Deep Dive
Shownotes Transcript
Hey, bazillionaires. Are you ready for a new episode of Million Bazillion? This season is presented in partnership with Greenlight, the debit card and money app for kids and teens. With Greenlight, kids can learn how money works in the real world, including how to save, invest, and set goals. Get smarter about how you spend and save with Greenlight. Sign up now at greenlight.com slash million. That's greenlight.com slash million.
I'm Kent, and I'm 10 years old in Seoul, South Korea. My name is Lily, and I'm 11 years old, and I'm from Oregon. Hi, my name is Oscar. I'm 8 years old, and I live in New York. My question is... And my question is... My question is... What are tariffs? I love your show. Thank you. Well, I love that question. So, Kent, Lily, and Oscar, this one's for you.
Oh yeah, this looks real good. Bridget, have you seen my lunchbox? It's the Darth Maul one that was in the office fridge and now I can't find it. Oh sure, I've got it right here. It's such a nice day. I thought we could eat lunch outside for once, like European people do in movies. Okay, but why are we sitting on the same side of the table facing the sidewalk? And what's this giant sign you're working on? Solve over sandwiches? Hey, what is this?
Okay, so I had this great idea. So sure, we're amazing at answering questions about money, but maybe it's time we take it to the next level and start solving our listeners' problems with money. Mm-hmm.
And since we don't have any extra time for this, I figured we could just do it on our lunch break, like in between answering questions. And that's why I'm calling it Solve Over Sandwiches. I'm still workshopping the name. Wait, so we're selling sandwiches? No, no, we're solving money issues while we eat sandwiches. Because it's lunch.
Solve over sandwiches sounds like the name of a sandwich store, though. Sure, sure, but you know, we're not selling sandwiches. We're giving away free and still excellent solutions to money problems over lunch. Yeah, but I just want to eat my lunch over lunch. I don't want to work. Oh, come on. This is going to be fun. I promise we'll only pick problems that we can actually solve during the allotted lunch break time. Uh-huh. Oh, look, it's our first customers. Hey, hey, over here.
Are you guys selling sandwiches? I want one. Yeah, I'll take a pastrami on rye. I want peanut butter and jelly on wheat. Sorry, no sandwiches here. Do you have any money problems that we can help you solve? Not really. Just wanted a sandwich. Hey, how much for a solve over sandwich? Sorry, we're not a sandwich shop. A new sandwich place. Let's all run there at once. Oh, boy.
Welcome to Million Bazillion, everyone. I'm Ryan. And I'm Bridget, and we help dollars make more sense. Unless we're on our lunch break, in which case we can solve your money problems over sandwiches. And that's why we're called Solve Over Sandwiches. Sandwiches not included.
Sorry, everybody. We're still workshopping the name. Well, hopefully we get a good problem to solve soon. Well, with lunch break time ticking down, this is the perfect moment to bite into my double-decker jelly and monster cheese pickle sandwich. Mmm. Mmm.
Uh, are you the people who solve the money problems? Oh yeah, that's us. No, hold on, sorry. Wait, let me chew a little bit more. Let me just do a little bit more chewing. I'm almost done. Okay. Tell us, what's the money problem you're facing?
My name's Robin. I'm in the fifth grade and I started a slime business at school. Ooh, cool. Slime business. That's very go-get-em of you. Yeah, well, I make the slime myself in the science lab. My trademark is that I add glitter. It looks really cool. Love that. And then I sell the slime to my fellow students. Uh-huh. So what's the problem? I sell my slime for $3 a jar.
I can't go any lower than that or I wouldn't make enough money to stay in business. $3 a jar. That's not a bad price. But there's this other kid at school who buys slime for $1 a jar from South Bay Elementary across town. Then she sells it back at our school for $2 a jar. I can't compete. Okay, so it costs her $1 and then she sells it for $2. So that's a nice little profit she's making. So how come the slime from South Bay costs a whole dollar less than yours?
