Quotulatiousness

June 13, 2026

Hating on Elon Musk, the world’s first trillionaire

Filed under: Business, Economics, Media, Politics, USA — Tags: , , , , — Nicholas @ 04:00

It shouldn’t be surprising that so many people are doing what they can to raise resentment against the very rich in general, and Elon Musk in particular. Stoking resentment of the better off has always been a viable short-term political play, and it’s not every day we see wealth of this scale:

Reddit meme

For all these dumbasses claiming if they had Elon’s money they’d end world hunger, cause world peace, educate everyone, or whatever, blah blah blah … No you wouldn’t. You’re full of shit and everyone knows it, because that’s not how the world works.

Throwing money at a problem doesn’t fix it. The entire history of government demonstrates that. Saying vapid nonsense just makes weak, unimaginative people with a childlike grasp on reality feel better about themselves for caring harder, while accomplishing nothing.

Meanwhile, the guy you hate revolutionized EVs and self driving cars, brought affordable reliable internet to every corner of the Earth, and is making the dream of colonizing space real. And the process of doing all that has given hundreds of thousands of people jobs.

While you posture about how you’d give everybody an imaginary unicorn, he’s done stuff that’s actually changed the world for the better.

And you don’t get it. You can’t get it. Because you’re just too fucking small.

And even the Globe and Mail, which used to consider itself the most respectable and influential newspaper in Canada goes for the “hate the rich” market:

But some people just can’t help themselves and ginning up the hate and envy is all they can do:

For the left, it’s important that you do more than view billionaires with skepticism. You have to actually hate them. You have to blame them for every ill that befalls you, and you must actively resent their wealth.

One way that the left accomplishes this is by framing their gains as somehow your losses.

Congressman Greg Cesar (D-TX) decided to try that on X Tuesday with this banger.

Now, it’s interesting that he talks about their wealth being three times what it was 15 years ago, but doesn’t account for what the rest of us are dealing with. Instead, he engages in an apples-and-oranges comparison.

For starters, the increase in net worth for billionaires has nothing at all to do with whether your life is three times better than it was back then. There are too many variables. Someone who was unemployed and homeless and got a job, built a life back up, and then started a successful business is a lot more than three times better off, right?

Plus, it doesn’t account for differences in the cost of living or anything else.

Instead, a better metric is whether the median household net worth in America has increased a similar amount. So, I went to Google, then got its AI to generate a graph for me showing what’s happened over that timeframe.

While that’s not three times, it is 2.5 times the median net worth 15 years ago, and since this caps at 2022, it may well have increased even more.

In other words, the net worth of ordinary Americans seems to be mostly keeping up with that of the billionaires.

Cesar’s question, though, is disengenuous because the cost of living has gone up about 53 percent over that timeframe. So while net worth has increased, so has the cost of living. Not enough to completely drain away the gains in net worth, but enough that people aren’t living three times better than they were.

But that’s the point, isn’t it?

It’s not enough that, on average, Americans are much richer than they were 15 years ago, and by about the same amount as the billionaires, because that won’t foster the necessary resentment the left needs to push through their policies. You have to resent their wealth, and that’s less likely if you realize you’ve gained as much as they have by percentages. You have to feel like their wealth has been taken from yours, otherwise you’re less likely to look at wealth redistribution as a good thing.

And wealth redistribution is what it’s always about.

June 9, 2026

Stop buying stadiums for billionaires!

Filed under: Business, Economics, Government, Media, Politics, Sports, USA — Tags: , , , , — Nicholas @ 02:00

ReasonTV
Published 6 Feb 2026

Sports subsidies suck.

If sports is a trillion dollar industry, with billionaire team owners and millionaire players, and hundreds of thousands of enthusiastic fans, and weird pervert mascot creatures, why is the government giving them your money?

June 8, 2026

Milton Friedman – accessory to Grand Theft Taxation

Filed under: Bureaucracy, Economics, Government, History, USA, WW2 — Tags: , — Nicholas @ 05:00

I’ve only read a small part of Milton Friedman’s work, but I have great respect for him and think that overall, he was a very strong proponent for smaller, less intrusive government. But there’s one terrible thing that he was instrumental in implementing that almost outweighs everything else:

Milton Friedman’s greatest regret.

