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Russia’s ruble is strong … for now.
Apr 13, 2022
Episode 641

Russia’s ruble is strong … for now.

Plus, your questions on shift work, the worker shortage and taxes.

The strength of Russia’s ruble even in the face of sanctions from the West has surprised some. This Whaddya Wanna Know Wednesday, we’ll get into some of the ways Russia’s worked to prop up its currency, and how long those actions might work. We’ll also tackle your questions about shift work and health, the worker shortage and taxes.

Here’s everything we talked about on the show today:

Do you have a question for Whaddya Wanna Know Wednesday? Send a voice memo or email to makemesmart@marketplace.org, or leave us a voicemail at 508-U-B-SMART (508-827-6278).

Make Me Smart transcript April 13, 2022

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: If I’m not going to ask this of you, then you don’t get to ask it of me or like demand it of me.

Meghan McCarty Carino: Right.

Marielle Segarra: You know? It’s enough.

Meghan McCarty Carino: Enough is enough.

Marielle Segarra: Hello, I am Marielle Segarra, welcome back to Make Me Smart where we make today make sense and kvetch about being bridesmaids.

Meghan McCarty Carino: It’s really hard. I’m Meghan McCarty Carino, I’m in for Kai Ryssdal today, who is currently in quarantine. If you’ve been keeping up with his tweets, I think he’s been more productive than I have. Like when he’s out sick in quarantine.

Marielle Segarra: He really is. He can’t stop working.

Meghan McCarty Carino: But I hope he feels better soon. And to the rest of you thank you so much for joining us for Whaddya Want to Know Wednesday? It’s the day that we answer your questions. And first up, we got this one from Jim in North Carolina. He writes: “The Associated Press reported last week that the Russian ruble had recovered much of its value since it tanked at the beginning of the war in Ukraine. They mentioned that it was due to some extraordinary and probably unsustainable measures that Russia had taken. What has Russia done to prop up its currency? And does it mean that the sanctions are not working as well as we hoped?”

Marielle Segarra: Yeah, so the Russian ruble is now trading at roughly the same value that it was before the war in Ukraine.

Meghan McCarty Carino: Crazy.

Marielle Segarra: It is because the sanctions were supposed to make the ruble plummet. There are a bunch of reasons for this. And actually Paddy Hirsch, who used to work at Marketplace and now works at Planet Money, and is a delight. He did an explainer on this, that’s super helpful. One big thing is that Russia is a huge exporter of natural gas, you’ve heard us all talk about that on Marketplace, over and over again, gas prices are going up. And that means more money is coming into the country. And as Paddy points out, that has eased the concerns that Russia would become insolvent. Also, Russia raised interest rates to 20%, which gives Russians and other people an incentive to keep their money in rubles instead of converting it to dollars or euros because they know they can make big returns on it just by putting it in the bank. And Russia has done some other things to prop up the ruble to like it’s put limits on how much if any money Russians can send abroad, like, let’s say to family, who might then convert the money to dollars. And Russia is talking about requiring other countries that buy its natural gas to pay only in rubles, we’ll see if they agree to that. But these countries, many of which are in Europe, are kind of stuck because they rely heavily on Russia for gas, and there’s just not enough supply elsewhere. So critics say this is all a sign that the sanctions are not severe enough. We should say things don’t look great for Russia’s economy in the long run, we’re really talking about the short run still. But sanctions can take a long time, even years to really have an effect if they do. And a lot of these countries are now trying to pivot from Russian gas, which would hurt Russia, economically long term.

Meghan McCarty Carino: Right, it’s kind of reminds me of how like, shut down the stock market exchange for a super long time, because the stock market was just gonna tank. And then when they reopened it, it was like, but with all of these kind of really strategic rules whereby stocks could not tank like, well, we’re not going to trade these and you can’t do this and you can’t do this and sort of artificially propping up the stock market. In the short run, obviously, in the long term. Like economic forces will do what they will do.

Marielle Segarra: Yeah, I mean, it seems like a bit of a game of chess, right? Like the West makes certain moves, Russia counter moves, we make certain moves, Russia counter moves, and it just takes time to see how it all is going to shake out. Well, this next question is for you, again, as our workplace culture reporter.

Gina: Hi, my name is Gina and I’m calling from Michigan. I’ve been working straight midnight shift for over 20 years now. And I can tell you it’s made my life very, very interesting at times, please make us all smart about shift work in the health, detriments and other things that it can do to a person’s life. Thank you very much.

