Transcript: It’s central bank week!

This is an audio transcript of the FT News Briefing podcast episode: ‘It’s central bank week!’

Kasia Broussalian
Good morning from the Financial Times. Today is Monday, March 18th, and this is your FT News Briefing.

[MUSIC PLAYING]

Central banks around the world are meeting this week to discuss interest rates. And there are finally some reasons to be optimistic about South Africa’s economy. Plus, a few big companies are taking on a watchdog for labour in the US. I’m Kasia Broussalian, and here’s the news you need to start your day.

[MUSIC PLAYING]

It’s a big week for central banks. The US Federal Reserve, the Bank of England and the Bank of Japan will all be making important announcements about interest rates in the coming days. But recent events are making those announcements a bit more complicated. In just one example, inflation unexpectedly increased in the US last week. That’s raised some pretty serious doubts about the Fed’s timeline for cutting rates. We’ll be following these meetings throughout the week, and we’ll have updates as they come.

[MUSIC PLAYING]

A US agency that enforces laws related to unions is facing an existential threat. Four big US companies, that’s Trader Joe’s, Starbucks, Amazon and SpaceX, are all challenging the authority of the National Labor Relations Board in court. Here to talk about what that could mean for the organisation and the labour movement is the FT’s Taylor Nicole Rogers. Hey, Taylor.

Taylor Nicole Rogers
Hey.

Kasia Broussalian
So can you give me a little bit of a background here? What does the NLRB do, and just how important is it?

Taylor Nicole Rogers
It’s pretty important if you have a job. So what they’re famous for is administering elections if a workplace is thinking about adding a union. But they also do lots of other things. For instance, there was a case last year where some Home Depot employees were wearing Black Lives Matter buttons and got in trouble for it. They step in in cases like that too.

Kasia Broussalian
Got it. So what are these big companies alleging then?

Taylor Nicole Rogers
These employers are essentially saying that the entire agency is unconstitutional. The problems go back to the way that they enforce labour laws. The core of the argument here is that because the NLRB not just investigates workers’ complaints against their employers but they also hire judges that make determinations in these cases, the argument is that they are violating employers’ right to trial by jury. Because in these hearings you are being accused by an NLRB lawyer, and then an NLRB judge is making the final decision.

Kasia Broussalian
So what these employers are saying then is that there’s no one really on their side in these situations. What would it mean for the NLRB if these companies are actually successful in court?

Taylor Nicole Rogers
It could mean anything from the entire agency is just shut down and exists no more to they still get to investigate these unfair labour practice charges but in a different kind of way. In the near term, it would mean that any sort of case of unfair labour practices would have to go through federal court instead of the NLRB’s internal court system. That could work, but there’s a big problem in that our federal courts are really backed up, especially for civil cases. So if a worker says that their employer fires them for an illegal reason, they might have to wait years instead of months for that case to be resolved.

Kasia Broussalian
Yeah and obviously time wouldn’t be on the side of that employee. I mean, they’re not gonna be getting paid during that time, so they’d probably just try and find a job somewhere else. But I’m curious, why are these companies going after the NLRB right now?

Taylor Nicole Rogers
I think it all comes back to the Biden administration because a lot of the labour laws that have been really popular with unions are tied up in Congress and not moving anytime soon. Biden has really relied on the NLRB to help unions and to crack down on some of these things that a lot of big companies do to try to stop their workers from organising. So as the NLRB has really cracked down on employers, employers have said, hey, wait a second, this doesn’t feel fair to us.

Kasia Broussalian
Yeah and now they’re trying to do something about it. So what could the outcome of these cases mean for the labour movement just more broadly?

Taylor Nicole Rogers
I think because the labour movement has had all of these big wins, like when we’re talking about the massive raises for auto workers and UPS drivers and these huge strikes that we saw in Hollywood last year, it really encourages people to join unions. These cases are really important to the labour movement because they could really make it a lot harder for new unions to be formed. That’s a big problem because the existing unions have been shrinking for decades, and without an NLRB around to administer these new elections and stop employers from interfering in their organising attempts, they could just fade out of existence.

Kasia Broussalian
Taylor Nicole Rogers is the FT’s US labour & equality correspondent. Thanks, Taylor.

Taylor Nicole Rogers
Thanks for inviting me on.

