The Bulwark Podcast: S2 Ep1013 - Mallory McMorrow and Tracy Alloway: A Self-Inflicted Crisis

Release Date: April 3, 2025

Introduction and Overview

In this episode of The Bulwark Podcast, host Tim Miller delves into a double-header episode featuring two prominent guests: Tracy Alloway, a seasoned finance journalist from Bloomberg, and Mallory McMorrow, a Democratic Michigan state senator and newly declared U.S. Senate candidate. The episode is aptly titled "A Self-Inflicted Crisis," highlighting the central theme of economic turmoil stemming from recent political decisions.

Section 1: Economic Turmoil and Trump's Tariff Policies with Tracy Alloway

[00:00 - 05:24] (Skipped: Advertisements and Introductory Segments)

Introduction of Tracy Alloway

At [05:25], Tim Miller introduces Tracy Alloway, co-host of Bloomberg's Odd Lots podcast, to discuss the immediate and profound impacts of President Donald Trump's recent tariff announcements made on Liberation Day. The tariffs have precipitated a significant downturn in the stock markets, with the Nasdaq dropping 5%, the S&P 500 by 4.5%, and the Dow Jones Industrial Average by 2.5%, all within a short span.

Key Discussions:

1. Market Reaction to Tariffs

   • Tim Miller [05:46]: Expresses frustration over the market's swift negative reaction, emphasizing that the tariffs seem "self-inflicted" and attributing the pain solely to "Trump chaos."

   • Tracy Alloway [07:20]: Explains the surprise from financial professionals, highlighting that Trump's policies are against established economic principles. She notes the difficulty professionals have in reconciling the administration's actions with conventional economic thought.

   • Notable Quote [08:00]: "Trump's whole career has been failures like this. This was utterly predictable across every metric." — Tim Miller

2. Details and Implications of the Tariffs

   • Reciprocal Tariffs Explained [09:18]: Alloway breaks down the complexity of reciprocal tariffs, citing inconsistent rates across countries. For instance, China faces an effective tariff rate of 54% after cumulative tariffs, while smaller nations like Nehru see tariffs targeting minimal exports like fish and pig meat.

   • Impact on Brand Value [15:13]: Alloway discusses the intangible effects of tariffs, such as diminishing brand value in international markets. She illustrates this with anecdotal evidence of declining American product sales in Canada.

3. Long-Term Economic Consequences

   • Inflation and Investment Uncertainty [15:56]: Alloway highlights that even if Trump's tariff moves are temporary, they have already increased inflation expectations and created long-term uncertainty, deterring investments in capital-intensive projects.

   • Comparison to 2008 Housing Crisis [17:32]: Drawing parallels to the 2008 financial crisis, she emphasizes that the current uncertainty could have prolonged negative effects on the economy, similar to the delayed recovery in the housing market post-2008.

4. Risk to Federal Reserve Independence

   • Central Bank Autonomy [29:13]: Alloway warns of potential threats to the Federal Reserve's independence if the administration continues to meddle with economic policies. She draws comparisons to Turkey's volatile central bank appointments under President Erdogan, cautioning against similar destabilizing moves in the U.S.

   • Catastrophic Risks [31:11]: She elaborates on how undermining the Fed's independence could lead to unchecked inflation and economic instability, drawing on international examples where political interference has led to economic downturns.

Notable Quotes with Timestamps:

• Tim Miller [06:34]: "The tariff chaos is self-inflicted. There is not some external bubble or credit market issue causing this downfall. It's only due to Trump chaos."

• Tracy Alloway [07:52]: "There's no single seriously taken economist who believes that destroying global trade will boost the American economy."

• Tracy Alloway [15:13]: "Brand value is diminishing very, very quickly. So there are all sorts of intangibles, soft power that are wrapped up in the taxation of actual things."

• Tracy Alloway [29:13]: "Trump can effectively fire whoever he wants at the Fed. That would give unprecedented control to a president over the central bank, which markets and investors tend to dislike deeply."

Section 2: Political Campaign Insights with Mallory McMorrow

[35:48 - 74:49] (Transition from Economic Discussion to Political Segment)

Introduction of Mallory McMorrow

At [36:02], Tim Miller welcomes Mallory McMorrow, a Democratic Michigan state senator and Majority Whip, who has recently launched her campaign for the U.S. Senate. Mallory is the author of "Hate Won't Win," and she brings a fresh perspective on combating political hate and fostering positive change.

