Latest news with #Explained
Vox
3 days ago
- Business
- Vox
What the rise of 'buy now, pay later' services tells us about the economy
You've probably noticed it by now: You're shopping online for some makeup or a new pair of running shoes or a water table for your toddler, and when you go to check out, you have a new option — why not break up the cost into four payments, made over time? US consumers, especially Gen Z and millennial ones, have been embracing 'buy now, pay later' services like Klarna and Afterpay with gusto the last few years. It's not hard to see the attraction: Unlike a credit card, most BNPL plans don't carry interest, and they generally don't impact your credit score (though that is now changing). On social media people tout BNPL as a way to buy stuff you want but don't have the cash for right then — or maybe ever. And that's starting to show up in the data: Leading BNPL company Klarna — which recently partnered with the food delivery service DoorDash, spawning a thousand memes — saw its net losses from consumers not paying their loans more than double in the first quarter of this year. All this has Kyla Scanlon worried. Scanlon is an author and economic commentator, best known for breaking down economic issues through blog posts and videos on social media. In a video she published shortly after Klarna announced its partnership with DoorDash, Scanlon called the rise of BNPL a symptom of our 'poor-impulse-control economy.' 'What I worry about is that the convenience and the impulsivity that it allows for allows for the expansion of the grift economy, of a world where people are spending money on things that they don't need to and they're just totally lost in that cycle,' Scanlon told Today, Explained co-host Noel King. Scanlon talked to King about buy now, pay later, Gen Z's relationship to debt, and what financial responsibility looks like in today's economy. Below is an excerpt of the conversation, edited for length and clarity. There's much more in the full podcast, so listen to Today, Explained wherever you get podcasts, including Apple Podcasts, Pandora, and Spotify. You're a commentator, you're a public intellectual, you're also a member of Gen Z, and you speak directly to Gen Zers who are operating in the economy. How are young people using BNPL? A lot of Gen Zers have had very common interactions with debt. Student loan debt is a big part of the life of a Gen Zer. Medical bills, anything involving a credit score. Debt has been so normalized for the younger generation that when they see something like BNPL, it's like, 'Oh, this is just casual debt.' For young people, they've been raised in the shadow of the 2008 crisis and student loan debt. It's just what they do with their money. This is interesting, that debt has always been available to Gen Z. If you're an older millennial like I am, that's not really the case. You might remember getting your first credit card when you were 22, but there was no Apple Pay. You couldn't just pay for stuff on your phone. And it strikes me that my nieces and nephews who are teenagers, they can do that. They have this ease with paying for stuff and taking on debt for stuff that never occurred to me when I was young. A lot of that is structural. In 2020, the government sent out unemployment checks. In 2021, the Fed had rates really close to zero. We're always talking about the deficit. We're always talking about how much money the United States as a country owes. And so I think for everybody, they're looking at that and they're like, If the government owes all this money, surely I can have a little bit of debt, too. And then credit scores have become such a core part of the American identity. It really informs a lot — how you can buy a house or if you can even get certain loans. I think people view debt as structural to themselves as a person, and that's increased. And I think it really has a lot to do with the environment that Gen Z has grown up in and the fact that these tools are so readily available and they're so easy to use. Talk to me a bit about debt. Is it dangerous? When you look at debt systemically, it's not inherently a bad thing. Like most things, it's a tool. Like social media, you could say it's bad, but it's just a tool. It's all about how you use it. Same with debt. BNPL in itself isn't evil, especially if you can pay it all off without having to face those high interest rates. Credit cards themselves aren't evil. But it's really about the system that encourages these sorts of products to be created. Real wages were stagnant for a really long time. The entry-level labor force has really deteriorated. It's very tough to get a job right now. If you're graduating from college and the college wage premium has eroded quite a bit, rent is high because we don't build enough housing. Groceries are up. People are looking at the very high prices, the impossibility of ever buying a house, the struggles that they might be facing in the labor force. It's like, Well, sure, it might be irresponsible to use BNPL to get a moisturizer from Sephora, but what else am I going