Gas price vibe check

From American Public Media, this is Marketplace.

“In Denver, I'm Amy Scott, in Forkai, Rizdahl.”

It is Tuesday, March 17th, good as always to have you with us.

We are now in today 18 of the war in the Middle East, commercial airspace and much of the region remains closed. Oil prices are fluctuating, but high above $100 a barrel for Brent Crude, the International benchmark, and here in the United States airport lines keep getting longer, as the partial government shutdown of the Department of Homeland Security stretches into a second month

than more TSA agents don't come to work. To see where I'm going here, all of this is adding up for airlines. Marketplace's Samantha Fields has the 30,000-foot view of the business of flying right now. Just a few weeks ago, airlines were paying about $2.50 a gallon for jet fuel.

Today, it's closer to $4 a gallon.

That is putting extreme financial pressure on airlines. Charles Duncan at altitude x aviation group says no one has any idea how long these high fuel prices will last. Which makes it nearly impossible to plan for.

“So I think everyone is taking it day to day, week to week.”

The same is true with the closure of commercial airspace and the severe disruptions that key airport hubs in the Middle East, including Dubai, Doha, and Abu Dhabi. The industry has really had to shift capacity and passengers and had to scramble to find new ways to travel globally. The options for flying from Europe to Asia have narrowed, and Mike Stangol at aerodynamic

advisories says in many cases the new routes are longer. These detours can add significantly to flight time, which means more fuel. And higher costs, airlines based in the goal for more affected than others. But Stangol says all are scrambling to adjust their operations and account for spiking fuel prices.

If I were an airline executive, it would fuel a B-min number one concern on cost items. The airline profits are highly sensitive to changes in fuel prices. And Dan Ackens at Flight Path Economics says as much as they can, airlines will pass higher prices on to consumers.

The problem is once you start doing that, you destroy some of the demand.

There's another problem too, he says. It's not just higher air fares that could make people less inclined to fly. It's also safety concerns. So for the conflict in the Middle East, plus long security lines and staffing shortages at U.S. airports because of the partial government shutdown combined all of the micro elements

of this have the makings of a bigger macro problem. For now demand for air travel is still strong, but the longer the war in Iran and the shutdown drag on, the more the risks mount for airlines and for the economy. I'm Samantha Fields from Marketplace. John Wall Street today, the major indices closed higher will have the details when we do

the numbers. We've been talking a lot about the price of fuel in recent days because it matters to people's personal finances, of course, but gas prices also have a psychological effect. The National Association of Convenient Stores found that 70% of consumers say gas prices affect their view of the economy.

In reality, though, the oil market is mostly its own beast driven by OPEC, inventory and, as we're seeing now, geopolitical events.

“So why do so many Americans gauge the health of the economy by the cost of fuel?”

This place's Christian Schwab looks at American's unique relationship with gas and the cars it powers. There are few people more sensitive to gas prices in New York City than taxi drivers. Ralph Codier is fueling up his yellow cab at a B.C. gas station near LaGuardia airport before his shift.

"I feel the gas every day almost. The full was like $35, now he's 51." Codier tracks gas prices and says this station usually has the best deal. A gallon of unleaded here today is $3.30. He opens up Google Maps on his phone and shows me prices at stations nearby.

"I mean, I want to see the disaster, look at it. 340, 336, 316, 350, 380." I stared his phone, then look at the huge neon green sign showing today's rates.

Plus says Scott Rick, a marketing professor at the University of Michigan.

There's the screen on the actual pump.

“"You have to stand there and watch these numbers inflate and magnify in front of you and”

really feel it, you know the money flying out of your possession. It's very visceral." Also Rick says there's just no way to hide a rising price. Bill and Exxon can't make gas seem cheaper the way, say a potato chip maker can, by putting fewer chips in the bag.

"I can't feel you like 95% of a gallon and keep the sticker price the same." Sure, you can go electric or get a smaller car, or you can just try to drive less, but that's not as simple as other budgeting trade-offs, like buying chicken thigh instead of chicken breast.

Rick says when gas prices go up, people feel a bit powerless.

"You know, you can play around on the margins, but you know, we still have to do the things we need to do." Like go to work. Peter Norton is the author of Fighting Traffic, the dawn of the motor age in the American city.

