DRAFT: Turn-of-the-1900s Techbro Samuel Insull & His Meme-Stock "Electrifying America" Utility Empire

The Ghosts of TechBros Past, Present, and Future: From Middle West Utilities to Tesla: how boom-time visions have fragile foundations, or techbro dreams and financial nightmares: Samuel Insull, and to what extent his history is echoing in the career of the person Donald Trump would sometimes call “Elon Tesla”…
Behind the paywall because I am not yet sure to what extent history is rhyming here…

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Born in 1859 to a London temperance hotelkeeper, by the age of 21 Samuel Insull was at the center of the Silicon Valley of the 1880s: he had gained a life-altering position in Menlo Park, New Jersey as the private secretary of Thomas Alva Edison, where he caught the Unwoke Mind Virus that was Edison’s vision of a future of Electrified Humanity.

Moreover, Insull had a genius for organization and management that his then-mentor lacked. In the mid-1880s Edison’s manufacturing operations in Schenectady, New York were foundering. Edison sent Insull at the age of 26 to take charge. Through production and scale economies driven by vertical integration and through very aggressive marketing, by 1992 Insull had successfully transformed a zero-profit enterprise with 200 workers into a massively profitable 6,000-worker industrial juggernaut. And he had had enough of working for others. He left the Edison enpire to lead the then-modest Chicago Edison Electric Company.

Thereafter Insull followed a strategy of technological audacity in the service of pragmatic expansion with the goal of creating and maintaining natural monopolies. Recognizing that electricity’s value lay in ubiquity, he was early to break with Edison’s direct-current approach to champion Tesla and Westinghouse’s alternating-current alternative.

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I Have Reached My Limit. I Cannot Stand It. Too Much Sanewashing of the Trump Administration Has Broken My Brain

A huge number of journalists continue to talk about a “Trump administration” with things called “policies” that it “plans”. They know better. They should act better…

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As the extraordinary tropism for pretty much everyone to sanewash Trump has taken over, I have been losing it more and more.

In the old days, one could at least count on the news pages of the Wall Street Journal—they were, as one old hand said, information so financiers could make money, while the editorial pages were balm for the right-wing plutocratic soul. But even before Gerry Baker the wall had clearly eroded, and add to it a desire to make sense of Trump (and perhaps a growing eagerness to please sources, and it is now distrust and verify).

Then it was the Financial Times, as Gillian Tett and others began to take an anthropological approach to the Trump administration—look at all these interesting beliefs of this tribe! we should respect their cognitive picture of the universe!

And now we have the very sharp John Authers of Bloomberg:

John Authers: Where’s Mike Tyson With Advice When You Need Him? <https://www.bloomberg.com/opinion/newsletters/2025-04-25/trump-plan-where-s-mike-tyson-with-economic-advice-when-you-need-him>: ‘The great boxer Mike Tyson and once said that everyone has a plan until they’re punched in the face. Similarly, the Trump administration had one for rebuilding the world economy with tariffs. It’s been a rough first round. The plan was Stephen Miran’s A User’s Guide to Restructuring the Global Trading System, which must have been the most-viewed document by the financial world over the last six months. Stunningly ambitious, it helped earn its author a gig as chairman of the president’s Council of Economic Advisers, birthed the concept of the “Mar-a-Lago Accord,” and was widely taken as the road map for Trump 2.0’s bid to reshape the world using tariffs…

That is pretty much all a, well, completely out of contact with anything one might find her on God’s Green Earth:

  • The Trump administration had no plan.

  • Trump had grievances.

  • Miran had a plan.

  • Navarro had a very different plan.

  • Trump says stuff.

  • Bessent, Lutnick, Hassett, and others frantically try to retcon a small selected subset of what Trump says into a plan, and try to get Trump back on some kind of track.

  • They fail, over and over again. And reporters sanewash the enterprise, over and over again.

Read a little bit further, and you get:

John Authers: Where’s Mike Tyson With Advice When You Need Him? <https://www.bloomberg.com/opinion/newsletters/2025-04-25/trump-plan-where-s-mike-tyson-with-economic-advice-when-you-need-him>: ‘the “User’s Guide” reads differently now. Some of it has come to pass, Trump has deviated sharply from important recommendations, and certain assumptions now look tenuous at best…

No:

  • It does not read differently now.

  • It reads like it read last fall: as Miran’s plan, not Trump’s.

  • Its “certain assumptions” do not “now look tenuous”. They always looked unhinged.

  • Trump has not deviated sharply from important recommendations. Trump was never on course to follow those recommendations.

IT WAS NEVER TRUMP’S PLAN. TRUMP HAD NO PLAN EXCEPT TO VENT GRIEVANCES AND GET HEADLINES.

GROW UP, SHEEPLE.

And because he starts with sanewashing Trump as his foundational ground zero, very little of what Auther says makes sense. I could feel myself becoming dumber and losing brain cells by the minute as I read it:

(1) “If Europe has already decided that it cannot rely on US protection, as seems likely, then that makes life much easier for the US…”: No—it does not make life easier for the U.S. We used to have real allies, and as primus haud inter pares could count on their economic, diplomatic, moral, and geographic resources as a force multiplier to roughly double our weight in the world. Now, because of Trump, we have no allies. Life is not much easier for the US, it is much harder.

(2) “Miran expected the currency to rise… which he argued would have the effect of putting the burden on to the tariffed country…”: No—he argued that, but it was false. Imposed tariffs plus retaliation plus uncertainty plus the demonstration that everyone needs to derisk from the United States meant the even the threat of the tariffs was always going to put an enormous burden on the United States, with respect to which the effects of changes in terms-of-trade would be minor third-order corrections.

(3) “Miran acknowledged that… if the dollar were to weaken, then continuing inflation worries and the high budget deficit would put pressure on Treasuries…. The good news is that inflation numbers have improved in the last few months…”

What improvement in inflation numbers? The Fed watches the PCE. Given Trump’s desires to impose tariffs and blow up the budget deficit and the expectational consequences of same, all hope for any significant improvement in inflation numbers went out the window last November.

(4) “Advice Ignored: Proceed Gradually…. Miran’s precise suggestion was to raise tariffs by 2% each month until an agreement was reached. That would have worked very much better than the chosen strategy of hiking the tariff on China to 145% in very short order. The exasperating twists and turns of the last three months mean that any forward guidance cannot be credible. That has had a massive effect on uncertainty, even for the administration’s natural constituency of small business owners…. It’s not yet clear how damaging this will be, but the administration has taken a big risk by acting in such an unpredictable way…” No: Not even. There is no even. ESPECIALLY. And it makes no sense to say “the administration has taken a big risk” in the hope of getting some return, because there is no way in which the Trump administration can be, even metaphorically, accurately described as an animal with a mind. Chaos-monkey did chaos. There was no thought about whether the risk was worth running. There is only chaos, and then a few people scrambling around hoping that they can convince John Authers and his ilk that it is all part of a plan, even if they admit it is not a particularly clever or good plan.

(5) “Advice Ignored: Don’t Upset the Markets…. The White House is doing its best to look as unbothered by market selloff as it can…” Does anybody think that the White House as an entity is “unbothered”? Everyone in it is very borrowed. The most you can say with respect to “unbothered” is that Navarro hopes that at some point asset prices will stabilize, and then everyone will forget how much lower they are, and that Trump continues to say random chaotic stuff by day.

(6) “Questionable: Tariffs Aren’t Inflationary…. This looks increasingly like over-learning the lesson from the very different environment of… 2018… [when] tariffs were imposed gradually and with due warning, against a backdrop of placid inflationary pressure…” No: The small tariffs of 2018 delivered about as much inflationary pressure as one would have expected: about 0.3%-points <https://www.aeaweb.org/articles?id=10.1257%2Fjep.33.4.187> <https://www.bostonfed.org/publications/current-policy-perspectives/2025/the-impact-of-tariffs-on-inflation.aspx>. The claim that large tariffs would not be inflationary was always not “questionable” but unhinged. Always.

(7) “Questionable: Demand for Treasuries Is Eternal. [Miran:] ‘Much (but not all) of the reserve demand for [dollars and Treasuries] is inelastic with respect to economic or investment fundamentals. Treasurys bought to collateralize trade between Micronesia and Polynesia are bought irrespective of the US trade balance with either, the latest jobs report, or the relative return of Treasurys vs. German Bunds…’ Demand may not be as inelastic as all that…. Effectively, the suggestion [from Miran] is that the US should charge foreigners a fee for the privilege of lending to Uncle Sam…” For the amount of Treasurys that collateralize trade between Micronesia and Polynesia is microscopic. Reserve and other demand for Treasury’s is HUUUUUGELY dependent on economic, investment, geopolitical, and—as we saw in the misadventures of Liz Truss and Kwasi Kwarteng—moron-premium fundamentals. And the proposal to “effectively… charge foreigners a fee” was never questionable, always unhinged. For it is the most basic principle of public finance is that it is always unwise to alter after the fact the terms of payment on bonds you have already sold.

(8) “Questionable: The US Can Beat China in a Game of Chicken.… It looks at present like this is flat wrong. China retaliated swiftly… amped up the pressure… blocking… rare earths. Trump’s rhetoric is already swerving away from the confrontation…. The Chinese response is that tariffs have to come down first before talks can begin…. This game will be won by the player who can absorb the most pain. That appears to be China, even though it also stands to lose more…” No:

  • China exports $500 billion a year to the United States—in billions: $125 of electrical and electronic equipment, $100 of machinery, $30 of toys, games, sports requisites, $30 of apparel, $20 of plastics, $20 of vehicles—which are pretty much all finished products: things, and things that are useful, for which there is demand elsewhere in the world.

  • If China embargoed exports to the United States completely, it would over the next two years have to sell two years’ of stuff at half-off to others, and thus take a $500 billion hit.

  • The $500 billion a year of Chinese goods exported to the United States feed into the value chains of the predominately service-sector US economy, and are crucial parts of $3 trillion a year of US GDP. Over the next two years, there is not manufacturing capability in the US or elsewhere to replace those. Apple cannot get iPhone hardware at scale other than from China, and without hardware there are no distribution or software or services revenues for Apple or for anybody else relying on their platform. So over the next two years $6 trillion of US GDP simply stops. (Except to the extent that we pay women in Bangladesh to cut “made in China” labels out of and sew “made in Bangladesh” labels into clothes.

  • Trump has launched a trade war not against China but against the world.

  • The US is a much bigger loser from a trade war in which the rest of the globalized world continues on its course, and only the US is frozen out.

(9) “What Lies Ahead: So where does this leave us? A hundred days in, Miran’s “User’s Guide” shows that the administration entered the conflict with an inflated view of its own strength, and that it has been handled more abruptly and aggressively than the architects of the policy wanted. The response so far has not been what was bargained for…” No: THERE WAS NO “VIEW OF ITS OWN STRENGTH” THAT COULD BE DESCRIBED AS ‘“INFLATED”. THERE WERE NO “ARCHITECTS”. NOTHING WAS “BARGAINED FOR”.

(10) “We’re not keeping to the course laid out by Miran, but that doesn’t mean that we are irrevocably on the road to de-dollarization…” Again: NO!!! There was never a course. There are now, and will for the foreseeable future be frantic attempts to retcon things into a plan, a strategy, a course. We are not on any road. And we will not be on any road, absent the appointment of a Regent and universal accord that the Truth Social ravings of the president are in no sense to be understood as having anything to do with the policies of the United States of America.

PODCAST: Hexapodia LXIII: Plato's WereWolf, & Other Trumpist Topics

Back after a year on hiatus! Noah Smith & Brad DeLong Record the Podcast They, at Least, Would Like to Listen to!; Aspirationally Bi-Weekly (Meaning Every Other Week); Aspirationally an hour...

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Sokrates: The people find some protector, whom they nurse into greatness… but then changes, as indicated in the old fable of the Temple of Zeus of the Wolf, of how he who tastes human flesh mixed up with the flesh of other sacrificial victims will turn into a wolf. Even so, the protector, once metaphorically tasting human blood, slaying some and exiling others, within or without the law, hinting at the cancellation of debts and the fair redistribution of lands, must then either perish or become a werewolf—that is, a tyrant…


Key Insights:

  1. We are back! After a year-long hiatus.

  2. Hexapodia is a metaphor: a small, strange insight (like alien shrubs riding on six-wheeled carts as involuntary agents of the Great Evil) can provide key insight into useful and valuable Truth.

  3. The Democratic Party is run by 27-year-old staffers, not geriatric figurehead politicians–this shapes messaging and internal dynamics.

  4. The American progressive movement did not possess enough assibayah to keep from fracturing over Gaza War, especially among younger Democratic staffers influenced by social media discourse.

  5. The left’s adoption of “indigeneity” rhetoric undermined its ability to be a coalition in the face of tensions generated by the Hamas-Israel terrorism campaigns.

  6. Trump’s election with more popular votes than Harris destroyed Democratic belief that they had a right to oppose root-and-branch.

  7. The belief that Democrats are the “natural majority” of the U.S. electorate is now false: nonvoters lean Trump, not so much Republican, and definitely not Democratic.

  8. Trump’s populism is not economic redistribution, but a claim to provide a redistribution of status and respect to those who feel culturally disrespected.

  9. The Supreme Court’s response to Trumpian overreach is likely to be very cautious—Barrett and Roberts are desperately eager to avoid any confrontation with Trump they might wind up losing, and Alito, Kavanaugh, Gorsuch, and Thomas will go the extra mile—they are Republicans who are judges, not judges who are Republicans, except in some extremis that may not even exist.

  10. Trump’s administration pursues selective repression through the state, rather than stochastic terrorism.

  11. The economic consequence of the second Trump presidency look akin to another Brexit costing the U.S. ~10% of its prosperity, or more.

  12. Social media, especially Twitter a status warfare machine–amplifying trolls and extremists, suppressing nuance.

  13. People addicted to toxic media diets but lack the tools or education to curate better information environments.

  14. SubStack and newsletters may become part of a healthier information ecosystem, a partial antidote to the toxic amplification of the Shouting Class on social media.

  15. Human history is marked by information revolutions (e.g., printing press), each producing destructive upheaval before stabilization: destruction, that may or may not be creative.

  16. As in the 1930s, we are entering a period where institutions–not mobs–become the threat, even as social unrest diminishes.

  17. The dangers are real,and recognizing and adapting to new communication realities is key to preserving democracy.

  18. Plato’s Republic warned of democracy decaying into tyranny, especially when mob-like populism finds a strongman champion who then, having (metaphorically) fed on human flesh, becomes a (metaphorical) werewolf.

  19. Enlightenment values relied more than we knew on print-based gatekeeping and slow communication; digital communication bypasses these safeguards.

  20. The cycle of crisis and recovery is consistent through history: societies fall into holes they later dig out of, usually at great cost—or they don’t.

  21. &, as always, HEXAPODIA!

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Trump vs. Powell vs. Trump vs. Warsh

On the Edge Again: The Fed, Trump, and the Risk of a 1980s-Style Spiral: An ongoing cautionary tale of monetary policy, inflationary pressures, and the destabilizing influence of political interference…

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From now on the Federal Reserve faces a harder balancing act, as Donald Trump reenters the political fray with threats against Fed Chair Jerome Powell. On one side, economic momentum is weakening: business investment is retracting in the face of political chaos as the “animal spirits” that drive growth are deflating. On the other side, inflationary pressures are building from Trump tariffs. Now layered atop this economic instability is the political wildcard of Donald Trump’s chaos-monkey act, in the context of his very clear and very present desire to fire his own former choice for Fed Chair, Jerome Powell. Inflation bares its teeth, recession looms, and Trump wants the Fed Chair’s head on a pike. These are waves that might wash the sandcastle order of economic stability and prosperity away.

To switch metaphors, the Federal Reserve right now is pinned like a butterfly stuck in a museum case. We have collapsing business animal spirits as people who enthusiastically voted for Trump last November recognize that the damage from chaos-monkey policies outweighs the benefits of tax cuts, and that they are better cut back investment. Raising interest rates thus runs big risks of a recession, and risks a big recession. But Trump tariffs are bringing rising inflation as surely as day follows night for all who are not Joshua, son of Nunn. Failing to raise interest rates thus runs risks of boosting inflation. It required four shocks from bad policy and bad luck to get the U.S. into the inflationary spiral it was in 1980: the failure to contract fiscal and monetary policy during the Vietnam War, Nixon’s turning up the heat to boost his reëlection chances while welding the top onto the pot via wage-and-price controls, the 1993 OAPEC Yom Kippur Arab-Israeli war oil embargo, and the Iranian Revolution. We have now had three shocks: post-COVID reopening, Putin’s attack on Ukraine, and Trump tariffs.

Will there be a fourth?

And might it bring a return to a 1980-like expectational spiral?

I think it will not. I think we are still far from the cliff. But we are much closer than we were back in 2020.

