A small town's fight against ICE

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On the show today, jobs, housing, and the climate impacts of war

from American public media, this is Marketplace.

In Denver, I'm Amy Scott, Inferchi, Rizdol.

It's Thursday, March 19th. Good to have you with us.

We got another sign today that the US job market is holding up.

Okay, the Labor Department said new claims for unemployment benefits

dropped more than expected last week.

The number of people filing for the first time fell to 205,000,

the lowest level since January.

While one week does not make a trend, it is one more data point to back up

the Fed's assessment yesterday that the labor market appears to be pretty stable,

even as the economic outlook is uncertain.

Marketplace's Megan McCarty Carino has more.

Weekly jobless claims are one of the first places we'd see signs that

recent geopolitical turbulence is destabilizing the labor market.

So far, this is consistent with what we understand to be kind of a boring job market.

Mark Hemrick at Bankrate says it's basically the same low higher, low fire environment

we've been talking about for months.

A lack of new jobs means it's taking longer for unemployed people to find work,

pushing continuing claims higher.

But it looks like most firms are holding onto workers,

as Elizabeth Crowfoot, principal economist at Lightcast.

It's a gradual rebalancing of the labor market, not a full-on deterioration.

Which may sound surprising if you've been following the news,

says Daniel Zhao, chief economist at Glassdoor.

There have been big layoff announcements from Amazon,

Block, UPS, Meta.

But when we actually look at the macro data,

we see that layoffs are relatively similar to where they were before COVID.

We aren't seeing this dramatic surge in layoffs.

Some of those cuts might never show up in jobless claims,

says Andy Challenger at Challenger Gray in Christmas.

If you get, like, over a large tech company and you get a severance package,

there might not be a need for you to go claim that insurance.

Those job losses would show up in the unemployment rate,

which as of last month was 4.4%.

Relatively low by historic standards.

I'm Megan McCarty-Karino from Marketplace.

We're coming up on the spring home buying market,

but we're still catching up on data from earlier this year,

thanks to the lingering effects from last fall's government shutdown.

Today, the Census Bureau reported new home sales for January,

and as Daniel Ackerman reports, the news was not great for builders.

Seasonally-adjusted sales were down more than 17% compared to December.

On one hand, Lisa Stern event of Bright MLS expected some weakness.

There was a lot of wintry weather.

People aren't usually outtouring home sites during that weather.

But she didn't think the numbers would be quite this bad.

We saw sales at their lowest level since October 2022.

And that has caused some home builders and the lenders they work with

to offer sweeteners for prospective buyers,

says Tiffany Russell, a real estate agent in Austin, Texas.

Those include below-market mortgage rates.

I'm seeing that they are building a lot of homes

and giving the farm away on incentives.

For sellers, Russell is also being more conservative

with asking price these days.

We are pricing on the lower end of the comps of the area

because our buyers won't come through the door if we're even a bit overpriced.

Rising mortgage rates in the past few weeks haven't helped,

says Michael Orbino, a real estate agent in Bellevue, Washington.

The spike in interest rates with conflict going on in the Middle East

and oil prices have really disappointed some folks.

That plus ongoing worries about the job market means the housing market

is still kind of stuck.

We've been at this for three years ever since the Fed changed their policy.

Orbino says at this point, he considers the slower housing market

a new normal. I'm Daniel Ackerman for Marketplace.

Wall Street, singing the blues today,

we'll have the details when we do the numbers.

To buy one of those new houses, Daniel Ackerman was talking about,

most Americans need a mortgage.

But there are some parts of the country where it's harder to get one.

You've heard of food deserts and banking deserts.

Sharon Cornelison, director of housing at the Consumer Federation of America,

has studied mortgage deserts.

She's here today to tell us about her work.

Sharon, good to have you on.

Yeah, so glad to be on today.

What exactly is a mortgage desert?

How do you define it?

Yeah, so a mortgage desert is a place where mortgages have become scars.

So there's not that many mortgages that are being used in the neighborhood.

So many homes are instead bought and sold without a mortgage.

We found that some mortgage deserts are vacation destinations

where a lot of people buy second homes with cash.

We found that in some other places, there are some really investor-heavy communities.