[MUSIC PLAYING]

Kasia Broussalian
Benjamin Netanyahu harshly criticised western allies on Sunday, including those from the US. He accused them of trying to orchestrate new elections in Israel and warned that that would allow Hamas to win the war. The Israeli prime minister is preparing for an offensive into the city of Rafah, which is on the southern edge of Gaza. More than a million Palestinians are sheltering there, and western allies are concerned that Israel doesn’t have a solid plan to protect them from the fighting. Last week, US President Joe Biden said that Netanyahu was, quote, hurting Israel. And Senator Chuck Schumer said that Netanyahu’s far-right government needed to be replaced so that Israel didn’t become a pariah.

[MUSIC PLAYING]

South Africa hasn’t been doing all that well lately. There are major power outages, corruption and chronic unemployment. Plus, the economy isn’t really growing. But things might be turning around. David Pilling is the FT’s Africa editor, and he’s here to talk to me about it. Hey, David.

David Pilling
Hi, Kasia.

Kasia Broussalian
All right. So can we maybe start by you giving us a recap of some of South Africa’s biggest problems in recent years? Like, tell me a little bit more about those power outages.

David Pilling
Yes. Well, power outages have really become a symbol of much that’s gone wrong with South Africa. The state energy company Eskom has just not been able to provide enough power for South Africans. That means in people’s homes, their refrigerators go off. It means businesses can no longer function properly. When the power is out, there’s also a lot of crime and theft, and ironically, people often steal power cables, which means, of course, that power cuts are then much more likely to happen. It’s become a symbol of all that’s gone wrong with the economy and with the government that’s been running it.

Kasia Broussalian
All right, so what happened to help turn things around?

David Pilling
Well, I think in a sense the following: I think the backs of the government were against the wall. And so Cyril Ramaphosa, the new president, decided that he would turn to the private sector for salvation. And so he announced that there would be no limit on the amount of power private sector generators could produce, both for themselves and if they had excess to feed back into the grid. And a lot of this power is solar power and wind power, but it’s not coal power, which South Africa has relied on for many decades. These new producers of solar power and wind power, they’re often white private businesses. The government was very resistant to turning to them, but in the end, it has done.

Kasia Broussalian
And did it solve the problem?

David Pilling
Well, it certainly hasn’t solved the problem yet, but I think it is safe to say, and I hope these are not famous last words, that things are gradually going to get better from now on.

Kasia Broussalian
OK. And so it sounds like the solution then was to kind of move on to cleaner energy that was really, you know, from the private sector. Are there other areas in the economy where turning to the private sector has solved some other problems as well?

David Pilling
Yes, I think something similar is happening in ports and rail, which are run by a state-owned company called Transnet. That has also been in dire straits and has had a really deleterious impact on the economy, just as bad as the electricity shortages. And again, with their backs to the wall, the government is turning to the private sector. It is allowing a Filipino company to manage Durban port, which is the biggest port in Africa. It is allowing private companies to provide private security to guard the rails, and it’s even considering allowing private companies to run locomotives on the railways. Now, we don’t know exactly how this is gonna turn out, but again, there is a glimmer of hope that where the state has failed, some of these private initiatives can do better.

Kasia Broussalian
Yeah, and it seems like what we really are talking about here is the political situation in South Africa. So what’s next then for the government?

David Pilling
Well, we’re coming up to elections in May. The ANC, the African National Congress party, of course, the party associated with the liberation and the end of apartheid in 1994, it is likely to drop below 50 per cent for the first time in those 30 years, ushering in an era of coalition politics. Now, some people are concerned that it may have to turn to a left-wing party called the Economic Freedom Fighters. My hunch is that the ANC will do a little bit better and that as a result, post-election, it’s gonna be a slightly more stable situation than some people have been predicting.

Kasia Broussalian
David Pilling is the FT’s Africa editor. Thanks, David.

David Pilling
Thank you.

[MUSIC PLAYING]

Kasia Broussalian
One more thing, the Briefing is offering listeners a deal on access to FT journalism. From now until April 4th, you can save up to 40 per cent on a standard digital subscription. To take advantage of this special offer, just go to ft.com/briefingsale. We’ll also have a link to that in our show notes. This has been your daily FT News Briefing. Make sure to check back tomorrow for the latest business news.