How ‘Swiftonomics’ May Finally Break Ticketmaster’s Spell

much about where all that discarded stuff goes next. If you're someone who likes to refresh your wardrobe on a regular basis, you definitely shouldn't go to Gharna, where parts of the coastline are clogged with what locals call dead white people's clothes washed up on the beach, sometimes in six foot piles. Bloomberg investigative reporter Natalie Pierson went to Ghana and India to see for herself what happened to

all the second hand clothes we ship abroad. We have that depressing story in a minute, and some truths about plastics recycling from a teacher and former official from the Environmental Protection Agency Judith Ink. But first we have an insight into another corner of the economy, which looks seriously out of whack. Only this time the problem isn't excess supply, but an explosion in demand the tickets to see the singer Taylor Swift. Here's Bloomberg's Augusta Serreva. Good morning America.

It's Taylor. I wanted to tell you something that I've been so excited about for a really long time. Have been planning for ages, and I finally get to tell you I'm going back on tour. Taylor Swift has been my top streaming artist for six years now. Despite that, I've never had a chance to see her alive. That's why when the thirty two year old singer announced that she was touring, they was for the first time in

five years next year. I signed up for the PRIs Cell right away, But when I got to the virtual line on the Ticketmaster platform last week, I quickly found out that I wasn't the only one bringing years of pent up demand to the table. Not even eight hours in line were enough for me to score a ticket. The site was supposed to be opened up for one point five million verified Taylor Swift fans. We had fourteen

million people hit the site. We did sell over two million tickets that day, we could have filled nine hundred stadiums. That was Gregmafae, the CEO with Ticketmaster's parent company, in an interview with CNBC. Yes, Greg, I know it all too well. Demand was so high in the pre sale that Ticketmaster canceled the general public sale after a record

two point four million tickets were sold. The whole frenzy triggered anti rust investigations from politicians and attorneys general like Meanwhile, for those like me, all that's love to do is trying to buy tickets for as much as forty thou dollars on the secondary market. We have the means of almost unlimited production. We have an almost unlimited capacity to consume. We need to raise our actual consumption so that it

matches our capacity to produce. We know that this doesn't have supply and demand, two of the oldest concepts and economics. But this is swift ponomics, where supplies manufactured and accusations of price gouging and monopoly abound. In the early two thousand's, late economists Alan Krueger came up with the term ro economics. The labor economists who advised to US presidents suggested that economic concepts could be more easily explained through the music industry,

which most of us are familiar with. Krueger often used Swift as an example of someone who's successfully used loyalty strategies to boost concert and music sales. First of all, I think Taylor Swift is an economic genius. She has made more money from concerts at her age than Madonna did at her age, or Beyonce or Lady Gaga. So she's on its tremendous trajectory. And she has done this

I think by making very good economic decisions. That was Krueger in a eighteen interview with the Princeton Alumni magazine. Swift has chosen to play only a high capacity football stadiums, She's added seventeen extra concerts since the Erastore was first announced, and she's even created a verified band system to guarantee only the most loyal had access to the pre sale. None of that, though, was enough to stop years of pantop demand turned nearly in elastic for the millions of

die hard fans. Not even the fact that Swift will be touring the US at a time when many economists are certain the country will be in a recession. Swift aconomics is it's on economics microcosm, and for now all fans, including myself, can do is shake it off. Great great, great great again. Well, as Augusta mentioned, the saga of the Swift tickets isn't just offering a window into millennial

spending habits. It's also triggered a renewed debate about antitrust policies in the US, and particularly where the ticket master has been allowed to acquire too much power in the industry. Elena Tyler is a legal analyst for the Bloomberg Industry Group in Arlington, Virginia, and she wrote an excellent piece on all of that for us. Elena, thank you so much for joining us very late notes just before Thanksgiving. I appreciate it. Why has this Taylor Swift ticket debarked

