

  “The height of the water is kind of like the price level. And now imagine there's a hose going into this pool… that's inflation.”
  — Greg Rosalski (11:23)

• The discussion highlights that while general inflation may slow, specific sectors like groceries continue to see significant price hikes due to factors such as supply chain disruptions and disease outbreaks affecting production, such as the bird flu impacting egg prices.

• Rosalski emphasizes that grocery prices are unlikely to decrease in the near future, referencing the rare instance in 2016 when grocery prices slightly fell—a trend not expected to continue.

  Quote:

  “These things tend to go up over time, not go down.”
  — Greg Rosalski (13:58)

• To cope with rising grocery costs, the recommendation is for individuals to seek wage increases, as rising incomes can help offset the higher expense of living.

  Quote:

  “She should hope to get a raise and, you know, like, hope her household income goes up.”
  — Greg Rosalski (14:30)

---

4. Will Trump's Administration Cut NPR Funding?

Timestamp: 15:18 – 22:48

Listener Jane Gray inquires about the likelihood of funding cuts to NPR under Trump’s administration, reflecting broader concerns about public broadcasting’s future.

Key Insights:

• Brooke Gladstone, co-host of the public radio show On the Media, provides historical context, detailing past administrations’ attempts to reduce funding for the Corporation for Public Broadcasting (CPB), which funds NPR and PBS.

  Quote:

  “Nixon tried to do it, but that was before I was covering it… George W. Bush also tried to do it.”
  — Brooke Gladstone (17:31)

• The CPB’s funding is protected through the Public Broadcasting Financing Act, which allocates budgets two years in advance to shield it from immediate political interference.

• Brooke explains that while the president can request rescissions—the withdrawal of unspent allocated funds—bipartisan support in Congress typically safeguards CPB’s budget, ensuring continuity in public broadcasting.

  Quote:

  “Rescission means that they can go in and cut things that were previously appropriated.”
  — Brooke Gladstone (20:36)

• The segment underscores that any significant cuts would disproportionately impact local public radio and TV stations, which serve as vital information sources in their communities.

  Quote:

  “It would hurt these local stations a lot more. Stations that act as a service and might be the only source of local news.”
  — Brooke Gladstone (21:31)

Overall, the analysis suggests that while attempts to cut NPR funding may surface, institutional protections and legislative support make such moves challenging and unlikely to fully dismantle public broadcasting.

---

5. Should You Buy a New iPhone Before Tariffs Kick In?

Timestamp: 23:51 – 29:40

Brian Bunton from South Carolina asks whether he should purchase a new iPhone now to avoid potential price increases due to upcoming tariffs under Trump’s administration.

Key Insights:

• Amit Kundwal, a Yale economics professor, discusses the possibility of exemptions for certain products, suggesting that not all goods, including iPhones, might be subject to new tariffs.

  Quote:

  “Maybe there just won't be tariffs on iPhones because companies can request exemptions.”
  — Amit Kundwal (25:00)

• Historical precedent is provided where previous tariffs proposed by Trump did not ultimately apply to iPhones, as Apple, led by CEO Tim Cook, successfully lobbied for exemptions to maintain competitiveness against Android devices.

  Quote:

  “iPhones were almost subject to tariffs… there was never a tariff on iPhones.”
  — Amanda Aronczyk summarizing (25:08)

• Comparisons are made to the broader supply chain adjustments, such as Apple’s shift of iPhone production to countries like Vietnam and India, as part of a “China plus one” strategy to diversify manufacturing bases and mitigate tariff impacts.

  Quote:

  “In the past five years… they've been increasingly shifting iPhone production to Vietnam and India.”
  — Jeff Guo (27:15)

• The conversation humorously reveals that Brian has already purchased a new iPhone despite the impending uncertainty, reflecting a common consumer response to ambiguity in economic policies.

  Quote:

  “Pretty much I wrote in the question, but I kind of came to the conclusion myself. Probably rather be safe than sorry.”
  — Jeff Guo (28:36)

The segment concludes with a lighthearted note on consumer decision-making amidst policy uncertainties, emphasizing the complex interplay between government actions and corporate strategies.