to do? I don't see a solution before me. And so I think that's been the big thing with debt — we've used it as a tool in order to navigate some of the hairier parts about being in the United States right now. I think historically you might say, Look, you can't afford the Sephora lotion right now, why don't you just wait? And it sounds like what you were saying is that's a bit of a privileged or maybe old-fashioned idea of how paying for things works. Right! I think, 'Why don't you just wait?' ignores some of the ladder issues that we're facing as Gen Z, younger people — even millennials, in some capacity, are facing this broken-ladder problem where they could wait to buy that moisturizer, but that would require the entry-level labor market to free up again, that would require wages to really speed up, that would require the housing market to normalize. So I think a lot of people blame younger people for using debt and using BNPL. And you should be careful — I don't think you should be living above your means in an extravagant way. But it really is a psychological buffer of sorts, where people are just like, Well, I don't know what else to do, so I'm going to go buy this thing. It is an element of instant gratification, the same thing that we see in social media, but for Gen Z-ers and younger people. There isn't that stability, that expectation of stability in the traditional sense. And so I think these little small luxuries matter — buying that moisturizer matters because it is indulgent in a certain way, but it's also an act of agency in an economy that doesn't feel like it's allowing you into it. It does feel like there is some American ethos here that says, To live is to be in debt, and we've all accepted that. I mean, that's the only way you can get by sometimes. There's that misquoted statistic about living paycheck to paycheck. It's not 60 percent of Americans living paycheck to paycheck. It's far lower, but I think a lot of people just feel like, one wrong move and the whole thing could come tumbling down.
Vox
14-06-2025
- Business
- Vox
What happens to DOGE without Elon Musk?
Elon Musk holds a news conference with President Donald Trump to mark the end of his tenure as a special government employee overseeing DOGE on May 30 in the Oval Office of the White House. Tom Brenner for Washington Post via Getty Images Elon Musk may be gone from the Trump administration — and his friendship status with President Donald Trump may be at best uncertain — but his whirlwind stint in government certainly left its imprint. The Department of Government Efficiency (DOGE), his pet government-slashing project, remains entrenched in Washington. During his 130-day tenure, Musk led DOGE in eliminating about 260,000 federal employee jobs and gutting agencies supporting scientific research and humanitarian aid. But to date, DOGE claims to have saved the government $180 billion — well short of its ambitious (and frankly never realistic) target of cutting at least $2 trillion from the federal budget. And with Musk's departure still fresh, there are reports that the federal government is trying to rehire federal workers who quit or were let go. For Elaine Kamarck, senior fellow at the Brookings Institution, DOGE's tactics will likely end up being disastrous in the long run. 'DOGE came in with these huge cuts, which were not attached to a plan,' she told Today, Explained co-host Sean Rameswaram. Kamarck knows all about making government more efficient. In the 1990s, she ran the Clinton administration's Reinventing Government program. 'I was Elon Musk,' she told Today, Explained. With the benefit of that experience, she assesses Musk's record at DOGE, and what, if anything, the billionaire's loud efforts at cutting government spending added up to. Below is an excerpt of the conversation, edited for length and clarity. There's much more in the full podcast, so listen to Today, Explained wherever you get podcasts, including Apple Podcasts, Pandora, and Spotify. What do you think Elon Musk's legacy is? Well, he will not have totally, radically reshaped the federal government. Absolutely not. In fact, there's a high probability that on January 20, 2029, when the next president takes over, the federal government is about the same size as it is now, and is probably doing the same stuff that it's doing now. What he did manage to do was insert chaos, fear, and loathing into the federal workforce. There was reporting in the Washington Post late last week that these cuts were so ineffective that the White House is actually reaching out to various federal employees who were laid off and asking them to come back, from the FDA to the IRS to even USAID. Which cuts are sticking at this point and which ones aren't? First of all, in a lot of cases, people went to court and the courts have reversed those earlier decisions. So the first thing that happened is, courts said, 'No, no, no, you can't do it this way. You have to bring them back.' The second thing that happened is that Cabinet officers started to get confirmed by the Senate. And remember that a lot of the most