WEBVTT - Job Losses for 20.5 Million Americans 0:00:00.720 --> 0:00:03.720 This is Bloomberg Business Week. I'm Carol Masser and I'm 0:00:03.800 --> 0:00:06.320 Jason Kelly. We're right here every day bringing you the 0:00:06.400 --> 0:00:11.160 latest news from the world's of business and finance, plus technology, politics, economics, 0:00:11.240 --> 0:00:14.280 all harnessing the power of Business Week reporters and editors, 0:00:14.440 --> 0:00:16.439 and of course Carol that's part of a team of 0:00:16.520 --> 0:00:20.439 twenty seven hundred journalists and analysts more than a hundred 0:00:20.480 --> 0:00:23.280 and twenty countries and Jason. You can download Bloomberg Business 0:00:23.280 --> 0:00:26.239 Week on iTunes, SoundCloud, bl Bloomberg dot com. You can 0:00:26.280 --> 0:00:28.640 also listen to our radio show at two pm Eastern 0:00:28.680 --> 0:00:31.560 on Bloomberg Radio every weekday, or watch us on YouTube 0:00:31.600 --> 0:00:36.040 by searching Bloomberg Global News. Well, this is a conversation 0:00:36.080 --> 0:00:38.800 we've been looking forward to all week, Carol Masser and 0:00:38.920 --> 0:00:41.559 I have because he's our go to guy when it 0:00:41.640 --> 0:00:45.520 comes to jobs, and this one we have to understand fully. 0:00:45.600 --> 0:00:47.959 Chris lew back with a senior fellow at the University 0:00:48.000 --> 0:00:51.479 of Virginia Miller Center. He's also a former Deputy Secretary 0:00:51.479 --> 0:00:54.560 of Labor under President Obama, worked across all three branches 0:00:54.920 --> 0:00:57.880 of government. He joins us on the phone from Washington. Chris, 0:00:57.880 --> 0:01:00.520 great to talk to you, and what a day to 0:01:00.640 --> 0:01:03.480 try and make sense of it all. Yeah, you know, 0:01:03.720 --> 0:01:06.560 I remember the very first jobs report we got in 0:01:06.600 --> 0:01:09.720 the Obama administration. We had lost eight hundred thousand jobs 0:01:10.280 --> 0:01:15.240 January two thousand nine h This is twenty five times bigger. Uh, 0:01:15.280 --> 0:01:18.800 And so this is staggering for people like me who 0:01:19.000 --> 0:01:21.280 um every Friday look at these numbers and used to 0:01:21.360 --> 0:01:24.199 a hundred thousand up, hundred thousand down. To see twenty 0:01:24.240 --> 0:01:29.119 million losses is it's it's it's hard to explain. So 0:01:29.560 --> 0:01:31.880 I do wonder too, And this is where your insight 0:01:32.040 --> 0:01:34.720 and your experience really helps us out. Chris, is what 0:01:34.959 --> 0:01:38.440 are the conversations that you think are going on inside 0:01:38.480 --> 0:01:41.960 the White House? UM about this? Because obviously a lot 0:01:41.959 --> 0:01:44.400 of steps have already been taken to help out workers, 0:01:44.959 --> 0:01:46.679 but we know these numbers are going to be tough 0:01:46.720 --> 0:01:49.080 for a while. And I do wonder about the conversations 0:01:49.080 --> 0:01:51.280 we need to be having about once we get through 0:01:51.320 --> 0:01:55.040 the virus and things start to reopen. Well, you know, 0:01:55.080 --> 0:01:58.560 the conversation that should be happening is to treat this 0:01:58.840 --> 0:02:01.280 as a public health crisis, which is what it is. 0:02:01.320 --> 0:02:05.880 Because until you get that public health crisis fixed or 0:02:06.080 --> 0:02:08.800 it gets to get it reduced. Um, you can't really 0:02:08.919 --> 0:02:11.880 start to deal with rebuilding the economy. And and that's 0:02:11.919 --> 0:02:14.080 the problem where we are right now. We're kind of 0:02:14.160 --> 0:02:17.320 half reopening the economy, but not really fully dealing with 0:02:17.880 --> 0:02:20.160 the public health issues. You know, we continue to have 0:02:20.760 --> 0:02:24.080 cases at a steady state, well over twenty new cases 0:02:24.120 --> 0:02:26.320 every day. We've continue to have well over two thousand 0:02:26.360 --> 0:02:29.360 deaths every day. Uh. And and that's the problem because 0:02:29.560 --> 0:02:32.120 all of the U. S economy or the U. S 0:02:32.160 --> 0:02:35.839 economy is based on consumer spending, and consumers spend money 0:02:35.880 --> 0:02:38.520 when they feel confident, and right now there's not a 0:02:38.560 --> 0:02:40.720 lot of confidence. And so you could reopen parts of 0:02:40.760 --> 0:02:43.360 the economy, but that's not going to make a big difference. 