Meghan McCarty Carino: Wow. Now I want to know what kind of work Gina is doing overnight. That is very, very interesting at times. I’m so curious now. so rough. And yes, Gina is correct. There are a lot of different, particularly health impacts that have been correlated with night shift work. So just last year, there were some high quality government studies that showed a correlation with cancer, particularly breast and prostate cancer. There have been correlations with all kinds of conditions type two diabetes, heart disease, stroke, metabolic disorders, sleep disorders, according to the CDC, nightshift workers also have an increased risk for fertility issues. And a lot of this comes back to how it disrupts your circadian rhythms and sort of melatonin in the brain. And that is very important for a lot of different health processes, body processes, you know, I mean, we’re always told, like, yeah, sleeping overnight, you know, that’s when your body restores itself,  yadda, yadda yadda. And there does seem to be sort of just a need for the body to do that at night, when it’s dark, you know, your brain produces melatonin, and it signals all kinds of different processes. There’s also been some recent research on shift work, not necessarily just overnight shift work, but you know, shift work that is unpredictable, and how that affects, you know, sort of happiness well being and health and this was done in Seattle, which actually instituted a law an ordinance a local ordinance, the Fair Work Week ordinance that requires workers to get a certain sort of advance notice and predictability in their schedules. And they studied, you know, sort of how, how this changed outcomes for those workers having actual predictability. And they saw a huge uptick in worker happiness and a really big increase in in good sleep quality for workers, which, you know, has a has a really big impact on health. Now, during the pandemic, and you know, during this period, that we’ve been experiencing so much demand for logistics and that kind of stuff. The demand for for night shifts has gone up. And, you know, we’ve needed to catch up on the supply chain backlog, have people working around the clock, supposedly, at the ports of L.A. and Long Beach, well, it’s hard to get people to take those jobs. So we have seen an enormous spike in these job postings for night shift work, but they tend not to be the most popular, so they may be difficult to recruit for now. I mean, for folks like Gina who do do this work, you know, it’s definitely a challenge, but I don’t, like I don’t want to put it like, “Oh, if you do this work, these health challenges are definitely going to happen.” Things like eating meat, or eating grilled meat also carry, you know, a certain risk, and this is another risk added on top. Yeah.

Marielle Segarra: Yeah. I mean,  thinking about like the supply chain backlog and the fact that they can’t fill those jobs. It’s kind of like, once again, there are a lot of us who we consume and we keep consuming, we have an endless, you know, voracious need for stuff, right? A lot of that is because we’re trying to do retail therapy because things are really tough.

Meghan McCarty Carino:  100%.

Marielle Segarra:  You know, that has an impact on on people – people that need to get that stuff to you and anyone who’s done an overnight or even early morning shift can tell you it’s it’s painful. It’s – I mean, when I’ve I’ve done even the morning shift here at Marketplace, and I feel sick after, often, if I didn’t get enough sleep when you’re –

Meghan McCarty Carino:  I’m laughing because I like – I literally get sick to my stomach. If I have to get up before 6am I will be sick to my stomach all day. That’s what a baby I am.

Marielle Segarra:  I mean, and it feels like some people can handle it more than others. I don’t know what that is. But it’s, it’s has a real impact, especially if your, if your hours are changing constantly, right. And you’re doing, the night shift some days and not on others.

Meghan McCarty Carino: Having to juggle with a family. That was one of the things that the Seattle study also found that people had increased happiness and increased sort of wellbeing for their family, it can be incredibly disruptive to have an unpredictable schedule and manage a family.

Marielle Segarra: Yeah. Can’t imagine like how much money you could really compensate for all that?

Meghan McCarty Carino: Yeah. All right, let’s go to our next question. This is a voice message from Caspar in Seattle.

Caspar: Hey, guys, I have a question for you. So why are there different tax brackets. So why does someone pay more or less depending on how much income they make? Is there a benefit to having a tiered tax system? Thanks for making me smart.

Marielle Segarra: So right, the U.S. has what’s called a progressive income tax, as you make more money, you start getting taxed at higher rates. And that does happen in brackets. So you know, you’re an individual, and you make between $0 and this year, it’s between zero and $10,275, all of that money is taxed at a rate of 10%. The next tax bracket has a 12% tax rate, which, by the way, I just feel like I’m just saying this does not mean that when you start making $10,276, that all your money is taxed at 12%. That is a common misconception, it just means that additional dollar is taxed at the higher rate. And there are seven tax brackets. And you do not have to do all this math yourself. There’s a tax table, that when you file your taxes, you just look at that. So with all that out of the way, the idea of a system like this is to shift the tax burden to people who can most afford it. And the philosophy is basically, you know, once you make over a certain amount, you are more easily able to part with your money because you already have your basic needs and more taken care of. There are other ways to do this, there are other systems a country can set up like you could charge everyone the same tax rate no matter how much money they make, and we have some taxes like that. But the income tax is a progressive system. Some say progressive taxes disincentivize people from trying to make more money. But just remember two things. If you get a raise, and suddenly you’re pushed into a new tax bracket, like you’ve probably heard that phrase and a lot of songs, that doesn’t mean you’re gonna bring home less money than before, it just means that additional chunk of money in the new tax bracket is taxed at a slightly higher rate. So it’s not really a disincentive to make more money. And also the wealthiest people in America often qualify for tax breaks that the rest of us do not.

