Slate Money – "Omnishambles" (September 7, 2019)

Podcast: Slate Money
Host: Felix Salmon (Axios) with Anna Szymanski & Emily Peck
Theme: A rundown of the week’s biggest news in business and finance, focusing on Britain’s Brexit “omnishambles,” Amazon’s dangerous delivery gig economy, and Argentina’s political and financial crisis.

Episode Overview

The "Omnishambles" edition dives into chaotic events in three arenas:

• The Brexit crisis and British political breakdown
• Amazon's rise as a dangerous logistics behemoth
• Argentina's economic meltdown after a shocking election

The hosts break down each topic with a mixture of dry humor, skepticism, and sharp financial insight.

Main Topics & Key Insights

1. Brexit Breakdown: Britain’s "Omnishambles" (00:10–15:58)

Background & Confusion

• Felix opens by noting the utter confusion in the UK: “Britain is what is known as omnishambling off a cliff.” (00:14)
• Even UK insiders admit no one grasped the state of affairs. “The general rule of thumb is no one understands what is going on up to and including Boris Johnson.” – Felix (01:40)

Parliamentary Mayhem

• Johnson’s approach is contrasted with Theresa May; where May cajoled, Johnson simply “barges ahead.”
• Unprecedented loss of multiple key votes in Parliament.
• Johnson expels "super important and powerful grandees of the Tory Party" when they defy him. (05:17)

The Real Stakes

• Legislation to prevent a "no deal" Brexit is rushed through, creating a standoff between Johnson and Parliament.
• Johnson tries to call a snap election to bypass this, but is blocked.

Electoral Uncertainty & Second Referendum

• “The outcome of the new elections is super up in the air.” – Felix (08:42)
• A possible second referendum could reverse Brexit, as demographics shift and new information has come to light about the consequences and manipulation behind the first vote.
• Felix argues: “If you get a second referendum, it’s not only possible, it’s likely that [Britain will] vote to remain.” (11:52)

Notable Quotes

• “It's an embarrassment...but it is also deeply real. UK productivity has plunged about 5% already. No one is investing in the UK right now.” – Felix (15:07)
• “The only reason we had this godforsaken referendum in the first place was because David Cameron wanted to keep his party together. Well, how did that work for you, David?” – Felix (15:44)

2. Amazon: Beneath the Prime Delivery (15:58–31:02)

The Reporting

• Major exposés detail fatalities and injuries caused by Amazon’s gig delivery system.
• “The drivers are getting into a lot of accidents and people are dying.” – Emily (17:02)
• Since 2015, Times & ProPublica track 60 accidents (at least 10 deaths), but real numbers may be underreported due to obscure contractor relationships.

Why It’s Happening

• Amazon built a pseudo-Uber for deliveries after the 2013 “Christmas Fiasco” to guarantee faster deliveries, leading to a diffuse, poorly regulated fleet of third-party contractors.

Systemic Dangers

• Contractors lack:
  • Proper training
  • Employee protections (benefits, fair pay, hours limits)
  • Oversight on safety
• “Amazon is even worse than Uber because...with the Amazon delivery guys, you don’t know.” – Emily (25:17)
• Company evades responsibility and liability, even as their demands create deadly conditions.

Broader Implications

• “This story...does suggest that as we shift towards...more of the gig economy, we are going to need new regulations. You can't have it where companies can have third parties...and then be like, well, those weren't our people.” – Anna (19:54)
• Amazon’s outsourcing is extended to logistics, retail, and more, raising risk for consumers and workers.

The Need for Regulation

• Discussion of proposed California joint employer laws and the need for federal rules to stop companies from contracting away accountability.
• “If they’re going to lay out how many packages drivers have to deliver...they should also be setting higher standards for pay.” – Emily (24:58)

Notable Quotes

• “Killing your customers is just not a great way of keeping them.” – Felix (30:38)
• “Consumers are also laborers...They have other needs besides, like, really cheap paper towels delivered tomorrow.” – Emily (31:00)

3. Argentina’s Latest Meltdown (31:02–41:41)

The Shocking Primary & Economic Fallout

• The "Fernandez-Fernandez" ticket's unexpected victory in primaries led to a currency crash, debt selloff, and acute economic distress.
• “Things have not been good for a while in Argentina. [This] is heightened.” – Anna (31:36)
• Technical default and capital controls imposed as reserves tank.

Argentina as a Serial Defaulter

• “Argentina is the classic serial defaulter. Every time it issues a bunch of debt, it defaults...It's a rinse and repeat.” – Felix (32:56)
• Recent issuance of a 100-year bond now considered a farce.

Political Implications

• Return to rule by Cristina Fernandez de Kirchner (now on the ticket as VP), whose previous presidency coincided with chronic default, inflation, and data manipulation.
• “Last time she was president, Argentina had like a decade of being in default and was basically cut off from the rest of the planet.” – Felix (37:14)

Impact & Contagion?

• No evidence (so far) of contagion to other EM markets due to Argentina's unique case, but some spreading risk via liquidity needs.
• IMF, US dollar dominance, and Fed policy changes cited as structural contributors to EM instability.

Notable Quotes

• “We legitimately had some big news...the peso massively declined in value, their bonds sold off...a bit of economic chaos following...significant period of economic chaos.” – Anna (31:16)
• “It may not matter because the economy is such a mess, that it is going to take really draconian reforms to get out of that.” – Anna (37:48)

4. Numbers Round (41:45–44:38)

• Emily: $27,000 – six out of the ten careers with highest projected job growth in the US have median wages of ~$27k. (41:47)
• Anna: $20 billion – WeWork’s revised IPO target, down from $47 billion. “Investors are starting to get wary of companies...losing a tremendous amount of money.” (42:38)
• Felix: 80% – Prime age employment-population ratio in the US, first time hitting this mark in many years. “Jobs may not be good, but there are jobs.” (44:24)

Memorable Moments & Quotes

• “No one understands what is going on [with Brexit] up to and including Boris Johnson.” – Felix Salmon (01:40)
• “Amazon is even worse than Uber because...you don’t know [who the driver is].” – Emily Peck (25:17)
• “Argentina is the classic serial defaulter...It’s a rinse and repeat.” – Felix Salmon (32:56)
• “Killing your customers is just not a great way of keeping them.” – Felix Salmon (30:38)
• “Consumers are also laborers. They are workers. They have other needs besides, like, really cheap paper towels delivered tomorrow.” – Emily Peck (31:00)

Timeline of Key Segments

• 00:10–15:58 – Brexit: Parliamentary chaos, electoral prospects, and economic fallout
• 15:58–31:02 – Amazon: Delivery workforce dangers & structural gig economy problems
• 31:02–41:41 – Argentina: Political shift, technical default, and global context
• 41:45–44:38 – Numbers round: Wage inequality, WeWork’s diminishing valuation, and US employment stats

Closing Thoughts

The hosts paint Brexit as a slow-moving disaster with no clear escape, while Amazon’s model is revealed as a potentially deadly new form of labor exploitation, and Argentina’s repeat crisis is both unique and cautionary for emerging economies everywhere. The tone is a blend of exasperation and dry wit, turning global chaos into enlightening conversation.