Think about suburban Atlanta where there's just a lot of investors competing with home buyers.

And then the final type is communities that are more just invested,

where home values are usually low.

And it's difficult for people to get a mortgage in these places.

Yeah, I covered housing in Baltimore for a long time,

where people often had trouble getting mortgages because the home values were too low.

And especially when interest rates were low,

the banks wouldn't justify the cost.

Yeah, in my research, we found that in Baltimore,

half of all homes were sold with cash.

It's often very difficult to get a mortgage

for a home that's worth less than $100,000 or even $150,000.

It's really a market that's not well covered right now by lenders.

What are the impacts of this on equity in homeownership?

Yeah, most people in order to become a homeowner, they need a mortgage.

It's really difficult to become a homeowner, especially first-time homeowner.

But even for existing homeowners, it's really important to be able to get access to a mortgage.

Because without it, let's say your roof starts to leak,

where are you going to get the money from?

A lot of people need to refinance to get some equity out of their home to maintain their home over time.

So even not having access to a mortgage kind of later in your home ownership journey,

can be really difficult and can really undermine the equity that you can maintain over time.

Now, just because there aren't a lot of mortgages in a given area,

doesn't mean homes aren't being bought and sold, right?

Can you talk about how those deals are getting done and why that's going to be problematic?

Yeah, so in many cases, we see that in those places,

cash buyers have an advantage, right? Because people can buy with a mortgage.

So you kind of have to have cash.

So we see that the playing field deals towards investors.

So it means that local homeownership opportunities go down and less wealth is being built locally

in the community, right? Another kind of alternative that we see emerging is often there's

kind of exploitative alternatives that don't have a lot of consumer protections.

For example, there could be like sellers financing where you have to enter into a land contract

with a seller, but these kind of arrangements more often feel than they succeed.

So in most cases, it's much better for people to kind of have access to the standard

30-year mortgage with a lot of protections and kind of they know what they're getting into.

Now, some of this is because of reforms that were made after the big, you know,

subprime mortgage crisis in the mid-2000s. Did that backfire in some ways?

I think there have been some unintended consequences. I mean, the Dodd-Frank Act was really

important to prevent kind of these kind of predatory mortgage products from emerging again.

But especially at the bottom of the market for homes with very low values,

lenders can only charge up to a certain amount of points and fees if they want to

originate the mortgage today on these protections. But it means that it's not really,

a lot of lenders don't really see it worth their while because they may spend as much time

originating a $50,000 mortgage as they would originating a $500,000 mortgage. And they can get

a lot more compensation in the latter case, right? So they go for the bigger mortgages,

better than the small mortgages. All right, Sharon Cornelison is at the Consumer Federation of

America where she wrote a report about mortgage deserts. Thank you so much for your time. Thank you.

When we think about the costs of war, there are of course the lives lost, the people injured and

displaced, the property and economic damage. But there is also an environmental toll,

whether it's the pollution caused by bombs or the excess burning of fossil fuels.

For more on how the US-Israeli war on Iran will affect environmental and human health,

we reached out to Nida Crawford, a professor of international relations at the University of

St. Andrews. We know that in the short term and in the local area, there is air pollution from

fires, black rain they described in Iran. That is when buildings and infrastructure burn,

they put up a lot of particular matter. Then we also know that there's been water pollution

from the tankers that have been destroyed. And then we know that there are toxic chemicals released

in the water and in the air when all of these buildings are destroyed or

communications are either detonated or they don't detonate and then are contaminating the ground as

they decay. How about the climate effects? War fighting machinery obviously burns a lot of

fossil fuels, but this war is taking place in an area where there's a lot of oil and gas infrastructure.

In any war, the emissions from the armaments as they get to the place that they're going to fight.

So those are operational and installation emissions that are particular to war and that's

immediate. And then in the case of this particular region, as you say, it's oil rich, natural gas

rich, natural gas infrastructure has been targeted and damaged or destroyed. So what you see is

there can be uncontrolled release of the methane. So then in addition, even longer term, military

spending will go up. Military spending will go up for the direct combatants and it will increase

for those in the region. And when military spending goes up, military emissions increase.

