WEBVTT - Bloomberg Businessweek Weekend-March 13, 2021 0:00:01.080 --> 0:00:05.440 This is Bloomberg Business Week inside from the reporters and 0:00:05.600 --> 0:00:09.200 editors who bring you America's most trusted business magazine, plus 0:00:09.240 --> 0:00:12.559 global business, finance and tech news as it happened. Its 0:00:12.600 --> 0:00:16.439 Bloomberg Business Week with Carol Messier and Bloomberg Quick Takes. 0:00:16.520 --> 0:00:21.000 Tim Stinovic on Bloomberg Radio. Hi, everyone, Welcome to the 0:00:21.040 --> 0:00:23.560 weekend edition of Bloomberg Business Week. Tim. This week I 0:00:23.600 --> 0:00:26.720 thought about this a lot. It's been a milestone as 0:00:26.920 --> 0:00:29.880 I've been keeping track. In fact, my calendar book, every 0:00:29.880 --> 0:00:31.800 week I write, Okay, what week it is that we 0:00:31.960 --> 0:00:35.640 have been or many have been working from home? It is, 0:00:35.680 --> 0:00:37.200 and you know it's it's a week that I've seen 0:00:37.600 --> 0:00:40.080 a lot of memories play out on social media, on 0:00:40.159 --> 0:00:43.320 text message chains with family. One year ago this week, 0:00:43.360 --> 0:00:45.400 you know, the last time stepping foot in a restaurant, 0:00:45.440 --> 0:00:48.959 the last time visiting family. Um, it was a year 0:00:49.000 --> 0:00:52.040 ago this week that the world completely changed. Yeah, exactly, 0:00:52.080 --> 0:00:57.840 Friday March the last time we had a guest actually 0:00:57.920 --> 0:01:01.480 in our Bloomberg Radio studio. And I just remember, you know, 0:01:01.560 --> 0:01:03.400 our managers and like we want to be safe, we 0:01:03.440 --> 0:01:05.760 want a home. We're sending you with equipment, like we 0:01:05.959 --> 0:01:08.679 just want to make sure everybody safe. Hard to believe it. 0:01:08.680 --> 0:01:11.160 It has been a year, no shortage of virus headlines. 0:01:11.200 --> 0:01:13.600 This week it's still, of course top and center for us. 0:01:13.680 --> 0:01:17.080 Here the CDC issuing its first set of guidelines Carol 0:01:17.120 --> 0:01:20.920 on how fully vaccinated people can safely visit with others. 0:01:20.959 --> 0:01:24.160 And I gotta say people are feeling good about reopenings, 0:01:24.160 --> 0:01:26.560 but at the same time, we keep talking to various 0:01:26.560 --> 0:01:28.959 members of the medical community, like listen, we still have 0:01:29.080 --> 0:01:32.600 to be really, really cautious. And I gotta say on 0:01:32.800 --> 0:01:35.720 that we've got the person that last spring was done 0:01:35.720 --> 0:01:37.720 by the New York Times, the CEO at the center 0:01:37.800 --> 0:01:40.800 of New York's coronavirus crisis. And we've got a new 0:01:40.840 --> 0:01:44.480 crisis brewing cyber security. Lucky for us though, we just 0:01:44.560 --> 0:01:47.720 happen to have on Tom Siebel, founder of Cebel Systems, 0:01:47.720 --> 0:01:50.520 also c three AI, just as we learned that hackers 0:01:50.560 --> 0:01:55.360 broke into thousands of security cameras, exposing testless suppliers, jails, 0:01:55.440 --> 0:01:57.760 even hospitals doest you feel like cybersecurity. It's one of 0:01:57.760 --> 0:01:59.720 those stories people keep saying, you know, you guys aren't 0:01:59.720 --> 0:02:01.880 talking about it enough. It's a big, big story. It's 0:02:01.880 --> 0:02:05.640 getting lost in the other headline, it's terrifying. Yeah, absolutely, 0:02:05.720 --> 0:02:07.760 all right, So all of this to come. Let's begin 0:02:07.840 --> 0:02:10.280 though with this week's issue of the magazine. It features 0:02:10.280 --> 0:02:13.080 a deep dive into equality, and that includes him. The 0:02:13.080 --> 0:02:15.280 cover's story, which was among our most read on the 0:02:15.320 --> 0:02:18.600 Bloomberg It is about Dorothy Brown. So Dorothy Brown, she 0:02:18.600 --> 0:02:22.200 she spent her career as a law professor documenting racism 0:02:22.200 --> 0:02:25.359 in a tax system that's supposedly color blind. In fact, 0:02:25.520 --> 0:02:28.200 she thought it was color blind until she really started 0:02:28.240 --> 0:02:32.239 doing research onto this years into her career. Bloomberg News 0:02:32.280 --> 0:02:35.200 Personal