The federal government discovered the perfect crime in 1943: make employers collect taxes before workers ever see their paychecks. You think you earn $60,000 per year, but you actually earn $75,000 and hand over $15,000 to politicians without ever touching it. The psychological difference is enormous.

Before payroll withholding, Americans wrote quarterly checks directly to the Treasury. Picture yourself sitting at your kitchen table, writing a $3,750 check to the IRS every three months. The pain was immediate and visceral. Politicians faced constant pressure to justify every dollar because citizens felt the extraction in real time.

Withholding transforms this concrete loss into an abstract accounting entry. Your employer becomes an unpaid tax collector, and you never experience the actual cost of government. Worse, most people celebrate their tax refunds as government generosity rather than recognizing them as interest-free loans they provided to politicians. The Treasury collects your money throughout the year, spends it immediately, then returns your own cash and receives gratitude.

This system enables the explosion in government spending you witness today. Defense contractors billing $640 for toilet seats, agricultural subsidies for corn syrup, and congressional salaries for 535 people who rarely show up to work. When taxation feels painless, voters stop demanding accountability for how their money gets spent.

Milton Friedman helped design withholding as a wartime emergency measure and later called it his greatest regret. Free market economists recognized that the psychological pain of direct taxation creates political pressure for fiscal restraint. The temporary always becomes permanent in government hands, and the emergency justification disappears while the extraction mechanism remains forever.

Libertarian economist Murray Rothbard was far more scathing about Friedman:

QotD: Re-use, recycle, and contaminate

Filed under: Economics, Health, History, Quotations, USA — Tags: , , — Nicholas @ 01:00

At the start of the twentieth century, American consumers were still living in what today’s greens would consider a state of grace. They carried their own baskets and cotton bags to the grocery store and brought home food wrapped in biodegradable paper. They didn’t use disposable towels in public bathrooms, which provided cloth towels attached to rollers. There were no Styrofoam cups for coffee and no plastic bottles of water. When people wanted water in a public place, they’d get it from the spigot of a drinking fountain by filling a tin cup chained to the fountain.

This “common cup” was the ultimate reusable product — much to the horror of public-health experts, who blamed it for spreading tuberculosis, pneumonia, diphtheria, meningitis, and other diseases. Alvin Davison, a biologist at Lafayette College in Pennsylvania, analyzed cups from public schools and reported in 1908 that a single sip from a student left a residue of 100 dead skin cells and 75,000 bacteria. He used the scrapings from one school cup to induce fatal cases of pneumonia and tuberculosis in guinea pigs.

His article “Death in School Drinking Cups” provided support to “Ban the Cup” campaigns around the country. The first successful one was led in Kansas by Samuel Crumbine, a colorful doctor who had started his career in Dodge City (he was the model for Doc Adams in the long-running Gunsmoke television series) and went on to lead various public-hygiene crusades. The term “flyswatter” comes from a slogan he popularized, “Swat the fly” (which came to him while listening to the crowd at a baseball game urging a hitter to swat a sacrifice fly ball). After watching train passengers with tuberculosis and other diseases drinking water from a common cup, Crumbine got so upset that he threw the cup out the train’s window, and proceeded to persuade his colleagues on the state board of health to ban the common cup in trains, schools, and other public places in Kansas in 1909.

The ban left Kansans with a new problem: What were they supposed to use at a public fountain? Fortunately, as Crumbine later recalled, “Necessity proved to be the mother of invention.” Shortly after banning the cup, Crumbine was visited by a former Kansan named Hugh Moore, who brought with him samples of a product that his brother-in-law had invented: round paper cups that could be stacked in a dispenser next to a fountain. Crumbine’s endorsement provided crucial help to Moore in selling his product, originally called Health Kups and later renamed Dixie Cups.

John Tierney, “Let’s Hold On to the Throwaway Society”, City Journal, 2020-09-13.

June 5, 2026

The Canadian economy, RIP

Filed under: Cancon, Economics, Government, Media, Politics — Tags: , , , , , , — Nicholas @ 04:00

On the social media site formerly known as Twitter, James E. Thorne writes an obituary for the Canadian economy:

For the record.

In Canada, It Matters How the Economy Dies.