spectacular DOGE stuff was happening in February. In February, these Cabinet secretaries were preparing for their Senate hearings. They weren't on the job. Now that their Cabinet secretary's home, what's happening is they're looking at these cuts and they're saying, 'No, no, no! We can't live with these cuts because we have a mission to do.' As the government tries to hire back the people they fired, they're going to have a tough time, and they're going to have a tough time for two reasons. First of all, they treated them like dirt, and they've said a lot of insulting things. Second, most of the people who work for the federal government are highly skilled. They're not paper pushers. We have computers to push our paper, right? They're scientists. They're engineers. They're people with high skills, and guess what? They can get jobs outside the government. So there's going to be real lasting damage to the government from the way they did this. And it's analogous to the lasting damage that they're causing at universities, where we now have top scientists who used to invent great cures for cancer and things like that, deciding to go find jobs in Europe because this culture has gotten so bad. What happens to this agency now? Who's in charge of it? Well, what they've done is DOGE employees have been embedded in each of the organizations in the government, okay? And they basically — and the president himself has said this — they basically report to the Cabinet secretaries. So if you are in the Transportation Department, you have to make sure that Sean Duffy, who's the secretary of transportation, agrees with you on what you want to do. And Sean Duffy has already had a fight during a Cabinet meeting with Elon Musk. You know that he has not been thrilled with the advice he's gotten from DOGE. So from now on, DOGE is going to have to work hand in hand with Donald Trump's appointed leaders. And just to bring this around to what we're here talking about now, they're in this huge fight over wasteful spending with the so-called big, beautiful bill. Does this just look like the government as usual, ultimately? It's actually worse than normal. Because the deficit impacts are bigger than normal. It's adding more to the deficit than previous bills have done. And the second reason it's worse than normal is that everybody is still living in a fantasy world. And the fantasy world says that somehow we can deal with our deficits by cutting waste, fraud, and abuse. That is pure nonsense. Let me say it: pure nonsense. Where does most of the government money go? Does it go to some bureaucrats sitting on Pennsylvania Avenue? It goes to us. It goes to your grandmother and her Social Security and her Medicare. It goes to veterans in veterans benefits. It goes to Americans. That's why it's so hard to cut it. It's so hard to cut it because it's us.
Vox
13-06-2025
- Politics
- Vox
A court ordered Trump's team to free an activist. They refused.
This story appeared in The Logoff, a daily newsletter that helps you stay informed about the Trump administration without letting political news take over your life. Subscribe here. Welcome to The Logoff: The Trump administration is defying a federal judge's order that it free a pro-Palestinian activist, attacking both the rule of law and the Constitution's guarantee of free speech. Catch me up? In March, the Trump administration arrested Mahmoud Khalil, a pro-Palestinian activist and former Columbia University student, and designated him for deportation over his participation in campus protests. Mahmoud was a legal permanent US resident, but the administration argued it has the right to revoke Khalil's green card on the grounds that his presence constitutes a threat to US foreign policy. Khalil sued to stop the deportation, and the two sides have been in court ever since. So what happened this week? On Wednesday, a federal judge ordered the administration to free Khalil. But today, the administration said it would not free him, arguing unconvincingly that it's still detaining Khalil for a different violation. (The judge's ruling to free Khalil explicitly anticipated this strategy and described it as legally unsound.) What's next? The administration says that it will appeal the order to a higher court — and keep Khalil detained in the meantime. What's the big picture? If Khalil had conducted all the same protest actions on behalf of a cause favored by the administration, he'd still be free. That means that, under Donald Trump, immigrants are facing consequences for expressing political opinions that the administration objects to — a clear violation of the First Amendment. And with that, it's time to log off… I'm in desperate need of a long walk with my dog and a podcast, so I'm excited about the new episode of Today, Explained. The episode is focused on Dropout, a streaming platform whose fans are so dedicated that some of them are actually asking to pay more for the service. (You can listen on Apple Podcasts, Spotify, and elsewhere.) I hope everyone has a safe and fulfilling weekend, and I'll see you back here Monday.