And their school pays for an unlimited supply of white glue. And they have the kindergartners make it. Have you thought about getting in on this school-subsidized slime business? Maybe you could buy slime from South Bay Elementary and sell it too. No way. Making and selling slime from scratch is my dream. And I want to be known as the town's biggest slime ball. But in a good way. But how am I supposed to do that when I've got to compete with $2 slime made across town?
Well, yeah, that's a big dilemma you have there, Robin. Probably would take more than 30 minutes to solve, though. Wish we could help. Wait, wait, wait. Okay, so Robin just wants to figure out how to make her slime business more successful. There must be a solution here. We just need to think. Where's that old colonial music coming from? I think I can help. Ah! It's a ghost! In colonial garb! Wait, is that friend of the show Ghost of Alexander Hamilton?
What? No! Alexander, I should think not. It is I, Fourth President of the United States, James Madison.
Oh, wow. Oh, cool, cool, cool, cool. Listen, I may not impart pop history lessons through hip-hopera like some founding statesman who didn't become president, but I've got a solution for you. It will solve everything. Get ready for it. How about a tariff? What's that?
Oh, it's just a little trade policy that I was deeply involved with back when I was an active member of American politics. Did you invent these tariffs? Well, no, but you know what? Alexander Hamilton didn't invent them either. I just thought they were a really good idea and I used them a lot when I was president. What are they even teaching you kids in your James Madison 101 classes? Uh, that's not a class. What? I think what Robin is trying to say is, um...
Tell us more about tariffs and how they might solve Robin's problem. Of course. A tariff is an extra charge or tax that countries put on goods that are made somewhere else, like in another country. It also goes by the name of duty. Duty. Oh.
Okay, well, um, and then how will this help Robin? Because she's not a country. She is a kid. Tariffs are things a country would use, right? I will explain everything. I just need a moment to straighten out my powdered wig. Which, by the way, is Hamilton's wig more powdery than mine? Just tell me. Just tell me. You guys are about the same. Are you sure? Because I think mine's more powdery.
We'll learn more about tariffs when we come back after this.
And now it's time for asking random kids not-so-random questions. Today's question is, what's the best coin and why? The best coin is the penny. It has a different color than all the rest of the coins. The 25 cents one because there was a Simpsons game at a restaurant and it was 25 cents. The half dollar coin because it's worth nothing.
Half a dollar. I would rather like the quarter because it has the first president on it. I'd have to say the silver dollar because I think they're awesome. That was Eleanor in Nebraska, Connor in California, Joshua in California, Willa in Nebraska, and Kai in Florida. This has been Asking Random Kids Not-So-Random Questions. And we're back.
Just to catch you up, I've finished my sandwich and am now moving on to my pudding cup. Yeah, but in terms of today's question so far, we're trying to help neighborhood friend of the show, Robin, solve a problem. The solution to which apparently involves the ghost of James Madison and something called tariffs. Tariffs are an extra tax we put on something made in another country. Very good, Robin. Yeah, so the ghost of James Madison was just about to explain to all of us how tariffs could help you grow your business.
Say, Ghost Madison, we've actually had the ghost of Alexander Hamilton on the show before, and he, like, sang this whole song. Do you also have a song to help us learn this lesson? No, I don't. That is... So, of course he did that. The total theater kid. No, I'm not one for light rapping, but I do have a humble story that I'd like to share now that my wig is on straight. Let me take you back to the years after the American Revolutionary War.
We white men were deciding how the country would be run. There was just so much to do. Should we have our own currency or no? That's a hard yes. What about a central bank? Um,
Your buddy Hamilton had an idea for a way we could raise a bunch of money to help pay for all the stuff we wanted to do. Hammy says to us, he says, why don't we take all the goods coming into our country, imports they're called, and just put a small tariff on them? Well, how's that going to help?
See, business owners are responsible for paying tariffs to the government when they bring those goods into the country. And then the government gets to keep that tariff money. So Hamilton's idea was that this little extra tax would help the government raise money, as long as the tariff was a nice, reasonable amount.