0:02:43.639 --> 0:02:45.800 The only difference you're probably going to make is you 0:02:45.880 --> 0:02:49.160 may actually be undoing some of the great work that's 0:02:49.160 --> 0:02:54.359 happened over the last six weeks. And so, Chris, help 0:02:54.440 --> 0:02:59.200 us understand where you see that consumer economy in these numbers, 0:02:59.280 --> 0:03:02.919 because we see it, you know, really in the breakdown. 0:03:02.919 --> 0:03:05.720 It feels like of the types of workers who lost 0:03:05.760 --> 0:03:09.120 their job, they are you know, they're working in in 0:03:09.200 --> 0:03:11.720 a lot of consumer facing things because people aren't out 0:03:11.880 --> 0:03:15.120 they're not spending money, so help us understand that aspect 0:03:15.200 --> 0:03:17.800 of it. Yeah, well, well it's a great point because 0:03:17.840 --> 0:03:21.720 the leisure in hospitality, seven point seven million jobs was lost, 0:03:21.840 --> 0:03:24.680 which is sort of what you'd expect. The challenge there 0:03:24.919 --> 0:03:26.560 is that, you know, if you think about something like 0:03:26.639 --> 0:03:32.239 airlines or hotels or tourist areas, those might not come 0:03:32.240 --> 0:03:34.400 back even if the economy is fully opened, because that 0:03:34.480 --> 0:03:38.480 again depends on consumer confidence. But what was striking about 0:03:38.520 --> 0:03:41.440 these numbers is how across the board they work. You 0:03:41.560 --> 0:03:46.160 lost the million jobs in construction and manufacturing and healthcare, 0:03:46.200 --> 0:03:49.920 you lost two million in professional and business services. You 0:03:50.000 --> 0:03:52.360 started to see some of the hemorrhaging of state government. 0:03:52.440 --> 0:03:57.400 So this is uh and across the board economic downturn. 0:03:57.440 --> 0:03:59.160 And if you're sitting in the White House, you're probably 0:03:59.200 --> 0:04:01.880 trying to figure out, Okay, how much of this is permanent, 0:04:01.960 --> 0:04:05.080 how much is this temporary? Which of these industries is 0:04:05.160 --> 0:04:07.920 most likely to bounce back, Which are the ones need 0:04:07.960 --> 0:04:11.000 a little bit of help to stabilize or or to 0:04:11.040 --> 0:04:13.800 grow eventually in the future. Well, that is certainly something 0:04:13.960 --> 0:04:16.520 our Bloomberg News team has been tackling over the last week. 0:04:16.800 --> 0:04:19.720 Chris and and We've written numerous stories about how much 0:04:20.040 --> 0:04:23.720 of the temporary workers who've lost their jobs become permanent. 0:04:24.120 --> 0:04:27.200 With your knowledge of the labor markets, how much do 0:04:27.240 --> 0:04:31.240 you think comes back, how much doesn't. Well, what's interesting 0:04:31.279 --> 0:04:34.160 in these numbers is about of the job losses, at 0:04:34.240 --> 0:04:37.719 least as the Bureau of Labor Statistics characterized, it was 0:04:37.760 --> 0:04:41.520 considered temporary. And if you look at polls of workers, 0:04:41.520 --> 0:04:44.800 about seventy of workers in a recent poll said their 0:04:44.839 --> 0:04:48.080 layoffs are temporary. Now, that may not be consistent with 0:04:48.160 --> 0:04:52.960 the reality of where business owners, restaurant owners are as well. 0:04:53.080 --> 0:04:56.200 And the problem is that, you know, as this continues, 0:04:56.320 --> 0:04:59.920 this shutdown continues to go on, a lot of those moments, 0:05:00.040 --> 0:05:02.880 top businesses, which are such a driver of the US 0:05:02.960 --> 0:05:05.480 economy just won't be able to come back. Um, they 0:05:05.600 --> 0:05:09.640 already were operating under very small profit margins, and they 0:05:09.680 --> 0:05:12.120 just might make the decision they come back, can't come back, 0:05:12.480 --> 0:05:14.880 or they can't come back until they get fully reopened. 0:05:15.000 --> 0:05:19.400 Because even in the states where there are reopening uh 0:05:19.560 --> 0:05:22.680 right now, they're still operating under you know, restaurants can 0:05:22.720 --> 0:05:27.000 only have capacity, cables have to be six ft apart. 