Finance editor Ben Steve Berman wrote all about it right, 0:02:35.200 --> 0:02:37.280 and Ben joined us along with Bloomberg Business Week editor 0:02:37.360 --> 0:02:40.040 Joel Weber. Joel kicking it off though by talking about 0:02:40.120 --> 0:02:43.919 the overall equality issue we have. We launched a vertical 0:02:44.000 --> 0:02:48.079 that UH at Bloomberg called Quality that will be sort 0:02:48.120 --> 0:02:50.240 of the home for our ongoing coverage, and we wanted 0:02:50.280 --> 0:02:52.800 to help make a splash at Business Weeks as we 0:02:52.919 --> 0:02:55.920 launched that that initiative and that and that project, and 0:02:55.960 --> 0:02:59.280 so we really kind of like pulled together across the 0:02:59.280 --> 0:03:02.520 global news room to try and bring as many of 0:03:02.520 --> 0:03:05.360 of these stories to life as we could. And there 0:03:05.360 --> 0:03:08.040 were a couple in particular that stood out to me 0:03:08.120 --> 0:03:11.240 that we're a little bit more US centric that funny enough, 0:03:11.280 --> 0:03:13.720 both had to do with taxes, and we heard about 0:03:13.840 --> 0:03:17.960 Jason Grotto's story on on property tax um and how 0:03:18.240 --> 0:03:21.919 it's effectively like a regressive tax. And there was another 0:03:21.960 --> 0:03:25.440 thing that caught our attention, which was Ben steveerman Um saying, Hey, 0:03:25.480 --> 0:03:28.040 by the way, do you guys know about Dorothy Brown, 0:03:28.840 --> 0:03:30.560 who's got a book coming out? And I said, I 0:03:30.800 --> 0:03:33.160 have never heard of Dorothy Brown. Tell me more. And 0:03:33.720 --> 0:03:37.280 with that I'll segue is over to Ben Um. This 0:03:37.400 --> 0:03:40.840 is a professor, a legal illegal tax expert, Um, a 0:03:40.920 --> 0:03:44.600 law professor at Emory UM. And she spent decades basically 0:03:44.920 --> 0:03:47.640 examining the U. S. Tax code. And and Ben, that's 0:03:47.640 --> 0:03:51.280 where it gets provocative. Where does she found Yeah, So 0:03:51.400 --> 0:03:57.000 she's um an interesting person even before she became an 0:03:57.000 --> 0:03:59.600 eminent professor of tax law. She's grew up in the 0:03:59.640 --> 0:04:02.480 bron She worked at Drexel Burnham Lambert back in the eighties. 0:04:02.560 --> 0:04:06.200 She's had a long career, but Um, since the nineties 0:04:06.240 --> 0:04:08.520 she's been looking at different parts of the tax code 0:04:08.600 --> 0:04:12.400 and saying and really analyzing what is the impact this 0:04:12.480 --> 0:04:16.760 has on wealth, um, especially on the wealth of black 0:04:16.800 --> 0:04:19.320 people and the wealth of white people, and what the 0:04:20.440 --> 0:04:22.159 part of the question is, you know, and we've had 0:04:22.279 --> 0:04:24.760 a racial wealth gap between black and white in this 0:04:24.920 --> 0:04:27.760 country that really hasn't narrowed at all. So you see 0:04:28.800 --> 0:04:33.640 many more black people going to college, incomes uh going up, 0:04:33.920 --> 0:04:37.240 but they're the wealth of black folks is not keeping 0:04:37.279 --> 0:04:40.400 pace with well, it is keeping pace, but it's it's 0:04:40.520 --> 0:04:45.080 waste away behind um the wealth of white families. And 0:04:45.160 --> 0:04:48.400 so what she's concluded is that the tax code has 0:04:49.080 --> 0:04:52.480 a big part in that, especially the US income tax, 0:04:52.880 --> 0:04:54.880 and a lot of these carve outs in the income 0:04:54.920 --> 0:04:57.599 tax for retirement and homeownership and all sorts of other 0:04:57.720 --> 0:05:00.760 things that have been built into this supposed the progressive 0:05:00.800 --> 0:05:04.120 system did really end up in a situation where a 0:05:04.160 --> 0:05:07.760 black person and a white person with similar incomes, uh, 0:05:07.800 --> 0:05:11.120 the black person can end up paying significantly more. How 0:05:11.120 --> 0:05:14.039 did she get there to this point because initially I 0:05:14.080 --> 0:05:17.200 think her thinking, according to your story, is that you know, thought, 0:05:17.320 --> 0:05:21.360 you know, tax code, it's going to be color blind. Yeah, 0:05:21.400 --> 0:05:23.520 I mean, that's that was her assumption