Vox
13-06-2025
- Politics
- Vox
Why Donald Trump soured on some of his own judges
Late last month, approximately 1 billion news cycles ago, an obscure federal court made President Donald Trump very, very mad. The US Court of International Trade ruled unanimously on May 28 that the massive tariffs Trump imposed after taking office again are illegal. That ruling was suspended the next day by the US Court of Appeals for the Federal Circuit, and the tariffs will be allowed to remain in effect pending a ruling (arguments are scheduled for late July). But the appellate court's decision didn't soothe Trump. He took to Truth Social on May 29 to post a 510-word screed attacking the judges on the Court of International Trade, before turning his ire toward a more surprising candidate — Leonard Leo, the most important person in the conservative legal movement. 'I was new to Washington, and it was suggested that I use The Federalist Society as a recommending source on Judges,' Trump wrote, reminiscing about his first term. 'I did so, openly and freely, but then realized that they were under the thumb of a real 'sleazebag' named Leonard Leo, a bad person who, in his own way, probably hates America, and obviously has his own separate ambitions.' This breakup surprised many commentators. But not David French. 'If you're familiar with how the conservative legal movement has interacted with MAGA, you have seen this coming for a while,' French, a New York Times columnist, lawyer, and onetime member of the Federalist Society, told Today, Explained co-host Sean Rameswaram. 'You knew this was coming after 2020. Because in 2020, after Trump had really stocked the federal judiciary with an awful lot of FedSoc judges and justices…none of them, zero of them, helped him try to steal the election.' French spoke with Today, Explained about the origins of the (other) big, beautiful breakup and what it means for the Trump administration and the future of the federal judiciary. Below is an excerpt of the conversation, edited for length and clarity. There's much more in the full podcast, so listen to Today, Explained wherever you get podcasts, including Apple Podcasts, Pandora, and Spotify. Are you now or have you ever been a member of the Federalist Society? I am not now, but I have been a member of the Federalist Society. I was a member of the Federalist Society either all three years of law school or the first two years of law school. But it was also a very different time. I think the Federalist Society at the law school at that time, when we would have meetings, maybe 10 or 12 people would show up. Things have changed. One of the most conspicuous changes is that FedSoc has become an enemy of the president of the United States. From [2020] forward, you began to see this drifting apart between FedSoc and MAGA. When Trump comes back into office and he doubles down on being Donald Trump, all of this became very, very predictable. Because if the Trump administration's argument dovetailed with their originalist legal philosophy, they would rule for it. But if it was just simply Trump's lawless demands, they were going to reject it. And Trump is baffled by this distinction. He's baffled by it because congressional Republicans haven't drawn this line at all. When Trump's demands conflict with conservative principles, they will yield to Trump's demands every time. And the judges and justices have taken the opposite tack to such an extent that Republican-nominated judges have ruled against Trump about 72 percent of the time, which is remarkably close to about the 80 percent or so of the time that Democratic-appointed judges have ruled against Trump. You mentioned a whole host of issues where FedSoc judges have perhaps not given Trump what he wanted. Does the one that finally tips Trump off to go for it on Truth Social surprise you? It doesn't, because what really set him off was striking down tariffs. To the extent that Trump loves a policy, he loves tariffs. The Court of International Trade struck it down, and it was pointed out to him that one of the judges on the Court of International Trade that struck down the tariffs was appointed by him. He had been ranting about judges in general. Now he got specific with Leonard Leo; he got specific with the FedSoc. People like me who'd been watching this for a very long time were not wondering if this was going to happen. We were just wondering what was going to be the tipping point: Was it going to be a Supreme Court case? Was it going to be an appellate court? It turns out it was the Court of International Trade that brought us to this moment. Leonard Leo did not author a decision from this court. Why is he mad at Leonard Leo? Leonard Leo has long been a key figure in the Federalist Society and was very much a part of the first Trump administration, working closely with the administration to put forward judges. For a long time, Trump looked at his judicial nominations and waved them like a flag to the American conservative public saying, look what I did. But the more the American conservative public started loving Trump as Trump, versus Trump as what policy wins he could deliver, the less he started waving these other ideological flags, and the more it became all about him. And so this meant that this marriage was going to be temporary almost from the beginning, unless FedSoc capitulated. And if you know anything about FedSoc and the people who belong to it, and the people who've come up as judges, I knew they weren't going to capitulate. It's a very different culture from political conservatism. Do you think Donald Trump didn't realize that? I don't think he realized that at all. He's had this entire history politically of when Republicans disagree with him, they either fall in line or they're steamrolled. And so it's so interesting to me that he actually began that Truth Social rant that lacerated Leonard Leo and the FedSoc with this question: What's going on? Why is this happening? And I totally understand his bafflement. Because all of the political people had surrendered, or almost all of them. And so when he turns around and these judges and justices just keep ruling against him, you can understand why he would take that as, 'What's going on here? I don't get this. I don't understand this. I've been assured that these were good judges.' And so that's where you get to that real tension. Do you think this rift with the Federalist Society will affect how he appoints judges going forward? The short answer to that question is yes. The longer answer to that question is heck yes. A lot of people were worried about this because they were thinking, Okay, Trump 1.0: He has General Mattis as his secretary of defense. Trump 2.0: He has Pete Hegseth. You can do this all day long. The Trump 1.0 early nominations — sound, serious, establishment conservatives. Trump 2.0 — often MAGA crazies. The question was, 'Is this same pattern going to establish itself in Trump 2.0 on judges?' And then he appointed to the Third Circuit Emil Bove, this DOJ enforcer of his who was responsible for the effort to dismiss the Eric Adams case. He's nominated him for the Third Circuit, and a lot of people are now saying, 'Oh, now that's your harbinger right there.'