---

Conclusion

Timestamp: 29:50 – 30:25

Amanda Aronczyk wraps up the episode by encouraging listeners to continue submitting their questions, highlighting Planet Money’s commitment to addressing the economic issues that matter most to its audience.

Final Note:

“Feel free to always send us your questions. We love to hear from you.”
— Amanda Aronczyk (30:25)

---

This episode of Planet Money offers a comprehensive exploration of listener concerns related to economic policies under President Trump’s administration. Through expert analysis and thoughtful discussion, the show equips listeners with a deeper understanding of how presidential actions and global market dynamics influence everyday economic realities.

Transcript

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[Amanda Aronczyk]

This is Planet Money from NPR.

[Host/Producer]

Right after Donald Trump was reelected, we turned to you, our listeners, and asked, what do you want to know? What do you want us to cover? Do you have questions about tariffs or immigration or presidential control of the Federal Reserve or tax cuts or, I don't know, any number of things. And we got a really, like, large number of questions. But what we realized as we started to sift through this giant metaphoric pile was that our inbox was filled with, yes, with letters, but also with uncertainty and excitement and shock. This was not an ordinary bunch of questions. Like, take this one from an academic historian.

[Sponsor Voice]

So, my name is Aaron Fountain, and I live in Maryland.

[Host/Producer]

Our producer Emma Peaslee called Aaron up. Do you want to tell me about.

[Jeff Guo]

Your question and why you decided to write into us?

[Sponsor Voice]

So, since the 2024 presidential election, many commentators and media have talked about how many voters voted for Trump because of economic anxiety and inequality. But I'm curious, do people think that he can actually, you know, continue to address inequality and will it actually get better or will it get worse?

[Host/Producer]

I will say with your question, we were like, we don't know. Like, your question is a hard question.

[Jeff Guo]

Were you expecting, like, what kind of.

[Host/Producer]

Answer did you think?

[Sponsor Voice]

You know, it's hard because, like I said, I am a historian by training. It really takes years and sometimes decades to assess something.

[Host/Producer]

Decades. Even Aaron, who wrote in with a question, acknowledges, we just can't know yet. We have no crystal ball. There's no way to know exactly what will happen. And yeah, a lot of your questions, it's just impossible to answer now. But what we can do is look at how much power the president really has to shape the economy. Where does that power come from? And can Trump use it to do the things he has promised to do? Hello and welcome to Planet Money. I'm Amanda Aronczyk. Today on the show, your questions about the next four years with answers. Questions about tariffs, oil, grocery prices, and the future of NPR. That's all coming up.

[Sponsor Voice]

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[Host/Producer]

Okay, so today we are doing questions from you, our listeners, all about President elect Donald Trump and the next four years. To answer your questions, I will be bringing in different people from the Planet Money team. First up, Jeff Guo. Hello, Jeff.

[Jeff Guo]

Hey, Amanda. So my listener question has to do with one of President Trump's big campaign promises. It's about oil.

[Host/Producer]

I will end the devastating inflation crisis immediately, bring down interest rates and lower the cost of energy. We will drill, baby, drill. Drill, baby, drill. That one's a classic.

[Jeff Guo]

It really is. So listener Michael Mesa basically wanted to know, can the president make a dent in energy prices and also, you know, in inflation by encouraging oil production?

[Host/Producer]

Yeah. This seems like a big, important international question because the US Is the largest producer of oil in the world.

[Jeff Guo]

Exactly. So I called up Samantha Gross, and she actually used to work in the oil industry. She was an engineer. She helped oil refineries manage their leftover gunk.

[Samantha Gross]

I used to say that if it came out the back end of the refinery, it was my fault or my job, I should say.

[Host/Producer]

Oh, yuck.

[Jeff Guo]

Now, these days, Samantha is an expert in energy policy at the Brookings Institution, and she says when it comes to increasing the supply of oil, the president basically has two main moves. Number one, he can open up more federal land for drilling, you know, hand out more drilling permits, that sort of stuff.

[Host/Producer]

Yes, right. There have been, I remember, it's all coming back to me, a lot of political fights over this, right?

[Amanda Aronczyk]

Yeah.