They're tightly correlated. And the United States military was already the biggest

institutional greenhouse gas emitter in the world, right? That's correct. So last year,

I'm sorry, well, 2024, which is the most recent year for which we have emissions data,

the emissions profile of the US military at 47 million metric tons that year

was greater than many countries about the same size as the emissions of countries like Portugal.

But one of the reasons we don't know all of the military emissions of every country in the

world is that the United States fought very hard at the Kyoto Protocol negotiations in 1998 to

exclude mandatory reporting of military emissions. So we know that we have either my calculations

or other people's calculations of US military emissions going back to 1975. But we don't have

every other countries. But it is safe to say of the United States military that it is the largest

military emitter in the world. Many have pointed this out that this war and also the war in

Ukraine and the energy shocks that resulted have only strengthened the case for transitioning away

from our dependence on fossil fuels. Do you think this will give political leaders any more

sense of urgency? Well, to me, the UN climate reporting should give us enough urgency.

The planet is warming at an unprecedented rate. If we need more urgency,

perhaps this would be it, but the problem with high military spending for every country is

that's less money to put into transitioning to renewables. And even in countries like the one I

live in, Great Britain, which are not directly involved in this conflict, they have increased their

military spending because of the war in Ukraine. And now that military spending is increasing

emissions and that money is not available for a transition. It's an opportunity cost.

Nita Crawford is at the University of St. Andrews and also affiliated with Brown University's

Costs of War project. Thank you so much. Pleasure to be with you.

For more of our climate reporting, check out our podcast, How We Survive.

Kai hosted a whole season about the military and climate change, wherever you get your podcasts.

Coming up, they never came out and said we are planning a really nifty detention center here.

There were signs though, but first let's do the numbers.

Dow Jones industrial average dropped 203 points, 410% to close of 46,021. The Nasdaq lost 61 points,

310th percent to finish at 22,090. And the SB 500 gave up 18 points, also 310th percent to end at

66,06. Daniel Ackerman was just talking about January's sluggish new home sales, home builder,

Lanar corporations slumped 1 and 1 10th percent. The online marketplace Zillow dwindled 1 and

810th percent. Rocket companies, the mortgage lender and brokerage jumped 3%. Energy facilities

are getting hit on many fronts in the Iran War. Brent Crude hit a high of $119 a barrel today

and settled at 106 gas in the US average $388 a gallon. You're listening to Marketplace.

This Marketplace podcast is supported by Vantage Score. The modern credit score used by nine

of the 10 largest banks, over 3,700 companies, and now approved by Fannie Mae and Freddie Mac,

Vantage Score. Trended data, alternative data, reduced risk.

This Marketplace podcast is sponsored by the University of Illinois Geese College of Business.

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This is Marketplace. I'm Amy Scott. We heard earlier in the show about mortgage deserts,

but how about pharmacy deserts? According to a 2024 study published in the Journal of the American

Medical Association, nearly half of all counties in the U.S. have at least one 10-mile area

without a retail pharmacy. And rural pharmacies are feeling that pressure. That brings us to the

latest installment of our series, My Economy, where we're bringing you stories from health care

all this week. I'm Julie Perkins. I'm Batson Stragon Family Market in Hamburg, Kansas. I'm a

pharmacist. With the pharmacy, I bought it in 1995 in 2004. Our grocery store in town went out of

business, so we remodeled, put in a full line grocery store because I was afraid if we didn't

have a grocery store here in the county that the pharmacy wouldn't be able to exist either. So

here we are today. 80% of my prescriptions are through one of the three PBMs pharmacy benefit

managers. They are the go-between between us and the insurance company. They tell us how much they

will pay us. They just have so much control, which has taken all of the control out of my hands.

So there's what's called a dispensing fee. To come up with that fee per prescription,

you add in your pharmacist time, your technician time, the electricity, the label, the bottle,

all the overhead that a regular business has. Well, when 80 to 85% of the prescriptions are

underneath that minimum that we need to break even, it doesn't pencil out. There are some scripts

that I will fill that I get 12 cents over what it costs me to buy that. That doesn't even pay for my

label, my lid, and the bottle. The last 10, 15 years, it's been very, very difficult.