0:05:27.120 --> 0:05:29.560 That's hard to really kind of turn a profit or 0:05:29.600 --> 0:05:34.200 be fully employed with those restrictions. Yeah, that's such a 0:05:34.279 --> 0:05:36.440 really that's such an interesting point. And I've been thinking 0:05:36.440 --> 0:05:38.640 a lot about that, Chris, that you know, even if 0:05:38.680 --> 0:05:40.640 you are able to reopen, I mean, I think about 0:05:40.880 --> 0:05:44.479 you know, the restaurants and retail establishments here in my 0:05:44.520 --> 0:05:47.520 little town in suburban New York that you know, maybe 0:05:47.560 --> 0:05:51.039 they don't hire everyone back. Maybe they reopened, and maybe 0:05:51.040 --> 0:05:54.560 they don't hire people back for six twelve months or 0:05:54.720 --> 0:05:57.440 or ever. And I would imagine that's hard to model 0:05:57.480 --> 0:06:00.320 at this point. Well, and it's hard to adele. And 0:06:00.320 --> 0:06:03.039 then it's hard to figure out what the economic remedy 0:06:03.120 --> 0:06:07.080 is that because so much of the relief programs that 0:06:07.080 --> 0:06:10.240 are out there are intended for either businesses that are 0:06:10.240 --> 0:06:14.560 fully closed or for workers that are completely unemployed. We 0:06:14.600 --> 0:06:17.200 don't really know what to do if we've got you know, 0:06:18.320 --> 0:06:21.240 the workers coming back but only working part time, which 0:06:21.279 --> 0:06:23.640 is also an important thing that was in space jobs. 0:06:23.839 --> 0:06:27.040 You know, five million people, there's five million additional people 0:06:27.600 --> 0:06:32.640 were registered as working um part time, not by their 0:06:32.680 --> 0:06:35.280 own choice. Uh, And so I think that's something that's 0:06:35.320 --> 0:06:37.760 not fully considered within these numbers that we have a 0:06:37.880 --> 0:06:40.480 huge number of people unemployed. We've got a lot of 0:06:40.520 --> 0:06:44.560 people who are underemployed as well. All right, well, stick 0:06:44.600 --> 0:06:47.480 with us. We're going to continue this conversation. Always good 0:06:47.520 --> 0:06:50.039 to talk with Chris Lew, senior fellow down at the 0:06:50.120 --> 0:06:52.719 University of Virginia Miller Center, and of course former Deputy 0:06:52.760 --> 0:06:56.880 Secretary of Labor under President Obama, and some great context 0:06:57.080 --> 0:06:59.200 right there at the top that you know, they looked 0:06:59.240 --> 0:07:02.440 at eight hundred thousand jobs lost and probably at that 0:07:02.520 --> 0:07:07.880 moment thought this is catastrophic, and today twenty five times that. Wow, 0:07:07.960 --> 0:07:10.679 it's remarkable. All Right, we'll continue that conversation with Chris. 0:07:10.680 --> 0:07:13.119 In just a moment, you are listening to Bloomberg Radio, 0:07:13.880 --> 0:07:15.840 we are talking with Chris Lew, senior fellow at the 0:07:15.920 --> 0:07:19.360 University of Virginia Miller Center, former Deputy Secretary of Labor 0:07:19.680 --> 0:07:22.320 under President of Bama, still with us on the phone 0:07:22.320 --> 0:07:24.880 from Washington, d C. You know, Chris, I was just 0:07:24.920 --> 0:07:28.000 thinking about as Charlie Pellett recapped the markets, and we 0:07:28.080 --> 0:07:30.000 talked at the top of our show that despite this 0:07:30.080 --> 0:07:33.320 staggering monthly jobs report, which we knew was going to 0:07:33.400 --> 0:07:37.440 be kind of mind blowing, um investors increasingly certainly equity 0:07:37.480 --> 0:07:40.800 investors are looking past it, and you know, we've got 0:07:40.840 --> 0:07:44.480 a risk on trade today. I am always curious about 0:07:44.560 --> 0:07:48.000 how much internal talk goes on at the White House, 0:07:48.360 --> 0:07:50.360 UM and at the various departments about what's going on 0:07:50.400 --> 0:07:52.800 in the financial markets and particularly in the stock market. 