[Host/Producer]

Whether the president was going to allow for drilling in the Arctic or drilling in the Gulf Coast.

[Jeff Guo]

Yeah. And those fights matter when it comes to protecting those places from pollution and potential oil spills. But in terms of just raw crude production, Samantha says it's not that significant. Only about a quarter of US Oil comes from federal land or waters.

[Samantha Gross]

So it gets a lot of attention because it's a lever that the president has but it's not where most of our production comes from.

[Jeff Guo]

Most of the oil that the US Produces has always come from private land or land owned by individual states, like Texas. The President doesn't control that.

[Host/Producer]

Okay, but if President Trump just threw open the doors and was like, yeah, come on, in oil companies, you can drill on federal land, no problem. Like, I have to assume that that would be enough oil production, that it would bring down the price of oil at least some.

[Jeff Guo]

Yes and no. Samantha says in the long term, maybe, but we're talking like the really long term, because oil and gas companies, they make their drilling plans years and years in advance.

[Samantha Gross]

They'll have the land that's producing now. They'll have the next land they plan to drill. They'll have some land that is prospective, that they're still figuring things out. So it can be years between leasing land and drilling on it.

[Jeff Guo]

And the other thing is that even if President Trump wants companies to drill more on federal land, it's not clear that the companies themselves would even really want to, because the rest of the world, it's already producing a lot of oil right now.

[Samantha Gross]

This is a time of a pretty ample supply in oil markets. This is good for prices if you want to see lower prices as a consumer.

[Jeff Guo]

But if you are an oil company, those lower prices, they're probably discouraging you from investing more in oil projects.

[Host/Producer]

Right? Companies are not saying drill, baby, drill because they won't necessarily get a good price for their oil.

[Jeff Guo]

Exactly. Samantha says that's the reason OPEC countries like Saudi Arabia, Iraq, Iran, they've been holding back their oil production because they don't like the price right now.

[Host/Producer]

Oh, interesting. So it sounds like no matter how much federal land the President just opens up, he can't make companies go drill on that land.

[Jeff Guo]

No, it's up to the market.

[Host/Producer]

Up to the market. Right. Okay. So, Jeff, you also mentioned that there is a second big thing that the President can do to affect the price of oil.

[Jeff Guo]

Oh, yeah, this is actually pretty cool. The US has this thing called the Strategic Petroleum Reserve. It's literally a bunch of caves where we stockpile a ginormous amount of oil for emergencies.

[Host/Producer]

God, I love all the caves that we just store things in. So great.

[Samantha Gross]

You know, think of it as like a gigantic underground tank. They are like sort of mined out caverns made of salt, so you can put the oil in there, you know, as liquid in these big old caverns.

[Jeff Guo]

You just pump the oil into these caves.

[Samantha Gross]

They sure do, yes. They're like gigantic salt Caves.

[Host/Producer]

Wow. Where are these?

[Jeff Guo]

In the Gulf coast, like Louisiana, Texas. And. And get this, these salt caves, they can hold enough oil to supply the entire world for like, a week.

[Host/Producer]

I mean, I guess that is a lot. That is a lot of oil.

[Jeff Guo]

That's a lot of oil. It is the largest oil stockpile in the world. Okay? And so remember when Russia invaded Ukraine and oil prices spiked, one thing that President Biden did was to open up the reserves and start selling some of what's in there.

[Host/Producer]

Ah, yes, unleash the oil.

[Jeff Guo]

And most economists think that made a difference, at least enough to, you know, stabilize oil prices in the short term. Now, Biden didn't do it alone, of course. Other countries, they also opened up their own reserves.

[Host/Producer]

But it sounds like you couldn't actually bring down oil prices this way in the long term if it's only lasting for a week.

[Jeff Guo]

No, no. The caves are ginormous, but they're not that ginormous.

[Host/Producer]

Okay, so back to our listener Michael's question. Can the President bring down the price of oil so that, you know, help fight inflation? And it sounds like the answer is not really. The oil market is simply too big for the limited tools that the President has access to.

[Jeff Guo]

Right. And by the way, energy prices, they aren't even that big of a part of inflation. Like, even if you look back at the 1970s energy crisis, like, if you actually decompose the different factors. Economists.