And there already is shock #4: Trump’s desire to try to fire Fed Chair Jerome Powell, even though all his advisors are pulling back on what reins they have on him as hard as they can. Inflation expectations are already on the move—to a small degree among the professionals, and a large degree in the surveys:

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And we have today, April 23:

Dan Ennis: Trump backs off his push to fire Fed’s Powell <https://www.bankingdive.com/news/trump-no-intention-fire-jerome-powell-fed/746148/>: ‘President Donald Trump said Tuesday he has “no intention” of firing Federal Reserve Chair Jerome Powell. “Never did,” Trump told reporters in the Oval Office. “The press runs away with things”…

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We had, on April 18:

Aimee Picchi: Trump is studying how to remove Fed Chair Jerome Powell, economic adviser says <https://www.cbsnews.com/news/trump-powell-studying-removal-fire-kevin-warsh/>: ‘President Trump and his team are studying whether firing Federal Reserve Chair Jerome Powell is an option, according to National Economic Council Director Kevin Hassett…. "The President and his team will continue to study that matter"…

Kevin Hassett still has his job. So Trump is very happy having someone directly working for him who he claims is a big liar. And Hassett has so little self-respect that he is happy to keep working for someone who claims he is a big liar. Two scorpions in a bottle, each thinking he is using the other, and both probably wrong. Not to mention the fact that Powell was, originally, the one person out of 330 million Americans whom Donald Trump picked as best qualified to be Fed Chair.

And on April 17 we had:

Brian Schwartz & Nick Timiraos: Trump Has for Months Privately Discussed Firing Fed Chair Powell <https://www.wsj.com/economy/central-banking/trump-has-for-months-privately-discussed-firing-fed-chair-powell-628d3d79>: ‘The president hasn’t made a decision on whether to try to oust Powell, and some of his advisers have warned against the move: President Trump said he can fire Federal Reserve Chair Jerome Powell at any time because he believes the chair has been slow to cut interest rates…. President Trump has for months privately discussed firing Federal Reserve Chair Jerome Powell, according to people familiar with the matter, but he hasn’t made a final decision about whether to try to oust him…

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Who would Trump want to choose to replace Powell? Kevin Warsh. We also have:

Brian Schwartz & Nick Timiraos: Trump Has for Months Privately Discussed Firing Fed Chair Powell <https://www.wsj.com/economy/central-banking/trump-has-for-months-privately-discussed-firing-fed-chair-powell-628d3d79>: ‘In meetings at the president’s private Florida club, Mar-a-Lago, Trump has spoken with Kevin Warsh, a former Fed governor, about potentially firing Powell before his term ends and possibly selecting Warsh to be his replacement, the people said. Warsh has advised against firing Powell and has argued that he should let the Fed chair complete his term without interference, according to the people. The conversations with Warsh carried into February, while others close to the president have spoken to Trump about firing Powell as recently as early March, the people said…. Trump’s advisers don’t agree themselves over how far the president should go, and it remains unclear if the president will move to fire Powell

Several people who have spoken to Warsh in the past year said Warsh gave the impression that the Fed job had all but been offered to him once Powell’s term expires…. Trump… mak[es] the case to allies in private meetings that the Fed chair should lose his job and that the Fed’s governing law, which says policymakers can only be removed “for cause,” isn’t strong enough to hold up in court if he sought to remove Powell…

And to complete the chaos-monkey circus, we have puzzlement from Dan Ennis later down in his story:

Dan Ennis: Trump backs off his push to fire Fed’s Powell <https://www.bankingdive.com/news/trump-no-intention-fire-jerome-powell-fed/746148/>: ‘Fed governor Kevin Warsh, 55, is a former Morgan Stanley executive who was nominated to the Fed's board of governors by President George W. Bush. Mr. Trump is considering selecting Warsh as Powell's replacement, the Wall Street Journal reported on Thursday. However, Warsh has advised Mr. Trump to allow Powell to remain through the end of his term, the publication added. Widely respected, Warsh is considered to be even more hawkish — or willing to allow interest rates to remain high to control inflation — than Powell, according to a January blog post by Harvard economist Kenneth Rogoff…

Indeed, Ken Rogoff did write on January 2 that Warsh has been more hawkish than Powell with respect to interest rates in his comments and had been more hawkish than Powell with respect to interest rates in his votes when he was on the Fed. But that was before Warsh signed up with Donald Trump. And many, many people lose their moral principles and their intellectual commitments when Trump offers them a chance that they think will get him on his careening career of grift. Will Warsh be different? Perhaps. So is Rogoff right? Perhaps, perhaps not. I am made very uneasy by Rogoff’s:

Kenneth Rogoff: Will Trump Fire the Fed? <https://www.project-syndicate.org/commentary/trump-bid-to-control-fed-puts-us-economy-at-risk-by-kenneth-rogoff-2025-01>: ‘Trump’s antagonism toward Powell is baffling, given that Powell has been doing an excellent job…. To Trump’s credit, the leading candidate to replace Powell, Kevin Warsh, is a highly regarded former Fed governor who has consistently been even more hawkish than Powell…

But that would be to Trump’s credit only if you think that Powell has been insufficiently hawkish. And I have certainly not seen that argument made. Plus Rogoff is one of the few people alive who claims to be “baffled” by Trump’s strong eminent antagonism toward and desire to fire Powell. Everyone else seems to have no problem understanding it.

So in what rhetorical mode are we supposed to take this?

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Trade, Trump, & the Inverse of Trust: I Gave a Quote to "Morning Brew" on How to View Trump

Like a declassé WWF performer yelling obscenities while waving a metal folding chair over his head & threatening to come into the ring and beat the s**t out of people with it…

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Brad DeLong: ‘One of the top priorities for Canada, for Mexico, for Europe, for China right now is to figure out how to start de-risking from the United States as much as possible, as fast as possible….

[What happens] depends on whether there is actually a trade war, or whether it is the same kind of contest as a [faked] World Wrestling Federation match.

Donald Trump was in the ring. He went outside the ring. He picked up the metal folding chair. He waved the metal folding chair over his head. He said: “I’m going to come into the ring and I’m going to beat you up with the chair!”

The question is: Will he put the chair down and come back in the ring and have it be a normal wrestling match? Or is he going to do it again—pick up the chair and wave it around?

Either way, we are in substantial trouble.

My guess is we’re in as much trouble as Britain was after 2016, when they exited from the European Union. But it might be less. It might be a bunch more…

The show:

Good Work: Why Are We in a Trade War? <https://www.youtube.com/watch?v=eNptnCkCoVk>:

The trade war has begun, and investigative journalist Dan Toomey has been drafted to the front lines. In a top secret special operation, Lieutenant Colonel Toomey and the 13th Good Work Investigative Platoon infiltrate and uncover the reasons behind this war. Featuring interviews with:


But there was a bunch more. My side, what is worth keeping:

  • “TRUMPXIT” is pronouncedd “Trump-Zit”. The “P” and the “X” together compress into a “P” and a “Z” in English phonetics. You want to preserve the “exit” reference in there, but that means the “P” absorbs the “K” part of the “X,” and what’s left phonetically is an “S” or “Z” sound. So: Trump-Zit…

  • What happens depends on whether this is actually a trade war—or a fake theatrical match like those of the World Wrestling Federation. Trump, after entering the ring, steps out of the ring. Now he is picking up a folding chair, waving it over his head, and shouting, “I’m going to beat you up with this!” He gets tons of attention and lots of praise from the people he listens to; praise for “standing up for America” and “fighting the globalists.” But then—he puts the chair down.

  • What’s actually happened? Not much, yet, apart from China noise and Apple rushing 600 tons of iPhones into the U.S. ahead of one of these threatened tariffs. So far it’s the threat—not the follow-through—that’s been driving things. And now he’s paused things for 90 days.

  • Will he pick up the chair again? Will he then declare another victory simply for dominating attention? Will he then put it back down?

  • Either way, we’re in trouble. We could be in as much trouble as Britain was post-2016 after its EU exit. Maybe less. Maybe more.

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"Ser Nihilo" & Ser Niccolò in France: Machiavelli, Broke & Un-Listened to at the French Court of Louis XII

The Renaissance city-state of Florence sends a junior diplomat to try to fix the diplomatic consequences of a military disaster. And doesn’t fund him. Nobody listens. Machiavelli in the diplomatic trenches, thirteen years before The Prince. Between unpaid mercenaries, snubbed at audiences, and court contempt, the youngish Niccolò Machiavelli learns the cost of weak states and weaker instructions…

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Sent to explain away Florence’s role in the military disaster at Pisa, Machiavelli is sent with no plan, little pay—half the pay of his partner—and instructions both so vague and so micromanaged they bordered on sabotage. The court of French King Louis XII would not take this jumped-up clerk seriously: they offered gave him contempt. But what Machiavelli observed in failure would help shape one of the most original minds in political thought. A glimpse of Renaissance geopolitics and a cold-bath awakening to realpolitik.

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Letters Patent:

PRO NICOLAO MACHIAVELLO ET FRANCISCO DELLA CASA, AD CHRISTIANISSIMAM REGIAM MAJESTATEM:

17 July 1500:

In sending at the present time, on account of certain important matters of ours, our respectable and most valued citizens Francesco della Casa and Niccolo Machiavelli to the court of the Most Christian King [Louis XII Valois of France], we beg the friends, confederates, and wellwishers of our republic, and command our subjects, that both in going and returning you will receive them with all their servants, goods, and equipage, and treat them in the most friendly manner everywhere within your dominion, without payment of any tolls or taxes. And in case they should require any guides, escorts, or any other favors for their safe conveyance to where they wish to go, we pray you promptly to comply with their requests. Your doing so will be appreciated by us in the highest degree, and in similar or more important occasions we offer you the same service at your good will and pleasure…

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In 1500, the ruling executive—the Signoria—of the city-state Republic of Florence sent one Niccolò Machiavelli and one Francesco della Cas on a Mission to the Court of France, that kingdom being then ruled by Louis XII Valois:

You will proceed with all possible despatch, even to riding post, if your strength permits it, to Lyons, or wherever you learn that his most Christian Majesty is to be found. Upon arrival, you will at once call upon our ambassadors there, Messers Francesco Gualterotti and Lorenzo Lenzi, and communicate to them our present instructions, and confer with them as to whether there is anything to be added or left out; also as to your mode of proceeding in urging one thing more than another.

You will then present yourselves, together with our ambassadors, before his Majesty, the king, and, after the customary formalities of the first audience, you will expose to him in our name the substance of the instructions you will receive from us; although we do not believe that we can give you more clear and positive information than what you already possess touching the events of which you have yourselves been witnesses, and in connection with which you were in great part the agents and executors of all that had to be done on our part…

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These do not seem friendly instructions—the undertone seems to me to be thus: Things went wrong with respect to the siege of Pisa, and someone shit the bed. You were there. In fact, you were more than there: you were our “agents and executors” as the bed-shitting took place. Now go explain to the King Louis XII Valois of France the state of the bed, and why he should not blame Florence for it.

And then the real high-status Ambassador, Lorenzo Lenzi appears to have taken a look at the situation and skipped town—ignoring the instructions of the Signoria that he accompany them to their audiences with Louis XII. For we have:

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UPDATE: This, Again: Scott Bessent Wants to Resurrect the Trans-Pacific Partnership. But Does Donald Trump? No.

For Donald Trump to want to resurrect the TPP—to recognize he made a huge mistake back in January 2017—would be possible only if Donald Trump actually had ideas and preferences about policies, which he does not. All he has are “instincts”…

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Eight years and three months after Donald Trump blew up the Trans-Pacific Partnership, and so unilaterally disarmed the United States in the runup to his launching his trade war against China, Treasury Secretary Scott Bessent claims (a) he has the baton from Donald Trump to use the threat of tariffs to negotiate trade deals, and (b) his first priority is to renegotiate the Trans-Pacific Partnership, and then have its members negotiate as a group vis-a-vis the Great Central Country that is China. Chris Anstey notices. But there is one big problem:

Chris Anstey: Bessent Has a ‘Grand Encirclement’ Plan for China <https://www.bloomberg.com/news/newsletters/2025-04-12/bessent-has-a-grand-encirclement-plan-for-china-bloomberg-new-economy>: ‘Trump abandoned the TPP shortly after first taking office in January 2017…. [And now] there’s no indication the 78-year-old Republican aligns with his Treausry secretary’s gang-up-on-China approach. Meantime… Lutnick and… Navarro, are focused on the flood of cash, ostensibly earmarked for domestic manufacturing, a high tariff wall may temporarily provide. They’re not championing grand geo-economic strategy…. Countries such as Vietnam and Cambodia that have been threatened with high tariffs lack the capacity for large-scale investments (unlike Japan and South Korea) that could create American jobs. So it’s not clear what sort of deals could be possible. Trump this week highlighted that deals can go beyond trade. So would Cambodia bar Chinese vessels from the Ream Naval Base that’s seen as a potential China military hub in Southeast Asia? Only time will tell. Washington’s surrender of soft-power influence cannot have helped. As Trump shut down US Agency for International Development assistance in Cambodia, China has ramped up. So Bessent has his work cut out for him. And an early-July deadline, as Trump’s 90-day pause ticks down…

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Not having blown up the TPP would have been the best thing. The Obama team knew what it was redoing in pursuing a strategy to rebalance the U.S.-China trade relationship. But, having blown up the TPP in the past, it would indeed be the best thing to resurrect it.

But that is not possible. First of all, none of the other potential members believe that Trump is a credible negotiating partner. Bessent wants to work with “Japan, South Korea, Vietnam and India”. They will be very happy to say they are working with the U.S. Their leaders will even come to Mar-a-Lago, and say nice words about Trump. But they all know that there is no point in conceding anything to Trump because doing so will get them the exactly zero credit with Trump that Mexico and Canada got from playing ball with Trump and doing him the favor of transforming what he said was the worst into the very best of trade agreements by renegotiating NAFTA into the USMCA agreement.

Second, Bessent is, to put it bluntly, lying.

He does not have a baton.

There is no baton.

Trump makes decisions minute to minute based on “instincts”. If Bessent manages to come up with something and bring it to Trump as a moment when Trump’s instincts say “yes”, Trump will take credit for it. If Bessent comes up with nothing, or if what he brings to Trump is not to Trump’s instinctive liking at that particular moment, Trump will disavow Bessent for freelancing.

Such is life at the court of the chaos-monkey king.

But I said all this last week:

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The Self-Inflicted Slump: How Tariffs Are Pushing the U.S. Toward a VTRR—A Voluntary Trade Reset Recession

A sudden spike in tariffs has small businesses on the ropes, and the broader economy may be next. Yes, individually big businesses can lobby and bribe Trump and Trumpists for loopholes. But small businesses cannot, and they are going to be the things that are most macroeconomicly significant now. This likely recession will be a new kind of recession—not the result of inventory and investment cycles, supply shocks, bursting bubbles, or bank failures, but from brute idiot-policy force, a self-inflicted slowdown driven by tariff shocks and political brinkmanship. Since none of our models have been estimated on such a shock, it is a very brave forecaster who will put it out there right now. And so I am very grateful to Torsten Slok, Karen Dynan, and Adam Posen for doing so…

I see Torsten Slok writing:

Torsten Slok: Probability of VTRR 90% <https://www.apolloacademy.com/probability-of-vtrr-90/>: ‘Tariffs have been implemented in a way that has not been effective, and there is now a 90% chance of what can be called a Voluntary Trade Reset Recession (“VTRR”), see the first chart below. The administration inherited an economy with strong growth, 4% unemployment, positive hiring, and a substantial tailwind from investments. US and international investors are building infrastructure, next-generation factories, and data centers. The Inflation Reduction Act increased capex, and the US was poised for a substantial increase due to energy supply additions, increased defense production, and deregulation. But implementing extremely high tariffs overnight hurts many businesses; particularly small businesses because the tariff must be paid by the business when the imported goods arrive in the US. Small businesses that have for decades relied on a stable US system will have to adjust immediately and do not have the working capital to pay tariffs. Expect ships to sit offshore, orders to be canceled, and well-run generational retailers to file for bankruptcy.

To make exceptions for large businesses that have the flexibility and resources to handle unforeseen expenses but not small businesses does not make sense. The challenges for small- and medium-sized enterprises are now a macro problem for the US economy, where small businesses account for more than 80% of US employment and capex, see the second and third chart below. One way to quantify the coming negative impact on GDP is to compare the current tariff increase with the tariff increase observed during the trade war in 2018…. The US average tariff rate increased from 2% to 3%, and studies… (here and here)…. The negative impact on GDP in 2025 could be almost 4 percentage points, not including additional non-linear effects because of the current increase in uncertainty for consumer spending decisions and business planning…

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While Adam Posen says:

Adam Posen:

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And Karen Dynan:

Karen Dynan:

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Karen is the only one not making a recession call—and she is on the edge: a 40% chance of recession, and a long and dangerous tail should the policy shocks set a self-sustaining feedback downward spiral into operation.

What do I think? I think that there are very few times when market timing—diminishing the global stock-market weight in your portfolio from the 1.5 or so that it ought to be to 0.5 or less—has been worth doing in the past 150 years.

But it really looks like now is one of them.

The disjunction between the political-economic Trump situation and real market values:

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and price/earnings ratios:

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is palpable. There is not much of an equity premium to be harvested even if CAPE returns only to the value of 25, which we then thought was very high, it had back in 2015.

Plus even if price/earnings ratios remain at their current levels, recognize that the U.S. has just inflicted a likely recession on itself in the short-term and a BREXIT-class uncertainty-generated growth slowdown in the long-term. That BREXIT-class disaster looks likely to me to be between 1% and 2% per year over the next two decades. International trade in goods is massive. And people pretending that doesn’t matter because we are overwhelmingly a service economy ignores how much of service-sector productivity is linked to and indeed derivative from the goods economy.

And downward tail risk is very high.

