Slate Money — "A Bigger Hammer" (March 21, 2020)

Episode Overview

This urgent episode of Slate Money, hosted by Felix Salmon (Axios), with co-hosts Emily Peck (HuffPost) and Anna Szymanski (BreakingViews), dives deep into the economic fallout from COVID-19 as of mid-March 2020. The main focus is the rapid movement toward massive U.S. government stimulus packages, debate over bailouts and checks for individuals, the public health crisis's impact on markets, and questions about the adequacy and fairness of policy responses. The team also discusses global reactions, U.S. political blame, stories of inequality, and how this crisis may change the world's economic order.

Main Discussion Points & Insights

1. The State of the U.S. Coronavirus Bailout

Details of Proposed Direct Payments

• Congress is debating stimulus checks to Americans.
• Early proposals: Up to $1,500 per adult (Felix); latest: $1,200 per adult, phasing out above $75,000/year income, and no checks above $99,000/year (Emily) [02:11-03:18].
• Notably, "poor people under this proposal from McConnell would actually get less money than middle class people because they don't get tax refunds." (Emily) [02:38].

Critique of "Helicopter Drops" vs. Targeted Help

• Current ideas resemble broad, one-off payments, not targeted relief for those most in need (laid-off workers, hardest-hit industries) [04:06].
  • "We're not seeing a massive increase in unemployment insurance... All of these kind of very targeted interventions seem not to be happening." (Felix) [04:09].
• Contrasted with Europe: Denmark covers 75% of affected employees' salaries; France waives rent during lockdowns.

The Need for Speed and Scope

• Consensus: Do more, and do it fast.
  • "The lesson of the coronavirus is that you can never be too early or too aggressive." (Felix) [06:10].
  • "Just do more, do it now and keep doing it. Like there's no shortage of things. Like you can't think too big on this." (Emily) [06:20].
• Unemployment spike underway: Forecast of 2.2 million new claims next week — "a number which is unimaginable... never in American history has it been even half that" (Felix) [07:26].

2. Stimulus vs. Economic Lifeline

• "This isn't really stimulus. We're not trying to stimulate the economy. We're just trying to bridge it." (Emily) [08:08].
  • The immediate goal is economic preservation—not growth—by enabling survival until reactivation is possible.

Keeping Markets "Clearing"

• Focus shifts from market levels to functionality: "Are [markets] doing their job of being able to move capital around to where people need capital?" (Felix) [10:57].
  • Markets are under stress but functioning; credit facilities (Fed, ECB) are critical.
  • The internet’s resilience is a bright spot for homebound workers [10:57-11:59].

3. Societal Inequality & Inadequate Safety Nets

• Hourly and gig economy workers are especially vulnerable; state systems are overwhelmed.
  • "Even if they got the $1,200 one time check, that's not enough money..." (Emily) [11:59].
  • Criticism of recent paid sick leave law: covers only workers at companies with fewer than 500 employees, leaving out millions [12:58].
  • "What they've done with paid sick leave is a national embarrassment." (Emily) [12:58].

Optimism About Congressional Action?

• Felix: "Congress has unlimited bites at this apple... They will continue to pass new bills for as long as this crisis continues." [13:34]
• Possible expansions: rent, utilities, healthcare costs waivers, universal paid treatment.

4. Political Scandal: Congressional Insider Trading

• Senators Richard Burr and Kelly Loeffler dumped millions in stocks after coronavirus briefings while publicly denying the threat [15:30-19:47].
  • "Burr understood what was about to happen...was telling people privately...He was making trades based on that information. Then he was going out to the public and giving a whole other story. To me, that's even more shocking than trading on the information." (Emily) [19:01].
• Legal loopholes let Congress evade prosecution; only public exposure might force resignations (Felix) [17:14-18:22].
• The incident exposes deep flaws in both ethics and transparency in U.S. governance.

5. Signals from China: Cautious Optimism

• China reports zero new domestic coronavirus cases and over 90% of large businesses back online [20:43].
  • Felix references "The Hammer and the Dance" Medium post to explain the need for strong early action ("the hammer") and the careful easing ("the dance") [20:43-22:42].
• Doubts raised about the sustainability and completeness of China's recovery.
  • "Any type of V-shaped recovery is incredibly unlikely...could be slow going for a while." (Anna) [22:42].
  • "You have to wait around 14 days to see that...One day isn't enough to make a trend." (Emily) [23:23].

U.S. Testing Troubles

• America lacks comprehensive data on case counts due to testing shortages [23:42-24:34].
• Bringing cases down, ramping up medical capacity, and learning from Asian monitoring practices are seen as urgent priorities [24:56-26:49].