when she decided 0:05:23.520 --> 0:05:25.800 to get into tax you wanted to escape the whole 0:05:25.839 --> 0:05:29.039 issue of racism. Her original plan was to be Um 0:05:29.600 --> 0:05:32.600 following the footsteps of Theurbid Marshall. And then she, you know, 0:05:32.720 --> 0:05:34.680 civil rights lawyer, and she said, I don't want to 0:05:34.680 --> 0:05:36.599 deal with that in my professional life. I just want 0:05:36.640 --> 0:05:39.880 to focus on this this what seemed like this color 0:05:39.920 --> 0:05:42.279 blind system of all these intricate rules and tax code 0:05:42.279 --> 0:05:45.600 doesn't even mention race really. But she she Um was 0:05:45.680 --> 0:05:47.320 part of a movement of people who back in the 0:05:47.360 --> 0:05:50.440 nineties who really started to say, hey, there's these other 0:05:50.480 --> 0:05:52.880 areas of the law. They were written, All these laws 0:05:52.880 --> 0:05:56.280 were written by white people, generations of white people, Um, 0:05:57.040 --> 0:06:00.240 And and you know, is there some hidden racism there? 0:06:00.240 --> 0:06:02.600 And what she's really showing in her book is that 0:06:03.160 --> 0:06:06.360 the generations of lawmakers have built the system that's really 0:06:06.400 --> 0:06:09.159 optimized for white wealth, for people, for white people that 0:06:09.200 --> 0:06:12.280 are already wealthy. The stories in this week special Equality 0:06:12.320 --> 0:06:15.400 issue reminding us that so much work still has to 0:06:15.440 --> 0:06:19.120 be done. That was Bloomberg News Personal Finance editor Ben Steveherman, 0:06:19.200 --> 0:06:21.880 also Bloomberg Business Week editor Joel Webber. Be sure to 0:06:21.880 --> 0:06:23.760 listen to the full audio version of the story on 0:06:23.800 --> 0:06:26.520 our podcast feed at Bloomberg dot Com. Hey and Tim. 0:06:26.560 --> 0:06:29.480 By the way, Dorothy Brown's book, it's entitled The Whiteness 0:06:29.480 --> 0:06:33.120 of Wealth, How the tax system impoverishes Black Americans and 0:06:33.160 --> 0:06:35.240 how we can fix it. That book coming out later 0:06:35.279 --> 0:06:37.280 this month, and she's gonna be joining us in a 0:06:37.320 --> 0:06:39.320 few weeks on air to talk about it. I'm really 0:06:39.320 --> 0:06:41.240 excited for that interview. The book not even out yet, 0:06:41.240 --> 0:06:44.159 already making a splash exactly. Coming up more on the 0:06:44.200 --> 0:06:48.520 equality issue and once again involving taxes and racism. You're 0:06:48.560 --> 0:07:02.159 listening to Bloomberg Business Week. This is Bloomberg. This is 0:07:02.200 --> 0:07:06.040 Bloomberg Business Week with Carol Masser and Bloomberg Quick Takes 0:07:06.160 --> 0:07:11.440 Tim Stenovik from Bloomberg Radio. So we continue with coverage 0:07:11.480 --> 0:07:14.360 of this week's equality issue of Bloomberg Business Week magazine. 0:07:14.360 --> 0:07:17.560 Another story Tim, having to do with taxes and racism, 0:07:17.560 --> 0:07:21.560 more specifically about how in cities across the US, unfair 0:07:21.600 --> 0:07:24.840 property taxes are keeping black families from gaining wealth. To 0:07:24.840 --> 0:07:27.600 set it all up, here's Bloomberg's Reneed a young She's 0:07:27.600 --> 0:07:30.119 got the story of one woman from Detroit. I feel 0:07:30.160 --> 0:07:32.120 like there is no safe place for me to have 0:07:32.240 --> 0:07:35.920 this conversation because I'm gonna get judge one way or another. 0:07:36.240 --> 0:07:39.720 That's delicious. Scott from Detroit. She was over taxed on 0:07:39.880 --> 0:07:43.160 what was once her home. She became a proud homeowner 0:07:43.200 --> 0:07:46.280 in two thousand five, a dream because she always wanted 0:07:46.320 --> 0:07:50.280 stable housing for her kids, something she's never known. But 0:07:50.360 --> 0:07:53.480 when Scott lost her job during the Great Recession, she 0:07:53.680 --> 0:07:57.120 fell three years behind on her property tax payments, and 0:07:57.160 --> 0:07:59.920 those payments shield were much higher than she should have been. 0:08:00.600 --> 0:08:03.640 Then Wayne County took her home away and auctioned it 0:08:03.680 --> 0:08:06.280 off for less than ten percent of what she paid 0:08:06.320 --> 0:08:09.880 for it. I feel betrayed to last year to learn 0:08:09.960 --> 0:08:14.800 that I was over taxed by five thousand. It makes 0:08:14.840 --> 0:08:18.360 me stand, It makes me depress, It makes me feel 0:08:18.400 --> 0:08:21.360 like a failure. For years, the city of Detroit used 0:08:21.360 --> 0:08:25.720 inflated valuations of Scott's house to calculate her property tax bills. 