Well, how much is a nice, reasonable tariff amount? Oh, you know, 3%, 5%. Not so high as to stop people from buying altogether. Because if the American business importing those goods has to pay a little extra at the border, they're probably going to raise prices for their customers to make that money back. Oh, right. Okay, that makes sense. So if it costs the store owner more to get that on their shelf, chances are that's going to end up as part of the final price.
Yes, and if the price is too high on the store shelf, people stop buying, you know. But old Hamhocks, he wanted people to keep buying so that tax money keeps flowing into the U.S. Treasury. Ah, all right. So tariffs are just a way the government makes money because they're a tax. A tax that helped solve a problem. And then there was this other problem which might feel a little familiar to you, Robin. Okay, let's hear it.
In the early days of this country, we knew it was important to have our own industries, but it was hard to grow a brand new industry out of nothing when other more established competitors, like those villainous British redcoats, were selling their goods in America for lower prices than we could offer. Oh!
Okay, I see where this is going. That sounds like Robin's slime problem. I mean, not the part where she's competing with the British over slime sales, but the other part. Kids are bringing in inexpensive slime made outside the school, and it's making it hard for Robin's slime business to succeed. Exactly. I thought we could use tariffs to protect the industries that are most important to us. So we put high tariffs on the things we didn't want other countries to make and sell in our country.
What do you consider a high tariff? High enough that it raises the price of that good so that people would think twice before buying the overseas option. That way, maybe locally made items look a little more attractive. I still don't get what this means for my slime business.
Oh, right, yes. Robin, I suggest you go to your school and ask them to levy a tariff on slime imported into the school. You, of course, as a local manufacturer of slime, would be exempt. But I'm a kid, not a country, and my competing slime sellers are just kids, too.
Have a little imagination. Sure, tariffs have never been used before at an elementary school, but that's what makes you an innovator, young Robin. Convince your school to levy tariffs on slime not made at your school and reap the benefits. You and your school could become the biggest slime balls in this town. In a good way. I mean, it kind of sounds like a good idea, Robin. Yes, come on, Robin.
If Hamilton told you to do it, you'd probably say yes. Well, this is your former president saying this is great.
I don't know that my school would go for this. Well, lucky you, Robin. We have 12 minutes left on our lunch break, and we can walk right over and help you figure out who to talk to about starting the tariff at your school. Oh, man. I was about to use the other half of my lunch break to watch YouTube videos. When else am I going to find the time to watch YouTube videos? Oh, I don't know. How about at your desk during work hours like I always catch you doing?
Okay, fair. You'll be fine. Let's get to Robin's school and see if we can convince them to start a tariff at the school to help protect Robin's homegrown slime business. More after this.
Hey, bazillionaires. This episode of Million Bazillion is presented in partnership with Greenlight, the debit card and money app for kids and teens. We've been diving into the world of tariffs, those extra fees on stuff we import from other countries. And while that might sound like a very boring and technical thing for old people elsewhere to think about, tariffs do affect the way we pay for all kinds of everyday stuff.
That's why it helps to be a smart shopper right now. And Greenlight can help with that. With Greenlight, kids and teens learn how to track spending, stick to a budget, and get a better sense of what things actually cost. When prices go up, your money skills can keep you grounded. Get smarter about how you spend and save with Greenlight. Sign up now at greenlight.com slash million. Once again, that's greenlight.com slash million.
Welcome back. To catch you up, a ghost of one of the Founding Fathers has convinced us that tariffs will solve the entrepreneurial problems for young neighborhood slime maker Robin. Good thing I live right around the corner from Robin's school, Smoky Brook Elementary. And we're about to go convince them to enact a tariff or a tax on any slime sold on school grounds not made by a kid at this school. Let's go. Look, there's Principal Howe, headed right toward us. Principal Howe, Principal Howe? Yes? Robin, aren't you supposed to be in class today?