triggered antitrust debates? What exactly is the monopoly problem? So it falls neatly into a couple of debates that the broader an antitrust policy uh world is having in the United States right now. One of them is about whether vertical mergers are something that the antitrust world should be concerned about. And when you say, just to explain about what a vertical merger is oh, of course, so there

are really we think of murders in two ways. Either two companies that directly compete with each other in the same market merge, and then obviously one of them stops competing with the other and the market consolidates. But you can also have mergers between companies that are not in the same market. They are either supplier and buyer, or they are a company that makes a product and maybe

one that retails it or distributes it. Those mergers we generally call vertical because they're in different places in the supply chain. It used to be that antitrust didn't consider those to be much of a threat because they weren't consolidating a single market, but economic theory has recently called that into question. A bunch of additional research has happened, and we now are no longer quite so sure that vertical mergers are as efficient and unproblematic as we had

believed in the past. This original merger in between Live Nation, which is a behemoth in concert promotion for major venues um and Ticketmaster, which is the beheaventh in primary ticket sales, was very controversial, and the Department of Justice permitted the merger to close with a settlement that both required some structural changes to what would get merged together and also

some behavioral promises. Um the businesses combined promised not to bully other providers and basically throw around their newly acquired

market weight. Right that hasn't worked the way one might have hoped it would, and so that likewise speeds into a current debate that's happening in anti trust policy about whether behavioral agreements you know, not to be nasty once you're allowed to merge, are really a good idea, and whether the best solution isn't to prohibit the merger in the first instance and keep the market power from console alidating, rather than trying to tinker on the edges with the

merged party and keep the worst outcomes from happening. So those are two big debates that this plays into right now. And now there's a concern that Ticketmaster is becoming a big power in the secondary market as well, in other words, resale of tickets. So there's a concern there that if all of these markets, which play into each other, feed off of each other and work together, might create a situation where the whole industry is more or less dominated

by one big firm. Yeah, and it's interesting because there's an absolute furore on Twitter. And I'm not someone despite having a Taylor Swift mad fourteen year old daughter at home, I don't spend a lot of time on the relevant Twitter accounts. But I was just I would recommend people listening just take a look at the amount of vitriol against ticket Master and Taylor Swift herself as kind of

come out against ticket Master. But I didn't know until I read your piece this point about the resale that the ticket Master even just in the three months at the end of September, did about did one point one billion dollars worth of business ticket Master did in the

ticket resale business. So if you're if you're a fan who spent hours trying to get tickets, you couldn't get one, But somehow these touts or the resale market markets could you are surely looking at Ticketmaster and say, well, you've got no interest in giving the ticket to me if you can get paid twice giving it to somebody else,

that's the real concern. It's a puzzle. Somebody obviously got tickets, right, there aren't exactly tickets left over and these complaints that we see from private parties in US courts have all claimed that while Ticketmaster says that it is um cracking down on scalpers, cracking down on bots that sweep through the system with multiple account and grab a bunch of tickets and then place them for resale, that that's definitely

not where their incentives lie. Buying a ticket on the primary market generates a fee for Live Nation, and then if the ticket is turned around and resold on a Live Nation platform and they have several um through ticket Master, then they will generate a second fee. You would imagine that the sale that generates two or even three fees is preferable to the one that's a one and done fee.

It explains a lot why the market looks like it does, UM, and why it's still frustrating for ordinary people trying to click with their actual human speed. Uh, they're up against spots. I guess, going back to what you said about whether you should be trusting businesses to do the right thing, UM, I guess if you're a ticket Master and you do the wrong thing and you get on the wrong side of Taylor Swift, I mean that it's going to rue

the day that it didn't make more of an effort. Well, it certainly has raised the profile of this specific problem. But if Taylor Swift tangles with Live Nation and Ticketmaster, she certainly wouldn't be the first big act to fail in getting them to change their practices. Pearl jam back in the Odds worked hard to try to change the way ticketing happens in the primary market and failed. It's a pretty tall order, but the Swifties may be up