6. Healthcare, Capacity, and Inequality

• The hospital ship for New York demonstrates slow federal logistics but a needed increase in capacity [27:40-28:11].
• The crisis could depress non-COVID deaths (fewer car accidents, flu) — a "silver lining" in public health [28:39-29:45].
• Environmental benefits (air quality) noted due to economic slowdown—but not viewed as a template for climate action (Anna) [29:51-30:16].

7. Corporate Bailouts, Stock Buybacks, and Capitalism's Role

• Should bailouts include restrictions? Debate over banning stock buybacks, imposing climate conditions [31:21-32:08].
  • Anna: Temporary restrictions make sense when companies have outstanding government loans; beyond that, may be punitive.
• Felix on the true purpose of capital and risk:
  • "That's capitalism kind of working the way it should...if and when a pandemic arrives, [investors] lose money, and that's how things should work." [32:50, 35:15].
• Anna pushes back: "This is something that is truly unique...that's very different from what's happening here." [33:58].
  • Felix: "The businesses continue because they've already received the money from the investors...the risk materialized and they lost a bunch of money, and that's how things should work." [35:15].

8. The Numbers Round

1. Xenophobia and Deglobalization

• Felix: "12" — the number of U.S. journalists expelled from China, indicative of growing nationalism [37:44].
  • Prediction: the pandemic accelerates deglobalization and nationalism [39:18].
• Emily: Silver lining may be voters' rejection of populist, anti-globalist leaders [39:18-40:11].
• Anna: Worries deglobalization is here to stay [40:11].

2. Gold-Silver Price Ratio

• Anna: "123.78" — the highest gold-to-silver price ratio in 5,000 years, reflecting market chaos [40:50-41:34].

3. Health Insurance Inequality

• Emily: "$6,500" — the deductible faced by an Amazon driver she interviewed [41:49]. Contrasts the desperation of essential workers with the privileged (e.g., rich New Yorkers paying $5,000 per year for concierge medicine and rapid COVID-19 testing) [43:25].
  • "Just shows you the extreme inequality." (Emily) [43:27].
• Felix: An effective safety net is crucial—countries that have succeeded against COVID-19 have universal healthcare; the U.K. remains better positioned than the U.S. due to its NHS [43:34-45:11].

Notable Quotes & Memorable Moments

• "This isn't really stimulus. We're just trying to bridge it until we can get it back going." — Emily [08:08]
• "You can never be too early or too aggressive." — Felix [06:10]
• "Congress has unlimited bites at this apple...They will continue to pass new bills for as long as this crisis continues." — Felix [13:34]
• "What they've done with paid sick leave is a national embarrassment." — Emily [12:58]
• "To me, that's even more shocking than trading on the information...not doing his duty as a public servant." — Emily on Senator Burr [19:01]
• "The lesson of the coronavirus is that you can never be too early or too aggressive." — Felix [06:10]
• "That's capitalism kind of working the way it should." — Felix [32:50]
• "If you want to prevent losses in the event of a pandemic, don't have wealth; just go out and spend your money instead." — Felix [35:15]

Timeline — Key Segments with Timestamps

• [00:12] — Episode theme: Congress stimulus talks and economic impact of COVID-19
• [02:11-04:06] — Breakdown of proposed checks and missed targeting
• [06:10] — "Never be too early or too aggressive"
• [07:26] — Unemployment spike; systemic risk
• [08:08-08:54] — "Not stimulus, a bridge"
• [10:57] — Importance of functional markets and clearing
• [11:59-13:34] — Safety net failures, Congressional inaction
• [15:30-19:47] — Senatorial insider trading scandal and structural corruption
• [20:43-22:42] — China's "Hammer and the Dance" response
• [23:42-24:34] — U.S. lack of testing data, need for suppression to re-open economy
• [27:40-28:11] — Hospital ships, medical capacity ramp-up
• [31:21-32:08] — Corporate bailouts and buyback restrictions debate
• [32:50-36:56] — Felix and Anna debate the point of capital, risk, and crisis losses
• [37:44-40:11] — Numbers round: expelled journalists, deglobalization fears
• [40:50-41:34] — Gold-silver ratio historical record
• [41:49-43:34] — Health insurance inequality, essential worker struggles

Tone & Style

The conversation is brisk, informed, and balanced between urgent realism and the hosts’ characteristic dry humor. While critical of policy failures and attuned to the mounting human costs, the hosts seek out positive lessons and global perspectives. They do not mince words about corruption, inequality, or the scale of the crisis, and aim their critiques both at structural forces and specific leaders.

Conclusion

“A Bigger Hammer” thoughtfully captures the uncertainty and urgency of March 2020. The hosts analyze the initial U.S. federal crisis response, compare global policy measures, underscore both technical and moral imperatives, and highlight how the pandemic exposes deep fault lines in American society and economics. They warn that the crisis may fundamentally reshape markets, inequality, and globalization—evidence, perhaps, of the world hammering out a new order in real time.