0:07:52.800 --> 0:07:55.120 We certainly have a president who watches it very closely, 0:07:55.160 --> 0:07:58.280 But I'm just curious how much of that did you 0:07:58.280 --> 0:08:00.920 guys think about, and how much should we as leaders 0:08:01.200 --> 0:08:03.760 also take that into account when when thinking about policy 0:08:03.760 --> 0:08:07.679 and moves. Well, look, I think it's certainly one measure 0:08:07.920 --> 0:08:10.720 of the health, the economic health of the country, but 0:08:10.760 --> 0:08:14.920 it's probably not the one that most Americans can relate to. 0:08:15.520 --> 0:08:17.680 You know, when we were in the obob administration at 0:08:17.680 --> 0:08:20.200 the depths of the Great Recession, you know, we were 0:08:20.920 --> 0:08:25.440 laser focused on these jobs announcements every month, UM, trying 0:08:25.440 --> 0:08:27.160 to figure out how we get ourselves out of the 0:08:27.200 --> 0:08:29.880 whole as well as the jobs that were created to 0:08:29.920 --> 0:08:33.200 the very stimulus measures. I can't ever remember sort of 0:08:33.240 --> 0:08:36.040 focusing on what the Dow or s and T we're doing, 0:08:36.080 --> 0:08:38.640 and I certainly don't think we ever sent President Obama 0:08:38.640 --> 0:08:41.000 out to tout about that. You know, part of because 0:08:41.080 --> 0:08:43.960 the relatively small number of Americans that own stock at all, 0:08:44.040 --> 0:08:47.640 whether um individual stocks, neutral funds, or four in one case. 0:08:48.000 --> 0:08:50.800 I think it has been a mistake of President Trump 0:08:50.960 --> 0:08:53.520 to continue touting this on the way up, because you 0:08:53.640 --> 0:08:55.360 pat it on the way up, you own it on 0:08:55.400 --> 0:08:57.839 the way down. But I think on a day like today, 0:08:57.960 --> 0:09:01.640 we especially see the disconnect between where the market is 0:09:01.679 --> 0:09:06.000 and what everyday Americans are feeling, and so, Chris, you know, 0:09:06.240 --> 0:09:10.760 part of what's got to happen next, presumably, is everybody 0:09:10.760 --> 0:09:12.960 in Washington has to get on something close to the 0:09:13.000 --> 0:09:18.640 same page about where to put additional stabilization or stimulus 0:09:18.679 --> 0:09:22.040 funds or rescue funds, depending on how you want to 0:09:22.320 --> 0:09:26.120 characterize it or how one wants to characterize it. What 0:09:26.320 --> 0:09:29.559 is the advice you would give, especially to lawmakers. You're 0:09:29.679 --> 0:09:32.920 very familiar with the Congress and how it works in 0:09:33.040 --> 0:09:38.600 terms of where they can and should be putting a 0:09:38.760 --> 0:09:41.920 next round, which could be the last round of stimulus 0:09:42.000 --> 0:09:44.960 or stabilization. Yeah, I think you're right. I think this 0:09:45.160 --> 0:09:47.280 next round is I would say it's the next round 0:09:47.360 --> 0:09:50.199 is probably the last round of economic relief. We may 0:09:50.240 --> 0:09:54.000 be on economic stimulus after that. Uh, there's a couple 0:09:54.000 --> 0:09:56.400 of things that jump that come to mind. One is 0:09:57.000 --> 0:10:00.480 the enhanced unemployment benefits. Those expire at the end of July. 0:10:01.240 --> 0:10:03.600 That's the extra six hundred dollars a week that went 0:10:03.640 --> 0:10:07.800 into people's unemployment checks. That probably needs to be extended. 0:10:08.160 --> 0:10:11.560 Maybe not at the six hundred dollar level, but probably something. 0:10:12.200 --> 0:10:14.120 I do think that there needs to be an infusion 0:10:14.120 --> 0:10:16.720 of money and to stay in local government. We didn't 0:10:16.760 --> 0:10:20.880 see many job losses in this round of of data, 0:10:21.640 --> 0:10:24.640 but you know, when I hear Governor Cuomo saying that 0:10:25.040 --> 0:10:28.280 New York is running a fifteen fifteen billion dollar deficit, 0:10:28.720 --> 0:10:31.680 or Governor Whitmer in Michigan saying they're running a three 0:10:31.679 --> 0:10:35.200 billion dollar deficit and they have no ability to raise 0:10:35.280 --> 0:10:37.360 revenues at this point or even collect the revenues that 0:10:37.400 --> 0:10:39.400 are owed to them, So they're going to have to 0:10:39.400 --> 0:10:43.680 start to layoff teachers and police and firefighters. That's the 0:10:43.760 --> 0:10:47.160 next round of layoffs unless we provide some some additional 0:10:47.160 --> 0:10:49.480 relief to them. And I still think more needs to 0:10:49.480 --> 0:10:52.120 be done with the p p P program um and 0:10:52.200 --> 0:10:56.040 particularly in terms of targeting it to really really small businesses. 