to the churche. Well, we've also seen quite a lot of prominent lawmakers weighing in, and I see that the chair of the U. S Senates Antitrust Subcommittee, Amy Kloba, she said she'll hold a hearing on Ticketmaster by the end of the year, so I guess we'll you'll be watching that space. Eleana Tyler, thank you so much. Thank you. Well. Now, as promised, we have some bad news for those of you planning to splash out on a new winter wardrobe

in the days after Thanksgiving. Here's Natalie Pearson waterlog clothes roll like carcasses and the waves along the coast of Ghana. The country is one of the world's biggest importers of US clothing. The cast offs arriving by the bail are known here as a browny wind or dead white people's clothes. What is happening is the fast fashion lifestyle of the vitaman. They will go for programs, they print some clothing because

they know they have a place to dump them. That was Solomon Noi, the head of waste management in Accra, the capital of Ghana. Some of the imported clothes don't get reworn or repurposed. They simply end up as garbage. When it rains, waterways belch garments into the ocean, waves bring them right back to form a wall of rags more than six ft high in places along the shoreline of the city. Sanitation crews fight a losing battle every day trying to corral Acra's textile waste into landfills. But

there's just too much, says Noi. So at the end of the day, government doesn't have the money to be able to implement a fastratcher that is needed to take care of the mite man's glueto exactly. It's a disaster decades in the making. As clothing has become cheaper, plentiful, and ever more disposable each year, the fashion industry produces more than one hundred billion apparel items. That's roughly fourteen for every person on Earth, and more than double the

amount of two thousand. Every day, consumers toss out tens of millions of garments, many land and so called recycling bins set up in stores by fast fashion chains like h and M, Zarah and pre Mark. Research shows that when people believe an item will be recycled, they consume more of it, but textile recycling doesn't yet exist at scale globally. It's estimated that less than one percent of

used clothing is actually remade into new garments. Instead, discards enter a global second hand supply chain, which prolongs their life, either by reselling them in developing markets or repurposing them into items like cleaning cloths or insulation. One of the world's biggest used clothing processors is in India's western Gujarat state Knam International. Here, forklifts dig their way into forty foot shipping containers packed tight with used garments, heating the

giant bales inside for sorting and grading. Some four hundred women work at Cannam's facility, each sorting as many as five thousand pieces a day. Sunita Suni Sa who is one of them? My name is Sunita. I have been working with Kanam International for sixteen years. I first started with cutting, then sorting, than grading, and now finally I'm on quality control. The work is tough to automate. A greater needs to quickly decide the economic value of a

used garment. Can it be reworn or turned into rags or is it simply worthless. It took around five years for me to understand which garments were premium brands as I started with the cutting job. Now I understand properly which ones are branded and which was sell for a better prize. Roughly a third of what the sility receives has no value. Across the industry, that share is growing. The decline and clothing quality has been spurred by fast

fashion and consumers preference for quantity over quality. Garments fall apart after a few washes. Most are blends of cheap synthetic fibers that are difficult to repurpose or recycle, and there's just so much of it that markets are saturated. Clothing value the high and the prices are low. That's why at Robert Hall Family Clothings march toward disposability traces back to the post World War two period, when companies in America began intentionally designing goods not to last so

that people would keep buying. The fashion instry became geared toward getting consumers, particularly women, to turn through clothing ever faster. By the nineteen eighties, the preconditions for fast fashion were in place. Then one Spanish company perfected the formula. Hey guys, welcome back to my channel. I'm so excited to be doing this haul for you. I went to Zara and picked out my favorite items. It's the beginning of October

five and it's time to see what's in store. I found ten hidden Johns from Zara that are really worth buying into texts. The parent company of Zarah pioneered a retailing model that rolled out ten thousand designs a year and continuously cleared out unsold items. The effect was astounding. Shoppers began dropping by Zara stores four times more frequently than those of its competitors. Neurological research has since shown that shopping taps in to a region of our brain