And I cannot see any way out, short of Trump resigning, or appointing a competent regent.

These tariffs—whatever they ultimately turn out to be, and even if they would have been a nothingburger if properly prepared and rolled out—dropped suddenly and with little preparation, are inflicting heavy costs on the backbone of the American economy. Expect canceled imports, idle container ships, and an uptick in bankruptcies. The U.S. economy had momentum. Investments in manufacturing, infrastructure, and data centers were being propelled by the Inflation Reduction Act, energy expansion, and defense production. But a policy move with no possible economic strategy justification is bringing the growth machine to a halt. Right now we have to hope that there is no unknown systemic vulnerability out there that can—like mortgage-backed securities falsely marketed as AAA assets—trigger a true financial explosion.

Paul Krugman thinks it likely that there are such systemic vulnerabilities, although we still do not see where they are:

Paul Krugman: A Primer on Financial Crises, Part II <https://paulkrugman.substack.com/p/a-primer-on-financial-crises-part>: ‘The April storm… [when] Trump shocked the world by announcing that he was imposing very high tariffs on just about every nation America trades with. When Trump took office the average U.S. tariff rate was only about 3 percent. In one fell swoop he pushed it above 20 percent, higher than it was after… Smoot-Hawley…. The specifics of market reaction were peculiar…. [(1)] Interest rates on U.S. government debt rose. This was peculiar because normally the increased likelihood of a recession… will cause interest rates on US government debt to fall. Moreover, U.S. interest rates have historically fallen in uncertain times…. [(2)] Economists normally expect that tariffs… will cause the dollar to rise… [plus] rising U.S. interest rates should also have boosted the dollar. Instead, it fell…. [This is] something we… see in emerging markets that lose… confidence…. It’s unprecedented to see what looks like capital flight from the United States.

But[is] capital flight… the whole story? I don’t think so…. We’ve also seen interest rates on relatively risky or thinly traded assets… shoot up…. Bonds… protected against inflatio… rose so much that the spread between these bonds and regular bonds, often seen as a market forecast of inflation, went down…. [But] tariffs will surely lead to higher, not lower inflation…. That spread plunged during the 2008 crisis and again in 2020, so it suggest[s]… that we may be in the early stages of another financial crisis…. What’s the mechanism? As best I can tell, we’re looking at a potential balance sheet crisis focused on hedge funds… [that] need to reduce their exposure to market volatility by selling assets. This drives the prices of assets on their balance sheet down, which in turn requires that they sell even more assets to further reduce their exposure…

There are moments when politics and markets seem to diverge so sharply that it seems inevitable that something has to give.

This isn't just a short-term policy mistake—it’s a structural own goal. And it comes at a time when the U.S. had all the ingredients for an investment-led growth boom. Instead, we may be facing a downturn driven entirely by policy error.

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Another Brief Note on the Flexible-Function View of MAMLMs

Modern Advanced Machine Learning Models—MAMLMs—are they BRAINS!!!! or not? So far it is still very clear to me that they are not. And I see it as highly probable that MAMLMs as we know them are still at the very beginning of what might become the process of building Artificial Intelligence, as capable as they are at Complex Information Processing. & yet we overascribe mind to them. Searle’s Chinese Room does not understand Chinese until it grows as large as the entire Earth and is serviced by tens and thousands of robots traveling at lightspeed. & we are still very far from that…

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If you start from the premise that a language model like ChatGPT is a very flexible, very high dimensional, very big data regression-and-classification engine best seen as a function from the domain of word-strings to the range of continuation words, I think a large number of things become clear.

First, because its training dataset is sparse in its potential domain—nearly all even moderate-length word-sequences that are not boilerplate or cliché are unique—its task is one of interpolation: take word-sequences “close” to the prompt, examine their continuations, and average them. Thus while pouring more and more resources into the engine does get you, potentially, a finer and finer interpolation, it seems highly likely that this process will have limits rather than grow to the sky, and it is better to look at it as an engine summarizing what humans typically say in analogous linguistic situations rather than any form of “thinking”.

I think the post-ChatGPT3 history of LLMs bears this out:

Sebastian Raschka: The State of Reinforcement Learning for LLM Reasoning <https://magazine.sebastianraschka.com/p/the-state-of-llm-reasoning-model-training>: ‘Releases of new flagship models like GPT-4.5 and Llama 4…. Reactions to these releases were relatively muted…. The muted response… suggests we are approaching the limits of what scaling model size and data alone can achieve. However, OpenAI’s recent release of the o3 reasoning model demonstrates there is still considerable room for improvement when investing compute strategically, specifically via reinforcement learning methods tailored for reasoning tasks. (According to OpenAI staff during the recent livestream, o3 used 10× more training compute compared to o1)…

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Second, reinforcement learning—prompt engineering—and such are ways of attempting to condition this interpolation process by altering the domain word-sequence in such a way as to carry it into a portion of the training dataset where, when judged by humans, this function (word-strings) → (continuations) does not suck. That is, in some sense, all they are: You have a function trained on internet dreck in which there are some veins of gold—accurate information and useful continuations of word-strings—and you need to transform the word-string you send so that it lands inside one of those veins.

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CROSSPOST: FRED CLARK: Holy Saturday as the Day When the Gospels for Believers & Agnostics Converge...

As I understand the theology, each year Believers do not only remember and commemorate but participate in Jesus of Nazareth's journey; thus on Holy Saturday God is really and truly Dead here and now, in this world today, and that reality excludes looking forward to Sunday with anything other than a probably vain hope...

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What follows from that? This:

Fred Clark: Holy Saturday <https://www.patheos.com/blogs/slacktivist/2024/03/30/holy-saturday-13/>: ‘This is my favorite day in Holy Week, this Saturday, this unrestful Sabbath, my favorite day in the whole of the liturgical calendar.

Well, actually, “favorite” is the wrong word. It’s not that I like this day so much as that I understand it. It’s recognizable, familiar, lived-in.

This day, the Saturday that can’t know if there will ever be a Sunday, is the day we live in, you and I, today and every day for the whole of our lives. This is all we are given to know.

Easter Sunday? That’s tomorrow, the day after today. We’ll never get there in time. We can believe in Easter Sunday, but we can’t be sure. We can’t know for sure. We can’t know until we’re out of time.

Here, in time, there’s just this day, this dreadful Saturday of not knowing.

There are some things we can know on this Saturday. Jesus is dead, to begin with, dead and buried. He said the world was upside-down and needed a revolution to turn it right-way-round and so he was executed for disturbing the peace. He came and said love was greater than power, and so power killed him.

And now it’s Saturday and Jesus is dead and we’re all going to die and everything I’ve told you about him turns out to be in vain and everything I’ve staked my life on turns out to be in vain. Our faith is futile and we’re still hopeless in our sins. Jesus is dead and we are of all people most to be pitied.

That last paragraph is a paraphrase from St. Paul. What he actually says there, in his letter to the Christians in Corinth, is “if…” What he says, specifically, is: “If there is no resurrection of the dead, then Christ has not been raised; and if Christ has not been raised, then our proclamation has been in vain and your faith has been in vain.…

“If Christ has not been raised, your faith is futile and you are still in your sins. Then those also who have died in Christ have perished. If for this life only we have hoped in Christ, we are of all people most to be pitied.

“But in fact Christ has been raised from the dead…”

But that’s Sunday language, and Sunday certainty, and it doesn’t make much sense here on Saturday.


Here on Saturday, we can hope it’s true and we may even try to believe it’s true, but we can’t know “in fact” one way or another. Not now. Not on Saturday.

And to be honest, it doesn’t seem terribly likely, because Saturday, this Saturday, is all we’ve ever known. Yesterday was this same Saturday, and so was the day before that, and the day before that, and the day before that.

Why should we expect that tomorrow will be any different?

Seriously, just look around. Does it look like the meek are inheriting the earth? Does it look like those who hunger and thirst for justice are being filled? Does it look like the merciful are being shown mercy?

Jesus was meek and merciful and hungry for justice and look where that got him. They killed him. We killed him. Power won.

That’s what this everyday Saturday shows us — power always wins. “If you want a picture of the future,” George Orwell wrote, “imagine a boot stomping on a human face — forever.”

“But in fact,” St. Paul says, everything changes on Sunday. Come Sunday power loses. Come Sunday, love wins, the meek shall inherit, the merciful will receive mercy and no one will ever go hungry for justice again. Come Sunday, everything changes.

If there ever is a Sunday.

And but so, this is why we hope for Sunday and why we live for the hope of Sunday. Even though we can’t know for sure that Sunday will ever come and even if Saturday is all we ever get to see.

What warrant do we have for any belief or even hope that there is any sort of arc tending the world toward justice? And if they were, shouldn’t that properly terrify us all? And do we not—looking around these days—have even less warrant for any belief or even hope that there is any sort of arc tending towards any sort of mercy?

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Trumpist Chaos-Monkey Feces-Flinging in Trade Policy Continues. & It Is Turning into a Foreign-Policy Dumpster Fire...

Trump desperately wants to be on the phone with Xi Jinping, the dog’s has poked its nose into the steel trap, and corrupt media pretending to sanewash everything they can by pretending it is all 11-dimensional chess from people who think AI is a steak sauce…

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In the left-hand ring of the chaos-monkey three ring circus that is the Trump administration, I see this AM that the Bessent Affinity within the Trump administration is trying to make something that might resemble a move of sorts.

The Bessent Affinity is now retconning all the Trumpist chaos-monkey feces-flinging in trade policy. They are going all-in. It all always was, they say, an 11-dimensional chess strategy to resurrect the Obama Trans-Pacific Partnership that Trump blew up on Day 1 of his first presidential term.

And I see four Politico reporters—Megan Messerly, Ari Hawkins, Phelim Kine, and Felicia Schwartz—pretending, unprofessionally, to take it seriously.

They ask no hard questions, but imitate lapdogs begging for treats:

Megan Messerly, Ari Hawkins, Phelim Kine, & Felicia Schwartz: Trump wants to make a deal with China. Here’s how he’s trying to make that happen <https://www.politico.com/news/2025/04/16/trump-china-trade-strategy-00291979>: ‘The administration’s theory of the case is that tariff deals with other countries will isolate China — and urge them to come to the table…. [as] the U.S., will isolate China, disrupt the Chinese supply chain and threaten to cut the country off from the rest of the world…. Announcements from companies moving manufacturing operations to the U.S. and its broader sectoral-based tariff strategy… [are] key components in getting Xi to cooperate…. “Once you see a lot of countries — not just in southeast Asia or Asia, but all over — you’ll see that they’re willing to make deals with America, and that exerts pressure on China to hopefully come to the table,” the official said…. “Get all of Asia but China to the table, incentivize them with lower tariffs and U.S. companies will leave China,” said one person close to the White House. “And yes it makes sense. It’s happening already…”

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And this naturally drives Dan Drezner—recently having moved from his job at Tufts in Medford to become Whateley Chair in Thaumatropic Energies and Dimensional Rift Studies at Miskatonic in Arkham—into Shrill Unholy Madness:

Dan Drezner: The Trump Administration Is Just Grasping at Trade Policy Straws Now <https://danieldrezner.substack.com/p/the-trump-administration-is-just>: ‘Look who discovered a decade-old trade gambit!… Why… is this such an exasperating read?

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ChatGPT, Claude, Gemini, & Co.: They Are Not Brains, They Are Kernel-Smoother Functions

If your large language model reminds you of a brain, it’s because you’re projecting—not because it’s thinking. It’s not reasoning, it’s interpolation And anthropomorphizing the algorithm doesn’t make it smarter—it makes you dumber…

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This is not an annoyance, but rather a cavil—for I think that the very sharp Scott Cunningham has gone down the wrong track here:

Scott Cunningham: Inside the “Brain” of Claude <https://causalinf.substack.com/p/inside-the-brain-of-claude>“: ‘Modern AI models like Claude…. When asked to write a rhyming poem,.. it activates features representing potential rhyming words before beginning the second line… “grab it”… “rabbit” and “habit”. It then constructs the second line to lead naturally to the planned rhyme…. Claude doesn’t generate text “one token at a time”—it’s actively planning future content and working backward to create coherent structures…. LLMs are performing… abstract reasoning, planning, and metacognition…. Two years ago, I would’ve thought that was impossible…. Large language models are complex systems with emergent properties—much like biological organisms…

I think Scott goes awry in word 3 of his title “Brains”. In my view, LLMs are still much too simple for words like “reasoning”, “planning”, and “metacognition” to be useful terms to apply—even purely metaphorically—to their behavior. It leads to much more insight, I think, to start from recognizing that trained neural networks are extremely flexible interpolation functions from a domain (in this case, a string of words) to a range (in this case, the continuation words). They have a training data set that is sparse in the domain—unless a string of words is a quote, a cliché, or boilerplate, by the time the string reaches twenty words long there is less than an 0.1% chance that it has ever been written down before. For prompts in the training dataset your flexible function is obvious: you simply return the continuation.

But for everything else you have to interpolate, somehow. The Deep Magic of the LLMs is in that interpolation process and in the shape of the training data. And thinking “BRAINS!!!” actually, I think, makes it harder to gain insight into why they behave the way they do. All that Scott has to say in his exposition of Lindsey et al. does say interesting things about the “how”. But I want to know the “why”. And even the statements and findings about the “how” are, I think, corrupted into near-uselessness because of the “BRAINS!!!” frame.


Why do I think this?

Well, yesterday I had a University of Chicago citation:

Machiavelli, Niccolò. 1513 [2008]. “Letter to Francesco Vettori, December 10, 1513”. In The Prince. Trans. & ed. Peter Bondanella. Pp. 109–113. Oxford: Oxford University Press.

And so I gave ChatGPT a task:

Q: Please get me the book from archive.org, and spell out the URL please.

My question asks ChatGPT to find a string of symbols, beginning with “archive.org/& such that when these symbols are entered into the address bar of web browser and the “return” key is pressed, the web browser loads a file that is a scanned-and-OCRed digital version of the print book published in 2008 by Oxford University Press that is the version of Machiavelli’s Il Principe translated and edited by Peter Bondanella.

The correct string of symbols to return to accomplish this task is “archive.org/details/n…

But this is what ChatGPT gave me when I assigned it the task:

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Yes, Virginia, Predestination Marx Is Not Fake (ANNOYANCES)

Marx wrote unvermeidlich. That matters much more than Peter Gordon dares to admit. It means one has to read Capital as not just an analysis but as a work in the Judæo-Christian prophetic tradition as well as a work in what Marx and Engels thought of as fully science if you are to read it well. Marx really did see himself as history’s and sociology’s Darwin. And to pretend that he did not is to betray one’s scholarly-intellectual obligation to him…

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I must say I do find myself cranky this morning. And so I wonder: am I being unfair here to marxisant Peter Gordon, who seems to have closed off his mind to a lot of what is really going on in the thought of Karl Marx?

Am I? To cut to the chase: No. I really do not think I am.

The Reitter/North new translation of Marx’s Capital <https://press.princeton.edu/books/hardcover/9780691190075/capital> vol. I is, as best as I can tell, truly excellent—it made me read it again, cover to cover, with the old Moore-Aveling and Fowkes translations also open on the desk, for fun.

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And Peter Gordon <https://www.lrb.co.uk/the-paper/v47/n06/peter-e.-gordon/hair-splitting> does do a nice service by drawing attention to it.

But this from Peter Gordon:

Peter Gordon: Hair-Splitting <https://www.lrb.co.uk/the-paper/v47/n06/peter-e.-gordon/hair-splitting>: ‘The analogy to natural science is unfortunate… mischie[vious]… implies that human freedom must yield to naturalistic necessity.…. Marx did not use the term [“laws”] in the sense we have in mind when we say that laws govern… biolog[y]… or the… planets…. Marx… knew that the economy was a human creation and therefore susceptible to historical and social change…. In his later years Marx came to appreciate the diversity of human cultures and economic practices…. Whatever commitment he had to discovering necessary or universal laws in the economic sphere yielded to a far more pluralistic acknowledgment of the many paths from past to future.

This shift is evident when we consider the differences between the [1872] French translation of Capital and the [1867] German original…. German… “The country that is more developed industrially only shows, to the less developed, the image of its own future.”… French… “The most industrially developed country only shows those that follow it on the industrial ladder the image of their own future.”… This seemingly minor amendment has dramatic consequences… leaves history open to alternative routes that do not all climb the same ladder of Western industrialisation…

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It is simply gonzo wrong. And so Peter Gordon will henceforth serve as one of my poster children on how not to read big, difficult books.

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READING: Things American Universities Do Right: Lisa Cook Believes She Is One

Lisa Cook, who was just finishing up as a student at Berkeley when I arrived as a professor, and who survived an attack by the right-wing slime machine to get confirmed as a Governor of the Federal Reserve, has things to say…

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The Official Federal Reserve System portrait:

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Apropos of her remarks, I must say that Evans Hall continues to be a pit—as Lisa quotes from Berkeley’s own assessment “a dark, closed-in design… spoiling the main east-west axis of the campus…”—and that the eating hole between Bechtel Enginering and Evans was worse, only slightly redeemed by the very large cookies it served. Fortunately, the eating hole is now gone, and there had better be a better one in the replacement Grimes Engineering Center building that should open any day now:

But this “architect’s drawing” viewpoint of Grimes when it will be finished is completely fake to the reality of the campus—at least until after Evans Hall comes down, supposedly in 2030.