The Canadian economy is dead. It just didn’t die with a crash big enough to satisfy the models. No Lehman moment, no Covid-style cliff, just two negative quarters of GDP, years of falling output per person, negative productivity, and a private sector slowly strangled by rates and regulation while the establishment insists the patient is “resting”.

On the facts, this isn’t ambiguous. Real GDP has contracted for two consecutive quarters on an annualized basis. Labour productivity has been flat or negative since 2021. Real GDP per capita is below its pre-pandemic level. Ontario has logged its worst non-pandemic quarterly job losses since the mid-1970s. The only consistent growth is in government payrolls and compliance, not in private enterprise and investment. If that isn’t recessionary, the word is meaningless.

And yes Macklem threatens rate hikes through all of this insanity.

Yet Canada’s official guardians insist nothing fundamental has broken. The C.D. Howe recession-dating committee says the downturn is not “pronounced, persistent, and pervasive” enough. The central bank warns against overreacting to “technical” weakness. Bay Street talks about “soft landings” and “resilience”. In some quarters, the answer to this slow-motion collapse is not relief, but further rate hikes. Ignore the body on the table, we are told, the vital signs aren’t quite bad enough yet to fill out the certificate.

Their rulebook was built for heart attacks, not cancers. It excels at spotting sudden collapses in aggregate GDP and jobs. It barely registers slow organ failure: a few tenths off real GDP per capita each year, productivity edging down, ugly quarters for private-sector employment and capex offset by public hiring. None of that triggers the old alarms until the damage is permanent.

Meanwhile, Canada has been busy throwing away the advantages that once justified its prosperity. Energy and resource projects are stalled or strangled. Business investment per worker trails peers. A country rich in capital, talent, and geography behaves as if it can live forever off inherited endowments while making it harder to build anything new. That is not “resilience”. It is delusion.

Canada’s economic establishment needs to wake up.

Two negative quarters of GDP, negative productivity, falling GDP per person, historic job losses in the core province, a suffocated private sector and calls for more tightening on top, are not signs of an economy “cooling toward trend”. They are signs of an economy that has already crossed the line from stagnation into decay.

The Canadian economy is dead in the way that matters: as an engine of rising living standards and a place where private capital is rewarded for building the future. It just didn’t die loudly enough for the old definitions. The real question now is not what we call it, but how long our institutions will keep pretending the corpse is “resilient”.

As the propagandists of the mainstream media do everything they can to deflect any hint of blame from their Liberal paymasters, we can still see that things are getting worse, not better:

The federal Liberals are getting fantastic return on their investment … giving our money to the presstitutes of the legacy media in return for kid-glove treatment of the government and attack-dog tactics against the opposition:

Why Do 50% Still Support Carney? My long-winded response.

That is a question we need to take seriously.

Leger’s latest federal polling has the Liberals at 50% support among decided voters, their highest level in that firm’s tracking since the Liberals first formed government in 2015. Abacus also found the political environment still favourable for Carney and the Liberal government. So this is not imaginary. This is not just CBC fairy dust sprinkled over Ottawa. The support is real. The harder question is whether it is rational.

My answer is simple: many Canadians are not voting for results. They are voting for the illusion of relief.

Even though Carney was in the economic background since 2020 he appeared to arrive after the Trudeau years like a man in a clean suit walking into a room after the dog crapped on the floor. Trump threatened 51st State. Carney looked calm. Unlike Trudeau. He spoke in complete sentences. He had the central banker aura. For exhausted voters, that was enough. They did not examine the wiring. They just saw someone who did not seem to be setting the curtains on fire.

Carney’s appeal is not built mainly on performance. It is built on contrast. Compared with Trudeau’s theatre-kid government of slogans, selfies, and moral lectures, Carney looks serious. But “serious” is not the same as right. A surgeon can look serious while operating on the wrong leg.

Canada’s economy is now weak enough that Carney himself has had to acknowledge ugly economic data. Reuters reported him addressing Canada’s technical recession and warning that some data will be “uneven” “ah ah ah” as the government pushes through policy changes. The Wall Street Journal reported GDP weakness, including two consecutive quarterly contractions, while Carney framed the pain as part of a broader economic rebuild.