[Host/Producer]

We gotta move on. We gotta move on. Although, honestly, this does sound very interesting.

[Jeff Guo]

Okay, we'll save that for another time. Amanda, thank you so much. Thanks, Amanda.

[Greg Rosalski]

Okay, Amanda, what a pleasure.

[Host/Producer]

Just a second. No, no. I introduce you. You're coming to my show. Dude.

[Greg Rosalski]

Oh, dang it.

[Host/Producer]

Okay, so I wanna let you know we have another question from a listener. This one is from Jen Penzis. So here's a question.

[Brooke Gladstone]

Why are groceries still so expensive?

[Sponsor Voice]

Why has inflation decreased by food is still 25% more.

[Host/Producer]

Okay, so we looked this up, and between 2019 and 2023, grocery prices did increase by 25%, as Jen said. And broadly, overall, inflation was less. It increased by nearly 18%. Now, of course, inflation was a huge issue in this past election, and Trump has promised to bring down the cost of groceries.

[Greg Rosalski]

Right.

[Host/Producer]

So, Greg Rosalski, our newsletter writer, a little bit about Jen. Jen watches grocery prices closely. She even made a spreadsheet where she tracked how much she was spending on things like eggs and ground turkey and milk, I think so.

[Greg Rosalski]

Love spreadsheets.

[Host/Producer]

Love a spreadsheet. So what do you think is the Answer to her question, why are groceries still so expensive even though inflation overall has slowed?

[Greg Rosalski]

So, first of all, I gotta say, Jen, I feel you. Grocery prices do seem really high. But, you know, to answer this question, the first thing I want to do is just sort of, like, sort out this difference between the price level and inflation. So to clarify, the price level is like, you know, the general or average level of prices of goods and services in the economy. Inflation is different, though. It's an increase in the price level. It's the change, not the level. So how about this? So think of an inflatable pool.

[Host/Producer]

An inflatable swimming pool. Like one of those kiddie pools, maybe a big one.

[Greg Rosalski]

So. So I could get in and swim around.

[Host/Producer]

Okay.

[Greg Rosalski]

The height of the water is kind of like the price level. And now imagine there's a hose going into this pool.

[Host/Producer]

Okay? We're filling up the inflatable pool here.

[Greg Rosalski]

You're turning it on. You're filling it up. So the water going into the pool, that's inflation. Right? So when the pool is filling quickly, the rate of inflation is high. But when you close the spigot a little bit, the water then, you know, slows to a trickle, and now the pool is filling up less quickly. That's the rate of inflation slowing down.

[Host/Producer]

Okay, so that's. That's pretty much the situation that we are in now. Right? The inflation hose is slower than it was, but that does not mean that the water level or the price level is lower. Price of groceries is still really high.

[Greg Rosalski]

Yeah. So as you said earlier, Amanda, grocery prices have actually outpaced overall inflation over the last five or so years. And mind you, groceries are something we buy all the time. So we've all really noticed these high prices. Like, every time you go to the grocery store, you're like, dang it, these eggs are, I don't know, like a million dollars.

[Host/Producer]

Like a billion dollars for eggs.

[Greg Rosalski]

What, am I gonna have to get a mortgage on this freaking omelet? However, since late 2023, the rate of inflation for groceries has significantly slowed down. In fact, between August 2023 and November 2024, it was significantly lower than the. Now, I don't know what Jen is exactly buying at the grocery store. It sounds like she's a big fan of poultry products. Eggs in particular have spiked quite a bit in recent months because of bird flu. There goes my omelets. I don't know about you, Amanda, but yeah, this. This increase in the price of eggs, it actually drove an increase in the overall grocery inflation rate. More recently.

[Host/Producer]

Okay, so you've explained what's going on now, but I think what Jen really wants to know is will grocery prices ever go down again? Will things get cheaper at the supermarket?

[Greg Rosalski]

Yeah. So I hate to be the bearer of bad news here. Grocery prices tend not to go down. There was one big exception, though. In 2016, American grocery prices fell a little bit for the first time in, like, nearly 50 years.

[Host/Producer]

No kidding.