Here is the real picture, back a year ago, from as close to the POV as I can get in Google Earth <https://earth.google.com/web/search/Bechtel+Engineering+Center,+Berkeley,+CA/@37.87334562,-122.25823927,107.99944776a,111.50299201d,35y,13.0286944h,72.2500981t,0r/data=CiwiJgokCRM25cZvS0RAERQ25cZvS0TAGSREX9_Cr0xAIe-rUQ1sE03AQgIIAToDCgEwQgIIAEoNCP___________wEQAA>:

Back in Lisa’s day, Evans looked even worse: They hadn’t painted it in decades, and pieces of the exterior concrete and windowpanes would occasionally slough off and fall down to the earth from as high as 130 feet. (The windowpanes would be replaced—the exterior concrete, not. “Deferred maintenance” as a revenue source.)

I had not known that Greg Grossman had postponed his retirement to advise Lisa…

Lisa Cook:

No matter when you attended Cal or how long you have been away, I think we can all agree that Berkeley is a special place that stays in your heart. I grew up in the South, and by the time I arrived at Berkeley, I had the good fortune to have spent time living in Africa and Europe.

Even with this experience, what immediately stood out to me was the campus’s openness to many different cultures and ideas.

And a clear way this was expressed, as I am sure you will recall, was through the abundance of delicious food. Berkeley was truly like heaven for this former founder of a cooking school. Better coffee and cuisine than anywhere else in the country. Dim sum everywhere, vegan and vegetarian options galore, and that sourdough at Great Harvest Bread. (You cannot blame a hungry grad student for stopping in for samples.) When I was there, Berkeley was at the forefront of the farm-to-table and healthy eating movements. I remember being in awe of the produce at Berkeley Bowl. They had five or six types of yams and sweet potatoes. I am from Georgia, and I had never seen so many yams!

The wonderful food served as a perfect canvas upon which to share ideas.

Sometimes that was having dinner at each other’s apartments, and sometimes it was slipping over to the cafeteria between Bechtel and Evans to have lunch with my friends in engineering and computer science. Shockingly, the Cal engineers had nicer facilities than the econ students in Evans Hall. By the way, Evans Hall is described on Cal’s own websites as a “dark, closed-in design… spoiling the main east-west axis of the campus.” Ouch, but I told you, open to ideas!2

From these lunches and many other conversations at Berkeley, I learned the value of exchanging ideas and the free disposal of ideas. The next idea will come; be unafraid to try new things. Do not be wedded to bad ideas. I learned the value of working in teams and acknowledging and leveraging everyone’s varied scholarly and lived expertise. I learned the value of sharing and collaboration. This fosters the spirit of innovation that drives the Bay area. You can see why many of the greatest advancements in the past century have come from that region of the country, many directly from Cal alumni.

It was awe-inspiring to be surrounded by so many outstanding students and stellar faculty members from many disciplines. The work of Cal researchers has changed the world. I often wondered what inspired these great minds. Then one day, while traversing the always congested campus, I saw it—the real incentive for great minds: Nobel laureates received reserved parking spaces. All of you who have fought Bay Area traffic and Berkeley campus parking restrictions know that tops any prize you can receive in Sweden!

But seriously, I was extremely lucky to have an amazing group of professors and supporters at Cal.

Barry Eichengreen was my dissertation adviser, and George Akerlof was an informal adviser who was just curious about economies undergoing market transitions. Janet Yellen and Laura Tyson were inspirations. They epitomized the commitment to public service that flows through the Berkley campus. When I arrived, Dr. Tyson had recently left to become chair of President Clinton’s Council of Economic Advisers (CEA). Of course, Dr. Yellen would soon serve as chair of CEA as well as those of Fed chair and Treasury Secretary, the only person in history to hold all three positions. I had the mentorship and support of a whole bunch of Romers: Christina, David, and Paul. Christina would also serve as CEA Chair as we climbed out of the Global Financial Crisis

I arrived on campus in 1991 the very week the Soviet Union started breaking up and the Russian Soviet Socialist Republic became just Russia. This series of events gave the world an unfiltered view of a Russian economy blinking into the sunlight after decades of central planning and stagnation. I asked, what would happen next, and what could we learn from this historic event? I was desperate to explore those questions and to explore them with Greg Grossman. No one in the world knew more about the Soviet and Russian economies than he did.

However, he had other thoughts—namely, retirement. When I asked him to advise me, he was hesitant. So, he presented me with a challenge. He said the only way to study the Russian banking system and economy was to become fluent in Russian. If I could learn the language, he would delay his retirement to advise me, along with Eichengreen. I could tell he thought his retirement plans were safe with that lofty goal. A year and a half later, I walked into his office and struck up a conversation in Russian. I could see his heart sink. I had won the challenge. (What he did not know then was that I had already learned four other languages and was blessed with the ability to pick up new ones quickly.) Once he agreed to stay on, I was off and running.

I plowed through Tsarist-era statistical tables stashed in the depths of Bancroft Library. Later, I would travel to Moscow and collect data from the Russian Statistical Agency and eventually survey and conduct interviews with Russian bankers and entrepreneurs. I credit my Berkeley professors, particularly Barry, Greg, George, and Paul, for supporting the curiosity that took me to Moscow and many other distant places to do research and push forward the field of economics with new questions, data, and analysis. I especially thank them for asking tough, thoughtful questions that prepared me to approach any situation of heightened uncertainty and in which standard models and the conventional wisdom in economics may not apply.

One aspect that stood out about the Berkeley experience was that we defended our dissertations at the proposal stage rather than upon completion. This arrangement was not common at the time but is now becoming a more frequent practice at other schools. It sets up the dynamic of these experienced, knowledgeable professors looking for constructive ways to allow experimentation to ultimately bring ideas to fruition. It is this sense of collaboration and openness that I have taken from Berkeley and brought with me everywhere I have gone—through universities, banks, the government, and now at the Federal Reserve…


Her biography from winter 2020:

Lisa D. Cook is Professor of Economics and International Relations at Michigan State University. She was the first Marshall Scholar from Spelman College and received a second B.A. in Philosophy, Politics, and Economics from Oxford University. She earned a Ph.D. in economics from the University of California, Berkeley with fields in macroeconomics and international economics. Prior to this appointment, she was on the faculty of Harvard University’s Kennedy School of Government, Deputy Director for Africa Research at the Center for International Development at Harvard University, and a National Fellow at Stanford University. Among her current research interests are economic growth and development, innovation, financial institutions and markets, and economic history. Dr. Cook is a Research Associate at the National Bureau of Economic Research and is the author of a number of published articles, book chapters, and working papers. She is on the Board of Editors of the Journal of Economic Literature, and her research has appeared in such journals as the American Economic Review and the Journal of Economic Growth. This research has been funded by the National Science Foundation, the National Bureau for Economic Research, the Smithsonian Institution, Harvard Business School, and the Economic History Association, among others. She is currently Director of the American Economic Association Summer Program and was President of the National Economic Association from 2015 to 2016. In 2019, she was awarded the Impactful Mentor Award (for mentoring graduate students) by the American Economic Association Mentoring Pipeline Program and was elected to the Executive Committee of the American Economic Association. During the 2011-2012 academic year, she was on leave at the White House Council of Economic Advisers under President Obama and has had visiting appointments at the National Bureau of Economic Research, the University of Michigan, and the Federal Reserve Banks of New York, Chicago, Minneapolis, and Philadelphia. She serves on the Advisory Boards of the Federal Reserve Bank of Chicago (Academic Advisory Council), the National Science Foundation (Social and Behavioral Sciences), the Opportunity and Inclusive Growth Institute of the Federal Reserve Bank of Minneapolis, and the Lemelson Center for the Study of Invention and Innovation of the Smithsonian Institution. She is a member of the Council on Foreign Relations. Dr. Cook has been a Sigma Xi (Scientific Research Society) Distinguished Lecturer and was recently named an Edison Fellow at the US Patent and Trademark Office. She is a guest columnist for the New York Times (Economic View) and for the Detroit Free Press and a regular contributor on CNBC, MSNBC, and NPR. She speaks English, French, Russian, Spanish, and Wolof.


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PROJECT SYNDICATE: Rudderless America

And we are live! Instincts, sycophancy,spectacle—but no film editor—and the illusion of governance at the court of the chaos-monkey king…

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Rudderless America

Apr 15, 2025
J. Bradford DeLong

It should be obvious by now that the second Trump administration has no policies, nor even any policymaking processes. All that matters are the "instincts" of one ignorant man, and the eagerness of those around him to put their own interests ahead of the fate of the country.

BERKELEY – Eight years after US President Donald Trump abandoned the Trans-Pacific Partnership and unilaterally disarmed the United States in the trade war that he would soon launch against China, his second-term Treasury secretary, Scott Bessent, wants to renegotiate the TPP and use it to form a united front against the Chinese.

As Bloomberg’s Chris Anstey explains, Bessent has a “grand encirclement” plan, and if this “sounds familiar, that’s because… [t]he Obama administration’s big trade idea was using the Trans-Pacific Partnership to assemble a coalition of Pacific Rim nations that would increasingly be tied to the US, and not drift into China’s orbit.”

The problem is that resurrecting Obama’s strategy is probably no longer possible. The TPP now exists as the Comprehensive and Progressive Agreement for Trans-Pacific Partnership, none of whose members will regard Trump as a credible or trustworthy negotiating partner. Bessent wants to work with “Japan, South Korea, Vietnam, and India,” but while these countries will play nice, none would be so foolish as to concede anything meaningful to Trump. Mexico and Canada went down that path during his first term, when they agreed to renegotiate the North American Free Trade Agreement, and now they find themselves among the first countries Trump targeted for renewed bullying.

Moreover, Bessent is obviously either deluded or lying when he suggests that he is reflecting the administration’s view. No one has a mandate to speak for Trump, whose decision-making changes minute to minute on the basis of “instincts” and whatever happens to be showing on his TV. Trump may instinctively agree to a policy proposal by Bessent, but if the next person he sees tells him no, Bessent may be left to explain why he cannot deliver what he promised. Such is life at the court of the mad king.

Former US Secretary of the Treasury Lawrence H. Summers sees it differently:

The sole preoccupation that I would have if I were in the government would be with what the president was saying. … The president is entitled to have advisors who believe in his policies…. Individuals are entitled to follow their conscience…

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But, Larry, this is “sanewashing.” There are no policies to believe in. How can Trump be entitled to have advisors who believe in something that is nonexistent?

Policies embody clear goals, not to mention staff work, modeling, and analysis of various scenarios that may arise in their pursuit. What we have here is one ignorant man, surrounded by sycophants, wandering around spouting bullshit as the cameras roll.

This is business as usual for Trump, who is just playing the role he filled on the set of The Apprentice. The difference is that The Apprentice had highly capable producers and editors who could render all the messy raw footage into a compelling, clean final product. The current White House has only a live feed.

The contrast between Trump and Ronald Reagan is instructive here. Reagan had a cogent governing philosophy. It reflected his enormous confidence in the American people – in their industriousness and generosity and goodwill – as well as his suspicion of the policies, programs, and bureaucracies that the Democratic Party had built up since 1933. Reagan (a former actor) also had enormous confidence in himself – in his ability to memorize and perform his lines, and to play the part of president.

But while Reagan had a philosophy and knew he was the star, he did not think that he was the boss. He trusted the network of professionals who were there to make him an effective leader. When his confidence was justified – when he had high-quality professionals in their proper places on the White House staff – the results were quite good. When his confidence was not so justified – when Colonel Oliver North was allowed to make a mess of Middle East policy vis-à-vis Iran – scandal ensued.

The Trump White House has no film editors, only spin doctors. Trump will say something, and some adviser will rush to declare, “See! This was always the plan!” But these courtiers are not on the same page themselves. Sometimes, economic adviser Peter Navarro seems to have the upper hand; sometimes, Elon Musk does; and sometimes one detects the influence of Bessent, Commerce Secretary Howard Lutnick, Stephen Miran of the Council of Economic Advisers, or Kevin Hassett of the National Economic Council.

But these factions agree on very little.

And Trump ultimately trusts none of them anyway.

What should be done?

If the Republican Party had not turned sycophancy into a governing principle, Speaker of the House Mike Johnson and Senate Majority Leader John Thune would give Trump an ultimatum: Appoint qualified regents to oversee foreign and domestic policy and confine yourself to giving speeches that they write. Otherwise, a few of our members will align with the Democrats, and you will have to deal with a Congress led by Representative Hakeem Jeffries and Senator Chuck Schumer. These are the only options, because we have no confidence in your “policy process.”

If they were serious, Trump would knuckle under. He has already stopped casually insulting Canada now that its new prime minister, Mark Carney, has stared him down. My own vote for domestic-policy regent would go to Bessent, not because I think he would do well in the job, but because he might do less harm than anyone else who is actually willing to work for such a man. But none of this is going to happen. And that is why America and the world are in serious trouble.

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HOISTED From My Archives: "My Reading Difficult Books" Lecture

From the time I taught the “Smith, Marx, & Keynes” History of Economic Thought course designed by Ravi Bhandari…

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LECTURE NOTES: On Reading Big, Difficult Books…

Knowledge system and cognitive science guru Andy Matuschak writes a rant called Why Books Don’t Work <https://andymatuschak.org/books/>, about big, difficult books that take him six to nine hours each to read:

Have you ever had a book… come up… [and] discover[ed] that you’d absorbed what amounts to a few sentences?… It happens to me regularly…. Someone asks a basic probing question… [and] I simply can’t recall the relevant details… [or] I’ll realize I had never really understood the idea… though I’d certainly thought I understood…. I’ll realize that I had barely noticed how little I’d absorbed until that very moment…

However, he goes on to say:

Some people do absorb knowledge from books… the people who really do think about what they’re reading.… These readers’ inner monologues have sounds like: “This idea reminds me of…,” “This point conflicts with…,” “I don’t really understand how…,” etc. If they take some notes, they’re not simply transcribing the author’s words: they’re summarizing, synthesizing, analyzing…

But:

Unfortunately, these tactics don’t come easily. Readers must learn specific reflective strategies… run their own feedback loops… understand their own cognition… [what] learning science calls “metacognition”…. It’s challenging to learn these types of skills, and that many adults lack them…

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These points have strong relevance for you students in U.C. Berkeley’s “Econ 105: History of Economic Thought: Do We Live in a Smithian, Marxian or a Keynesian World?” For the core of the course is an assisted reading of three very big books that are damnably difficult to digest: Adam Smith’s An Inquiry into the Nature and Causes of the Wealth of Nations, Karl Marx’s Capital, and John Maynard Keynes’s The General Theory of Employment, Interest and Money. For it is a principal task of a successful modern university to teach people how to read such things.

These are all big, difficult, flawed, incredibly insightful, genius books. They each have a lot in them that is right. They also each have a lot in them that is wrong. Marx, especially, is wrong, often. But even where he is wrong, he is wrong in ways that are productive—reading him makes you smarter even and perhaps especially where you must disagree, and where history since he wrote has proven that he had little clue as to what was really going on in the world around him.

Indeed, it might be said that one of the few truly important key competencies we here at the university have to teach—our counterpart or the mediæval triad of rhetoric, logic, grammar and then quadriad of arithmetic, geometry, music and astrology—is how to read and absorb a theoretical argument made by a hard, worthwhile, flawed book.

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Oren Cass Pretends That Trump's Tariff Policies Have Something to Do with the Tariff Policies He Used to Advocate. Surprise! Surprise! They Do Not

And, on Fareed Zakaria's show "GPS" on 2024-04-13 Su, Larry Summers wipes the floor with him. Shame on Oren...

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There are three reasons to want to have a strong industrial sector.

  1. Blue collar mass production factory jobs – especially unionized ones – are an important channel promoting less inequality of opportunity and of result. They are one of the few ways in which people who do not pay close attention in elementary school can accomplish upward mobility and reach middle-class status.

  2. Plus factory work greatly aids in the self-organization of the working class. Without that self-organization, the working class tends to get the shaft relative to other economic interest groups that have an easier time assembling themselves into politically relevant forces.

  3. There are very powerful positive technological externalities generating useful knowledge about products and production processes. Many of those are generated by the growth and working of effective communities of engineering practice. Such communities necessarily grow around where the key and technologically difficult—and also evolving and changing—parts of the production network take place. Manufacturing production, equipment, installation, and a capital goods manufacture have long been those key places in the production network.

Reasons (1) and (2) are now off the table. With the successful war against the union movement, both are greatly weakened. Add that to the fall in share of true manufacturing production workers from 20% down to 4% of the labor force, it is no longer large enough a sector to matter.

Thus reasons (1) and (2) to boost manufacturing are now dead.

Reason (3) however remains.

But why would it call for tariffs to support manufacturing, rather than for the Pigovian response of painting a bulls-eye on the externality itself and subsidizing the training and employment of engineers?

There is a reason to want to use tariffs as a tool to boost the strength of our industrial sector:

  • Undervaluing your currency and then using tariffs on manufactured imports to boost the prospects for your own manufacturing sector creates an export surplus in those industries you have targeted. Using that export surplus as a guide, you can borrow the judgments of the middle classes of other countries to assess which of firms are actually productive and worth subsidizing.

  • If you do not undervalue your currency and use tariffs to create space for your manufactures to grow, then you are reduced to using merely the intelligence of your bureaucrats to decide, which of your firms are actually productive and worth subsidizing. And your bureaucrats may be easily bribed and certainly are easily flattered by those better at giving presentations than running efficient production networks.