0:08:26.280 --> 0:08:29.480 She now rents that same home for twenty seven percent 0:08:29.640 --> 0:08:32.520 more than she once paid for the mortgage. You know, 0:08:33.280 --> 0:08:38.920 it's not just a rental property. This is my home right. 0:08:39.400 --> 0:08:42.880 I raised my children in the space. Scott is not 0:08:42.960 --> 0:08:46.280 alone and her story is not unique. Her home was 0:08:46.320 --> 0:08:49.840 among tens of thousands in Detroit's lower income black neighborhoods 0:08:49.840 --> 0:08:53.960 that the city's assessors routinely overvalued, and this happens all 0:08:54.000 --> 0:08:57.480 across the country, where nationwide data show local officials have 0:08:57.559 --> 0:09:03.320 also systematically undervalued home and affluent areas, reducing the taxes 0:09:03.360 --> 0:09:07.720 those homeowners paid. Ban Behaves Brown leads the nonprofit organization 0:09:07.920 --> 0:09:12.160 Georgia Advancing Communities Together, which focuses on affordable housing and 0:09:12.240 --> 0:09:16.040 community development. She says, the entire real estate system has 0:09:16.040 --> 0:09:18.520 a role to play in equitable housing, and it all 0:09:18.600 --> 0:09:22.280 starts with training, not just your training to get your 0:09:22.320 --> 0:09:26.240 license and you're training for renewal, but to also go 0:09:26.440 --> 0:09:30.640 deeper into ethics, trainings that look at in turn racial 0:09:30.679 --> 0:09:34.720 biases and how to overcome them. In many cases, real 0:09:34.840 --> 0:09:38.400 estate investors profit off of unfair tax burdens, but for 0:09:38.480 --> 0:09:41.680 the people who they weigh on, like Delicia Scott, it 0:09:41.800 --> 0:09:44.920 leads to a vicious cycle of unpaid bills and property 0:09:44.960 --> 0:09:48.600 seizures and ultimately destroys the best chance for families to 0:09:48.600 --> 0:09:52.040 build generational wealth. For more on this story, subscribed to 0:09:52.080 --> 0:09:55.840 the Paycheck podcast from Bloomberg, with a new season focusing 0:09:55.880 --> 0:09:58.960 on the racial wealth gap. You can find Paycheck on 0:09:59.000 --> 0:10:02.920 Apple Spotify or wherever you get your podcasts. That was 0:10:02.920 --> 0:10:05.960 Bloomberg's Rnita Young. Now let's get more on this story, 0:10:06.000 --> 0:10:08.200 which was among the most red on the Bloomberg this week, 0:10:08.240 --> 0:10:11.040 with the reporter who wrote it. It's Bloomberg News Projects 0:10:11.040 --> 0:10:14.600 and Investigations reporter Jason Grotto. He joined us, as did 0:10:14.600 --> 0:10:17.199 Bloomberg Business Week editor Joel Webber, who began by talking 0:10:17.200 --> 0:10:20.320 about disparities. I think the unfairness is the thing that 0:10:20.679 --> 0:10:23.800 um really stings about this one. And you know, everybody 0:10:23.800 --> 0:10:26.000 hates property taxes to begin with, but then to have 0:10:26.240 --> 0:10:29.320 unfair qualities kind of layered on top of it, I 0:10:29.360 --> 0:10:32.760 think is the thing that can definitely provoke some outrage. 0:10:32.840 --> 0:10:34.480 And it is one of these things that sort of 0:10:34.559 --> 0:10:38.760 hidden in plain sight. Um, but it does affect people 0:10:38.800 --> 0:10:43.719 of color, especially black communities, disproportionately. So, so Jason, help us. 0:10:44.080 --> 0:10:46.640 You've been through so much data on this one. Help 0:10:46.720 --> 0:10:50.160 us break down what you found. Well, first of all, 0:10:50.200 --> 0:10:53.080 thanks so much for having me. Everybody, Um, well, so 0:10:53.360 --> 0:10:56.679 you know, the thrust of the story is actually based 0:10:56.880 --> 0:11:00.280 on a mass of study out of the universe. See 0:11:00.280 --> 0:11:03.959 of Chicago Hair School of Public Policy. A professor there, 0:11:04.080 --> 0:11:08.520 Chris Berry, analyzed twenty six million property tax records over 0:11:08.520 --> 0:11:12.240 a ten year period and all over the country UM. 0:11:12.320 --> 0:11:15.640 The analysis found the same pattern, and that is lower 0:11:15.679 --> 0:11:21.040 priced homes being overassessed and higher priced ones being under 0:11:21.080 --> 0:11:24.160 assessed relative to the market value of those homes. And 0:11:24.200 --> 0:11:28.040 of course all property taxes are based off of these valuations. 