[Greg Rosalski]

But I think, you know, the fact that this was, like, the first time it happened in nearly 50 years and it wasn't that big of, you know, a fall in prices, it suggests that, like, we're probably not going to see a big drop of grocery prices anytime soon. These things tend to go up over time, not. Not go down.

[Host/Producer]

Okay, so if grocery prices are unlikely to go down, how is Jen or anyone really supposed to keep up? Like, how are we supposed to be able to afford to buy this very expensive food?

[Greg Rosalski]

Yeah. And also, I mean, like, I should say that she should hope to get a raise and, you know, like, hope her household income goes up, because that's generally what happens over time. You'll see this, the spike in the, in the price level, and people start demanding raises, and we'll get used to higher sticker prices at grocery stores.

[Host/Producer]

Okay.

[Greg Rosalski]

And actually, over the last year or so, the, the wages of Americans have been going up and they've been growing faster than overall grocery prices.

[Host/Producer]

Okay. So, Jen, you thought you were calling about groceries, but really we are suggesting you go ask for a raise. Thank you, Greg. This has been super helpful.

[Greg Rosalski]

It's always a good call.

[Host/Producer]

We have more questions and answers coming up. Questions about the potential impact of Trump's tariffs on our purchases. Like, for example, when we buy an iPhone. And will President Elect Donald Trump find a way to cut NPR's funding? That's all after the break.

[Greg Rosalski]

Oh, whoa. I want to hear that segment.

[Host/Producer]

Exactly.

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[Host/Producer]

Next question is from a listener named Jane Gray. This one is about the media. It impacts us. We get this question a lot. And I decided to bring it to Brooke Gladstone. She is the co public radio show on the media and she's just finished reporting an episode about public broadcasting funding. I read her the listener question. What is the likelihood that Trump's administration will cut funding for npr?

[Brooke Gladstone]

Well, I think that prognostication is a mugs game, especially in the era of Trump. So let me just say that one.

[Host/Producer]

Of Brooks first media gigs back in the 1980s was writing for Current, which is like this industry trade magazine. So since the very beginning of her media career has seen many attempts to cut funding to public broadcasting.

[Brooke Gladstone]

Nixon tried to do it, but that was before I was covering it, certainly during the Reagan era. And Newt Gingrich was a very big advocate of killing public broadcasting. George W. Bush also tried to do it, and the great stalwart warriors like Big Bird and Mr. Rogers have fought it back.

[Host/Producer]

So first, a little context. NPR and PBS get some of their funding from the government through the Corporation for Public Broadcasting, or CPB, which was established by President Lyndon Johnson back in 1967 as part of his Great Society programs. A couple of years later, PBS was founded, then NPR. But almost immediately after Richard Nixon took office in 1969, Nixon tried to cut its proposed funding. He did not like being criticized and he saw the media as his adversary. So that year, Mr. Rogers, who is still establishing himself and his neighborhood as this educational place on television for children, he goes to testify before a Senate committee about the value of public television.

[Jeff Guo]

I'm constantly concerned about what our children are seeing. And for 15 years I have tried in this country and Canada to present what I feel is a meaningful expression of care. Do you narrate it? I'm the host, yes. And I do all the puppets and I write all the music and I write all the scripts.

[Host/Producer]

Well, I'm supposed to be a pretty tough guy, and this is the first time I've had goosebumps for the last two days.

[Jeff Guo]

Well, I'm grateful not only for your goosebumps, but for Your interest in our kind of communication at that time.

[Host/Producer]

Those goosebumps did help keep the CPB's funding intact. But when President Nixon was re elected in 1972, he again targeted the CPB and vetoed a measure that would have given it more funding. So in the next administration, in an attempt to protect CPB's funding, the Public Broadcasting Financing act of 1972, 1975 gets passed. And this is important, in that act, there is a guarantee that the CPB would have this kind of unique budget.

[Brooke Gladstone]

It is funded two years in advance to protect it from political meddling.

[Host/Producer]

That means that this year's CPB budget was already set and appropriated two years ago. But there is a way to claw back that money.

[Brooke Gladstone]

Rescission means that they can go in and cut things that were previously appropriated.