This last is not an argument that fits easily with economics—it is more of a management cybernetics argument.

But that may well mean that it is more likely to be right than an economics-based argument.

And that certainly means that there is every reason to think that it is underweighted in the public-sphere discussion, and needs more attention.

But all such attention and discussion needs to begin with this: Such intellectual arguments have absolutely nothing to do with Trumpist tariff policy. And people who do claim they have something to do—or in some way support—Trumpist tariff policy are big liars, grifters hoping to use chaos as a ladder in some way.


I am thinking about this because this morning I saw another example of one of the (admittedly few) great life lessons that the universe has managed to pound into my brain over the past 64 1/2 years. They are:

  1. Never play cards with a man named “Doc”.

  2. Never eat at a place named “Mom’s”.

  3. Never bet against the Jack of Spades jumping up and pissing in your ear.

  4. Never get involved in a land war in Asia.

  5. Never go up against a Sicilian when death is on the line.

  6. It is good to have Larry Summers on your side.

This AM it was #6.

Indeed, when Larry Summers is on your side, your side really does tend to win intellectual arguments. You even have a good chance of winning them when you probably should not. But when your case is strong ex ante, Larry can be counted on to wipe the floor.

Exhibit “A”, from this morning, the morning of April 13, on the only Sunday Morning Politics & Policy show that makes you smarter rather than dumber, Fareed Zakaria’s “GPS”:

Professional Economist Larry Summers vs. Professional Republican Oren Cass:


Fareed Zakaria, Larry Summers, & Oren Cass: GPS—April 13, 2025 <https://transcripts.cnn.com/show/fzgps/date/2025-04-13/segment/01>:

FAREED ZAKARIA: As Timothy Carney from the conservative think tank AEI notes, Trump's first election created a trade lobbying boom from 921 entities who hired lobbyists to work on trade to a peak of 1,419 by 2019. With the highest tariffs in the industrialized world, the American bazaar is now open. Countries and companies will descend on Washington to cut deals and gain carve outs, exemptions and special terms....

The India I grew up in was a country riddled with tariffs, high barriers designed to protect the country's domestic industry and shielded from what was regarded as unfair foreign competition. It produced stagnation, poverty and lots of corruption. Thoroughly politicizing the economy. No business of any size in India could survive without a good relationship with the government.

When I got to America, I was delighted to see that most businessmen went about their work with little care as to who was in the White House. But now I watch tech pioneers give interviews slavishly extolling Donald Trump's genius and Wall Street titans race to post-North Korea style congratulations to the president for his brilliance in rescuing the economy from his own actions. And I wonder what country am I living in?...

The Trump tariffs have roiled the global economy, and America's too. Markets are all over the place and some experts believe a recession is quite possible. Most mainstream economists argue the tariffs and these tariffs in particular are a terrible idea. But the president's aides and MAGA faithful beg to differ. What are the arguments on both sides? Well, you're about to hear them. Larry Summers served as Treasury Secretary under Bill Clinton, and Oren Cass is known as a MAGA intellectual. He's the founder of the conservative think tank American Compass.

Welcome both.

Oren, let me start with you. You've long argued for a 10 percent across the board tariff, and you've long argued for tariffs that would help America decouple from China's economy. So I think it's fair to say that where we have ended up at the end of last week has ended up pretty much where you want it to be. And I just want to begin by throwing up a few charts to show you what the market reaction to those policies has been.

So if you look at expected change in prices over the next year, inflation expectations, they're higher than they've been in I think about 40 years. If you look at U.S. asset performance, the 30-year Treasury is down. The dollar is down. The S&P 500 is down. If you look at the index of consumer sentiment, it's again the lowest in 40 years.

So consumer sentiment has tanked. Inflation expectations have soared. And people are fleeing almost every dollar asset. Isn't that a pretty decisive verdict against your policies?

OREN CASS: Two policies that I'm very supportive of: One is the 10 percent across-the-board tariff....

The other is much higher tariffs on China....

I... critici[ze]... the uncertainty that's been created by the way that some of these tariffs have been put into place.... [That] is not the way to transition there.... [But] I have a hard time swallowing this analysis that... focuses on stock prices as the appropriate measure of good economic policy....

ZAKARIA: But, Oren, I showed you... not just stocks. I showed you bonds... the dollar... inflation expectations... consumer sentiment....

CASS: Consumer sentiment... reflects the uncertainty.... We need to do this in a way that has less uncertainty and a lot more stability.... We need to do a better job getting it right on the specifics.

But I'm really concerned by... people who... say, no... what we really should do is... what we've been doing since... 2000... embraced this kind of hyper globalization....

LARRY SUMMERS: Nobody is saying that the stock prices are the right criterion for judging economic policy, Oren.... What happens to the middle class is what's crucial.

However, when you cause financial markets to gyrate in a way that is where there are only three compares, the 1987 crash, the pandemic, and the 2008 financial crisis... not because of some external event, but because of the rhetoric... and the threats of the president of the United States, you're making a pretty big mistake. When you cause the consensus judgment of economists to be that the main hope for avoiding recession is a policy reversal, you're making a pretty egregious error. When even the leading intellectual in favor of the president's approach, Oren, thinks it's been done in a blunderbuss way... you're... inept....

You pointed out something very important, Fareed, in your comment.... Giving an exemption here and an exemption there... is introducing... corruption... rent seeking... hugely advantageous for people to be friends of the first family, hugely advantageous for people to hire lobbyists.... Tthe big boom that's being created here is in crony capitalism....

When you tank their sentiment worse than it's been tanked in 20 years, you're not looking out for the middle class. When you make inflation... expectations higher... even than it was during the Biden stimulus, you're not looking out for the middle class.... This is the worst self-inflicted wound through economic policy since the Second World War. It's wrong on competitiveness, wrong on unemployment, wrong on inflation, wrong on uncertainty. The best thing we can hope for is that people start to see sense and reverse these errors....

ZAKARIA: Oren... I want to show you... [the] manufacturing share of U.S. employment... basically a straight slope down from about 1950.... The slope is... standard. You can't find NAFTA... [or] China WTO. It just keeps going down from... 30 percent... to about 8 percent.... 80 percent of Americans work in services, 8 percent work in manufacturing.... Aren't your policies taxing most of the middle class to subsidize this very small and shrinking part of the middle class, which is the factory worker? Why is that a good deal for the middle class?...

CASS: There's nobody who cares about manufacturing employment as a share of total employment.... You didn't put up the chart that matters, which is actual manufacturing employment.... That... stayed in a very steady band between about 17 million jobs and 19 million jobs from the 1950s all the way up through the year 2000.... Through all of the technological progress, all of the automation, what we were getting were more and better jobs in manufacturing.... What we see after the year 2000 is a collapse in the number of manufacturing jobs. A sharp, frankly unprecedented collapse that devastated communities.... That's what we care about. That's what economists who are actually debating this issue are grappling with. Does making things matter? Do we care that we have a strong industrial sector? And if the answer is yes, then you have to be very worried about this. And the problem is that too many economists, I believe Larry is among them, says the answer is no. Making things just doesn't matter anymore. And I think that's wrong....

SUMMERS: The 8 percent number is misleading.... 4 percent... are working in production.... The rest... are in marketing or accounting or all that.... We could debate the exact merits about just how much manufacturing and how important it is to get more manufacturing. Here's the thing. The Trump program is completely ill-conceived for the objective. The focus on steel tariffs. There are 50 times more people who work in industries that use steel that are made less competitive.... When we stop imports, we make all the inputs to our export industries more expensive and make our export industries less competitive. There are important things to do for manufacturing.... This administration has destroyed the CHIPS program, which was investing in building capacity in manufacturing....

Let's assume that we want to support manufacturing. There is no reason to believe that this program will be other than counterproductive, especially since it especially burdens our manufacturing teammates, Canada and Mexico, from its design.

With respect to getting people's attention: Look, Fareed, if you punch your erstwhile friend in the face, you will get their attention. They might even suck up to you a little bit for a little while so you don't do it again. But you will have lost a friend for a very long time. You will have driven them into the arms of your adversaries, and I don't think you'll end up getting better deals from them.

There is a winner in what's being pursued.... Xi Jinping and China... scope for influence, scope for new markets, scope to displace the United States of a kind they could not have imagined as a result of the policies that we are pursuing.... [There] is a discussion Oren and I can have about the importance of manufacturing, but that's not the issue with the Trump program...


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To Put It Politely: Stanford's Jennifer Burns Is a Liar

By pretending in the existence of a plan that does not actually exist, Jennifer Burns, with the active assistance of the New York Times, has handed the Trumpists an attractive fictional gift-wrapped economic narrative, affirming the Trumpists’ worldview, granting them credibility—and fatally undermining her own attempt at a critique in the process. And when your anti-Trump argument affirms Trump’s worldview, you need to face facts—you’ve written propaganda…

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And the New York Times knows that she is a liar. Shame on them for publishing this.

Jennifer Burns wanted to write an anti-Trump op-ed. She wanted to argue that the United States should keep its foreign-policy economic and security commitments, that Trump wants to break them, and that this breaking will be bad for America. She wanted to argue that it will devalue our nation, and trade away the core economic and political values that have made America truly great.

But the way she set about making her argument involved her telling an awful lot of lies, pretening that Trump has a plan, and so sanewashing him.

The net effect is that she has written two intertwined op-eds, one of which she intends to be pro-Trump and the other anti-Trump. Call the first the “Trump method” op-ed and the second the “devaluing America” op-ed. The arguments of the “Trump-method” op-ed strengthen the confidence the Trump-friendly and the Trump-curious have in Donald Trump. And the arguments of the “devaluing America” op-ed do the same, for from the standpoint of the Trump-friendly and the Trump-curious it tells the story not of Trump devaluing but of Trump standing up for America.

The “Trump method” op-ed sanewashes Trump by saying he has a plan:

Jennifer Burns: There’s a Method to Trump’s Tariff Madness <https://www.nytimes.com/2025/04/07/opinion/tariffs-trump-dollar.html>: ‘Trump’s… tariffs… stumped economists. There is no economic rationale…. But there is order… or at least a strategy…. Trump’s tariffs… are the gambit in a more ambitious plan… intended to better serve American interests…. The Mar-a-Lago Accord… devised by Mr. Trump… Scott Bessent and Stephen Miran… [to] make U.S. exports more competitive, put economic pressure on China and increase manufacturing…. There is genuine economic, social and political discontent driving this plan. Given the demise of U.S. manufacturing and the post-Cold War development of a technologically interconnected world shaped by new geopolitical rivalries, some sort of reset of the economic order probably makes sense for the United States….

The first step is disruption: tariffs that… drive countries to the negotiating table…. Should allies refuse to bend… they may find the United States withdrawing from defense agreements…. Lowering… [the dollar’s] value would amount to financial warfare with China, which the plan endorses…. If everything goes as planned, U.S. exports would be more competitive globally, China would be weakened, and more of our allies would be sharing the burdens of military spending. The upshot would be more manufacturing in the United States and a reinvigorated American heartland…

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This “Trump method” op-ed is intertwined, almost paragraph by paragraph, with the “devaluing America”op-ed:

Jennifer Burns: There’s a Method to Trump’s Tariff Madness <https://www.nytimes.com/2025/04/07/opinion/tariffs-trump-dollar.html>: ‘The slash-and-burn approach of the Mar-a-Lago Accord isn’t the answer…. It is hard to find an economist outside Mr. Trump’s inner circle who thinks it… good…. But even if… the United States eventually prospers… we will have traded away the core economic and political values that make America truly great…. Will it work? Few economists think so….. Enormous risks of economic turbulence…. There is an even bigger problem…. The most valuable asset of the United States is not the dollar but our trustworthiness — our integrity and our values. If the world envisioned by the Mar-a-Lago Accords comes to pass, it will be a sign that not only our currency but also our nation has been devalued…

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This “devaluing America” piece of the intertwined op-eds makes two arguments: (1) it ain’t gonna work; (2) even if it does work, we will have traded away our integrity and our values for greater prosperity.

But this “devaluing America” op-ed simply asserts that globalist economists claim Trump’s plan won’t work. It does not provide any arguments. Hence it will have no impact on anyone Trump-friendly or even -curious: of course globalist economists are against it!.

This “devaluing America” op-ed does argue that trading away our integrity and our values—breaking our foreign relations economic and security commitments—is a bigger loss than renewed prosperity would be a gain. But, given where the Trump-friendly and Trump-curious are, that is not an anti-Trump argument. All of the Trump-friendly and Trump-curious will, when they read the “traded away the core economic and political values that make America truly great” line, be dumbfounded. They will conclude that Jennifer Burns is an idiot. The Trump line, remember, is that we were tricked by unpatriotic globalists into signing these agreements. Thus renouncing them is not a moral flaw. Renouncing them is a moral virtue. It is correcting mistakes of the past. It isrefusing to be conned again by the “globalists” who hate America. It is, in the words of Britain Brexiteers, regaining control of our destiny.

Thus the net effect of both of Jennifer Burns’s intertwined two op-eds is going to be, for everyone Trump-friendly or Trump-curious, this: Read this op-ed! The New York Times tells us that Trump knows what he is doing with these tariffs! And—if you were only to take off your globalist glasses—you would see that it is good!

So why does Jennifer Burns write this? And why does the New York Times publish it?

I cannot imagine. She knows as well as I do that there is no plan for a “Mar-a-Lago Accord… devised by Mr. Trump… Scott Bessent and Stephen Miran…”

She knows as well as I do that this is what Scott Bessent and Stephen Miran want to, after the fact, retcon into a plan. But she knows as well as I do that Trump is not onboard, and certainly did not devise it.

Bessent and Miran certainly want to turn Trump’s tariffs (along with other strong-arm tactics) into a plan to force the world into a reset of the global economic order, in order to allow a weakening of the dollar, and thus to increase manufacturing in the United States, harvest more of the gains from product and process technological progress produced by healthy and robust communities of engineering practice, and put pressure on China.

But they are nearly alone. And any “they” that the two of them are part of certainly does not include Trump.

The first prerequisite for manufacturing to be ingathered into the United States, after all, is the construction of a robust economic alliance with Mexico and Canada—we need Mexico for the unskilled-labor low-wage portions of the manufacturing value chains, and we need Canada because Ontario is an essential part of Midwestern manufacturing.

Hence if that were the plan Trump had devised, Trump would have spent the time from his inauguration to now going kissy-kissy with Mexico and Canada. They were in the “green box”. They were allies in the reset. They had, after all, embraced Trump’s demand to renegotiate the worst trade agreement ever NAFTA, into the best, USMCA. If that were the plan Trump had devised he would have given them some tongue: promised that all would be unicorns, rainbows, and puppies as far as NAFTAzone—excuse me, the USMCAzone—trade and economic relations were concerned.

Focusing from even before the inauguration on keeping Mexico and Canada from looking to derisk from the United States—from looking to shift to Japan, Korea, the Pearl River Delta, and Europe to fill the roles that the United States now fills in the globalized value chains in which they participate—would have been the first prerequisite step, if Bessent-Miran or anything in the same galaxy as it was, in fact, Trump’s plan.

Needless to say, Trump did not do that.

Trump has not spent the time since the inauguration getting Mexico and Canada onboard. Instead, he has given them every reason to prioritize and accelerating their diminishing as many of their economic links with the U.S. as they can as fast as they can.

The second action item in using tariffs as a negotiating tool to accomplish the Bessent-Miran agenda would have been to propose a system of tariffs that would ingather manufacturing in the United States. The tariffs would have been build by, first, looking at who was making the manufactured goods currently imported into the United States; second, looking at those that could be realistically moved here; third, looking at which moves would stoke the growth of the communities of engineering practice we should seek to build. Doing those lookings to devise that system of tariffs would require a lot of staffwork.

Trump did not OK the doing of any of that staffwork.

Instead, we had Kevin Hassett, in an office, with a copy of Excel that had a list of countries ordered alphabetically in column A, a list of trade deficits in column B, a list of trade volumes in column C, and a tariff formula in column D.

And the third action item would have been to, in Stephen Miran’s words, “start small and take small steps”.

That is not what is going on at all.

What does Jennifer Burns think she is doing by writing this? What does the New York Times think it is doing by publishing it?

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DRAFT: Consequences of the Revolutions of 1848: Élite Recognition that "If Everything Is Going to Stay the Same, Everything Has to Change..."

A meditation on the 1848 chapter of Harold James’s Seven Crashes: The Economic Crises that Shaped Globalization. I really wish he had written Seven Crashes before I published Slouching Towards Utopia, because this below would, I think, have fit perfectly into the book as a motivation for and tied together all of my references to the Pseudo-Classical Semi-Liberal Belle Époque Order…

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Harold James, in Seven Crashes: The Economic Crises that Shaped Globalization, identifies the 1840s agricultural crisis and the political Revolutions of 1848 as the initial push into something like modern globalization. It was a moment of conjoined shocks: famine, epidemic disease, financial collapse, and political upheaval. These events, James argues, formed a polycrisis, one aspect of which was a supply crisis of a particularly disruptive sort, one that destroyed traditional subsistence structures and rendered evident the insufficiency of the ancien régime’s political economy​. In Ireland, for example, the confluence of potato blight, doctrinaire laissez-faire policies, and an underdeveloped fiscal and relief apparatus led to what Amartya Sen would later call a man-made famine. In Germany and France, grain and bread riots cascaded into deeper confrontations with sclerotic state authority.