That is where the sales pitch gets slippery.

When the economy weakens under Conservatives, it is called failure. When it weakens under Liberals, it becomes “transition”, “restructuring”, or “long-term transformation”. Same corpse, nicer label on the toe tag.

The deeper problem is that Canadians were never really asked whether they wanted Carney’s ideology. They were sold competence, not doctrine. They were sold expertise, not a governing philosophy that puts the state, regulators, climate finance, and elite managerial planning at the centre of national life.

Nobody knocked on doors saying, “Would you like a prime minister who believes markets should be bent around elite-defined social and environmental values?” No. They said, “He is smart. He ran banks. He knows Trump. He will steady things.”

That is not a mandate. That is a branding exercise.

And this is why the Conservative attack has to get sharper. Not louder. Sharper.

Calling voters stupid is a dead end. Many Carney supporters are not stupid. They are terrified of Trump. They are tired. They are anxious. They are looking at housing, debt, food prices, crime, productivity, health care, and a country that feels smaller than it used to, and they want someone who looks like an adult. Carney gives them the visual. He gives them the voice. He gives them the vibe.

But vibes do not build houses. Vibes do not raise productivity. Vibes do not lower debt. Vibes do not attract investment. Vibes do not make young Canadians believe they have a future.

The Carney government’s strongest weapon is not success. It is emotional permission. It lets Liberal voters tell themselves they have moved on from Trudeau without admitting the Liberal machine remains fundamentally intact. Same operating system, cleaner looking wallpaper.

That is why 50% still support him.

They are not endorsing the results. They are postponing the verdict.

Canada does not need a better-spoken manager of decline. It needs a government willing to reverse the policies that caused the decline in the first place.

Because a tight ship headed toward the rocks is still headed toward the rocks.

June 3, 2026

“… basically it’s a plan to make power more expensive while campaigning on affordability”

Filed under: Cancon, Economics, Government, Technology, USA — Tags: , , , , , , , — Nicholas @ 05:00

John Robson examines a few of the ways the Ontario government (and other provincial and state governments) frames what they call “affordability”, yet somehow it always seems to cost more afterwards and nobody is ever held responsible:

In many areas of life, the devil is famously in the details. And it presents both an opportunity and a frustration because there is so much out there deserving readers’ attention that you can’t even follow it all let alone cram it into a newsletter. Including former banking executive Parker Gallant‘s vigilance about the absurdities of the power system in the Canadian province of Ontario that the aspiring Conservative premier Doug Ford promised to fix in the 2018 campaign and then has smugly done nothing about. These things might seem uninteresting if you do not live in Ontario … until you realize it’s just as bad wherever you live. And when we say bad we mean both the cost and the deviousness with which it is presented to, or hidden from, the public. On this very point we like to quote the late great P.J. O’Rourke that “Beyond a certain point complexity is fraud … when someone creates a system in which you can’t tell whether or not you’re being fooled, you’re being fooled.” Which brings us to the shiny new buzzword “affordability” which refers to policies that make everything more expensive and the beneficiaries hide the fraud in tangles of complex bureaucracy.

If you want to get a headache, stay with us while we explain what it is that Gallant tracks. Ontario has what they call the “Independent Electricity System Operator” so politicians can claim whatever disaster is unfolding isn’t their fault. Sure, they make the laws and oversee the creation of the regulations. But heck, these things are “arms’ length” and “impartial” and independent and expert and wise and wonderful so shut up.

Including this nutty system where the province buys power we don’t need at grossly inflated rates from wind and solar virtue-signallers and then sells the surplus at deep losses to the neighbouring province of Quebec and some American states including New York and Michigan. So he looked in depth (we promised a headache) at just half a day, May 19, 2026, because a post by another of the people who keeps an eye on this stuff for the benefit of an indifferent or baffled populace alerted him to something fishy in the IESO forecast of generation by Industrial Wind Turbine operators. But it seems to be hard to find out exactly how much the taxpayers, via this wonderful “Independent” system with its hand in their pockets via the arm of the state, actually paid these IWTs not to produce power.

