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EU looks to break from Russian energy

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A large sign lists gas prices in France.

A board displays the price of fuel as motorists queue to fill their vehicles at a petrol station near Chartres, central France on April 1, 2022. - Spiralling energy bills and disruptions caused by the war in Ukraine caused consumer prices in the eurozone to surge by a new record of 7.5 percent, EU statistics agency Eurostat said April 1, 2022. (Photo by JEAN-FRANCOIS MONIER / AFP) (Photo by JEAN-FRANCOIS MONIER/AFP via Getty Images)

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The European Union is trying to end its dependence on Russian oil — but that may be costly and complicated. This Thursday, we talk about how Western countries are pressing Russia to terminate its war in Ukraine while minding their own energy supplies. Plus, China is watching. And earlier this week, we mused that Twitter-famous billionaire Elon Musk could probably just buy the company if he wanted to. He revealed today that he made an offer. Does Musk listen to “Make Me Smart”? Finally, we share signs of spring that made us smile.

Here’s everything we talked about today:

Join us Friday for Economics on Tap. We’ll be livestreaming on YouTube starting at 3:30 p.m. Pacific time, 6:30 p.m. Eastern.

Make Me Smart April 14, 2022 transcript

Note: Marketplace podcasts are meant to be heard, with emphasis, tone and audio elements a transcript can’t capture. Transcripts are generated using a combination of automated software and human transcribers, and may contain errors. Please check the corresponding audio before quoting it.

Marielle Segarra: Sorry, I’m in a snorting mood, I guess. I just was so – like the look that I gave this kid. There it is. Hi, I’m Marielle Segarra, and welcome back to Make Me Smart where we make today make sense. Thanks for joining us and Sabri if you were surprised by that. Yes, they do roll the music right in the middle of when you’re talking sometimes.

Sabri Ben-Achour: Okay.

Marielle Segarra: Oh, we’re still going.

Sabri Ben-Achour: I’m Sabri Ben-Achour, hosting Make Me Smart for the first time. I did not know that music was going to come up. I am in for Kai Ryssdal who’s quarantining apparently. Sorry, Kai, but thanks for having me. It’s Thursday, we will talk about the news and then we’ll end on some Make Me Smiles and send you on your way. So I guess we start with the news, right that we do?

Marielle Segarra: Yeah, let’s do it. I’ll go first. So this story seems super important. And I want to talk about it. But I also feel like you need to give a caveat that it is not my area of expertise. So I just badgered Andy Uhler with questions about it in the minutes before this show rolled. Yeah, he was on the elliptical at the gym and trying to trying to work out while I was like, “What is liquid natural gas?” Okay, so this is a story about energy. And specifically, the EU is considering a ban on Russian imports of oil, which, when I saw that, I mean, we’ve been talking about how much the EU relies on, on Russia, for energy, oil in particular, and also natural gas, and coal. And that Germany is probably in the worst position here. But everything I’ve read is that there really aren’t enough alternatives to ban imports at this point. And so I was thinking like, how? How does this work? And I don’t think there’s really a good answer to that after talking to Andy, but it does seem like oil would be easier to ban that there might be more more alternatives to it. And also a bit faster, because of the infrastructure required to get gas in particular to Germany. So it’s worth saying also that if they just tried to cut it off like that, then that would really hurt Germany’s economy and and could drive it into a recession, because it needs this energy to make stuff especially like, one example was chocolate, right? It’s a high-energy use product. So really curious what’s going to happen with that. And if we’re really if we’re talking about this being a political, a political move, something to put pressure on Russia, but it’s going to take possibly years to happen. How does that actually, how’s that actually effective?

Sabri Ben-Achour: Yeah, I was wondering that, too. I mean, so I guess the idea is that with natural gas, it’s like, you have to keep it under high pressure, it has to become a liquid for you to move it around. And so it’s a lot harder to like build liquefaction plants, you know, to get it to your shores or whatever. But I guess oils, you can just put them out and send wherever I wonder, like, how long are they going to be able to buy – how are they going to like signal like, “we are serious about this. Just as soon as we build a new pipeline, we’re going to do something,” you know, like you kind of have to –

Marielle Segarra: In like two to three years.

Sabri Ben-Achour: Yeah, yeah.

Marielle Segarra: Yeah. So I mean, the ban would be on oil, but I’m curious what’s gonna happen with natural gas. And one story I was reading said, though, that that German imports of oil have already dropped from 35% to 25% now and its gas imports have have been cut too. So maybe they’ve done what they can so far, and now they’d actually have to, like make some big changes.