0:11:28.080 --> 0:11:30.760 So it's sort of bad data in, bad data out. 0:11:31.200 --> 0:11:34.000 And the result is it just excused the entire property 0:11:34.040 --> 0:11:38.000 tax um uh and places a much greater burden on 0:11:38.040 --> 0:11:41.400 those who can support it, makes it regressive. So tell 0:11:41.520 --> 0:11:45.920 us the story of Delicia here. So you know, uh, 0:11:46.840 --> 0:11:49.840 Delicia is someone who you know, I've been talking with 0:11:50.120 --> 0:11:53.640 for many, many months. Uh. You know, obviously it took 0:11:53.640 --> 0:11:56.160 a lot of bravery for her to come out, um 0:11:56.600 --> 0:11:59.280 and actually talk and put her story out there. You know, 0:11:59.320 --> 0:12:02.520 there's a lot of game that goes on here. But essentially, 0:12:02.600 --> 0:12:04.720 you know, she bought a home back in two thousand 0:12:04.800 --> 0:12:09.240 and five after working at a corporate cafeteria. She doubled 0:12:09.240 --> 0:12:11.520 her income when she got a job at a domestic 0:12:11.600 --> 0:12:14.760 violence shelter and was able to qualify for a mortgage, 0:12:14.800 --> 0:12:17.560 and and things were going along fine until the Great Recession, 0:12:18.240 --> 0:12:20.840 when she lost her job, and it took her a 0:12:20.840 --> 0:12:22.760 couple of years to get a job back, and she 0:12:22.800 --> 0:12:27.360 missed a tax payment and once you followed behind property taxes, 0:12:27.679 --> 0:12:31.520 it's really difficult you know to get back, uh, you know, 0:12:32.480 --> 0:12:34.520 caught up with those because there's so many fees and 0:12:34.600 --> 0:12:37.160 fines that get ladled on and so she just couldn't 0:12:37.200 --> 0:12:40.680 catch up. Um, the Wayne County, the county you know 0:12:41.040 --> 0:12:44.480 for Detroit, foreclosed on the home and an auction it off, 0:12:44.920 --> 0:12:47.800 as your story mentioned, And since then it's been sold 0:12:47.840 --> 0:12:51.040 two more times while she's been renting the home. So 0:12:51.080 --> 0:12:55.160 the last sale was for eighty four thousand dollars um, 0:12:55.200 --> 0:12:58.720 you know, far more than she paid originally. And you know, 0:12:58.800 --> 0:13:00.440 part of the reason why the value has gone up 0:13:00.480 --> 0:13:02.880 because her rents have gone up because now you know, 0:13:02.920 --> 0:13:06.000 it's an income producing property and the cash that it 0:13:06.200 --> 0:13:09.880 that it throws off every month is keeping the value high. Well, 0:13:09.880 --> 0:13:12.280 the investment, right, there's a whole investment angle into that, 0:13:12.400 --> 0:13:14.200 and and I wish we had more time. But one 0:13:14.240 --> 0:13:15.600 thing I do want to get to is this whole 0:13:15.600 --> 0:13:20.000 idea between you know, tax assessment being overvalued and private 0:13:20.120 --> 0:13:23.960 appraisal sales being undervalued. And as you say, you know, 0:13:24.000 --> 0:13:27.839 Christopher Barry's research. It's not just Detroit you talk about 0:13:27.840 --> 0:13:31.440 it an example in Brooklyn. Oh yeah, it's all over 0:13:31.480 --> 0:13:34.199 the place. We we spoke with a woman Carmen Daniels 0:13:34.240 --> 0:13:36.719 in East New York, you know who. You know. The 0:13:36.920 --> 0:13:41.040 really hard thing here is m Daniels her property, uh, 0:13:41.080 --> 0:13:44.480 you know, a single family home. Um. She felt like 0:13:44.559 --> 0:13:47.320 the valuation that the New York City Department of Finance 0:13:47.360 --> 0:13:49.400 put on it was pretty good, you know, she thought 0:13:49.400 --> 0:13:52.000 it was pretty fair. But then she learned that, you know, 0:13:52.160 --> 