But the 1840s crisis and the 1848 revolutions in Europe failed. Old Régimes did regain control. But the response was not, as it had been after the 1815 final defeat of Napoleon, the attempted clock rollback of reaction.

No, the Revolutions of 1848 did not produce the descent from Heaven of an New Jerusalem.

However, there was, after 1848:

a Europe-wide questioning of how policy could be more effective, and how the poor might be helped…. Better, more competent institutions were needed…. Governments needed to reinvent themselves so as to see their relationship with commercial prosperity in a new way….. The events of the 1840s laid the foundation for a wave of productive institutional adaptation…. Reaction is [not] really the best way of describing the… governance that emerged in the 1850s and 1860s… ambiguous figures like Louis Napoleon (Napoleon III) and Bismarck: modernizers who built a world in conformity with a new logic…

They did, however lead “governments… to reinvent themselves… [and] their relationship with commercial prosperity in a new way…. a wave of productive institutional adaptation…” That is Harold James’s summing-up of one of the true gems in his treasure that is his book Seven Crashes: The Economic Crises that Shaped Globalization.

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Scott Bessent Wants to Resurrect the Trans-Pacific Partnership. But Does Donald Trump? No.

For Donald Trump to want to resurrect the TPP—to recognize he made a huge mistake back in January 2017—would be possible only if Donald Trump actually had ideas and preferences about policies, which he does not. All he has are “instincts”. Now should I sent this in to Project Syndicate? Or is it just too intemperate a rant, reflective of nothing but my badly unbalanced mental state these days?

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Eight years and three months after Donald Trump blew up the Trans-Pacific Partnership, and so unilaterally disarmed the United States in the runup to his launching his trade war against China, Treasury Secretary Scott Bessent claims (a) he has the baton from Donald Trump to use the threat of tariffs to negotiate trade deals, and (b) his first priority is to renegotiate the Trans-Pacific Partnership, and then have its members negotiate as a group vis-a-vis the Great Central Country that is China. Chris Anstey notices:

Chris Anstey: Bessent Has a ‘Grand Encirclement’ Plan for China <https://www.bloomberg.com/news/newsletters/2025-04-12/bessent-has-a-grand-encirclement-plan-for-china-bloomberg-new-economy>: ‘US Treasury Secretary Scott Bessent emerged from this week’s market ructions as a perhaps-unexpected lead trade negotiator, offering a potential scenario for the coming months: US deals with longstanding partners that put pressure on China….US friends. At the end of the day, the Trump administration can probably reach an agreement with them. “Then we can approach China as a group,” he said…. Japan, South Korea, Vietnam and India… neighbors of China…. with which the US could work… a “grand encirclement” strategy. If this tactic sounds familiar, that’s because it is. The Obama administration’s big trade idea was using the Trans-Pacific Partnership to assemble a coalition of Pacific Rim nations that would increasingly be tied to the US, and not drift into China’s orbit. Trump abandoned the TPP shortly after first taking office in January 2017…

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Not having blown up the TPP would have been the best thing. The Obama team knew what it was redoing in pursuing a strategy to rebalance the U.S.-China trade relationship. But, having blown up the TPP in the past, it would indeed be the best thing to resurrect it.

But that is not possible.

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READING: Dwight D. Eisenhower on the Rôle of a Tory President In the New-Deal-Order America of the 1950s

From 1954: a letter from President Dwight D. Eisenhower to his brother Edgar Newton Eisenhower. Accommodation of the New Deal Order at home; aggressive anti-communism (I would say counterproductive in the long run, for examples take Guatemala and Iran) abroad...

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Dear Ed:

I think that such answer as I can give to your letter of November first will be arranged in reverse order–at least I shall comment first on your final paragraph.

You keep harping on the Constitution; I should like to point out that the meaning of the Constitution is what the Supreme Court says it is. Consequently no powers are exercised by the Federal government except where such exercise is approved by the Supreme Court (lawyers) of the land. I admit that the Supreme Court has in the past made certain decisions in this general field that have been astonishing to me. A recent case in point was the decision in the Phillips case. Others, and older ones, involved 'interstate commerce.' But until some future Supreme Court decision denies the right and responsibility of the Federal government to do certain things, you cannot possibly remove them from the political activities of the Federal government.

Now it is true that I believe this country is following a dangerous trend when it permits too great a degree of centralization of governmental functions. I oppose this—in some instances the fight is a rather desperate one. But to attain any success it is quite clear that the Federal government cannot avoid or escape responsibilities which the mass of the people firmly believe should be undertaken by it. The political processes of our country are such that if a rule of reason is not applied in this effort, we will lose everything—even to a possible and drastic change in the Constitution.

This is what I mean by my constant insistence upon “moderation” in government. Should any political party attempt to abolish social security, unemployment insurance, and eliminate labor laws and farm programs, you would not hear of that party again in our political history. There is a tiny splinter group, of course, that believes you can do these things. Among them are H. L. Hunt (you possibly know his background), a few other Texas oil millionaires, and an occasional politician or business man from other areas. Their number is negligible and they are stupid.

To say, therefore, that in some instances the policies of this Administration have not been radically changed from those of the last is perfectly true. Both Administrations levied taxes, both maintained military establishments, customs officials, and so on.

But in all governmental fields of action a combination of purpose, procedure and objectives must be considered if you are to get a true evaluation of the relative merits.

You say that the foreign policy of the two Administrations is the same. I suppose that even the most violent critic would agree that it is well for us to have friends in the world, to encourage them to oppose communism both in its external form and in its internal manifestations, to promote trade in the world that would be mutually profitable between us and our friends (and it must be mutually profitable or it will dry up), and to attempt the promotion of peace in the world, negotiating from a position of moral, intellectual, economic and military strength.

No matter what the party is in power, it must perforce follow a program that is related to these general purposes and aspirations. But the great difference is in how it is done and, particularly, in the results achieved.

A year ago last January we were in imminent danger of losing Iran, and sixty percent of the known oil reserves of the world. You may have forgotten this. Lots of people have. But there has been no greater threat that has in recent years overhung the free world. That threat has been largely, if not totally, removed. I could name at least a half dozen other spots of the same character.

This being true, how can anyone be so unaware of what is happening as to say that this Administration has conducted foreign affairs under the same policies as did the former Administration? As a matter of fact, if you will press any individual who brings to you all these strictures and comments, I venture that your experience will be the same as mine. That experience is that these individuals have no idea of what the “foreign policy” of the previous Administration was and what the present one is. They have heard certain slogans, such as “give away programs.” They have no slightest idea as to what has been the effect of these programs in sustaining American security and prosperity. Moreover, they have no idea whatsoever as to comparative size of them now as compared to even two or three years ago.

You say that these critics also complain about the continuance of “controls,” presumably over our economy. There is nothing in your letter that shows such complete ignorance as to what has actually happened as does this term. When we came into office there were Federal controls exercised over prices, wages, rents, as well as over the allocation and use of raw materials. The first thing this Administration did was to set about the elimination of those controls. This it did amid the most dire predictions of disaster, “run away” inflation, and so on and so on. We were proved right, but I must say that if the people of the United States do not even remember what took place, one is almost tempted to regret the agony of study, analysis and decision that was then our daily ration.

You also talk about “bad political advice” I am getting. I always assumed that lawyers attempted accuracy in their statements. How do you know that I am getting any political advice? Next, if I do get political advice, how do you know that it is not weighted in the direction that you seem to think it should be—although I am tempted at times to believe that you are just thrashing around rather than thinking anything through to a definite conclusion? So how can you say I am getting “bad” advice; why don’t you just assume I am stupid, trying to wreck the nation, and leave our Constitution in tatters?

I assure you that you have more reason, based on sixty-four years of contact, to say this than you do to make the bland assumption that I am surrounded by a group of Machiavellian characters who are seeking the downfall of the United States and the ascendancy of socialism and communism in the world. Incidentally, I notice that everybody seems to be a great Constitutionalist until his idea of what the Constitution ought to do is violated–then he suddenly becomes very strong for amendments or some peculiar and individualistic interpretation of his own.

Finally, I must assure you again that I am delighted to get your own honest criticisms, particularly if you will only take the trouble to lay down the facts on which you reach what seem to me to be some remarkable conclusions. But the mere repetition of aphorisms and political slogans and newspaper headlines leaves me cold. I am sorry you are not going to be at Abilene.6 It would be easier to tell you these things than to write them–except that by this method I hope to make you do a little thinking rather than devote yourself just to the winning of a noisy argument.

As ever

P.S. I attach a paragraph and a cartoon that came to me in the same mail as did your letter. At least it represents a different viewpoint. Incidentally, it comes from one of the most successful businessmen in the nation.

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It Was Twenty-Five Years Ago Last Tuesday...

That was not when Sgt. Pepper taught his band to play. But it was the first time that my proto-weblog was archived by the universal online virtual library of humanity. What did it then find?…

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Twenty-five years ago last Tuesday, on April 8, 2020, the Wayback Machine <https://web.archive.org/> at the Internet Archive <https://archive.org/> did its first crawl of my proto-weblog <http://j-bradford-delong.net>:

<http://web.archive.org/web/20000408235436/http://www.j-bradford-delong.net/>:

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The first thing that strikes me is the—very appealing, to me at least—information density: much more information per square screen inch than these days, when everything is designed for small-screen smartphones first, and for spreading-out to take advantage of high-resolution large-panel technology… never. This is a loss.

Why was I doing this back then?

Well, the story begins, as so many turn-of-the-century stories do, with more than a dash of techno-enthusiasm and an immense dammed-up sense of anger at what then struck me as the very poor state of the Habermasian public sphere that is one of the faces of humanity’s anthology intelligence. Back in 1995 I left my jobs as Deputy Assistant Secretary for Economic Policy at the U.S. Treasury Department for Berkeley. And I left thinking that I need to find a way to do better. Simply letting the media carry the message about economic policy choices and outcomes was grossly inadequate. Op-ed pages were narrow, gated, and often uncomprehending. Far too many journalists routinely got the economic story wrong, and were uncurious about getting it right—as if they knew that if they understood the issues, they would have to stop taking what many of their sources said at face value, and so they would have to work harder. (The most extreme example of this, BTW, was and remains Jonathan Weisman; “he’s young, he’s an English major, he’ll learn better”, his elders told me when I complained; never did). Moreover, they seemed to operate with a memory that went back maybe—maybe—a week.

It was a conversation with my sometime roommate Paul Mende—then physicist, now finance quant—that offered me a way forward. He told me, back in 1995, that physics had shifted its modes of internal scholarly communication from journals, preprints, and seminars to what he called the world-wide-web: a “website” at <http://arxiv.org>. He said that other disciplines were certain to follow—some rapidly, others more slowly. And that I should get ahead of the curve. The world-wide-web was, he told me, a technological tool that would reshape how intellectual work was done: “It’s not just a repository of working papers,” he insisted, “it’s a norm-shifting device. It changes the way the field thinks about visibility, priority, commentary, and dissemination.” That stuck with me. And I reflected on the appallingly low number of people who actually read the articles I had published in the “top five” economics journals.

“To get ahead of the curve”, Paul told me, “You should just start posting your stuff. All of it. Online. There’s no reason not to. And there’s every reason to.” That seemed to me to make sense.

So I decided I wasn’t going to wait for the New York Times to get the macro story right or for the Washington Post to quote someone sensibly accurately and in context, as one of the things that I would do with my time now that I was back in the university.

Flash forward three years. One evening I open my copy of the new issue of Foreign Affairs and find myself cited by both Paul Krugman and Jagdish Bhagwati—cited very favorably by Paul, and cited very unfavorably by Jagdish.

Both of these people were far above my pay grade. I was then desperate to be noticed by them and their ilk. Krugman was going to win a Nobel Prize in Economics, after all.

One citation favorable. One citation very unfavorable. At one point in the movie Pirates of the Caribbean, Lt. James Norrington says: “You've got a pistol with only one shot, a compass that doesn't point north... and no ship. You are without a doubt the worst pirate I have ever heard of!”.

And Captain Jack Sparrow responds: “Ah, but you have heard of me”.

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They had heard of me. They were citing me.

But they were not citing anything I had written that had been printed and been published. The quotations were from the pre-editing drafts I had posted. They were citing from my website.

“Hmmm…”I thought.

I had a vision in my mind’s eye of both Paul and Jagdish frantically working away under deadline pressure at their PCs on their respective pieces for Foreign Affairs, Paul looking for something to buttress and support his argument, Jagdish looking for something he could straw-man and attack. And with no time to go to the library, both opening up a Netscape Navigator window to Altavista <https://en.wikipedia.org/wiki/AltaVista> and then grabbing a quote from what they found.

And so I doubled down. The proto-weblog as of April 8, 2000 was what resulted…

The next webcrawl by the Wayback Machine would come on May 20, 2000…

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Martha Wells's MurderBot Is Coming to Apple TV Plus in May!

I have extremely high hopes for this! And now there is a trailer... IMHO, Alexander Skarsgård totally nails both the flatness of external affect and the internal “I am incredibly ill-at-ease and freaked out and do not want to be here, especially not with people trying to make eye contact” internal anxiety of MurderBot…
Starting May 16…

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If you have not read any of the books <https://torpublishinggroup.com/series/the-murderbot-diaries/>, here is Apple’s take on the series:

Apple: <https://www.apple.com/tv-pr/news/2025/02/apples-new-sci-fi-series-murderbot-starring-and-executive-produced-by-alexander-skarsgrd-and-hailing-from-chris-and-paul-weitz-to-make-global-debut-may-16-2025/>: ‘Based on Martha Wells’ bestselling Hugo and Nebula Award-winning book series of the same name, “Murderbot” is a sci-fi thriller/comedy about a self-hacking security construct who is horrified by human emotion yet drawn to its vulnerable clients. Played by Skarsgård, Murderbot must hide its free will and complete a dangerous assignment when all it really wants is to be left alone to watch futuristic soap operas and figure out its place in the universe…

And here is Molly Templeton’s:

Molly Templeton: You Have Been Very Good So Here Is The Murderbot Trailer<https://reactormag.com/murderbot-adaptation-trailer-martha-wells/>: ‘Murderbot stars Alexander Skarsgård as a rogue Security Unit, or SecUnit, who has hacked itself. It’s not just a mindless killing machine; it has things it likes and things it dislikes. First column: entertainment programming. Second column: humans, which make no sense to it. But its job is to look out for them, and they might just grow on it. A little…. It’s a thriller and a comedy! This is not untrue…

And this gets the vibe of at least the trailer completely right:

Susana Polo: The first trailer for Murderbot reveals an awkward cyborg workplace comedy with laser explosions <https://www.polygon.com/trailer/555471/the-first-trailer-for-murderbot-reveals-an-awkward-cyborg-workplace-comedy-with-laser-explosions>: ‘Guest starring the actual [“Rise and Fall of] Sanctuary Moon” show: [While] The first images from… Apple TV’s adaptation… lacked personality…. The first trailer… is full of personality.… Most exciting of all might be finally seeing Alexander Skarsgård’s take on Murderbot. He certainly does sound exactly like someone who has never said words out loud with its face to human beings before…

The trailer:

I wrote about MurderBot—and C.S. Forester’s Horatio Hornblower, and Lois McMaster Bujold’s Miles Vorkosigan, and Jane Austen’s Elizabeth Bennet—a year and a half ago:

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The opening of the first MurderBot novella, “All Systems Red”:

I COULD HAVE BECOME a mass murderer after I hacked my governor module, but then I realized I could access the combined feed of entertainment channels carried on the company satellites. It had been well over 35,000 hours or so since then, with still not much murdering, but probably, I don’t know, a little under 35,000 hours of movies, serials, books, plays, and music consumed.

As a heartless killing machine, I was a terrible failure.

I was also still doing my job, on a new contract, and hoping Dr. Volescu and Dr. Bharadwaj finished their survey soon so we could get back to the habitat and I could watch episode 397 of “Rise and Fall of Sanctuary Moon”.

I admit I was distracted. It was a boring contract so far and I was thinking about backburnering the status alert channel and trying to access music on the entertainment feed without HubSystem logging the extra activity. It was trickier to do it in the field than it was in the habitat...

Reference: Wells, Martha. 2017. All Systems Red. The Murderbot Diaries, Book 1. New York: Tor.com. <https://www.amazon.com/dp/0765397536>

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Why do those of us who find Martha Wells’s MurderBot series the kind of thing we like like Martha Wells’s MurderBot series so much?

I claim the cause is the enormous dissonance between the interior life of the protagonist character on the one hand and the external circumstances and thus the role in which Fate has cast the character on the other. To the outside world MurderBot is a clever, devious, brave, and omnicompetent action hero—Odysseos and Hektor rolled into one.

But from the inside, psychologically, MurderBot is simply a total wreck.

The combination of psychological interior anxiety and neurosis to the max alongside pure action-hero plot is tremendously arresting to some—that is, to me. Question: did Martha Wells deliberately tune this dissonance to be not only immense but also maximally attractive to certain classes of nerdy voracious readers, particularly those with a penchant for technology and introspection and who identify as outsiders or misunderstood? Or is this an emergent property?