[Host/Producer]

Rescission.

[Brooke Gladstone]

Rescission. As opposed to cut, meaning going back to cut something they already agreed to.

[Host/Producer]

Right. So a rescission means taking back money that has already been appropriated but has not been spent yet. This is something the President can ask Congress to do to avoid spending funds on things like the CPB. Brooks says yes, having Mr. Rogers or Big Bird show up on Capitol Hill, that's fun and helpful. But really, the funding for CBB has survived because a bipartisan majority of representatives in the House have supported public broadcasting. Their constituents wanted it. That is because 70% of this government money goes to the 1500 locally owned public radio and TV stations. These are all across the country. And they take that money from the CPB and they spend it in a bunch of different ways. Some of that money might go to pay NPR for programming. A lot goes to pay local reporters and to pay the cost of running a station. So Brooks says that cutting CPB funding would hurt npr. Yes, but it would hurt these local stations a lot more. Stations that act as a service and might be the only source of local news.

[Brooke Gladstone]

It is able to bring vital information to communities that would not get it. It is that simple. You're not going to strangle NPR if that's what they want to do. If they hate All Things Considered and Morning Edition, they're not going to kill it this way. The only thing they'll kill is rural stations in Alaska telling people where the ice is thin on the river that serves as a roadway in the winter.

[Host/Producer]

The station Brooke is referring to is KYUK in Bethel, Alaska, and their aptly named show River Watch, which is people keeping a close eye on their river in the winter. They want to make sure it's really frozen if they are going to drive on it.

[Samantha Gross]

How much snow you guys have left? We don't have very much snow. How about your temperature this morning? This morning was about six below. Wow. Quite a bit colder than I was holding my breath this past weekend when it started raining. Oh, man, I hope this isn't it. We've seen the river break up upriver several times during November. If we can make it to December without a big warmup, then it'll probably hold together, literally.

[Host/Producer]

River watch. So to our listeners, question. Yes, it is very likely that the Trump administration will try to cut funding to npr. Trump has called to cut funding for NPR in the past and he tried last he was president, but it didn't work because really the decision over the future of the Corporation for Public Broadcasting's funding that lies with Congress. All right, now onto our final listener question. To answer it, I have invited On Planet Money producer Willa Rubin. Hello, Willa.

[Amanda Aronczyk]

Hey, Amanda. So this question comes from listener Brian Bunton from South Carolina. And he wrote in to ask about his iPhone. He says it's three years old. He probably doesn't need to upgrade it for a few years, but he will.

[Host/Producer]

Is it possible that he is called the wrong show? There's gotta be like a tech show out there for him. Okay, now tell him what is his Planet Money ish question?

[Amanda Aronczyk]

Okay, so he wants to know should he go ahead and get a new phone before Trump takes office, given that Trump is promising to increase tariffs.

[Host/Producer]

Oh, good question. By the way, we should say Apple is an NPR sponsor. Okay, so let me summarize. Brian is wondering, should he buy himself a new iPhone now and avoid the price potentially going up because of a future tariff, which, as we know, is basically an import tax. Is that right?

[Amanda Aronczyk]

Yes, exactly. So I called up Yale economics professor Amit Kundwal who said that one scenario is that maybe there just won't be tariffs on iPhones because companies can request exemptions.

[Jeff Guo]

In the last round of tariffs that the previous Trump administration launched in 2018, 2019, it turned out that the iPhone was exempted from those tariffs.

[Host/Producer]

Oh, interesting. So Apple avoided tariffs on their iPhones.

[Amanda Aronczyk]

Yeah. So iPhones were almost subject to tariffs. But Tim Cook, CEO of Apple, during the last trade dispute, he went to Trump and was like, listen, if you put tariffs on the iPhones that we assemble in China, those tariffs will make it harder for my American company to compete with Androids, many of which are made by Samsung South Korean company, which does a lot of its manufacturing in Vietnam. And ultimately there was never a tariff on iPhones. Also, Tim Cook does seem to be maintaining his relationship with Trump. He recently visited Mar a Lago, but also he donated a million dollars to Trump's inauguration fund.