Male order has pulled away a lot of my business from the pharmacy. So we do some floral. We do

gift wrapping. We have a soda fountain. I just don't know how more diversified I can get.

The clients how we have are very faithful. They all say they need me, but that doesn't pay the bills.

I picked pharmacy because I thought it would be a comfortable living. Right now, it's not comfortable,

but where the only pharmacy and grocery store in the whole county without me, people will have

to drive 35 minutes just to get basic essentials. So this community just needs needs me.

Julie Perkins, pharmacist and owner of Battsons Drugstore and Family Market in Howard, Kansas.

Newport, Oregon is a small town on the coast, known for its beautiful beaches and its seafood

industry, particularly Dungeonous Crab. But recently, there's been trouble in Paradise,

and as in other bigger US cities, the community has come together over concerns about the Trump

administration's immigration enforcement efforts. Garrett Epps wrote about it for the Washington

Monthly. Thanks for being here, Garrett. Thanks for having me. So the meat of your story starts with a

disappearing helicopter. Can you briefly summarize what happened? The helicopter was something that was

one by the Newport Fisherman's wives, a very highly organized group of families of the people

who staffed the fishery. The rescue helicopters were stationed. Each was about 100 miles away. So

they just went to their members of Congress and they said, we need the helicopter here because

there's so much danger. And they got Congress to pass a special statute that said the Coast Guard

couldn't move an air station without giving 18 months public notice. So this was the situation

until last fall when they found out that with no notice, the Department of Homeland Security had

taken the helicopter and moved it down to the southern border. So the idea being that the priority

now is interdicting migrants coming in from Mexico. That's more important than the Coast Guard's

function of providing rescue. And then people in town realized that wasn't all right. There were

plans for a big ice detention center? Well, you know, they never came out and said we are

planning a really nifty detention center here. What they did do is federal contractors began

contacting local businesses and saying things like, let's suppose we need to rent 200 hotel rooms

for federal employees who might be coming in at some facility or other. And it became clear that

Department of Homeland Security had its eye on the Newport Airport and that they were planning to

put in an ice detention center there. But they gave no notice and they did not respond to questions

from city officials or members of the public or members of Congress. And people weren't happy about

this. Tell me about the town meeting over what was happening. Newport is a town of 10,000 folks.

800 people showed up. No one spoke in favor of an ice facility. People said it's unfair

that ice is treating people badly. The second thing was what's going to happen to our economy

because tourism and seafood both function significantly with immigrant labor. And the third

thing is what's this going to do to tourism? So this is perceived as a kind of existential threat

to the town on moral, political and economic levels. So the town pushed back. They fought to keep

their helicopter or get it back and to stop this detention center. Did they win? Where do they

things stand now? Well, they got a preliminary injunction from a federal court saying that

ice could not move the helicopter out of Newport because the statute said it had to remain there

for the 18-month period. And they finally got a statement from ice that said, we have no plans

to put a facility in. You know, I can't help but add that the community was and remains extremely

skeptical of these assurances. The dispute is not over. What lessons do you think are in this story

for other towns that are facing this choice about whether to allow ice detention centers?

I think what's interesting is the way that people immediately perceived that this would be bad

for the community on a number of levels that transcended simply whether you like the Trump

administration. It is the economy, our neighbors, the people that live here, whether we're going to be

able to continue with the life that we want here on the Oregon coast. So I think if a community

stands together, they may be able to avoid having the negative effects of an ice facility in

their town. Garrett Epps is the Legal Affairs Editor at the Washington Monthly. Thanks so much.

Thank you. Enjoyed it.

This final note on the way out today, we talked earlier about how reforms in the Dodd-Frank Act

after the financial crisis have contributed to the dearth of mortgages in some communities.

Today, the Federal Reserve and other banking regulators propose some changes. Officials say will

encourage more lending under the proposal's banks would have to set aside less capital to protect

against losses like the ones that almost took down the economy back in 2008. Our daily production

team includes Livy Burdett, Andy Corbin, Maria Hollenhorst, Sarah Leeson, Sean McHenry,

McKayla Sia, and Sophia Terenzio. Will Story is the supervising senior producer, and I'm Amy

Scott. We will see you tomorrow.

This is APN.

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