linked to addictive behavior. Sara had hit on a way to commercialized fomo or fear of missing out before it was even a thing. And I'm going to share those items with you today so that you can go out and buy them too. Today. China produces clothes so cheaply that new garments can be competitive with used ones. That's according to Eric Steuben, president of Transamerica's Textile Recycling, Inc. They operate one of North America's oldest sorting facilities. We

have to compete. Buyers all the time would say to me things like, well, we're competing against you know, uh, you know, cheap Chinese manufactured merchandise. So it's you know, in a lot of the major African markets or global markets, Chinese manufactured clothing competes with secondhand in these markets. I've seen that in first hand in my dealings. Turns out that recycling clothes back into fibers for new clothes is devilishly difficult. Buttons and zippers need to be removed, Blended

fabrics must be unblended dyes removed. The technology to do so is nascent. Garment tags that boast recycled fiber content today usually use polyester from plastic bottles, but a plastic bottle can be recycled back into a plastic bottle. Many times a plastic bottle turned into a puffer jacket. Can't At the end of the day, experts warn that we can't shop our way to sustainability. Recycling will always consume more energy and produce more waste than we're using something

or not consuming it in the first place. Here's Julia Atwood, head of sustainable Materials at Bloomberg an ef. I mean, whenever you're thinking about the circular economy of anything, the best thing to do is to reduce to map. So you would have to kill the fast fasht and market in order to make a meaningful difference to the emissions or footprint of text dollary cycling. Fort Lumberg inanever, I'm Natalie ob called Pierson now Judith thank is a senior

fellow and visiting faculty member at Bennington College. She was previously a senior official at the Environmental Protection Agency under President Obama, and she's also the founder of Beyond Plastics. Judy, thank you very much for coming on. Stephanois one lesson of Natalie's pieces that when it comes to clothing, the supply of secondhand clothes vastly exceeds what can realistically be

reused at home or abroad. Is that also the case for plastics, Well, there is so much plastic production happening every day and once it is used, and it's typically single use, um, there's nothing good to do with it when when you're done. Plastics recycling has been an abysmal failure. There's very very little reuse refill of plastics. So our world is drowning in single use plastic clothing. Uh, clothing

has plastic in it. And unfortunately, plastic production is on track to double in the next twenty years according to the World Economic Forum. So this absolutely is not sustainable. This is not what people think of when they think of the need for a circular economy. And when I look at my recycling bag and in our part of London, it's all mixed up together. Um. And if I at any given bag in a given week, you know a lot of it would be plastics that we're taking, whether

it's a milk plastic milk bottles and other things. Is it just is that just a fiction to say that that all of those plastics can be recycled. Yeah, it's a fiction and it's also a lie. Perpetuated by plastic producers. UM, we have so little choice when we go to the supermarket. UM, none of us have voted for more plastic. But plastic is cheap and it is flooded the market. And for decades, Big Plastic has suggested to the public, UM, don't worry about all of your single use plastics, just toss it

in your recycling bin. But they have known for decades that plastics fundamentally are not recyclable. That's why in the United States we're looking at a five to six percent recycling rate, a little bit higher in Europe, but not much high air And I just want to briefly explain why this is why plastic is not similar to metal, glass, paper, cardboard. All of those materials can be made from recycled material and then when you put them in your recycling bin

or bag, they actually do get recycled. It's the opposite with plastics. And that's because there are hundreds of different types of plastics. Not only do you have different resins, but they all have different chemical additives and different colorants. So think of your own home. On top of your washing machine, if you have one, you might have a bright orange hard plastic detergent bottle, and then in your refrigerator you might have a clear, squeezable ketchup bottle. You

cannot recycle them together. They are two different, different chemical additives, different colors, and so plastic recycling is a dead end, and plastic recycling has given other recycling a bad name. I want to be clear. I am a strong supporter first of waste reduction, refill, reuse, and then definitely recycle all of your metal, glass, paper, cardboard. But you need