Paid them what? Yup. It’s how it works. And the idea is that if they didn’t produce the original forecast rather than the revised one we’d have had to pay them even more for what they didn’t do. Weird even by the standards of government. And expensive. As Gallant sums it up:

    The net result is that those IWT cost us Ontario ratepayers almost $2.6 million for NOTHING over just the first 12 hours but we should rest assured the IWT owners loved it!

You read that right. The citizens of Ontario paid $2.6 million to the energy producers of the future not to produce energy in the present in just half of one day. If it were typical, it would be over $5 million a day times 365 days in the year so yes indeedy folks nearly $2 billion a year.

[…]

He then looks at various efforts to try to figure out the cost to consumers, including one by “my friend Roger Caiazza (the Pragmatic Environmentalist of New York)” based on the auction price of “allowances” in March 2025:

    Roger’s conclusion at that time was that the RGGI auctions were adding about $8-11/MWh to the wholesale cost of electricity, for electricity produced by natural gas. That would mean an addition of about 1 cent/kWh on a consumer’s bill. A penny may not seem like much, except when you realize that the average price in the country is less than 18 cents/kWh, so the penny is about 6%.

Imagine if people knew. As he concludes:

    remember that the structure of the program is that the amount of allowances goes down every year and the price is intentionally driven up. And data centers are going in all over the place. And the Northeastern states have refused to build new power plants for a couple of decades now in the midst of the climate hysteria. So the 10-15% extra cost being experienced now is only the beginning of much worse to come. The worst part of the RGGI ‘cap and invest’ scheme is that the consumers get absolutely nothing for the increased cost. It is just a gratuitously inflicted injury brought about by completely artificial scarcity. Keep this in mid when you hear a politician from an RGGI state talking about how they care about energy ‘affordability’.

Or, we add, transparency. Or accountability.

June 2, 2026

Judging Javier Milei’s work by the numbers

Filed under: Americas, Economics, Government, Media — Tags: , , , — Nicholas @ 05:00

Thanks to automated translation from the original French on the social media site formerly known as Twitter, Laurent outlines what he sees in the data from Argentina before and after Javier Milei became president:

I’ve been wondering for a while now about the (provisional) balance sheet of Milei in Argentina. You read everything and its opposite. So I stopped reading the commentary and looked at the raw numbers.

Argentina is the full-scale experiment that economists have been waiting for for 50 years. Same country. Same people. Same culture. We change ONE variable: the economic method.

Before: decades of statist and Peronist management, “redistributive”. The concrete result? 211% inflation, 42% poverty, a state in permanent deficit that funds its lifestyle by running the printing press.

Then Milei arrives. The opposite method, brutal, acknowledged: we cut, we deregulate, we stop printing.

Two years later ([snapshot] at his arrival (end of 2023) vs today):

Annual inflation: 211% → 31%
Monthly inflation: 25% → ~2%
Public deficit: −5% of GDP → +1.8% (surplus)
Growth: −1.6% → +4.4%
Poverty: 42% → 28%

No debate. Judge for yourselves.

And the essential point: these gains don’t go “to the rich” or “to the markets”. They go first to the poorest.

Inflation is the most unjust tax that exists — it hits those who have no assets to protect themselves. Dividing it by 7 is giving back purchasing power to those at the bottom. And 14 fewer poverty points means millions of people, not an Excel line.

For a century, Argentines were told that the state would protect them by spending more and more. Result: one of the richest countries in the world in 1910, ruined. We’ve just reversed the method. Look at the result.

At some point, you have to accept what the facts say: on the economic front, the liberal method has delivered in two years what decades of socialism promised without ever delivering. And it benefits the most modest first.

You can hate Milei’s style — the chainsaw, the excess, the improbable outbursts, he’s nothing like a classic statesman. But you don’t judge an economic policy by the style of the one who leads it. You judge it by what it does to people’s lives.

And the numbers have spoken.

May 31, 2026

Canada slips into recession: state media rally to attack official opposition

Filed under: Cancon, Economics, Government, Media, Politics — Tags: , , , , , , — Nicholas @ 03:00

Even before they became explicitly subsidized presstitutes for the Liberal Party, the Canadian mainstream media have always been far more critical of conservatives, so this pivot to defend the government after official statistics show the country is in a technical recession is very much on brand:

Stuart, this is exactly the problem.