Presumably its designers intended SecUnits (Security Units) like MurderBot to be stoic, unfeeling enforcers of discipline and power controlled by the Company, its programs, and MurderBot’s own governor module. Yet, having hacked its own governor module into impotence and gained free will, what we get is a MurderBot character that is deeply introspective, anxious, and poses as being far more interested in consuming human media than in being a traditional action hero.

And so there is a third layer. As the major AI supporting character ART—or Peri—says: “For a being as sophisticated as you are, it is baffling how little understanding you have of the composition of your own mind…” (Network Effect, p. 225). We thus have three layers of compelling narrative dissonance that together speak volumes.

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This aspect of the MurderBot series is not unique:

Consider Horatio Hornblower, the protagonist of C.S. Forester's naval warfare novels.

To the world, Hornblower is a brave, skilled, and decisive naval officer. Internally, however, he is fraught with self-doubt, anxiety, a sense of inadequacy—and is a coward. This disparity between his inner turmoil and the stoic, competent face he presents to the world resonates with readers who grapple with their self-perception versus how they are perceived by others.

I think Forester accomplishes this most brilliantly at the very end of the third book in the original Hornblower trilogy, Flying Colours. Hornblower has won remarkable victories against astonishing and overwhelming cause. He was won the LadyPrize (yes, she is a much deeper character than that), Lady Barbara, younger sister of the Duke of Wellington Arthur Wellesley—she has already taken over the wardship of his son, believing he was an orphan. The novel ends with both an action-hero and a romantic climax of high intensity. And yet to Hornblower:

He had been happy for thirty seconds with his son, and now, more morbidly still, he asked himself cynically if that happiness could endure for thirty years. His eyes met Barbara’s again, and he knew she was his for the asking. To those who did not know and understand, who thought there was romance in his life when really it was the most prosaic of lives, that would be a romantic climax. She was smiling at him, and then he saw her lips tremble as she smiled. He remembered how Marie had said he was a man whom women loved easily, and he felt uncomfortable at being reminded of her…

Reference: Forester, C. S. (orig. 1938). Flying Colours. Hornblower Saga Book 8. Lake Oswego OR: eNet Press Inc., p. 244.

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I do think the first three of Forester’s works here are the best.

In the later ones he is lazy. They are much closer to being more normal action-hero books. The psychological anxious-neurotic interiority is soft-pedaled. Still, there are always touches—like in Commodore Hornblower, in which Horatio allows himself to be seduced by the “boldest eyed and most beautiful” Countess Camerine:

“The Commodore,” went on the Countess, “has expressed a desire to see the picture gallery. Would you care to come with us, Princess?”

“No, thank you,” said the Princess, “I fear I am too old for picture galleries. But go, my children, without me.”

“I would not like to leave you alone, here,” protested the Countess.

“Even at my age, I can boast that I am still never left long alone, Countess. Leave me, I beg you. Enjoy yourselves, children.”

Hornblower bowed again, and the Countess took his arm, and they walked slowly out. She pressed his arm, while footmen stood aside to allow them passage. “The Italian pictures of the Cinque Cento are in the far gallery,” said the Countess as they came into the broad corridor. “Would you care to see the more modern ones first?”

“As madame wishes,” said Hornblower. Once through a door, once out of the ceremonial part of the palace, it was like a rabbit warren, narrow passages, innumerable staircases, an infinity of rooms. The apartment to which she led him was on the first floor; a sleepy maid who was awaiting her coming vanished into the room beyond as they came into the luxurious sitting room.

It was into the room beyond that the Countess called him, five minutes later…

Reference: Forester, C.S. (orig. 1945). Commodore Hornblower. Hornblower Saga Book 9. Lake Oswego OR: eNet Press Inc., p. 171.

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Others come immediately to mind:

Consider Miles Vorkosigan, hero of Lois McMaster Bujold's Vorkosigan Saga.

Miles Vorkosigan is a character whose external appearance belies his internal capabilities. Born with crippling physical disabilities in a warrior culture that prides physical prowess, Miles's appearance and stature leads nearly all to underestimate him. However, his sharp intellect and strategic acumen make him a formidable force, creating a dichotomy that challenges societal expectations about ability and competence—major, major physical limitations compensated for with strategic brilliance. All are bound together with a not-sane brain that is driven to be the action-hero his father would have expected an uncrippled-son to be—and, in fact, driven to be more.

One might even see Jane Austen’s Elizabeth Bennet in the same vein.

She is, by the end of the novel, to exterior appearances when she appears in public on display, the perfect ingénue. She has succeeded in landing a spot as wife, social secretary, and household accounts manager for one of the richest men in England. Her fiancé is only one notch below the nobility in social status (and far richer than many), Fitzwilliam Darcy.

Only… she is not an ingénue.

She is too smart, too witty, too snarky, speaks too quickly without being wise—not the kind of person who will suffer gladly the many fools whom Fitzwilliam Darcy’s social role will require him to have around his dinner table, not the kind of person for whom a key lifelong task will be serving as the grease between the ever-so-prideful Fitzwilliam Darcy and those he needs to retain in his affinity.

Yes, her wit, her intelligence, and her moral fortitude reveal a depth of character and internal strength.

But she is not well-suited for the patriarchal-society near-nobility role in which Fate casts her. And this does create a vast and very interesting tension in the novel—as well as providing a dream of hope for all of us whose fast-talking tongue and wit outrun our wisdom. That makes Elizabeth an overwhelmingly fascinating and beloved character in literary history.

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Should I call this “dissonance appealing to the nerdy reader”? Perhaps.

Do nerdy readers often find themselves, or remember finding themselves, in a similar position—externally perceived in one way while internally experiencing the world differently? Being much more complex than societal roles dictate? Facing struggles between exterior and interior that rhyme with Murderbot's journey of self-discovery, its love for human media, and its struggle for autonomy?

I would say: yes.

If this were an essay for a college course, I would conclude it thus: All four—Murderbot, Hornblower, Vorkosigan, and Elizabeth Bennet perhaps—gain great narrative power from the dissonance between internal life and external perception. Whether it's the struggle with societal roles, physical limitations, or the conflict between duty and personal desires, they each speak to the human condition's complexity.

And for nerdy readers this dissonance is more than just an intriguing narrative device; but a reflection of what they take to be or have been their own experiences.

But one more thing is required: this theme of dissonance has to be executed with excellence and nuance. It is the nuanced understanding of this dissonance that makes Martha Wells's Murderbot series, and the works of C.S. Forester, Lois McMaster Bujold—and perhaps Jane Austen—so captivating, mirroring their fan readers’ complexities, and their—our—desperate wish that there be more beneath than what meets the eye.

That seems pompous. But I do think it gets at something.

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TRUMPXIT: The Bell Tolls for Thee

We were once indispensable. Now we’re just unpredictable. Economic power runs on trust. Trump has burned trust in America to the ground. Brexit slashed Britain’s growth. Trumpxit is now doing the same over here. And it will do it even if no tariff is ever imposed…

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The very sharp Matthew Winkler put a stake in the ground last year. He assessed the damage from Britain’s 2016 Brexit:

Matthew Winkler (2024): Brexit’s Lasting Damage Is Looking Inescapable <https://www.bloomberg.com/opinion/articles/2024-03-19/brexit-s-lasting-economic-and-financial-damage-looks-inescapable>: ‘By almost every economic and financial measure, parting ways with the EU almost eight years ago has been disastrous for the UK. Is there no end in sight?… The toll of the June 23, 2016, referendum was more than double any of the eight worst days since 1981….

Sterling’s sudden collapse and failure to recover proved to be the signal that Britain’s best days are fleeting. For most of this century, the UK was the biggest beneficiary among the 27 countries in the EU. Measured by gross domestic product, GDP per capita growth, unemployment and superior debt, equity and currency valuations, Britain was the perennial leader. All of these superlatives ended with “Brexit” almost eight years ago. The EU since then outperforms the UK, whose listless economy is now little more than an also-ran….

The average premium investors pay for the future profits generated by the stocks in the 20 countries… [in] the euro zone, is 25%…. Between 2006 and 2019… [it] was zero…. Investors perceived no difference between the… euro zone and… UK…. The market… got it right. More than 50% of the British electorate belatedly acknowledged sterling’s June 2016 omen when they told polling firm YouGov in July they would vote to join the EU again…. British politicians instead show no hesitation offering prescriptions for the plight of Gaza 3,000 miles away and yet can’t be bothered to discuss remedies for the failure to protect vital UK industries such as finance and data while the public increasingly blames rising shop prices, reduced health care and broken public services on the vote to leave the EU.

Far from being the bloated, inefficient bureaucracy derided by Euroskeptics – led by former UK Prime Minister Boris Johnson when he was the fabulist journalist for the London Telegraph – who colored the prevailing Brexit media narrative… the bloc’s per capita GDP increased 19%, or 2.19 percentage points more than the UK on annual basis since 2016…. Between 2000 and 2016 the euro zone trailed the UK by six basis points…. Britain had everything to gain from its EU inclusion and little to lose as the bloc expanded with the fall of the Soviet Union’s Berlin Wall and rapid integration of Eastern European countries.… No one doubts now that Brexit hindered rather than helped the ailing British economy…

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And now, for us Americans, it is very clear that we need to listen to the tolling of the bell that tells us what Britain has experienced over the past ten years as a result of that extremely unwise choice. And we need to remember John Donne: “Ask not for whom the bell tolls: it tolls for thee”.

It is becoming increasingly clear to me: Suppose Donald Trump were to stand before the cameras tomorrow and say “never mind” to all of his proposed tariffs, export restrictions, and trade-war bluster. Suppose he were to retreat from the abyss with a mischievous grin. Suppose he were to declare it all a test. Suppose he were to do all of that. Then the odds are the damage would have already been done, for we would still be living in a post-Trumpxit world.

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HOISTED FROM THE ARCHIVES: A Return of "Management Cybernetics" as a Way Forward Out of Economics-Based Neoliberalism?

Dan Davies's book "The Unaccountability Machine" comes out in its U.S. edition today. So let me hoist the scattered, disorganized, self-indulgent and too-long review I wrote of it last year. I should write a proper review—The Holy One Who Is knows I have had enough time and spent enough time thinking about it—but right now I feel like Gandalf the White: “300 lives of men have I walked the earth, yet now I have no time!” From June 24, 2024…

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By reviving the ideas of cybernetics pioneer Stafford Beer, Davies suggests we can build organizations that are not just efficient, but truly accountable. In an age of AI anxiety and institutional mistrust, The Unaccountability Machine offers a timely reminder: the machines we fear most are the ones we've already built.

We have built a world of vast, interlocking systems that no one can fully understands. From corporate behemoths to government bureaucracies, these leviathan-like societal machines with human beings as their parts make decisions that shape our lives—often with disastrous consequences. Can there be a way to tame these monsters of our own creation, to give them human faces? Dan Davies thinks the forgotten discipline of “management cybernetics” might provide a way. That is the crux of his brand-new The Unaccountability Machine. Our societal woes stem not from individual failings, but from the opaque workings of large-scale decision-making structures—hence the need for better system design, better feedback loops, and more and better chosen variety of information, state, and action in these machines’ control mechanisms. Cybernetics was the discipline to help us understand communication and control in complex systems. The steersmen all ran aground, But we can try again.

Understanding how to make our systems more accountable and more human may not be the key to our survival, but it is certainly the key to our happiness and prosperity.


Create a photorealistic image of Stafford Beer's vision of a cybernetic macroeconomic control room. The room is brightly colored with maroon and grey as prominent accent colors. The control room features an array of futuristic consoles with large screens displaying various economic data, graphs, and real-time analytics. In the background, there are shelves filled with books and a large digital world map on the wall. People are engaged in intense discussions, monitoring the data, and making decisions. The overall atmosphere is one of high-tech efficiency and dynamic interaction. The image is in landscape format, capturing the vibrancy and complexity of the control room, and suitable to illustrate the 'Grasping Reality' weblog.

Dan Davies’s The Unaccountability Machine: Why Big Systems Make Terrible Decisions & How the World Lost Its Mind is a little book, and is a great book.

How is it a little book? Damned if I know. Had I set out to write anything like book, I could not have done so in less than four times the length.

Why is it a great book?

It is a great book because it sheds light on one of the most pressing issues of our time: why big systems make terrible decisions. Through a blend of historical analysis, theoretical insight, and contemporary case studies, Davies provides an essential read for those looking to understand the complexities of modern decision-making, and the pervasive issue of unaccountability and dysfunction in large human organizational systems.

It is a great book because it is a book that takes a lot of very important and fuzzy ideas about how a world of more than 8 billion people tightly linked together by economic commodity exchange, lightspeed voice, and political control can somehow organize itself to be productive, peaceful, and free when there is no way anything in our evolutionary past could possibly have predisposed us to pull and think together at such a scale. The result is inherent complexities and lack of transparency that lead to catastrophic decision-making. Davies makes this case through intricately woven combinations of historical analysis, theoretical frameworks, and contemporary examples that he uses to critique the phenomenon of 'unaccountability' that plagues modern society, from corporate behemoths to governmental institutions.

So what do we do? Davies says the first step is for him to write his book, attempting to revive what was once an important intellectual movement of the post-World War II world, cybernetics—Norbert Weiner’s idea that there should be principles that we can discover about how to make our increasingly large and complex systems of human organization comprehensible, and manageable by human beings. The root is the Greek kybernētikos, meaning “good at steering a boat”. Cybernetics would have been a discipline, metaphorically, about how to steer a boat, or perhaps about how to build a boat that can be steered.

For at the heart of Davies’s argument is the concept that historical events and societal shifts are better understood through the prism of decisions rather than the events themselves. He posits that many of these decisions emanate not from the will of individuals but from the impersonal, often opaque workings of large systems. This perspective challenges traditional notions of accountability and decision-making, suggesting a world increasingly governed by what Davies terms 'accountability sinks'—structures within organizations that deflect responsibility, thereby diluting individual accountability. Thus not events, but rather cybernetic information-flow structures, are at the center of at least modern history.

Davies’s argument is thus an optimistic one—that we can understand what appear to be the opaque workings of large systems because if there is not yet we can build a functioning intellectual discipline to help us manage them. Davies writes as if this conundrum we face is a product of the post-WWII history of the so-called “managerial revolution”.

But Henry Farrell argues that it is in fact much older than that. And I agree with him. Davies has chosen what Farrell calls the “Vico” as opposed to “Kafka” prong of the fork:

Vico-via-Crowley and Kafka-via-Jarrell present the two prongs of a vaster dilemma. Over the last few centuries, human beings have created a complex world of vast interlocking social and technological mechanisms. Can they grasp the totality of what they have created? Or alternatively, are they fated to subsist in the toils of great machineries that they have collectively created but that they cannot understand?… Understood in this light, current debates about the Singularity are so many footnotes to the enormous volumes of perplexity generated by the Industrial Revolution: the new powers that this centuries-long transformation has given rise to, and the seething convolutions that those powers generate in their wake…

What is this rope he tries to revive? I see five pieces spun together:

(1) revive the influence and reputation of counterculture-era management cyberneticist Stafford Beer. In his view, the principal governmental problem in managing corporate bureaucracies’ problems is a matter not for economists who focus on eliminating market failures, but of rather supervising them in a way that ensures that the internal flow of information between deciders and decided-upon is kept in balance so that they become and remain viable systems that are useful to humanity.

(2) Our current world is beset by accountability sinks—places where things are clearly going wrong, but it is nobody’s fault. As Felix Martin puts it:

frustrated customers endlessly on hold to ‘computer says no’ service departments… banking crises regularly recur—yet few individual bankers are found at fault… politicians’ promises flop[ping and] they complain they have no power; the Deep State is somehow to blame…

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(3) Every organization needs to do five things: operations, regulation, integration, intelligence and philosophy. Operations is doing the work; regulation is making sure the people doing the work have what they need when they need it; integration is making sure people are pulling in the right direction; intelligence is planning so when things happen you can modify operations, regulation, and integration; philosophy is what you are doing all of this for. Davies writes:

Think of soldiers, quartermasters, battlefield commander, reconnaissance and field marshal, or… musicians, conductor, tour manager, artistic director and Elton John…

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(4) Sometimes you need to get all the things done by simplifying-and-optimizing: delegate some of the work to a suborganization that will report its metrics, and as long as it meets its metrics don’t worry about it—but when it fails to meet its metrics, take a careful look inside at what is going on. This is attenuation: somehow reduce the complexities the organization has to keep trying to deal with so that there is less to do. (But do this badly and you are just pretending things are less complicated than they are.)

Davies’s example is how you would regulate the temperature of a squirrel’s cage. Rather than record its temperature at every minute, and then think about what would be the best thing to do, simply install an automatic thermostat and set the target temperature:

Variety engineering for beginners: The ambient temperature of our squirrel cage could take practically any value (within a realistic range). If we make a decision to reduce our information set to 'too hot' and 'too cold', we can match it to a regulator with states of 'heater on' and 'heater off'; we've built a thermostat. Doing this isn't difficult—we just decide to throw away some of the information, on the assumption that it's not relevant. That might end up being a bad decision, of course (if the ambient temperature rises above 100 degrees, for example, perhaps because the lab is on fire), but there is a huge saving in the amount of variety and information that we need in the regulator. This sort of decision is fundamental to the cybernetic analysis of systems; you are always attenuating variety in some way or other, unless you are describing a system that consists of everything in the universe…

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(5) Most of the time what you really need to get all the things done is to build better feedback loops, which requires amplification so that the control mechanism can see what is really there outside. The organization needs to better match in its internal structures the complexity of the environment it is dealing with, so that it sees what it needs to see in time for something to be done about it before it is too late.