to know that most plastics do not get recycled. And is there just on your example, given that a lot of the consumer products we do seem to be kind of hardwired to make things out of plastic, wouldn't make it any any better to be reducing the different types of plastics. So there was more possibility that maybe that that detergent bottle and the ketchup bottle could be recycled

in the same place. Yeah, it definitely would be better if we had fewer types of plastics, but that change is only going to happen when legislative bodies adopt new laws requiring this. The plastics industry and consumer brands like Unilever and um coke and PEPSI and McDonald's. They're not going to change on their own. We need new laws that give us a fighting chance to have a more sustainable economy. So one area is known as extended Producer Responsibility,

and that would put environmental standards on packaging. Just like we have fuel efficiency standards for cars that allow us to save money at the gas station. We have energy efficiency standards for appliances so we save a little bit of money on our monthly utility bill. We need environmental standards for packaging that encourage reduction, reuse, but also some standardization so you have a chance to actually recycle it. And equally important, we need to reduce the presence of

toxic chemicals in packaging, particularly food packaging. And I guess I should ask where the administration is on this. I mean, we've had sort of landmark environmental legislation in the summer which was more devoted to the sort of the big picture emissions um story um is there are the people in the administration, maybe former colleagues of yours in the in the e p A, who are planning to act on any of this. No, the Biden administration record and

goals on plastic pollution is m I a missing in action. Um, I don't think the Biden administration, which I have tremendous respect for, I don't understand. I don't think they understand the connection between plastics and climate change. They talk a lot about environmental justice, but they have not done very much to reduce the risks of plastic production in low

income communities and communities of color in places like Louisiana, Texas, Appalachia. Also, there's very little difference between the position that the Biden administration and the Trump administration is taking on a proposed international plastics treaty. But fundamentally what needs to happen is quite simple. We need to make less plastic. It's affecting health, particularly in low income communities where the plastic is produced

or disposed of. It is it definitely impacting climate change, It is turning our ocean into a landfill, and plastics is a huge recycling failure. So given all of that, it only makes sense that we make less plastic. But that's the opposite direction that the United States is taking. This is not a not a happy message that you've got, Judith.

I'm sure, but I'm sure it's a realistic one. I guess we should go back to the one bit of good news that you emphasize at the start, which is we shouldn't feel bad about or concerned about where are cans and paper and bottles are going, Glass bottles are going. Those are being recycled. We have managed a circularity with those things. Yes, you know, it's it's hard to sugarcoat the plastics message because it is pretty dire. You're you're,

You're definitely not falling into that trap. Yes, and I'm no fun at parties, but especially if anyone gives you a plastic cup, I imagine. But anyway, yeah, it's it's a scene. Um. But class in the United States is recycled at paper and cardboard, ferris metals. So recycling can work for some materials, and it also creates jobs. But what I am optimistic about is the public wants to see change and people are mobilizing to get important new

laws adopted. Bottle bills known as you know, beverage container deposit laws put a dime deposit on a beverage container. It eliminates litter of that container. It gets a high recycling rate because it's source separated and kept so clean um.

Some companies are slowly getting the message. For instance, Coke, one of the largest plastic polluter in the world, announced recently that they will shift to reusable, refillable beverage containers by the thirty Of course, that's going to require deposits on all of those containers. And we're seeing many small businesses emerge that use refillable, reusable containers. These are often women owned businesses, UH small businesses around the globe, and

that is the future. The future is reduction, reuse, refill and phasing out plastics. Judy think, thank you so much. Thank You's definitely a pleasure. Well, that's it for Stephanomics. That's it for my Black Friday shopping. We'll be back next week. In the meantime, check out the Bloomberg News website for more economic news and views on the global economy,

and follow at economics on Twitter. This episode was produced by Yang Yang and Magnus Hendrickson, with special thanks to Mohammed Farouk, Augusta Saraiva, Natalie Pearson, Eleanor Tyler, and Judith Enck. Mike Sasso is the executive producer of Stephanomics.