0:10:56.360 --> 0:10:59.200 And I know this isn't your your your world Chris, 0:10:59.280 --> 0:11:01.480 but I mean I am still blown away. And Jason 0:11:01.520 --> 0:11:04.000 I talked about this a lot. You know, we hear everyone, 0:11:04.080 --> 0:11:07.240 whether it's a CEO, whether it's members of Congress, whether 0:11:07.320 --> 0:11:10.800 it's governors, talking about the importance of testing, and it 0:11:10.920 --> 0:11:14.640 still seems like there is such, um, you know, a 0:11:14.720 --> 0:11:16.800 roadblock when it comes to that that if we talk 0:11:16.840 --> 0:11:19.320 about reopening the economy and how important that is, but 0:11:19.559 --> 0:11:21.800 yet it still feels like we're not getting to our testing. 0:11:22.240 --> 0:11:24.800 What what is the roadblock that you see or where's 0:11:24.800 --> 0:11:28.079 the problem? Well, look, I think that the approach this 0:11:28.120 --> 0:11:31.280 administration has taken from day one has you know, they 0:11:31.600 --> 0:11:33.240 started going down the road that they were going to 0:11:33.280 --> 0:11:35.839 ceneralize this and then they sort of pulled back and 0:11:35.920 --> 0:11:38.240 kind of left it to the state, uh into the 0:11:38.280 --> 0:11:40.800 private sector, and it's become kind of the wild West 0:11:40.920 --> 0:11:44.440 right now. And unfortunately, this is only the kind of 0:11:44.480 --> 0:11:47.679 thing that the federal governments effectively do. And we can 0:11:47.720 --> 0:11:51.240 look at the contrast. We look at South Korea, which 0:11:51.280 --> 0:11:55.480 does have much more aggressive testing, which really has been 0:11:56.200 --> 0:12:00.240 imposing a structor of social distancing requirements and as a 0:12:00.320 --> 0:12:02.280 results of that, they've been able to keep their cases 0:12:02.320 --> 0:12:04.920 down and actually have some kind of a functioning economy. 0:12:05.120 --> 0:12:07.559 So really this is the federal government that you take 0:12:07.640 --> 0:12:10.160 charge of this issue. Well, thank you so much, Chris. 0:12:10.200 --> 0:12:12.839 We really always appreciate the time you find for us, 0:12:12.920 --> 0:12:15.560 and really a nice in depth conversation again with Chris 0:12:15.640 --> 0:12:18.080 lou Thank you so much, senior fellow, University of Virginia, 0:12:18.080 --> 0:12:21.840 Miller Center, former Deputy Secretary of Labor under President Obama. 0:12:22.160 --> 0:12:25.760 This is Bloomberg Business Week with Carol Messer and Jason 0:12:25.840 --> 0:12:31.880 Kelly on Bloomberg Radio. Well on Saturday tomorrow. America's live 0:12:31.920 --> 0:12:35.240 sports industry, largely shuttered since March, It's gonna lurch back 0:12:35.280 --> 0:12:37.840 into action big time. Our Evan Kobie Williams actually writes 0:12:37.880 --> 0:12:39.760 that on the terminal. We're gonna talk about that little 0:12:39.760 --> 0:12:42.560 bit more later, but in the meantime, also writing about 0:12:42.559 --> 0:12:46.839 the UFC in a timely story on Bloomberg Business Week. 0:12:47.480 --> 0:12:49.880 It's in the magazine this week. It's about how the 0:12:49.960 --> 0:12:53.440 UFC the dominant force in Marshall Mixed Martial Arts. Excuse me, 0:12:53.559 --> 0:12:57.000 m m A has been fighting. Come on, Carol, I'm 0:12:57.040 --> 0:12:58.520 trying to get too much in here. I should just 0:12:58.559 --> 0:13:02.000 go to the story. Josh Idolson morning here. Darn, I'm 0:13:02.040 --> 0:13:04.280 so glad it's Friday. Josh Idle said, his labor reporter 0:13:04.320 --> 0:13:07.080 at Bloomberg News. He wrote this story. It's really interesting 0:13:07.120 --> 0:13:11.120 because it gets into some of the allegations against the UFC. 0:13:11.320 --> 0:13:13.520 Josh is on the phone from Palo Alto, also with 0:13:13.600 --> 0:13:15.680 us at Joe Webber, Bloomberg Business Week editor on the 0:13:15.679 --> 0:13:19.280 phone in Brooklyn. Uh and Joel, UM, come on in 0:13:19.360 --> 0:13:22.720 on here, because UM, just