0:13:55.040 three miles away in Clinton Hill, there's a condo that 0:13:55.160 --> 0:13:58.400 someone bought for three million dollars and the tax you know, 0:13:58.520 --> 0:14:00.880 it's taxed as if it were, is only one point 0:14:00.920 --> 0:14:04.600 two millions. So even though that home the market value 0:14:05.160 --> 0:14:09.240 is eight times greater than hers, the actual tax bill 0:14:10.000 --> 0:14:13.160 is only a thousand dollars more for that prop higher 0:14:13.200 --> 0:14:16.800 price property. So once again, the burden of it is, 0:14:16.880 --> 0:14:20.320 you know, tilted unfairly. There's something called the effective tax rate, 0:14:20.320 --> 0:14:22.920 which I'm sure everyone knows about. That's what gets skewed 0:14:22.920 --> 0:14:26.760 because of these valuations. That was Bloomberg News Projects and 0:14:26.840 --> 0:14:30.640 Investigations reporter Jason Grotto and Bloomberg Business Week editor Joel Weber. 0:14:30.880 --> 0:14:33.520 Check out more of Business week special equality issue. It's 0:14:33.520 --> 0:14:37.680 on newsstands, online, and on the Bloomberg still ahead. Unfortunately 0:14:37.920 --> 0:14:41.520 for New York City, it seems to be anomalous compared 0:14:41.600 --> 0:14:43.560 to a lot of the declines we're seeing in the 0:14:43.600 --> 0:14:45.440 rest of the country. We check in with the CEO 0:14:45.480 --> 0:14:49.480 of New York Presbyterian Hospital. One year since the COVID outbreak. Yes, 0:14:49.520 --> 0:14:51.360 we've made some progress, but there's still a lot of 0:14:51.400 --> 0:14:53.840 costs for concern. There really is. You're listening to Bloomberg 0:14:53.840 --> 0:15:01.040 Business Week. This is Bloomberg broadcasting from the financial capital 0:15:01.080 --> 0:15:04.920 of the world Bloomberg eleven Frio in New York to Washington, 0:15:04.960 --> 0:15:09.080 d C. Bloomberg to Boston, Bloomberg one oh six one, 0:15:09.160 --> 0:15:12.640 to San Francisco, Bloomberg nine sixty to the country Sirius 0:15:12.800 --> 0:15:15.960 XM Chado one nineteen and around the globe the Bloomberg 0:15:16.000 --> 0:15:20.400 Business app and Bloomberg Radio dot Com. This is Bloomberg 0:15:20.440 --> 0:15:23.640 Business Week. So, as we mentioned at the top, this 0:15:23.680 --> 0:15:26.000 week marked the one year anniversary when the World Health 0:15:26.120 --> 0:15:30.240 Organization declared the coronavirus outbreak a global pandemic, which meant 0:15:30.520 --> 0:15:32.720 tim we know this for so many of us, the 0:15:32.760 --> 0:15:36.120 beginning of working from home and a real complete disruption 0:15:36.320 --> 0:15:40.200 of our lives. Friday thirteenth, we're talking about Friday, March thirteen, 0:15:41.120 --> 0:15:43.800 tim that was the day we last had a live 0:15:43.880 --> 0:15:46.000 guest in studio. I think for a lot of people, 0:15:46.200 --> 0:15:48.520 including our next guests, there were signs that this was 0:15:48.560 --> 0:15:51.360 going to be worse than we thought, even earlier then 0:15:51.600 --> 0:15:54.480 March thirteenth of last year. Dr Stephen cor Went, President 0:15:54.480 --> 0:15:57.400 and CEO of New York Presbyterian Hospital, who, as you 0:15:57.480 --> 0:16:00.400 might recall the New York Times calling in the Ring, 0:16:00.560 --> 0:16:04.119 the CEO at the center of New York's coronavirus crisis. 0:16:04.240 --> 0:16:08.440 Unfortunately for New York City, it seems to be anomalous 0:16:08.480 --> 0:16:10.880 compared to a lot of the declines we're seeing in 0:16:10.920 --> 0:16:13.960 the rest of the country. What we've seen was a 0:16:14.040 --> 0:16:19.000 secondary surge that started in that December time frame, and 0:16:19.080 --> 0:16:22.280 we still have a lot of COVID patients in the 0:16:22.320 --> 0:16:25.000 hospital and a lot of sick COVID patients in the hospital. 