I may not be in class per se, but I am learning in a way. Well, she would be, except she's been dealing with this huge problem. We're Bridget and Ryan High from the podcast Million Bazillion. We answer the questions that kids and their families have about money. But today we're solving money problems. Robin has a big one. And long story short, we think you should make it a rule that any slime sold on school property that wasn't made by a Smokey Brook fighting trout should have an extra tariff added to the price. And the school collects that money before the slime can be sold.
A tariff, you say? At Smokey Brook Elementary School? That would be quite unorthodox. But this sure sounds like a learning opportunity. And like something that's going to take longer than nine minutes left in my lunch break. I can't believe it. Robin, if you can convince the majority of the student body that a tariff on slime not made by students at this school is a good idea, we'll make it an official rule. Wow, really?
Yep. But you'll have to debate one of your slime competitors in front of the whole school. Now, if you'll excuse me, I've got some important things to do. Wait, how do I convince the whole school that tariffs are a good idea? I barely know what they are. Oh, it's just a tax we put on things made outside of our borders. Easy. Hey, Ryan and I are going to help you prepare. For the next eight minutes or so. Good afternoon, everyone. It's me, Principal Howe.
I'll be your host for today's round of Students Debate at Smoky Brook Elementary. Let's go, fighting trout! Blub, blub, blub, blub. This afternoon, we're going to hear an argument for and an argument against tariffs here at Smoky Brook Elementary. Man, this school really threw together this assembly quick. I know. Weirdly efficient school. Good thing we gave Robin all those examples of how tariffs have worked in the past.
Madison! Don't sneak up on us like that! What are you even doing here? I'm here to support young Robin.
First up, Robin. Robin, tell us about yourself. Hi everyone, I'm Robin, fifth grader and maker of homemade custom slime. It's a cool kind with the glitter in it and everyone should get some. But today, I'm not here to advertise my slime. I'm here to argue for the immediate implementation of a $2 tariff on every jar of slime imported from the outside. That is, not made at the school.
Okay, thank you. And over here we have Jenny, one of the school's biggest sellers of slime, which she buys from another school and brings into Smokey Brook to sell for low, low prices. Please say more, Jenny. That's right. I'm Jenny. I'm a sixth grader, and I'm not ashamed to say I'm giving folks the best deal on slime in the school at a mere $2 a jar.
It's cheap, it's sticky, and it's effective. Quality slime for kids on the go. So what if it's made by students at South Bay? My opponent's boutique glitter slime will cost you an arm and a leg. And I'm here to say that tariffs are not right for Smokey Brook. Who's with me?
I think this all comes down to whether tariffs are good or bad, right? Something I bet elementary students can solve in a short debate. So let's discuss. Robin, you must think tariffs are good because you want our school to have them. What's so good about them? They'll make money for our school, just like they made money for our fledgling country after the Revolutionary War. If the school is collecting a couple of dollars on every jar of outside slime coming into Smokey Brook, we're going to raise a lot of bucks. And
And think about how we could use that. New books for the library, free school t-shirts for every student, that smushy rubber flooring for our playground. A new crushed ice machine in the teacher's lounge for, uh, educational purposes. But don't you see how tariffs have the potential of raising slime prices across the board? If I have to pay a tariff of $2 per jar of slime, I'm not taking that on the chin.
raise my prices to cover the new costs. That's an extra $2 my honest slime buyers are going to have to fork over. It means doubling my prices. That's the whole point of the tariff. We're trying to encourage the students of Smokey Brook to buy slime made here on campus. But there's something else that could happen too. Something none of you will like.
What happens when my imported slime does cost $4 a jar because of tariffs? Robin's charging $3 right now. What stops her from raising her prices a bit? Say, from $3 to $3.50? I'm just telling you like it is. Your slime prices are going up. With the competition hamstrung, suddenly slime goes from two or three bucks at this school to $3.50 or $4.00.