Key Discussions:

1. Campaign Launch and Vision

   • Mallory McMorrow [36:20]: Announces her Senate run, emphasizing the need for new leadership to navigate through challenging times.

   • Vision Statement [40:01]: Outlines her three-pronged vision: Success, Safety, and Sanity. She emphasizes empowering individuals to achieve the American Dream without demonizing success, ensuring community safety, and restoring sanity by removing government from becoming a dysfunctional reality TV show.

2. Critique of Current Democratic Strategies

   • Positive Vision vs. Micro-targeting [41:21]: Mallory criticizes the Democratic Party's focus on micro-targeted policies, arguing that it lacks a cohesive, positive vision that resonates with everyday Americans.

   • Coalition Building [44:20]: She stresses the importance of uniting diverse groups under a common positive vision rather than fragmenting the party with disparate policy focuses.

3. Economic and Social Policies

   • Impact of Tariffs on Michigan [56:02]: Mallory discusses the immediate fallout of Trump's tariffs on Michigan's economy, citing Stellantis' layoff of 900 workers as a direct consequence.

   • Federal Funding and State Budgets [53:06]: Highlights Michigan's heavy reliance on federal funds and the repercussions of a federal funding freeze initiated by the administration. She underscores the constitutional requirement for Michigan to pass a balanced budget, complicating the state's ability to absorb federal funding cuts.

4. Immigration and Community Safety

   • Deportations and Detentions [64:31]: Mallory recounts harrowing stories of permanent residents and immigrants facing deportations and detentions without due process, asserting that these actions do not enhance community safety but instead sow fear and instability.

   • Policy Solutions [64:46]: Advocates for comprehensive immigration reform and increased local revenue sharing to support police and community safety initiatives.

5. Engagement and Public Interaction

   • Rapid Fire Segment [66:36]: Engages in a lighthearted rapid-fire Q&A, humanizing her campaign by sharing personal anecdotes and preferences, such as her favorite Eminem track ("Lose Yourself") and her daughter's accomplishments.

Notable Quotes with Timestamps:

• Mallory McMorrow [36:24]: "Hate is having a moment. It's on us to decide if hate is going to win, and we're not going to let it."

• Mallory McMorrow [40:18]: "Everyone deserves success. We are not going to demonize success; we are going to lean into what people aspire to."

• Mallory McMorrow [52:52]: "Michigan stands to be hit harder than just about any other state in the country based on Trump's chaotic tariff policy."

• Mallory McMorrow [64:02]: "This is not keeping us safe. This is not ensuring that we are going after criminals. It's a chaotic approach to people who have done nothing wrong."

• Mallory McMorrow [70:02]: "We need new leadership in the Senate. Full stop."

Conclusion

This episode of The Bulwark Podcast interweaves a critical analysis of the current economic crisis attributed to President Trump's tariff policies with a spirited political discourse led by Mallory McMorrow. Tracy Alloway provides a sobering look at the immediate and long-term economic repercussions, while McMorrow presents a hopeful vision for change through her Senate campaign. Together, they paint a comprehensive picture of the intertwined challenges facing the U.S. economy and its political landscape.

Key Takeaways:

• Economic Impact: Trump's recent tariff policies have led to significant market downturns and increased uncertainty, with long-term implications for investment and inflation.

• Federal Reserve Independence: There is a looming threat to the Federal Reserve's autonomy, which could destabilize the U.S. economy further.

• Political Shift: Mallory McMorrow's Senate campaign emphasizes positive vision, community safety, and sanity, critiquing the current Democratic Party's fragmented policy approach.

• Local Consequences: Michigan, heavily reliant on federal funds and close economic ties with Canada, exemplifies the severe local impacts of national tariff decisions.

• Immigration Concerns: The administration's harsh immigration tactics are criticized for failing to enhance safety and instead causing fear and instability within communities.

Recommended for Listeners:

• Economy Watchers: Those interested in understanding the direct effects of political decisions on the economy will find Tracy Alloway's insights invaluable.

• Political Enthusiasts: Supporters of progressive change and new leadership in the Senate will resonate with Mallory McMorrow's campaign narrative.

• Community Advocates: Individuals concerned about immigration policies and community safety will appreciate the discussions surrounding the human impact of current administration policies.

For more in-depth analysis and future discussions, subscribe to The Bulwark Podcast on your preferred podcast platform.