0:16:25.520 --> 0:16:29.480 So although we're about thirty to thirty five percent of 0:16:29.560 --> 0:16:32.520 where we were at that horrendous peak in the April 0:16:32.520 --> 0:16:35.360 time frame, we still have a lot of patients in 0:16:35.400 --> 0:16:38.480 the i c U. We're still living with the virus, 0:16:38.480 --> 0:16:40.800 and the positivity rate in New York City still is 0:16:40.840 --> 0:16:44.040 hovering in that five percent range. So it still doesn't 0:16:44.040 --> 0:16:47.240 really feel good in terms of what our emergency rooms 0:16:47.240 --> 0:16:51.600 and I S users seeing. So hopefully with the with 0:16:51.680 --> 0:16:55.200 the vaccine, as we get more people vaccinated UH, the 0:16:55.280 --> 0:16:58.160 quicker we get people vaccinated, the less likely one of 0:16:58.240 --> 0:17:03.160 these variants UH will escape the vaccine and we can 0:17:03.200 --> 0:17:05.280 get back to normal. But right now we're seeing a 0:17:05.280 --> 0:17:08.159 plateau at a level that we're not really happy with. 0:17:08.320 --> 0:17:10.920 To be honest with you, that's some really disconcerting news. 0:17:10.920 --> 0:17:13.520 And my question is is why. I mean, we did 0:17:13.600 --> 0:17:16.840 learn today that new virus variances account for fifty of 0:17:16.880 --> 0:17:19.640 New York City's COVID cases. That's what health officials said 0:17:19.840 --> 0:17:22.640 at a briefing on Wednesday. We know that these are 0:17:23.040 --> 0:17:26.040 more infectious than older strains of the virus. Is this 0:17:26.080 --> 0:17:29.040 why this is happening in New York? I think so. 0:17:29.240 --> 0:17:32.560 I mean, you know, all of this becomes speculative because 0:17:32.560 --> 0:17:35.200 we're not testing every single sample, but it looks like 0:17:36.440 --> 0:17:39.280 the British variant is the dominant variant. We've seen some 0:17:39.400 --> 0:17:43.320 South African variant with our own genetic testing when we 0:17:43.359 --> 0:17:46.879 do sampling. Um So, I think that that's probably it. 0:17:47.440 --> 0:17:51.040 The more disturbing thing is that the percentage in the 0:17:51.040 --> 0:17:54.040 i c US has gone up, and that means that 0:17:54.119 --> 0:17:56.440 you know that the number of people who are quite 0:17:56.520 --> 0:17:59.439 critically ill has gone up. Um So, even with the 0:17:59.480 --> 0:18:03.160 south to get variant with Johnson and Johnson vaccine, people 0:18:03.200 --> 0:18:05.720 did not end up in the hospital and did not 0:18:05.920 --> 0:18:08.040 end up in the i c U. So I think 0:18:08.080 --> 0:18:10.800 that's going to be the critical thing, making sure that 0:18:10.800 --> 0:18:13.040 people don't end up in the hospital, even if the 0:18:13.080 --> 0:18:17.240 positivity rate is high. Dr. Coroner the demographics the same 0:18:17.280 --> 0:18:19.960 as it older people, is it minorities in terms of 0:18:20.320 --> 0:18:23.280 the more severe cases or the majority. It's a somewhat 0:18:23.320 --> 0:18:28.280 younger skew in part because I think that, thank god, 0:18:28.320 --> 0:18:31.040 the nursing home patients and a lot of elderly patients 0:18:31.040 --> 0:18:34.879 have already gotten the vaccine. So that's good. Um And 0:18:34.960 --> 0:18:38.280 we're you know, uh, I know that younger people are 0:18:38.320 --> 0:18:40.520 at lower risk, but we see a lot of young 0:18:40.600 --> 0:18:42.840 people in the i c U. So everyone's got to 0:18:42.880 --> 0:18:47.560 be particularly people young people who are have high body 0:18:47.600 --> 0:18:52.359 mass indexes or are obese or prediabetic and diabetic. So 0:18:53.680 --> 0:18:57.720 so that's that's a concern. You know, I heard you 0:18:57.840 --> 0:19:03.240 two anecdotes about what you recall. My recollection of that 0:19:03.440 --> 0:19:05.720 day was, you know, in March eight, believe it or not, 0:19:06.320 --> 0:19:09.800 March eighth of last year, we had four COVID cases 0:19:09.800 --> 0:19:12.679 in our entire health system, which has thirty six undred beds. 0:19:13.680 --> 0:19:17.320 By March fifteenth, we had sixty six patients. By March 0:19:17.400 --> 0:19:21.919 two we had five nine patients, and by Marche we 0:19:22.000 --> 0:19:26.720 had patients. So you call that dramatic slope and for 0:19:26.800 --> 0:19:30.159 those of us in New York, how absolutely horrific it is. 0:19:30.200 --> 0:19:35.280 But my recollection of that week was actually this very day, Uh, 0:19:35.440 --> 0:19:39.960 my chief Operating Officer, Dr. Laura Freese called her contacts 0:19:40.800 --> 0:19:43.680 in the archdiocese and said, you don't really plan to 0:19:43.720 --> 0:19:45.719 go ahead with the St. Patrick's Day parade, do you? 0:19:46.600 --> 0:19:49.440 And if you recall that Friday before the St. Patrick's Day, 0:19:50.119 --> 0:19:54.760 they canceled it. Uh And um, you know we all 0:19:54.800 --> 0:19:57.960 sort of rolled into it thinking let's hope for the best, 0:19:58.160 --> 0:20:01.240 and it was really horrific. Listen to him, that's something 0:20:01.280 --> 0:20:04.040 we've heard over and over throughout the pandemic. That was 0:20:04.119 --> 0:20:07.560 Dr Stephen Corwin, President n C of New York Presbyterian Hospital. 