You’re acting like annualized quarter-by-quarter numbers are some exotic partisan invention. They aren’t. That is one of the standard ways GDP is reported and understood.

And the “reporter’s narrative” point is weak. The reporter framed the question as if calling it a recession was irresponsible, even though the numbers show real weakness: contraction, stalled growth, falling investment, weak productivity, and Canadians losing ground.

Pierre did what more politicians should do: he challenged the frame.

Because the frame matters.

When Conservatives warn about decline, it’s “doom”.

When Liberals preside over decline, it’s “complex global headwinds”.

When Canadians get poorer, it’s “resilience”.

When GDP shrinks, it’s “not quite the word we’d prefer today”.

Give me a break.

Canadians do not live inside a Statistics Canada footnote. They live inside rent, mortgage renewals, grocery bills, job insecurity, and taxes. Pierre is speaking to that reality.

The press gallery can massage the vocabulary all it wants. The country is weaker, poorer, less productive, and more expensive.

That is not a narrative.

That is the room.

The Liberals are getting great value for their money — well, our money — as even though the economy is tottering, media-massaged messaging is reflected in polls (feel free to doubt the accuracy of polls like this if you like):

May 28, 2026

QotD: Re-defining economic liberalism

Filed under: Economics, History, Liberty, Quotations — Tags: , , , — Nicholas @ 01:00

The L-word is not taken to mean American “liberalism”, the distressingly anti-liberal, lawyer-driven politics of increasing governmental planning and regulation and physical coercion. It is instead the rest of the world’s “liberalism”, economist driven, “the liberal plan”, as old Adam Smith wrote in 1776, “of [social] equality, [economic] liberty and [legal] justice”, with a modest, restrained government giving real help to the poor. True modern liberalism.

A liberal “rhetoric” explains the good features of the modern world compared with earlier and later illiberal régimes — the economic success of the modern world, its arts and sciences, its kindness, its toleration, its inclusiveness, and especially its massive liberation of more and more people from violent hierarchies ancient and modern. Its enemies claim that it also explains alleged evils, such as the reduction of everything to money or the loss of community or the calamity of immigration by non-Christians. But they are mistaken.

Dierdre McCloskey, “The power of liberalism can combat oppression in all its forms”, The Economist, 2020-01-08.

May 24, 2026

The PRC would need a literal “short, victorious war” to defeat the US

Filed under: China, Economics, Food, Military, Pacific, USA — Tags: , , , — Nicholas @ 06:00

On Substack, Tom Kratman looks at the economic and strategic weakness of the Peoples Republic of China should it get into a serious shooting war with the United States:

China’s strategic position is appalling, and at least the higher party cadres and senior military leadership have to know that it is. Why? China is utterly dependent on both imports and exports to keep their economy going and to feed themselves. By that latter, I don’t just mean they need to import food, though they do to the tune of one third. That’s bad enough, but they also need to import fertilizer to grow the inadequate amount of food they grow for themselves. No, nitrogen and phosphates aren’t a huge problem; they are net exporters. Potash is a problem. Loss of potash imports probably cut their grain production by about ten percent. This would be painful, but survivable with a touch of rationing and some weight loss.

Except for one thing, oil and natural gas. Cut those off and grain production drops by a third within two years and probably forty percent after that. On top of the loss of the third that they must import, that’s serious hunger.

And another thing, farm machinery and transportation. China only produces about a quarter of its oil needs domestically. Cut those off and mechanization of farming must be reduced.

Add in that this kind of food reduction also means they must stop feeding food animals.

Moreover, while a good deal of their transportation net runs off of electricity, which can be produced by the coal China does have, at what we might call the strategic level, getting the food from the farms to the railheads and from the railheads to markets to kitchens requires liquid fuel. China’s ability to produce liquid fuel from coal exists, but it is tiny.

Add in the increased need for liquid fuel for their military in this case.

A long series of interrogatories to Grok suggests that China’s total food production and importation collapses by seventy percent or more within two or three years if they go to war with us.

It won’t be sudden; they probably have about a year’s worth of food in storage against such a day. But within three years? We’re talking an entire civilization in kwashiorkor1 and marasmus2.

How do they keep that industrial civilization going in the absence of food and energy imports, or the exports that have kept their economy going? They likely don’t.