Meghan McCarty Carino: Exactly, you know that that bit about the going into the next tax bracket not applying to all of your earnings, I have to admit was something that I took a while to learn.

Marielle Segarra: I don’t know when I learned it. It’s not –  it’s totally fair to say like you didn’t know that because it is an every song about making it big. You know, it’s like, now I’m in a new tax bracket. And as if that’s a bad thing. Yes, really not. Anyway, next up is an email from Glenn in San Diego, who has a two part question he wants to know, “is the worker shortage really a pay issue? And can you make me smart about the size of the workforce and overall payroll trends?”

Meghan McCarty Carino: Alright, so this is a really complicated question. Because I think there’s sort of different phases to the answer to this question has sort of changed over time. It is definitely the case that the labor force participation rate since the pandemic has been depressed, and so we have had a smaller labor pool, and I’ve done a ton of reporting on, you know, the various reasons why that is. There’s some element to the childcare crisis that’s been going on. We know, you know, so many women dropped out of the labor force because of childcare issues. A lot of older people did early retirement, that’s been a huge chunk of the labor force that has kind of been vacuumed out of the economy. You know, we had these federal assistance programs, enhanced unemployment, where, you know, maybe the the benefit of going back to work during that period was not as pronounced as when those programs have now ended. At this point, we have seen wages rise, I mean, at a really, really intense level over the last year the average wage growth, you know, over the last year for the average worker was around five over 5%, which is considerable when you compare it to, you know, the pre-pandemic, pre-pandemic, Great Recession recovery. And then in certain industries, it’s been really high, you know, in leisure and hospitality 11, 12% wage increases year-over-year. So wages have been increasing. But at this point, our labor force is still smaller than it was, before the pandemic, a lot of that is going to be from early retirements at this point, we still do have a ongoing child care crisis, a lot of child care workers didn’t go back into child care after, after the, you know, things started to open up again, in large part because it is very low paid work, and many probably found higher paying jobs elsewhere in the economy. So we still do have a contingent of people that are not going back to work because of childcare concerns. But we also have probably the biggest contingent, that are older workers who haven’t gone back to work, who may have retired. But there’s some new research that seems to suggest that they maybe could be going back into the labor force, which would sort of even things out a little bit. Boston College did some some research on Social Security filings for new benefits during this period. And so even though census data show that a lot of people retired early, there hasn’t really been an uptick in filings for Social Security benefits. So the sort of hypothesis is that maybe these folks could be pulled back into the labor force, maybe there, it’s not a permanent decision, you know, maybe it really has to do with the pandemic, not wages, but the pandemic, because older workers, obviously are at greater risk from being an in person job and having those kinds of risks. So maybe it really has to do with the trajectory of the pandemic, and these folks will be sucked back into the labor force if it remains tight, wages are good and you know, jobs are still growing as they have been. That’s a possibility.

Marielle Segarra: You know, that was a really complex question. I feel like you you got it all in there. Glad it was you and not me that had to answer them. Well, that’s it for us today. Thanks for listening. We will be back tomorrow with the news and some Make Me Smiles keep sending us your questions for what do you want to know Wednesday you can email us makemesmart@marketplace.org. Or leave us a voicemail at 508-UB-SMART.

Meghan McCarty Carino: Make Me Smart is produced by Marissa Cabrera and Marque Greene with production help from our intern Tiffany Bui.

Marielle Segarra: Today’s show was engineered by Jayk Cherry. Ben Tolliday and Daniel Ramirez composed our theme music and our senior producer is Bridget Bodnar. So when is this wedding? Do you have to wear like a horrible dress?

Meghan McCarty Carino: I hope it’s not horrible. You know I had to buy it sight unseen, really not looking forward to trying that on.

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The team

Marissa Cabrera Senior Producer
Bridget Bodnar Senior Producer
Tony Wagner Digital Producer
Marque Greene Associate Producer