“He says Americans are increasingly living farther away from their jobs.”

And so even a small increase in gas prices can be very expensive if you have a home where people are driving that much every day. Not only have commutes gotten longer, people are driving bigger cars. Americans like SUVs and pickup trucks. They're considered shockingly big by world standards, in fact, a lot of the cars that

we drive here are too big to be legally driveable on the roads of much of the rest of

the world. And this appears to have something to do with people's need to express themselves or to say something. We invented the drive-in and the drive-through. Relations write songs about pickup trucks and Corvettes.

I mean, there is a trend where Jeep owners leave little rubber ducks on other people's jeeps as a sign of mutual appreciation. Americans have a long and well-known tradition of loving the road trip of loving the road adventure of loving, getting to some place new, getting away. Sometimes this is called the American love affair with the automobile.

Driving is freedom, open road, windows down, music up, wind in your hair, at least when gas prices are low. Because when they're high, driving can feel like a burden, especially when it's your job. At the BP Station near LaGuardia, cab driver Roef Kadir says rising gas prices means he is

making less. He says he's going to touch me there because you know, the price is going up, I am going down. He says he needs to see prices go back under three bucks a gallon to feel good about the economy again.

In New York, I'm Kristen Schwab for Marketplace. The war in the Middle East also has truckers feeling some sticker shock at the pump. Retail diesel prices are averaging above $5 a gallon, according to AAA, nearly a buck 50 more than they were a month ago. At the same time, new restrictions on certain foreign-born truckers are pushing tens of

thousands of drivers out of that workforce, with more on how shifts in energy and immigration are shaping the trucking industry, Marketplace's Elizabeth Troval reports. Diesel is a major input cost for companies like J.K.C. trucking, where Mike Kacharsky is co-owner. "I keep getting calls from drivers in Los Angeles, they're seeing spikes from 90 cents

to over a dollar in some areas." While a lot of fuel costs get passed on to shippers through surcharges, the problem in the trucking industry is it's a really struggling, you know, because we have very little freight rates. Independent owner operators and smaller companies are more likely to eat that spike in fuel

costs. Avery Vice is with FTR transportation intelligence. There will certainly be a lot of small trucking companies that aren't going to be able to survive this surge in diesel prices. That price pressure is happening as the Trump administration and states are moving to take

certain foreign-born drivers off the road. For two decades that I have seen, we're more and more unqualified drivers are getting behind the wheel. John as far as that is with the Texas Trucking Association. He says a lot of foreign-born drivers lack proper training.

It is not about where your firm is, how qualified you are once we put you behind the wheel. I'm in a short with the trucking company JetCose as there's room for more qualified foreign-born drivers in industry. I go out to high schools and middle schools and talk about, you know, careers in trucking.

“In general, I think that there are not a ton of people who necessarily have that desire”

or that interest to get into trucking. Analyst Avery Vice says he's noticed the conversation around immigrant drivers shift since

About a year ago, it was always a driver shortage, which then begs the question, why are

“they supporting, you know, an even deeper shortage, and that's when it became a shortage”

of qualified drivers. He does expect immigration changes to tighten trucking capacity further. While higher diesel prices take out certain small-scale operators. I'm Elizabeth Troval for Marketplace. Moving on, it's tax season, and one of the big changes from last year's Republican

tax and spending law affects how taxpayers calculate deductions for their charitable giving. And that is likely to change charitable giving itself. The report out today from the Lilly Family School of Philanthropy at Indiana University says more Americans are likely to make donations under the law, but they're likely to give

less money in total, some $5.7 billion a year less, Marketplace's Karla Havier has

more.

“The changes do not impact the returns taxpayers are filing right now, says John Bergdahl,”

one of the researchers on the Indiana University study. But in terms of their actions this year and for the taxes they file next year, all of these effects that we're discussing today are in place. The vast majority of households take the standard deduction, which increased under the new law.

Bergdahl says before the changes, these filers, they've not been able to get any sort of tax incentive at a federal level for their giving. But now the law lets a single filer deduct up to $1,000 of contributions. That Bergdahl says should encourage more people to start making small donations.