Although China’s population appears to be in accelerating collapse, they still have a lot more people than we do. Surely that represents … nothing. For a war fought largely at sea it represents nothing. Yes, they can, at least for the moment, build more ships faster than we can. However, we can build things to sink ships faster than they can build ships. Thus, we’ll keep our existing naval supremacy.

There’s a worse factor in there, though; in China sons are just a lot more important than daughters. No, I don’t care if this upsets western feminist sensibilities; we are not talking about the west but about China. Daughters, assuming they marry, go on to take care of their husband’s family. Sons take care of the parents. It is the rare Chinese family with an extra son to spare.

But can’t they build enough ships to overwhelm our blockade in the short term, at least? No, they can’t. China is surrounded by enemies on land, Vietnam, India, and Russia predominant among them, though none of the neighbors – barring, maybe, North Korea – really likes China or doesn’t fear it. No, however much public kissy face they may engage in for foreign consumption, China and Russia have long-standing, intractable issues between them. China is a threat to Russia and vice versa in ways we are not.

So all the manpower and money spent on a navy is largely wasted. They’re not going to get a navy large, powerful, and competent enough to take us on and, if they really try to, we will manufacture a war – the United States is good at this – to trim them down to size before they can. Worse, every increment of money and manpower they spend on the navy is money and manpower not spent on the much more important army and air force.3

  1. Caused by protein deficiency.
  2. Caused by deficiency in all macronutrients.
  3. The Navy is much more important to us because we have no serious land enemies in this hemisphere.

Update, 25 May: Welcome, Instapundit readers! Have a look around at some of my other posts you may find of interest. I send out a daily summary of posts here through my Substack – https://substack.com/@nicholasrusson that you can subscribe to if you’d like to be informed of new posts in the future.

May 22, 2026

“Re-shoring” manufacturing isn’t the answer

Filed under: Business, Economics, Technology — Tags: , , , — Nicholas @ 04:00

On Substack, Tim Worstall uses the examples of Apple and Foxconn to illustrate that most of the value generated isn’t in the manufacturing side of the equation:

Yes, I know Apple is up to the iPhone 17 now, but it’s still as true about (some) iPhone addicts now as it was then.

Apple’s market capitalisation — the contribution to human wealth of the firm — is 4.3 trillion of those American dollars. That of Hon Hai Precision — most of us will know that better as “Foxconn”- is $3.1 trillion $. But those are the fun, New Taiwanese, dollars, which equals some $113 billion US dollars. Given the imprecision of what follows let us round those to $4 tr and $100b. Apple is worth 40 times Foxconn.

Now it’s not wholly true that Apple manufactures nothing. I think they — more so they say they do so than anything else — make some of the Macs themselves. And perhaps some number of their processing chips but I think even that is outsourced to other foundries, isn’t it? It’s also true that Apple uses more than one manufacturing company — Pegatron is a name I’ve heard around.

It’s also not true that Foxconn only works for Apple. It takes on that manufacturing and assembly work from a number of companies. Which is where my imprecision comes in, for I’m — just to make the example — going to assume that Foxconn does all and only Apple’s manufacturing, Apple does no manufacturing and sends it all to Foxconn. Those are incorrect assumptions but they’re good enough for this jazz hands of an argument.

So, designing stuff then selling it produces 40x the capital value of manufacturing it. We also know that Apple runs at 40% net margins and Foxconn most certainly does not. My numbers are a little out of date but it’s not all that long ago that the cost to assemble — ie, “manufacture” — an iPhone was perhaps $10.

We have pretty clear evidence that the place to make money in the global economy is sitting in an office and thinking therefore. Not out there bashing metal. So, why is it that so many say that the UK — and the US — must reshore all that manufacturing so as to get rich?

One explanation is as with that of the Physiocrats. French economists — and therefore wrong, they’re French — back in the old days who insisted that only growing food was real wealth production. They were musing over their brioche rather before anyone really manufactured anything — rather than artisaned — true but they have, of course, been proven wholly wrong. They might well have been about right for the centuries before them but were wrong by the time they wrote it all down.