[Host/Producer]

Ah, yes. Okay, so maybe Brian doesn't need to get a new iPhone yet, because if iPhones didn't get a tariff last time, possibly they won't get one this time.

[Amanda Aronczyk]

Right. Although Trump has also said that he would increase tariffs on everything coming from China.

[Host/Producer]

Okay. And that may include products made by Apple, but I know that since the pandemic, a lot of the companies have been diversifying where they manufacture and assemble their products. Is Apple, in fact, making all of their iPhones in China?

[Amanda Aronczyk]

No, not all of them. So for years, iPhones have been assembled in China in the city of Zhengzhou at a factory that is so big, it is sometimes called iPhone City. But, yeah, like you said, since the pandemic, also, because of increasing tensions with China, also labor costs, more and more companies are using a business strategy called China plus one. And the idea is like, yes, still make stuff in China, sure. But also branch out, make things in another country, too. And so these days, yeah, Apple is making more and more of its iPhones outside of China.

[Jeff Guo]

In the past five years, for example, they've been increasingly shifting iPhone production to Vietnam and India.

[Host/Producer]

Got it. Okay. India and Vietnam. But who knows? Maybe Trump will put tariffs on products coming from Vietnam or India. Or from anywhere. Or from everywhere. So what is a listener like Brian supposed to do? Could he just, like, wait a little bit longer? He didn't really need that new iPhone. I mean, how different is the new iPhone really? Come on, let's be honest here.

[Amanda Aronczyk]

Yeah, but it is also hard to know just how long to wait for a couple of reasons. First, because, Tara, tariffs don't all get imposed at once. Since the trade dispute with China began, there have been multiple rounds. And next, because once a tariff gets announced, there's no standard amount of time for how long it actually takes to then go into effect. And then even when those tariffs do take effect, like, who knows how long it'll take before those extra costs wind up getting passed on to us.

[Host/Producer]

Right? And they may not get passed on at all.

[Amanda Aronczyk]

Right. Although, you know, research from the last trade dispute showed that usually they did. And by the way, I asked Apple to talk about all of this, all their tariff plans. They didn't get back to me.

[Host/Producer]

Okay, so what are we. What are we gonna tell Brian? Should he get a new iPhone, yes or no?

[Amanda Aronczyk]

So actually, when I called up Brian to talk about all this. He had a confession.

[Jeff Guo]

I actually did get a new iPhone already.

[Amanda Aronczyk]

You did?

[Jeff Guo]

I did.

[Amanda Aronczyk]

Can you tell me why? Was it because of the kinds of questions you wrote in about?

[Jeff Guo]

Pretty much I wrote in the question, but I kind of came to the conclusion myself. Probably rather be safe than sorry. That's always been my philosophy.

[Host/Producer]

Oh, wow. Brian, maybe you could have emailed us a little earlier. Just teasing. We did make Brian wait for this answer. What did Amit think of Brian's choice?

[Amanda Aronczyk]

Well, I asked him, did Brian do the right thing?

[Jeff Guo]

Yeah. So I think that given that he was planning to upgrade anyways, I think he hedged his bets and went ahead and bought it, which makes sense.

[Host/Producer]

Okay, great guess. All's well that ends well.

[Amanda Aronczyk]

Yeah, but, you know, Brian owns other things and he was looking around his house thinking like, I don't know, other tariffs.

[Jeff Guo]

The dryer has an issue where it doesn't turn off.

[Amanda Aronczyk]

That's a problem.

[Jeff Guo]

So the only way to turn it off is to open the door.

[Host/Producer]

Oh, no. Brian's gonna have to buy a new dryer. Will he or won't he? So many decisions to make. So much uncertainty. Willa, thank you so much.

[Amanda Aronczyk]

Thank you so much, Amanda.

[Host/Producer]

Feel free to always send us your questions. We love to hear from you. Our inbox is my playground. I love going in there and seeing what you guys are asking. It's planetmoneypr.org this episode of Planet Money was produced by Emma Peaslee and edited by Meg Kramer. It was engineered by Neil Tivolt and fact checked by Sarah Juarez. Alex Goldmark is our executive producer. I'm Amanda Aronczyk. This is npr. Thanks for listening.

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