reading even just the beginning 0:13:22.720 --> 0:13:25.280 of this story about what one fighter says he has 0:13:25.320 --> 0:13:29.120 gone through is really gut wrenching. Well, I mean, you 0:13:29.120 --> 0:13:32.680 can watch it UFC fighting. You see the guys get 0:13:32.720 --> 0:13:35.880 into the octagon, and UM, you have to assume that 0:13:35.920 --> 0:13:38.640 it's at least got wrenching. But I think what Josh's 0:13:38.640 --> 0:13:41.280 story is ultimately about is what happens sort of outside 0:13:41.280 --> 0:13:43.600 the ring. Um. I think this is a really finally 0:13:43.640 --> 0:13:47.080 important story. UM. For a for the reason that you 0:13:47.160 --> 0:13:50.760 said at the top, which is this is as as Americans, 0:13:50.760 --> 0:13:53.760 I think right now we are creating sports. UFC is 0:13:53.800 --> 0:13:55.880 almost going to be the first one to really address 0:13:55.960 --> 0:13:58.720 that with this about small But the bigger story here 0:13:58.800 --> 0:14:02.319 is is that jeez are fighters who are effectively contractors, 0:14:02.320 --> 0:14:05.920 they're untrajected workers. And if we're a decade now, there's 0:14:05.960 --> 0:14:09.880 been this case sort of building against UFC that's basically 0:14:09.880 --> 0:14:13.319 an anti trust case. Um, Josh, you want to come 0:14:13.360 --> 0:14:16.439 in there, what's the what's the context that the fighters 0:14:16.679 --> 0:14:21.800 are are kind of uh finding themselves uniting a run. Sure, 0:14:21.880 --> 0:14:26.080 this is a five billion dollar antitrust monopoly case. And 0:14:26.440 --> 0:14:28.800 when people talk about monopoly in the US, they're often 0:14:28.800 --> 0:14:33.320 talking about how companies get an advantage over consumers. In 0:14:33.320 --> 0:14:38.040 this case does allege that the UFC has monopolized the 0:14:38.120 --> 0:14:43.040 market for selling abouts, but it's also about what's called monopsony, 0:14:43.120 --> 0:14:46.800 which is when you're a monopoly in dealing with your workers. 0:14:46.840 --> 0:14:51.920 That the UFC has monopolized the labor market so that 0:14:52.280 --> 0:14:56.440 workers don't have much else to turn to if they 0:14:56.480 --> 0:14:58.680 don't like what the UFC is offering them. As we 0:14:58.720 --> 0:15:01.760 say in the story, it's like the ground in pound 0:15:02.120 --> 0:15:05.560 that you might see in the octagon. According to the plaintiffs, 0:15:05.840 --> 0:15:09.080 that these workers are trapped, there's not somewhere else to go. 0:15:09.640 --> 0:15:11.680 And then the company has been able to layer on 0:15:12.240 --> 0:15:16.560 more and more restrictive rules and keep a much larger 0:15:16.680 --> 0:15:21.240 share of the revenue for the ownership rather than the players, 0:15:21.760 --> 0:15:24.600 then you would see in a lot of major league sports, 0:15:25.840 --> 0:15:27.880 and I'm actually to that end like that. I think 0:15:27.920 --> 0:15:30.960 one of the most interesting little details that Josh found 0:15:31.000 --> 0:15:33.280 out through his reporting was like, even if as a 0:15:33.360 --> 0:15:36.520 fighter you were going to have some sort of endorsement 0:15:36.720 --> 0:15:41.240 deal over time, UFC has actually intermediated that relationship and said, 0:15:41.240 --> 0:15:44.480 we'll actually negotiate those sponsorships for you and then give 0:15:44.520 --> 0:15:47.280 you just you know, a share that we say is reasonable, 0:15:47.320 --> 0:15:49.320 which I just think, you know, it's sort of an 0:15:49.360 --> 0:15:52.320 interesting twist. M Josh. I also just want to talk 0:15:52.360 --> 0:15:55.920 about his sports in general, because this isn't unique to UFC. 0:15:56.240 --> 0:15:59.680 Every other sporting league has has versions of of this 0:16:00.120 --> 0:16:03.480 where there are the players and the owners or the 0:16:03.600 --> 0:16:07.440 leagues and there's always that relationship. I'm thinking of baseball specifically. 