Sabri Ben-Achour: Yeah. I mean, it’s interesting to just that there is, you know, there is an element of disagreement, even on this, like, very core economic question. And I guess that is interesting, because, you know, I try and I’m trying to figure out just like how unified Europe is. So for example, the states that border Russia, there’s some disagreement between the northern states, Poland, and Baltic states, versus like Slovakia and Hungary on the south. And the, like the southern countries I was reading, you see more like Russian disinformation, like more sympathy for, you know, Russia’s story behind this war that, like, they’re de-Nazifying Ukraine or whatever. More conspiracy theories. And even at the political level, like more, just generally, you know, less sympathy for for Ukraine.

Marielle Segarra: Right.

Sabri Ben-Achour: It’s just, you know, that level of fracturing, it’s very interesting to wonder how far that’s going to spread when you have like this economic, when you have additional economic disagreements on top of that, and I mean, I’ll tell you, who’s who’s watching is China, like, China’s taking notes and being like, how long does you know, Europe, Japan, the US,  how long do they stay on the same page? Are they even on the same page? How far will they go together before they start bickering and, and, you know, fall apart? So, I mean, that’s what they’re predicting already. So I’m just I’m just like, I wonder how right they are you kno?

Marielle Segarra: Yeah. And where does China fit in here in terms of energy? Does it – can it supply? Can it kind of swoop in and supply some of this?

Sabri Ben-Achour: I don’t think it will be supplying I think it will be buying, I think if anything it would be just buying from Russia.

Marielle Segarra: From Russia. Gotcha. Yeah. Okay. Well, you’re up next. Tell us about Elon Musk.

Sabri Ben-Achour: Elon Musk. So um, alright, so Elon Musk already owns like, 9% of Twitter, and he was going to join the board. And then he’s like, “Well, actually, I’m not going to join the board.” Because the board also was like, if he joined the board, he would not be allowed to buy more shares, there will be limitations on it anyway. So he’s like, okay, so I’m not actually going to join the board. I’m going to just buy the company for like $43 billion. And now he is saying, well, maybe I won’t buy the company. Maybe I can’t pull it off. But I have a plan B, but no one knows what the plan B is. So it’s just the latest in this in this drama of like, is Elon Musk going to buy Twitter or not. And I feel like the one of the funny things here is that he despite being the world’s richest man worth $250 billion is  cash poor. Like they I saw an article like he’s cash poor, because all of his money is tied up in you know, his stocks of like Tesla and SpaceX or, you know, so.

Marielle Segarra: Does he actually have $43 billion sitting around that he could buy Twitter with? In cash, or could you pay in stock?

Sabri Ben-Achour: Not really. So he, well, so okay, if he were to just like sell $43 billion worth of his stocks, he would have to pay a ton of taxes on it. First of all, apparently, he can, like Twitter employer – Tesla employees can borrow 25% worth of their shares from the company in money to do things with and he might have some, like rich buddies that would go in on it with him. And he might be able to get some money from a bank. But so far, like I mean, so far, there’s sort of like skepticism and it’s not like Twitter shareholders or Tesla shareholders are like, rejoicing or the, you know, stock prices like, like shooting up because everyone’s like, “yeah, Elon join Twitter.” Everyone, I think is just like, on the couch with the popcorn watching what crazy thing is going to happen next.

Marielle Segarra:  Like what is happening? Yeah, I don’t really – doesn’t it feel like he’s just trolling? I mean, wasn’t – there was some joke like 420 joke. I mean, it was $43 billion. But wasn’t it like?

Sabri Ben-Achour: Yeah, the share price was like 5420. And people were like, “That’s, like, not a coincidence.”

Marielle Segarra: Right? It’s his joke about smoking pot.

Sabri Ben-Achour: Yeah. Hilarious.

Marielle Segarra: Spelling – spelling that one out. Yea-h. He’s so funny. Yeah, I do think you know, it’s possible that Elon listens to this podcast because Kai said the other day, he was like, “you know, Elon could just buy” –  is that my Kai impression?

Sabri Ben-Achour: I know!

Marielle Segarra: Like he said, you know, Elon has the has the pocket change to just buy Twitter. So maybe he’s just getting advice from “Make Me Smart.”

Sabri Ben-Achour: Maybe he is. I heard that and that’s exactly what I thought of when I saw the news that he was considering buying it. I was like Kai literally said he could buy it and have like $200 billion leftover.

Marielle Segarra: Huh. Well, we better choose our words carefully here because I guess Mr. Musk listens. All right, well, Juan Carlos, I think it’s time to smile.