0:20:07.920 --> 0:20:10.040 And we know that even though vaccines are are rolling 0:20:10.040 --> 0:20:12.720 out him, We've heard from everybody, still got to wear masks. 0:20:12.760 --> 0:20:14.880 You's still got to do some social distancing. We still 0:20:14.880 --> 0:20:16.639 have a long way to go. Yeah, we certainly do. 0:20:16.920 --> 0:20:32.080 You're listening to Bloomberg Business Week up next, Always be well, 0:20:32.160 --> 0:20:36.920 increasingly that is the case. Somebody is watching a Bloomberg 0:20:37.000 --> 0:20:42.400 exclusive involving the breach of thousands of surveillance cameras inside hospitals, companies, 0:20:42.480 --> 0:20:45.560 police departments, prisons and more. Totally creeped out. All right, 0:20:45.600 --> 0:20:48.480 what our team uncovered that's coming up next. This is Bloomberg. 0:20:59.160 --> 0:21:02.679 You're listening to Bloomberg Business Week with Carol Messer and 0:21:02.760 --> 0:21:08.200 Bloomberg Quick Takes. Tim Stinovik from Bloomberg Radio. Big Bloomberg 0:21:08.240 --> 0:21:09.960 exclusive this week. We were all over it when it 0:21:10.000 --> 0:21:12.639 crossed the Bloomberg terminal. It was about a group of 0:21:12.640 --> 0:21:16.000 hackers that say they breached a massive trope of security 0:21:16.000 --> 0:21:18.720 camera data collected by a Silicon Valley startup and tim. 0:21:18.720 --> 0:21:21.600 In doing so, they gained access to live feeds of 0:21:21.600 --> 0:21:24.359 what about a hundred and fifty thousand surveillance cameras. They 0:21:24.400 --> 0:21:29.520 were inside everywhere, hospitals, companies, police departments, prison schools, even 0:21:29.560 --> 0:21:34.400 a testless supplier. But talk about serendipity. When this news broke, 0:21:34.440 --> 0:21:37.359 we actually had Tom Siebel, founder and chairman and CEO 0:21:37.520 --> 0:21:40.600 at C three AI on the air. You were talking 0:21:40.640 --> 0:21:43.640 to him. Tom is also, of course founder of Sibel Systems. 0:21:44.040 --> 0:21:50.080 I think the threat associated with US cyber threat okay 0:21:50.280 --> 0:21:54.600 from bad actors at nation states including Russia, China, North Korea, 0:21:54.680 --> 0:21:59.560 Iran is existential. I mean, these people have the ability 0:22:00.160 --> 0:22:03.439 to shut down the United States, a great power, great infrastructure, 0:22:03.560 --> 0:22:07.800 the financial system, the healthcare system, you know, with a 0:22:07.880 --> 0:22:09.840 cell from from the other side of the planet, and 0:22:09.880 --> 0:22:13.120 they can do it tomorrow. This has been very very 0:22:13.160 --> 0:22:16.880 well documented in books that have been recently published, such 0:22:16.920 --> 0:22:20.320 as The Perfect Weapon and this is how they tell 0:22:20.359 --> 0:22:24.119 me the world ends. Uh. And this is very various 0:22:24.160 --> 0:22:28.840 here stuff. The National Security Commission for Artificial Intelligence published 0:22:28.880 --> 0:22:32.800 its report for years in the making, then concludes that 0:22:32.920 --> 0:22:38.200 today the United States government is not organized or investing 0:22:38.280 --> 0:22:43.640 to win the technology competition against the committed competitor, nor 0:22:43.840 --> 0:22:48.159 is it prepared to defend against AI enabled threats and 0:22:48.400 --> 0:22:52.919 rapidly adopt AI applications for national security purposes, that we 0:22:53.000 --> 0:22:56.600 are exposed there are bad actors out there, and this 0:22:56.720 --> 0:22:58.960 is very scary. Well, you know, it just reminds me 0:22:59.000 --> 0:23:01.080