0:16:07.680 --> 0:16:11.040 So how do we view this case in that context. Well, 0:16:11.120 --> 0:16:13.800 the argument that plaintiffs would make is they are just 0:16:13.920 --> 0:16:16.600 the latest to go through these struggles, and that it's 0:16:16.640 --> 0:16:20.720 a struggle that in every other great sport comes along eventually, 0:16:20.720 --> 0:16:23.440 as one of them said, and where the players have won. 0:16:23.600 --> 0:16:27.640 So there is the Muhammad Ali Act in boxing, there 0:16:27.760 --> 0:16:30.720 is free agency, now in baseball. And an interesting thing 0:16:30.720 --> 0:16:34.479 about this history is that each time there's been this conflict, 0:16:34.960 --> 0:16:38.840 management has argued, this will destroy the sport if you 0:16:38.960 --> 0:16:42.080 change it in this way. Now Here again you have 0:16:42.360 --> 0:16:46.680 these fighters saying they should have more leverage in dealing 0:16:46.720 --> 0:16:51.440 with management, and UFC has said that this lawsuit is 0:16:51.480 --> 0:16:54.400 an attack not just on them, but a threat to 0:16:54.800 --> 0:16:59.560 business's ability to be risk taking in successful Elsewhere. UFC 0:16:59.640 --> 0:17:03.120 says there wouldn't be much competition in m m A 0:17:03.280 --> 0:17:05.280 without them, because there wouldn't be much of an m 0:17:05.359 --> 0:17:08.480 m A industry in the first place without them. Well, 0:17:08.520 --> 0:17:10.840 and it's an argument, Josh, that's sort of like turns 0:17:10.920 --> 0:17:15.960 onto itself because they have been very savvy about and 0:17:15.960 --> 0:17:18.800 and you described this so well in the story about 0:17:18.920 --> 0:17:22.160 essentially just buying everything up and so this whole idea 0:17:22.160 --> 0:17:24.879 of it wouldn't exist without us. It's like, yeah, it 0:17:24.920 --> 0:17:28.360 wouldn't because you've got the market cornered. So how does 0:17:28.400 --> 0:17:33.840 this get figured out? Well, any day now or any 0:17:33.880 --> 0:17:38.640 month now, we could have a ruling on class certification 0:17:39.160 --> 0:17:42.640 come down from a federal district judge in Nevada. Judges 0:17:42.760 --> 0:17:46.240 when they're ruling gets work from home also So we 0:17:46.320 --> 0:17:49.320 are on the cusp of a very big step in 0:17:49.359 --> 0:17:53.439 this case, which is the judge ruling either for or 0:17:53.480 --> 0:17:58.480 against certifying a class of what could be twelve hundred fighters. 0:17:59.800 --> 0:18:03.960 We would really turbocharge this lawsuit and change the discussion 0:18:04.000 --> 0:18:06.520 about the lawsuit and about what it might look like 0:18:06.680 --> 0:18:09.959 if it could be settled. Now, UFC says this is 0:18:10.480 --> 0:18:14.440 not just a bad lawsuit, but a destructive legal theory 0:18:14.640 --> 0:18:18.080 behind the lawsuit, and that they're committed to defeating it. 0:18:18.200 --> 0:18:21.159 And in fact, the judge has already said he is 0:18:21.240 --> 0:18:24.960 confident that however he rules, this is going to get 0:18:24.960 --> 0:18:28.040 appealed to Federal Appeals Court, could get appealed from there 0:18:28.040 --> 0:18:30.440 to the U. S. Supreme Court. So we are five 0:18:30.520 --> 0:18:34.080 years into a legal struggle that could go on much further, 0:18:34.480 --> 0:18:38.080 but that is going to take a new form very 0:18:38.160 --> 0:18:41.600 soon with this judge's ruling that will get noticed, as 0:18:41.600 --> 0:18:45.320 scholars told me, not just in m m A, but 0:18:45.520 --> 0:18:48.520 in all sorts of companies. But I do wonder, Josh, 0:18:48.560 --> 0:18:52.240 if there was more competition in mm A, would we 0:18:52.320 --> 0:18:58.640 not be having this discussion and why isn't there more competition? Well, 0:18:58.760 --> 0:19:01.720 the argument of the laws suit is that there are 0:19:02.320 --> 0:19:06.600 a series of different exploitative practices that have gone on 0:19:06.720 --> 0:19:11.399 that reinforce each other. The lawsuit talks about everything from 0:19:11.800 --> 0:19:18.199 exclusive contract with sponsors to the contracts with the fighters, 0:19:18.280 --> 0:19:22.520 and there's a catch twenty two in that. The one 0:19:22.560 --> 0:19:25.160 of the phrases that comes up in some of the 0:19:25.320 --> 0:19:29.040 internal correspondence that's been unearthed is people you have seen 0:19:29.119 --> 0:19:32.919 talking about choking off the oxygen to their competition, and 0:19:32.960 --> 0:19:37.800 in particular they mean the players. So you deprive the 0:19:37.960 --> 0:19:41.840 competing promoters of the chance to get at the players. 