Vox
09-06-2025
- Politics
- Vox
How HBCUs are thinking about Trump 2.0
Graduates celebrate their achievements during the Florida A&M University commencement ceremony on May 3 in Tallahassee, Florida. Glenn Beil/Florida A&M University via Getty Images Universities are having a tough time under the second Trump administration. From elite private schools like Harvard and Columbia to state schools and community colleges, the nation's institutions of higher learning are on high alert about cuts to federal funding and grants and even, in the case of Columbia, threats of stripping the university's accreditation status. Historically Black colleges and universities (HBCUs) are no exception. These approximately 107 schools — public and private schools, big research institutions, and small liberal arts colleges — make up only 3 percent of the country's colleges and universities, but they enroll 10 percent of all Black students and produce almost 20 percent of all Black graduates. President Donald Trump pledged 'to promote excellence and innovation' at HBCUs in an April executive order, as he did in his first term. But soon after issuing his executive order, the White House announced funding cuts to Howard University, the nation's second-ranked HBCU. Against the backdrop of the Trump administration's assault on the Department of Education and diversity initiatives across the government (and private sector), the move has prompted concern among many Black academic leaders about the sustainability of their schools. Mark Brown, president of Tuskegee University in Alabama, joined Today, Explained guest host Jonquilyn Hill to share his perspective on how Black universities — especially those in Republican-controlled states — can navigate the uncertainty of this administration. The university was founded by Booker T. Washington in 1881. US News & World Report ranked it No. 3 among HBCUs overall, tied with Florida A&M University. Below is an excerpt of the conversation, edited for length and clarity. There's much more in the full podcast, so listen to Today, Explained wherever you get podcasts, including Apple Podcasts, Pandora, and Spotify. In his first term, Trump touted his support of HBCUs. This term, he's been leading the crusade against DEI practices and cutting federal funding to education. Do things feel dramatically different for you in terms of policy on HBCUs this time around? So you used the term 'feel.' Some measurable things would be the White House initiative on HBCUs. We've not seen all of the execution of that, but that's where I think you'll find measurable results. The president has publicly said, as has the secretary of education, that they are supportive of historically Black colleges and universities. We have done quite a bit to make sure everybody understands something. HBCUs are not diversity, equity, and inclusion universities, nor have we ever been. We are merit-based schools. Anybody can apply to come to Tuskegee, and if they qualify, they can come. And so it is confusion if we are associated with the pattern of diversity, equity, and inclusion. Having said that, if someone wrote in the federal government a grant, and that grant said that we are specifically looking at a particular subgroup under the category of diversity, equity, and inclusion, and the decision is that across not just HBCUs but the educational spectrum, those grants have to be pulled back, then HBCUs would be impacted. Let me give you an example. We have work that we do with University of Alabama at Birmingham. And it is on cancer research — cervical, prostate, those kinds of cancers, specifically. It deals with the genealogy of it. In other words, the grant provides the payroll, or a good portion of the payroll, so that we can hire the best researchers to come to Tuskegee and do that research using samples. And it's important because the morbidity rates of certain cancers are far greater in our region and our area than they are in others. So if the person writing the grant specifically targeted an area under the category DEI, It wouldn't matter if we were UAB, which is a PWI [predominantly white institution], or if you're the partner, Tuskegee, on the other end. If you had that broad category swath, you would impact us both, and it does. I want to make sure — is it a matter of policy, or is it a matter of just pure confusion? We have to work all of that out. Is there a consensus among Black academic leaders right now? Are you at all anxious about the future of HBCUs? Or are you feeling more optimistic because of Trump's statements of support right now? Let me reframe it in my way of looking at this. Here's what people in