Okay, so if the tariffs go through, Jenny's imported slime gets more expensive because Jenny's going to have to pass those tariff costs on to her buyers. And then that gives Robin some wiggle room to charge more, but still cost less than the imported stuff.
Right, but for slime-loving students, it could very well mean that prices are going up no matter whose slime they buy. Madison, how dare you? Oh dear. Well, that would be not ideal. It's an unintended consequence. Face it, you're only hurting the kids who want to buy slime. You're making it more expensive for them, whether they buy my slime or Robin's. Ooh, good point, Jenny. Robin, how do you respond?
I'm a student at this school like the rest of you. I want to protect the businesses we're building on school grounds. Because when Smokey Brook business prospers, we all prosper. The U.S. has put high tariffs on outside cars to help American car makers, on outside corn to help American farmers.
And sure, tariffs are usually things countries use, but I really think it could work here at our school. See, it's not just about me and my slime. It's about Amanda and our custom friendship bracelets, Renata's cookies she bakes and sells at recess for 50 cents a pop, and Angus designing his own trading cards for extremely unpopular Star Wars characters.
I still have 800 unsold Big Four tuna cards. Buy one before they sell out. Ooh, I gotta get one of those. Bridget, I need to borrow some money. Look, that sounds great and all, and you'll learn about this in sixth grade when you get to the unit on tariffs. But in the real world, when countries start trying to protect their own industries with targeted tariffs, other countries get mad. And sometimes they do the same thing back.
What are you talking about here, Jenny? Oh, I'll tell you. Did you know that Angus's biggest market for bib Fortuna cards is the second grade class at South Bay Elementary? They love Fortuna over there. What do you think that school is going to do when they realize their slime industry has dried up overnight? That's a metaphor, of course. My slime never dries out. What if they put high tariffs on unpopular Star Wars trading cards? Wait! What? This might be tricky for Angus in the short term, but in the long term, he'll adjust.
Suddenly, we could be in the middle of a trade war. Oh no, she said it. The dreaded T.W. You didn't say anything about a war, ghost of James Madison.
Well, you never really know how other countries will react. Someone could, if they wanted to, also use the threat of tariffs to punish other nations or get them to do something. And then things get really ugly. Ugh, Madison, why didn't you say something sooner? Oh, what's that? Oh, someone's calling from 1776. Gotta go, bye. What? Madison just bailed on us. No wonder he never got his own musical.
No one wins in a trade war, whether it's between countries or two schools who are obsessed with slime. Why don't we all just work together now to keep the movement of slime and other goods between our countries, I mean schools, free and fair to all? Do it to make sure the students of Smokey Brook can buy and sell whatever they need, at the best price, by avoiding tariffs. Okay, well, there you have it. A spirited debate on a topic with no easy answer.
But wait, I'm still confused. Are tariffs good or bad? I thought the answer would be simple enough and straightforward for a kid to understand. At the end of the day, tariffs are good, but can also be bad. So I guess it's complicated. Next time on Students Debate at Smoky Brook Elementary, marinara or ranch? What's the best dip for mozzarella sticks?
Oh, that's an easy one. Ranch. Oh, now you come back, Madison? Get out of here. Marinara all the way. Okay, enough. This episode doesn't have room for two big debates. Let's take a break, and we'll be right back. I'm Peter. Hi, I'm Elizabeth. And we're from Marina Del Rey, California. Why did the penny flip himself, Elizabeth? Because it would make more sense. Do-do-do-do-do.
Ugh, Robin, I'm sorry. Our lunch break is over. I promised Ryan we'd get back to answering questions. Yeah, it's been a fun 30 minutes, but I do think my digestion prefers a less active lunchtime. I'm going to have to take a few days off to make up for this, by the way, Bridget. I get it. I appreciate your help. Can you let us know how the school votes? I will, no problem. See ya. Well, Bridget, what did we learn today? ♪
Well, we learned that tariffs are just a fancy word for a tax that we put on things made outside our country. They're a tool that governments or, OK, I guess also elementary schools can use to raise money or to protect industries. They're a bargaining chip. But there's always a risk that another country could see a tariff as the first strike in a trade war. And then it's hard to say what happens next, where it all ends.