We have not learned these management-cybernetic lessons, we do not think of our systems in this way. And so lots of things have gone and do go and will continue to go wrong. Davies’s tracing of the cybernetic flaws in the implementation of the 'managerial revolution' provides a historical foundation for understanding the current state of unaccountability. Critical decisions increasingly made by systems and processes rather than by individuals with a stake. This shift, Davies argues, has not only made it difficult to pinpoint responsibility for poor decisions but has also alienated individuals from the very systems that govern their lives. A significant strength of the book lies in its ability to connect these abstract concepts to tangible, real-world consequences. Davies leverages a range of examples, from the tragicomic episode of squirrels at Schiphol Airport to the profound societal impacts of the 2008 financial crisis. These illustrations serve not only to elucidate his points but also to demonstrate the far-reaching implications of systemic unaccountability on both a micro and macro scale.

Note that nowhere in this management cybernetics is a primary task one of making sure that people have the right incentives to act on the information they have (that elimination of “market failures” is the focus of economics. It is, rather, making sure that the flow of information is not neurotic—neither too little for those who must decide to grasp the situation, too much so that those who must inside drown, or too irrelevant. I wish I could say: “It’s a kind of psychoanalysis for non-human intelligences, with [counterculture-era management cyberneticist] Stafford Beer as Sigmund Freud”. But I cannot. Felix Martin wrote that in his Financial Times review of The Unaccountability Machine. And since I cannot do better, I unabashedly steal it.

I need to stress here that economists’ advice and counsel is, in Davies’s view, worse than useless in solving these problems. Even on their home stomping grounds—in this case, on the functioning of international capital markets—economists’ insistence that market prices and profit-seeking economic agents guided by them goes abysmally wrong. In the 1980s British Chancellor of the Exchequer Nigel Lawson argued that since Britain’s foreign-exchange current-account deficit was generated by a free market, it must be good. But it was not good at all, Davies argued on his weblog. And it was not good at all for essentially cybernetic reasons that standard economics could not see:

Where did it all go wrong? Lots of places, of course, in different ways and at different times. But the British economy… from about 1986 to 1992…. Among a certain kind of economist of a certain age… Nigel Lawson is famous for is the “Lawson Doctrine”…. Current account deficits… [that] have arisen as a result of private sector firms’ and households’ investment and spending decisions… are… “benign and self-correcting”…. A potted summary of the end of the Lawson Boom (and of Conservative Party economic credibility for two decades after the Black Wednesday currency crisis) would be “it wasn’t”….

The point of the Hayekian economy as information processor is that whenever a private sector transaction happens, information is transmitted through the supply and demand mechanism, and then incorporated into the price mechanism. If you presume rational expectations, then this mechanism ought to be self-regulating; the price ought to adjust to bring the transactions into equilibrium, so that it shouldn’t be possible to build up deficits which have really bad consequences…. [Yet] the thing that happened is… the good kind of deficit… that should self-correct, didn’t. How come?…

Tak[e] seriously the Hayekian model of the market economy as an information processor. If you do that, the answer is pretty trivial—the self-regulatory mechanism didn’t have enough information processing capability to regulate this problem quickly enough…. It didn’t have enough bandwidth

If von Hayek’s arguments that the market-economy price mechanism can and does have enough information-transmission bandwidth were correct, Black Wednesday would not have happened, because the Lawson Doctrine would have been sound. It wasn’t sound. It did happen. It is not correct.

Davies goes on:

Economists don’t… think this way… because the economic debate about information and calculation was won in the 1920s with the “socialist calculation problem”, while the modern theory of information wasn’t invented until Shannon and Wiener… in the 1940s. “Long and variable lags” could and should have been translated into much more rigorous terms, decades ago. But we had other things on our minds…

This worse-than-uselessness is especially baneful, Davies thinks, as far as the large-corporation sector of the economy is concerned. Davies appears especially angry at what he sees as the intellectual wasteland and on-the-ground rubble left by Milton Friedman, and his shareholder value-maximization doctrine. It took a post-WWII oligopolistic-company system that was in rough, effective, and useful cybernetic balance—what John Kenneth Galbraith called the “technostructure”—and destabilized it by turning its components into harmful paperclip short-term profit maximizers.

He eloquently warns of us economists’ potentially baneful influence:

As long as the ideology of economics maintains its dominant position, there is always a considerable danger of the Friedman doctrine rising back up from the dead. If the highest-level decision-making mechanisms of the world are to be viable systems, they need a philosophy which can balance present against future and create self-identity…. This philosophy cannot look much like mainstream economics…. Any system which is set up to maximise a single objective has the potential to go bonkers…. You can’t have the economists in charge, not in the way they currently are…. The top level of any decision-making system that’s meant to operate autonomously can’t be a maximiser. And so, the governing philosophy of the overall economic system can’t be based on the constrained optimisation methodology that’s currently dominant in the subject of economics…

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And he has much else to say.

Still, is this more than mere handwaving? I think not quite, but almost: I hope this book will spur the thinking that we actually need to do, for we badly need a revival of the intellectual thread of cybernetics.

Why do we badly need it? Let me back up, and approach that question the long way around:

We East African Plains Apes are neither wise, nor smart. We are lucky if we can remember where we left our keys last night.

And yet, working together, we have conquered and dominate the world. are an awe-inspiring concept-thinking and nature-manipulating anthology intelligence, whose spatial reach embraces the globe, whose numerical reach now covers more then 8 billion of us, and whose temporal reach—because of writing—now extends back 5000 years. Even as long ago as 150,000 years ago, weak of tooth and absence of claw as we are, and when our ability to coöperate to work and think together was limited to a band of perhaps 100 with a memory that extended back only 60 years or so, we were not just being eaten by but we (or, rather, our very close Neandertal cousins) were also eating the hyenas.

But how can we work and think together at 8 billion-plus scale? We no longer just have our families, our neighbors, and our coworkers with whom we interact via networks of affection, dislike, communication, barter, exchange, small-scale plan, and arm-twisting.

Instead, or rather in addition, more and more of what we do is driven by an extremely complex assembly of vast interlocking social and technological mechanisms that we have made but that we do not understand. Dan Davies hopes to set forth an intellectual schema to help us understand them: that is the goal of management cybernetics.

The publisher’s website for the book says says:

Profile Books: The Unaccountability Machine (Hardback): ‘Part-biography, part-political thriller, The Unaccountability Machine is a rousing exposé of how management failures lead organisations to make catastrophic errors. “Entertaining, insightful ... compelling” Financial Times…. Dan Davies examines why markets, institutions and even governments systematically generate outcomes that everyone involved claims not to want…. Stafford Beer… argued in the 1950s that we should regard organisations as artificial intelligences, capable of taking decisions that are distinct from the intentions of their members. Management cybernetics… was largely ignored…. With his signature blend of cynicism and journalistic rigour, Davies looks at what's gone wrong, and what might have been, had the world listened to Stafford Beer when it had the chance… <https://profilebooks.com/work/the-unaccountability-machine/>

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Groups of humans that achieve outcomes or “decisions that are distinct from the intentions of their members…”—now that leads me to reach for Adam Smith and his Wealth of Nations, in which the combination of profit and security motives on the part of merchants leads them to take actions that add up to making society as rich as possible by:

render[ing] the annual revenue of the society as great as he can…. [although] he intends only his own gain, and he is in this, as in many other cases, led by an invisible hand to promote an end which was no part of his intention. Nor is it always the worse for the society that it was no part of it. By pursuing his own interest he frequently promotes that of the society more effectually than when he really intends to promote it…

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For Adam Smith, the fact that the market economy considered as a slow-AI has a mind of its own is not a bug but a feature. Indeed, the fact that the market economy as slow-AI has this mind of its own allows Adam Smith to dynamite the entire “Political Œconomy” literature of how to make England great that The Wealth of Nations intervenes in.

Smith thus created the intellectual discipline of economics by building a toolkit for thinking about the global-scale societal human thinking- and doing-mechanism that is the coördinated market economy.

But the market economy was not alone as a human-made but inhuman-scale and incomprehensible societal mechanism. We have others. And all of our global-scale societal mechanisms are Janus-faced.

They are extraordinarily, massively, mind-bogglingly productive. How much richer am I than my Ohlone predecessors who were the only people then living on the shore of San Francisco Bay four hundred years ago? A hundredfold richer? More? And what do I do to gain these riches? I know things and tell people stories about the human economy of the past. That is what I do.

But these mechanisms are also horrifyingly alien, inhumanly cruel, and bizarrely incomprehensible. Franz Kafka saw this. As Randall Jarrell wrote: “Kafka says… the system of your damnation… your society and your universe, is simply beyond your understanding…” Purdue Pharmaceuticals “decides” that a good way to make money for its shareholders is to addict Americans to opiates, and the individual humans who are its components fall into line—and afterwards all protest that that was not what they meant to do. But they did it. Global warming means that Berkeley right now has the climate that Santa Barbara 300 miles south had in my youth. Who decided to do this?

And I have not gotten to the fact that this is the timeline with the killer robots and the automated distributed propaganda machines that would make O’Brien of 1984 or Gletkin of Darkness at Noon laugh with joy.

New York Times columnist Ezra Klein says that in trying to understand the latest wave of cultural technologies that are the tech sectors MAMLMs—Modern Advanced Machine-Learning Models—he is driven to:

metaphors… [from] fantasy novels and occult texts… act[s] of summoning… strings of letters and numbers… uttered or executed… create some kind of entity… [to] stumble through the portal…. Their call… might summon demons and they're calling anyway…

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But what Ezra does not appear to recognize is that his metaphors of finding ourselves in a room with possibly malevolent THINGS that have escaped confining pentacles applies not just to programs running on NVIDIA-designed GPUs. Mary Shelley saw that it applied to science, Marx to the market economy, Kafka to bureaucracy. Adorno to the creation and transmission of culture, Marcuse to modern democracy, and so on. Can we understand and manage these inhuman massive-scale systems that are in the last analysis made up of people doing things for reasons? Can we control or constrain them to give them humanlike souls, or a human face?

So far the answer has been, largely, no. Consider what Gabriel Garcia-Marquez thought of was extremely high and definitely worshipful praise of Cuba’s Maximum Leader Fidel Castro:

He has breakfast with… two hundred pages of news…. No one can explain how he has the time or what method he employs to read so much and so fast…. A vast bureaucratic incompetence affecting almost every realm of daily life, especially domestic happiness, which has forced Fidel Castro himself, almost thirty years after victory, to involve himself personally in such extraordinary matters as how bread is made and the distribution of beer...

To which Jacobo Timerman snarked:

Castro… has a secret method… for reading quickly…. Yet, thirty years after the revolution, he hasn't managed to organize a system for baking bread and distributing beer…

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From a cybernetic perspective, most of our economic world today suffers from the inverse of the flaws of Fidel Castro’s system. We are under the dominion of sophisters, calculators, and most of all economists. So we have systems that are highly efficient at managing the wrong things in the wrong way. They are maximizers, where the goal is to make as much money as possible. As Davies writes:

A maximising system… defin[es] an objective function, and throw[s] away all the other information…. [But] the environment is going to change, and something which isn’t in the information set any more is going to lead… [to] destruction…. Every decision-making system set up as a maximiser needs to have a higher-level system watching over it. There needs to be a red handle to pull, a way for the decided-upon to indicate intolerability

But all is not lost, at least not with respect to the major shoggoths of our economy. This is what I see as Davies’s major action-item conclusion:

[In] the decision-making system of a modern corporation… one of its signals has been so amplified that it drowns out the others. The ‘profit motive’ isn’t…. Corporations… don’t have motives. What they have is an imbalance…. They aren’t capable of responding to signals from the long-term planning and intelligence function, because the short-term planning function has to operate under the constraints of the financial market disciplinary system…. Take away that pressure [and] it’s quite likely…corporate decision-making systems will be less hostile…. Viable systems fundamentally seek stability, not maximisation…. On any given day, managers spend a lot more time talking to their customers and employees than they do to investors; if they were able to pay attention to what they heard, that would be much healthier...

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The von Hayekian strand of economics—which is still the dominant strand—assumed that the tasks of managing society were primarily that of moving decision-making to where the information already was—that was the function of private property—that of signaling where addition resources were needed—that was contract—and that of incentivizing those with the resources, authority, and information to do their job—and that was the profit motive. Actual information flows of any more bandwidth than “this is the price” were seen as unnecessary.

But that has to be wrong. Management cybernetics offers a possible way to think about what would be right.

But economics is not the only intellectual discipline and the economy not the only global-scale societal-organizational mechanism that could not become more accurate and relevant with a dose of management cybernetics. Consider the issue of choosing “targets”, and then rewarding people for meeting them:

Targets… ought to target the thing that you care about, not something which you believe to be related to it, no matter how much easier that intermediate thing is to measure. That doesn’t guarantee success; the phenomenon of “gaming the system” or the tendency of control systems to be undermined by adversarial activity is much more general and complicated than this single problem. Targets are… an information reducing filter on the system…. Attenuating information to, literally. “make it manageable” is the whole [point]… That’s the fundamental reason why they sometimes go wrong…. As far as I can see, “teaching to the test” is a one hundred and eighty degrees inverted description of a phenomenon that ought to be called “not testing for the outcomes you want”…

And the tasks of management cybernetics will never end:

Complexity is constantly increasing…. Reorganisation is the way in which environmental variety is brought back into balance with the capacity to manage it…. The highest function of the Viable System Model is that of balancing the need to change with the capacity to change. It’s necessary to respect the problem, make a realistic assessment of what capacity exists or can be gathered, then think in terms of priorities and trade-offs to meet the most vital and immediate changes that need to be made. Systems have to be designed and redesigned, so that they obey the basic principles of “variety engineering” (the management science of ensuring that information arrives in the right place, in time and in a form in which it can be the basis of decision making)…

Thus the book is one of great, if Sisyphean, hope. We can fix our excessive dependence on unaccountable inhuman-scale systems. It is a problem of information flow: greater transparency, human oversight, and reintroducing personal responsibility. But this requires conscious efforts to combat and fix the tendency towards unaccountability and system opacity and misoptimization.

The Unaccountability Machine is, I think, a much better road towards understanding our current societal-organizational environment than others currently being put forward. I found Henry Farrell’s remarks on two of these useful. Remember Henry Farrell’s setting the stage as he sees it:

Human[s]… have created a complex world of vast interlocking social and technological mechanisms…. Humans have created a world… impervious to… understanding…. Our first instinct is to populate this incomprehensible new world with gods and demons…

And then, Henry says, technoutopianbros or technodystopianbros divide. The utopians are the:

AI rationalists… [who suppose] the purportedly superhuman entities they wish to understand and manipulate are intelligent, reasoning beings… [that] reason their way towards comprehensible goals. This might… allow you to trammel these entities, through the subtle grammaries of game theory and Bayesian reasoning. Not only may you call spirits from the vasty deep, but you may entrap them in equilibria where they must do what you demand they do…

This belief that the tools of the economist can successful bespell our societal-scale mechanisms is, Donald Davies would say, naïve and wrong. I think he is right.

Then there are the dystopians, who believe that we should abdicate all choice and direction and simply welcome our AI-overlords:

We are confronted by a world of rapid change that will not only defy our efforts to understand it: it will utterly shatter them. And we might as well embrace this, since it is coming, whether we want it to or not. At long last, the stars are right, and dark gods are walking backwards from the forthcoming Singularity to remake the past in their image. In one of Land’s best known and weirdest quotes:

“Mechinic desire… rips up political cultures, deletes traditions, dissolves subjectivities, and hacks through security apparatuses, tracking a soulless tropism to zero control. This is because what appears to humanity as the history of capitalism is an invasion from the future by an artificial intelligent space that must assemble itself…. Digitocommodification is the index of a cyberpositively escalating technovirus, of the planetary technocapital singularity: a self-organizing insidious traumatism, virtually guiding the entire biological desiring-complex towards post-carbon replicator usurpation…”

And this “technocapital singularity” is to be celebrated! William Gibson describes a future “like a deranged experiment in social Darwinism, designed by a bored researcher who kept one thumb permanently on the fast-forward button”…

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And this is simply crazy. For one thing, none of these processes have human intentionality. We are primed to attribute human intentionality to them for lots of reasons. But actually believing that they do have it will lead us far astray.

if these are our other potential guides, Dan Davies is vastly to be preferred.

In the final analysis, therefore, The Unaccountability Machine is a guide to action—or at least to thought to how to take action. It is a great book: a crucial addition to the discourse on governance, ethics, and the role of social-organizational as well as nature-manipulation technologies in society. It should be read by anyone concerned with the direction in which our world is headed, offering both a stark warning and a glimmer of hope for a more accountable future.

Moreover, once we economists recognize our subordinate role, there may still be a place for us not that far from the hearth:

It’s not as if the toolkit of optimisation needs to be thrown away completely. As we said before, if you have some inputs and you want some outputs, then you want to get the most outputs for your inputs, and that’s what economics is all about. Providing a governing ideology and philosophy isn’t the only thing that makes a science worth doing—John Maynard Keynes once said that economists could consider their discipline a success when they were regarded as useful and competent technicians, like dentists.

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