We see it adding a significant number of new donors around 8 million new donors back into

the donor pool. Those who do itemize tend to have higher incomes and make bigger contributions, says Erica York at the tax foundation. Under the new law, they need to give at least half a percent of their adjusted gross income.

“You have to give above that floor in order to kick in that itemized deduction.”

York says the law also limits itemized deductions for the highest bracket. So instead of someone in the 37% tax bracket, getting to deduct their itemized deductions against that 37 rate, they deduct it against the 35% rate. Ultimately, York says changing incentives may impact taxpayers on the margins. But overall, it's not going to be a massive effect.

The Indiana University study estimated that the changes would result in about a 1% decrease in giving. And that's not great news for nonprofits in today's environment, says Ray Matath at Boston College. Funding for all sorts of organizations has been drastically caught by the federal government.

And there's nothing that will increase the likelihood of charitable giving, making up that slack. Which Matath says puts charities in a tough position going forward. I'm Carla Havier for Marketplace. We've gotten to the point where all of our devices just assume that GPS is going

to be there for us. We would be lost without it. But first, let's do the numbers. Dow Jones industrial average added 46 points, one tenth of a percent to close at 46,993, the NASDAQ gain 105 points, a half percent to finish at 22,479, and the S&P 500 picked up

16 points, a quarter percent, and it's 67, 16. Samantha Fields was telling us how airlines are coping with high fuel prices and travel disruptions. Still, both Delta and Americans said today they're looking at strong revenue growth this quarter, Delta Airlines Swords 6 and 6/10 percent, American Airlines Group flew up 3 and

a half percent, United Airlines holding gained 3 and 2/10 percent, Southwest Airlines added to in 2/10 percent. Bonds rose the yield on the 10-year Tino fell to 4.20 percent, your listening to Marketplace. This is Marketplace, I'm Amy Scott. I don't have to tell you that medical care in this country is expensive, but here are some

According to data from KFF 41 percent of American adults report having debt due to medical

“or dental costs, and all of that collectively adds up to $220 billion in outstanding bills.”

But there are resources out there to help with some of that, and people to help find those resources, that brings us to the latest installment of our series My Economy, where we're bringing you stories from healthcare all this week. My name is Beth Scott, and I am the Director of Case Management at the Patient Advocate Foundation, and we are located in Hampton, Virginia.

I'm actually a surgical tech by trade. I worked at a doctor's office for 20 years, where I did lots of surgery authorizations. I realized that I really couldn't help the patient as much as I wanted to, and I didn't

really know what happened to that patient after surgery.

So I came here in 2015, helping patients with insurance, denials, appeals, and I've just really loved being able to help the patient go on. We're in demand now, probably more than ever, especially with all the changes that have happened with healthcare and premiums that are outrageous, and in this time that I've been here, resources have gotten fewer and far between, and mostly since COVID.

Sometimes we don't know where to start with a patient when they have so many needs.

“So, when you get sick, you have to think there's more than just the sickness.”

There's a lot of other things. What am I going to do with my kids, who's going to pay for food, who's going to take me to my treatment? So, do we focus just on the rent and find them a grant, which is few and far between? Or do we try to look what's going to be able to help them in the long run?

Is there premium assistance out there for their type of disease, for example? Do they have a plan that we could maybe find a supplement plan? Could the patient benefit from being on Medicaid if they're disabled? And we do have to be very honest that, you know, sometimes we may not be able to resolve all of their problems because the resources not out there.

And we do have to be very creative in what else we can find.

“It's not an easy job because, you know, all of our patients are sick.”

All of them are calling at the worst time of their life. They may have just been diagnosed. They may have been diagnosed a couple of years ago, and they've run out of their funds. So, it's not an easy job. But we do have wins. I did have a patient who had a cancer diagnosis.

Treatment was awfulable for his diagnosis of cancer.

So we do all levels of appeals, first level, second level, and we were on the third level,

and he was almost given up. And the doctor had put him on something else in the meantime with hopes that he would get this, and he was actually approved for the awfulable medication or immunotherapy. And so, you know, it's a big win to that patient, but that was just one of many. Unfortunately, we were founded because insurance is challenging and insurance is complicated.