But any which way you slice it, tariffs will probably make things cost more for the people who are doing the buying in the end. Well said. But I actually meant about this solving over sandwiches thing. Are we going to do it at lunch again tomorrow or not? Oh, yeah. No, that was a very hectic 30 minutes. I didn't even eat my lunch.
Bridget and Ryan! Great news, for me at least. The school voted to add tariffs to outside slime. Oh wow, okay, so what does this mean for you then? I'm going to become the biggest slime ball in Smoky Brook history, that's what. But in a good way, right? And get this, those South Bay kids put a tariff on Angus' trading cards like we knew they would. So we're going to hit them back with some more tariffs. Oh, wow, okay, more tariffs?
I mean, I didn't want to say the TW word, but that does seem... And I'm not stopping there. Next up, I'm pushing for tariffs on everything not made by a Smokey Brook Trout. We're keeping Smokey Brook dollars in Smokey Brook.
Right, but I think that South Bay does sell some things that the Smokey Brook kids like to buy. Oh, and get this. I did some reading, and it turns out you can use tariffs to threaten other countries and just get them to do what you want. So we're going to apply that to South Bay, too. What could you possibly want from the South Bay kids to use tariffs against them like this?
Well, they've got a fancier swing set for one. So if they want access to the full pockets of the Smokey Brooks student body, they're going to have to send over that swing set. Uh, remember when we were talking about how trade wars could get out of hand? You want a piece of me? Who wants a tariff? You're getting a tariff next. You get a tariff. And you get a tariff. Oh boy, we really should have just stuck to sandwiches.
All right, that's it for this episode of Million Bazillion. Thanks for listening. If you've got a money question you want us to answer or an idea for an episode, send it to us at our website. That's marketplace.org slash million. And did you know we have a newsletter that also includes a tip sheet to help you have more conversations with your kids about this very topic? Sign up at marketplace.org slash newsletters and you'll get new episodes plus those tip sheets delivered straight to your inbox.
Million Bazillion is brought to you by Marketplace from American Public Media. This episode was written and hosted by me, Ryan Perez and Bridget Bodner.
We had extra help voicing this episode today from Benicio Oliveira, Layla Peters, Isaac Luskowitz, James Pargok, and also Sabree Beneshore, Marie Hollenhorst, Zoha Mullick, Nancy Marshall-Genzer, Nova Saffo, and Daniel Shin. Million Bazillions editor is Jasmine Romero. Our producers are Courtney Bergseeker, Minju Park, Zoha Mullick, and Marissa Cabrera is our senior producer.
Armando Serrano is our sound designer. Nina Torres is our assistant sound designer. Becca Weinman is our mixing engineer. And our theme music was created by Wunderly. Bridget Bodner is the director of podcasts at Marketplace. Francesca Levy is the executive director of digital. Neil Scarborough is the VP and general manager. Million Bazillion is funded in part by the Cy Sims Foundation, partnering with organizations and people working for a better and more just future since 1985.
And special thanks to the Ranzetta Family Charitable Fund and NextGen Personal Finance for providing the startup funding for this podcast and continuing to support Marketplace in our work to make younger audiences smarter about the economy. If Million Bazillion is helping your family have important conversations about money, consider making a one-time donation today at marketplace.org slash givemillion. And thanks for your support.
Hey, bazillionaires. Thanks for listening to today's episode. We learned a lot about tariffs, how they work, and why they can affect the prices of things we buy every day.
With Greenlight, kids and teens can learn how to navigate tariffs and other wider economic forces to become savvy shoppers and savers. Get smarter about how you spend and save with Greenlight. Sign up now at greenlight.com slash million. That's greenlight.com slash million.