0:19:42.400 --> 0:19:45.679 You deprive the players of having somewhere else to go 0:19:45.760 --> 0:19:48.200 if they don't like what's being proposed in your contract. 0:19:48.359 --> 0:19:54.040 And these are contracts that allegedly become effectively perpetual because 0:19:54.200 --> 0:19:57.879 UFC has a chance to extend them for everything from 0:19:57.920 --> 0:20:01.159 you got injured too, you became a champion. It's like 0:20:01.200 --> 0:20:04.359 an mm A sweatshop is kind of to some extent 0:20:04.440 --> 0:20:07.360 going on. So this case sounds and we're so craved 0:20:07.560 --> 0:20:10.920 for sports, I know, I know, Well that's exactly the point. 0:20:10.920 --> 0:20:13.040 That's going to be millions of people that watch, and 0:20:13.200 --> 0:20:16.879 you know he again is also in need of it. 0:20:16.960 --> 0:20:20.320 Unless you want to watch Jordan's highlights from the nineties again, which, 0:20:20.400 --> 0:20:23.320 for the record, are our sensational film. Yeah yeah, nothing 0:20:23.320 --> 0:20:25.240 wrong with that, Nothing wrong with that. All right, Thank 0:20:25.280 --> 0:20:27.480 you both so much. I really appreciate it. It's a 0:20:27.520 --> 0:20:30.280 great story. It's on the terminal and on Bloomberger dot Com. 0:20:30.320 --> 0:20:33.200 In next week's issue of Bloomberg Business Week, Josh Idelson 0:20:33.240 --> 0:20:36.040 wrote at UFC wants you to watch brawls, not it's 0:20:36.080 --> 0:20:39.800 five billion dollar lawsuit. This is Bloomberg Business Week with 0:20:39.880 --> 0:20:43.879 Carol Messer and Jason Kelly on Bloomberg Radio. Well, we 0:20:43.920 --> 0:20:46.239 talked with our next guest back in late March, as 0:20:46.240 --> 0:20:48.879 those COVID nineteen cases were adding up, back with us. 0:20:49.280 --> 0:20:52.280 Dr Penny Wheeler, who is president CEO at a Line 0:20:52.280 --> 0:20:56.280 of Health. They've got twelve hospitals in the Minnesotia Minnesota area, 0:20:57.480 --> 0:21:02.680 doctors about clinics, fifteen retail pharmacies um throughout that region. 0:21:02.760 --> 0:21:05.760 The system's total operating revenue in fiscal twenty eight was 0:21:05.800 --> 0:21:09.159 about four point four billions. So let's talk about the 0:21:09.240 --> 0:21:12.199 virus in particular, what's going on in the Midwest. She 0:21:12.320 --> 0:21:15.400 joins us on the phone from Minnesota. Dr Wheeler, nice 0:21:15.400 --> 0:21:18.600 to have you back with us. How are you guys doing. Yeah, 0:21:18.760 --> 0:21:21.560 nice to be back. Thank you for having me. We're 0:21:21.560 --> 0:21:24.000 doing okay. I mean we've used that we still alright, 0:21:24.119 --> 0:21:26.960 just for cover Cuomo saying that down the downslope there 0:21:27.119 --> 0:21:29.119 on the New York side, we are still on the 0:21:29.200 --> 0:21:32.360 upfloat here in the Midwest. So but we've used the time, 0:21:32.400 --> 0:21:34.840 I think, to prepare and really kind of expand our 0:21:34.880 --> 0:21:37.720 capacity for for the community that we're ready. So we're 0:21:37.720 --> 0:21:41.600 continue to see an uptick in cases and sadly in 0:21:41.760 --> 0:21:46.320 death as well in our geography. Well, let's talk about that, 0:21:46.400 --> 0:21:49.800 Dr Wheeler. What have you seen and what have you learned? 0:21:49.920 --> 0:21:53.719 I guess both in terms of preparation, but also you know, 0:21:53.920 --> 0:21:57.080 how has the virus been a little bit different maybe 0:21:57.119 --> 0:21:59.560 in the in the ways that it's played out. You know, 0:21:59.600 --> 0:22:04.119 obviously each state, each locality is a little bit different. 0:22:04.320 --> 0:22:07.480 I wonder what you see versus what we've seen maybe 0:22:07.480 --> 0:22:11.000 on the coasts. Yeah, I think, Well, we're grateful, as 0:22:11.160 --> 0:22:13.560 as many governors have. We're grateful hour for our governors. 0:22:13.760 --> 0:22:18.199 Tim Wallas's actions on the physical distancing parameters and the 0:22:18.320 --> 0:22:21.720