And sickness is complicated, and I don't think anybody ever thought when you get a chronic illness, what's going to happen to everything else in your life. So we try to take that from the patient when we talk to them. We try to say, "Okay, you focus on getting your treatment and let us fill out these applications, let's look for the social programs to see if we can find help."

It's a fulfilling job. I mean, it is hard. If everything were perfect, we wouldn't be out of a job, I guess. But it is very rewarding only other end as well. That's thought.

It is Director of Case Management at the Patient Advocate Foundation in Hampton, Virginia. Whatever is going on in your economy, we want to hear about it. Let us know at Marketplace.org/myaconomy. The Strait of Hormuz, through which 20% of the world's oil travels, in normal times, is now a GPS dead zone.

The signal is being jammed as a form of electronic warfare, and that's one of the reasons why it's so hard for ships to go through the Strait right now. Christopher Mims is a technology columnist at the Wall Street Journal and wrote about the phenomenon. He says these jamming devices are cheap and small and increasingly used in warfare and beyond.

GPS gamers really took off with the conflict in Ukraine, because Ukraine was relying on GPS

One was to help guide their drones, and then also because there are a number of so-called

“smart bomb smart munitions that were relying on GPS in order to find their target.”

Russia figured this out pretty quick, and according to some public testimony, the effectiveness of one GPS guided bomb that the US used to use a lot went from 70% hit rate to 6% hit rate in the span of just a few months. And you write in your piece that that's a big factor in the current war in the Middle East, the Strait of Hormuz is basically a GPS dead zone?

Yeah, it's worse than that there's a ton of spoofing happening in the Strait of Hormuz, which is a little more sophisticated. That's where you have a device that's smart enough to guess what a GPS receiver is looking

for, and send out a more powerful version of the GPS signal that usually comes from satellites.

But it's a little bit off, it can make your GPS receiver think that you are very far away from where you actually are.

“How are these devices being used outside of warfare?”

People will sometimes use very small GPS chambers. For example, they don't want some kind of maybe company mandated tracking device to be operational, so that obviously is a gray area. So for example, there was a New Jersey truck driver who was fine almost $32,000 by the FCC after his truck's GPS jammer disrupted air traffic control signals.

And they're having some negative effects, I mean, you write about commercial flights being turned around.

I read about a construction site that was basically just shut down because it was messing

up its coordination of all the equipment. Yeah, I had readers reach out to me and say, "Oh, this is old news, you know, I live in Israel and you go outside your phone is not going to tell you accurately where you are because GPS just doesn't exist. We have just gotten to the point where all of our devices just assume that GPS is going

to be there for us."

“So companies are working on alternatives, can you describe some of those?”

They have their origins in the defense industry. Those systems are very expensive, they can cost millions of dollars, they're large, so there are companies that are trying to miniaturize those systems. So there's a company called Anelo Photonix and they miniaturize it to the point that it's, you know, a cube, an inch on a side and it can just fly on a drone.

Eventually, they want to make it so small that it could go to a cell phone. How long before some of these alternatives are as reliable and ubiquitous as GPS? Even this will come to our personal devices? That's unclear. I think part of it is going to depend on how much more GPS jamming spreads, you know, with

the number of new conflicts flaring up, there is a drive to commercialize this and bring it to the masses. "Do you think there would be all this effort to find an alternative if it weren't for these wars?" "Definitely not.

You're in a time of incredibly rapid technological evolution. We are seeing this incredibly swift tit-for-tat arms arrays where folks are getting better at making GPS inaccessible and other folks are working on, I mean, literally, close to a dozen different alternatives to it to allow us to navigate without GPS." Christopher Mims is a tech columnist at the Wall Street Journal, thank you so much for

your reporting. "Yeah, thanks for having me on." "This final note on the way out today with Creditu Axios. If you're worried about AI replacing your job, you can now look up the odds of that happening.

The Action Network, a sports betting media platform, now has a tool where you can compare probabilities for different occupations based on data from AI provider andthropic.

I looked up my job, news analysts, reporters, and journalists have 13 percent implied odds

of AI replacing them, relatively low risk according to the tool. Not sure I'd bet on it, Jordan Manjee, Zoneel Maharaj, Janet Win, Olga Oxman, and Virginia Case Myth are the digital team. I'm Amy Scott, we will see you tomorrow.