higher education ought to be concerned about, and I believe they are. There is a budget, and the House of Representatives has submitted it to the Senate for action. There are reductions in things like [student] loans. There are reductions in the way that you use Pell Grants — people who would be eligible, income levels, those kinds of things. There are policies like risk sharing as it relates to defaulted loans over time that ought to concern schools that service students in need. And here's what I mean: Nine out of 10 students at historically Black colleges and universities have some form of federally assisted financial aid. Access to education will be impacted by that legislation. Anybody paying attention, though, would be concerned. But I want to be careful about one thing. What is the issue? Is the issue that we're at HBCUs? Or is the issue poverty? In other words, I want to make sure we frame it the right way. Because if I'm at Georgia Tech, depending on a Pell Grant and a Parent PLUS loan to go to grad school to get a doctorate in engineering, I'm just as impacted if I'm down here trying to get a doctorate in engineering at Tuskegee. Like you said, most students at HBCUs rely on Pell Grants or some form of federal aid. What happens if access to those resources changes? What happens to the students? What happens to the universities? Here's what happens. In 2011, the policy was to change access to what we typically call the Parent PLUS loan across the country, not just to any particular demographic — 3 to 4 percent immediate reduction in enrollment across HBCUs. Access went down. That's evidence. At the same time, across the country, enrollment went up. I'm not saying it was targeted. I'm talking about the outcome. So if you reduce access to those programs, you're going to reduce access to students' ability to go to college. And I'll take that just a little bit further. So, how do we fill the gap? One way is to get an endowed scholarship. The wealth of a university is based on the endowment to some degree. If you take the HBCU endowments, and you add them all up — all of 'em — you will have less of an endowment than if you added up Brown University. Now this is not a criticism. I'm happy for the students at Brown University. I'm just trying to tell you the difference in the wealth that makes the impact far greater for a portion of society. A lot of HBCUs, including yours, are in states where Republicans hold the purse strings. I'm curious how you navigate that. Education is politically neutral. I believe that. Education should be politically neutral, and I think statesmen would see it that way. Here is my point. We produce chemical engineers. We produce electrical engineers. We have an aviation science program. The nation is short on aviators. The plane doesn't know if you're Republican or Democrat. The plane just knows that a qualified person has filled that need, which has an economic impact to this state. I take what you mean that a lot of this education stuff should be neutral, should be gender-neutral, should be race-neutral. But I often wonder if it is that way in practice. The disparities come from somewhere. I wonder how you navigate that. I navigate that by making sure the framework of our discussions are the same: What is the economic impact of our state? Because I can have that discussion with anybody. The way you navigate this is in capability — capability, outcome, and performance. That is what I want to drill into everybody at Tuskegee University. Did the student get an internship? Did they get experience? Did they graduate? Dr. Brown, you strike me as — I think a word I would use to describe you is very pragmatic, the way you approach things. And I think a lot of higher education institutions are trying to figure out the best approach to securing funds under this particular presidential administration. How do you think about these things and approach it? I would suggest, the approach we ought take with this administration, any other administration, is that we are an economic engine that creates social and economic mobility for this country. And we take greater risk in doing so, and that should be recognized. That's the approach that we take. And I don't think the approach is unique to Tuskegee, you know. I could say that my friends in Huntsville, Alabama, are doing the same thing, at Alabama A&M. My friends at the Morehouse School of Medicine — everybody should want the Morehouse School of Medicine to be successful. Everybody should want the Howard University School of Medicine to be a success. Everybody should want Claflin to be successful, not just South Carolinians, but everybody.