Marielle Segarra: Okay, I’m gonna go first on this one. Okay, I was walking around my neighborhood today. It’s a gorgeous day in New York. So part of that is is why I was smiling but also, I saw this giant inflatable Easter Bunny, which like when I say giant, I have a picture of it here. It’s like, like a Brooklyn brownstone is a couple floors. This thing is like a floor and a half of a Brooklyn brownstone. It’s so cute, huge and also terrifying. Like when I was a kid and I was picturing the Easter Bunny coming to my house. I actually was afraid every Easter Eve because I was like this horrifying huge rabbit is going to come in here. I like did not want to wake up did not want to meet the bunny. But my my point here is just like my neighbors are absolute pros at holiday decorating. Like they go all out. It’s – this, this is Easter but they do like Valentine’s Day they do St. Patrick’s Day. And they do. I have a lot of good pictures from Halloween where they get super creepy with it. And they have like skeletons hanging off the roof or I don’t even know – like giant spider.

Sabri Ben-Achour: Wow. When I was when I was little. That’s great, though. Yeah, it is a cute bunny. When I was little, when I was like four or five, we went to some sort of Easter party thing in the in the park. This is in Missouri. And the – some woman on the stage is like now the Easter Bunny is going to be here and he’s going to be looking for good little boys and girls who share their candy with others. And so I went to my brother, and I was like alright, brother, I am going to give you some of my Easter Eggs in front of the Easter Bunny so that he knows that I am generous and share. But I want them back afterward. And so then I was like I gave him candy. And then the Easter Bunny this giant Easter Bunny like the one you have, are talking about like started like waddle over. But he was so giant, he was terrifying. so terrifying that we just ran away like screaming because we were so terrified of him and our big, our big scheme like…

Marielle Segarra: Oh my god, yeah, you had this whole scheme and you couldn’t even you didn’t even pull it off.

Sabri Ben-Achour: Yeah, we were horrible children. We were just the worst.

Marielle Segarra: I think it was pretty – I think it’s pretty smart. And if you like ever hang out with kids on Halloween, you’ll see how much they know about negotiation and trade. Because they’re like coming home with their bags full of candy and like dumping it out on the floor and doing like, you know, I’ll do you this Reese’s for three Twizzlers or you’re like learning what’s most important to some other kid. They like really like Smarties but you don’t like Smarties. So is there like a comparative advantage thing going on there? I always think like kids have kids are so smart about about economics and also about pulling scams.

Sabri Ben-Achour: Yeah, yeah. 100%. Yeah, I guess I should give them more credit. Well, my make me smile moment was – so I came into the bureau where I like have almost not been at all for two years, other than to like refill my plant watering things. And as you know, my office has a bunch of plants. So anyway, I got in and there’s this flower that blooms once a year. And it’s called a – it’s a, it’s a cactus that lives in trees. It’s called nephilim. Anyway –

Marielle Segarra: Is that the corpse flower?

Sabri Ben-Achour: No, no, but that one is still in the conference room. No, yeah, but this one only blooms once a year and all the blooms were dead. And I was like, you know oh man, I missed it. But then I saw one it was still open. And I was like oh that’s so nice to not only after two years these office plants are still alive somehow barely. But  I got to I got to see it.

Marielle Segarra: That’s amazing. Didn’t you set up kind of an elaborate watering system so that it would like they’d kind of get water on their own?

Sabri Ben-Achour:  Yeah, yeah, yeah, there’s like a yeah, there’s like all these tubs of water with these little tubes that like feed into all the plants and gradually release water and they last like a solid like two months. And then the plants themselves a lot of them are like cacti so we’re, they don’t need a lot of water so they can like they can they can handle it. Except for what we did have. There was one casualty and there was one, one casualty. That didn’t make it but it’s okay. I have cutting of it at home. It’s fine.

Marielle Segarra: I feel like plants are what makes you smile most days.

Sabri Ben-Achour: I think that would be true. That’d be true.

Marielle Segarra: That and the gym.

Sabri Ben-Achour: Oh god. Yeah.

Marielle Segarra: Okay. Well that’s it for us today we will be back tomorrow for Economics on Tap. We’ll be doing the news with a drink and playing a game. That show will stream live on YouTube. So please join us at 3:30pm Pacific Time, 6:30pm Eastern time on YouTube and that means Sabri you and I have to be camera ready.

Sabri Ben-Achour: Okay, I will put on clothes. In the meantime, send us your thoughts or questions please. Our email is makemesmart@marketplace.org. Or leave us a message 508-UB-SMART. And yeah today was literally the first day I put on clothes because I had come into the office.

Marielle Segarra: So you don’t wear clothes at all?

Sabri Ben-Achour: No I literally have interviewed like three like Nobel Prize winners in my underwear.

Marielle Segarra: Wow. Make Me Smart is produced by Marissa Cabrera with help from our intern Tiffany Bui. Today’s episode was engineered by Juan Carlos Torrado.

Sabri Ben-Achour: Bridget Bodnar is the senior producer, the director of On Demand is Donna Tam.

Marielle Segarra: I want to be very clear that I always wear clothes during my interviews. Sabri, not so much.

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