We can extend the analogy to today. Yes, it has been true for much of the past couple of centuries that lots of manufacturing is what makes a place rich. Now, as with Apple and Foxconn this ain’t so. But some are still stuck in that old way of thinking.

Could be.

We can approach the same point from another direction. Actual manufacturing is something that is, these days, done by poor people in other countries. Why assume that if we did it it would make us rich?

QotD: The cargo cults of New Guinea

Filed under: Books, Economics, History, Pacific, Quotations, Religion — Tags: , , , , — Nicholas @ 01:00

When I was twelve years old, my grandfather gave me a copy of Jared Diamond’s Guns, Germs, and Steel. This single fact probably goes farther than any other in explaining How I Got This Way: the book blew my mind and kicked off a lifelong fascination with big-picture, multidisciplinary investigations of how the world, well, Got This Way. (Or, if you’re a hereditarian: roughly 25% of my genes come from a guy who thought this was a good book to buy for a twelve-year-old girl.)

You may remember that Guns, Germs, and Steel is framed as a reply to a man named Yali, a “remarkable local politician” whom Diamond encountered while walking on the beach in New Guinea in July of 1972. (Back before Diamond’s second career as a pop-science public intellectual, he was an ornithologist focusing on the birds of northern Melanesia.)1 They chatted for a while about the prospects for New Guinean independence, and local birds, and then Yali asked a question that Diamond spends a couple of paragraphs boiling down to something like, “Why did human development proceed at such different rates on different continents?” (Which is of course what Guns, Germs, and Steel tries to answer.) But that’s not actually the way Yali put it, and his real question — indeed, his whole story, which is fascinating in its own right — suggests a whole ‘nother set of answers

Yali should be better-known.2 He may have been from a backwards backwater, but he’s one of the true Player Characters of history. If we lived in a better world, he would be the subject of a prestige cable drama3 — or maybe a Robert Eggers film, because the values and assumptions of his society are incredibly foreign to a Western audience. And so to really understand and appreciate Yali’s story (and the question he asked an American ornithologist on the beach one day) you need some background about the tribal cultures of the New Guinea coast and their reaction to contact with Europeans. Which is to say, you need to understand cargo cults! Because what Yali actually asked (per Diamond’s recollection twenty-odd years later) was: “Why is it that you white people developed so much cargo and brought it to New Guinea, but we black people had little cargo of our own?”

“Cargo” is the catchall word for Western material culture in Pidgin English,4 the lingua franca of New Guinea’s many language isolates, and New Guineans were understandably obsessed: before European contact, they were living in the literal Stone Age. It would be an exaggeration to say that they hadn’t made any technological progress since their ancestors settled the island 50,000 years earlier, since they domesticated several local plants (taro, yams, and the cooking banana) and got pigs plus a little admixture from some passing Austronesians about 1500 BC, but they were solidly Neolithic and had been since time immemorial. So of course as soon as they encountered cargo — especially steel tools, tinned meat and dried rice, and cotton cloth — they wanted it desperately. And they almost universally believed they could get it by ritual activity.

The prescribed rituals varied. One set, recorded in secret by an American Lutheran missionary in the late 1930s, involved the locals setting up tables in front of the local cemetery and decorating them with flowers, food, and tobacco. Then they danced wildly until dawn in twitching, trembling fits so uncontrolled that some devotees continued to sway and shake for days or weeks afterward. Those lucky people were believed to have a special connection to the ancestors that would let them receive dream messages about the cargo shipments their tables and dancing would surely bring. A different cult was led by a man who had a long piece of iron he claimed brought him messages from the future. He told his followers that if they set out all their food in cemeteries as offerings to their ancestors, handed all their Western goods and money to him for safekeeping, and renamed Tuesday to Sunday, they could expect a god to send them airplanes full of cargo flown by the spirits of the dead disguised as Japanese servicemen. These spirits would bring them rifles, tanks, and other materiel and help them drive out the white people, and then the god would change the natives’ skin from black to white. Oh, and also there would be storms and earthquakes of unimaginable violence.

Forget everything you think you know about cargo cults. (Especially forget those pictures you may have seen of “decoy” airplanes or satellite dishes made out of straw and wood: one popular airplane photo is from a Japanese straw festival, another is a Soviet wind tunnel model, and the radio telescope is just one advertisement from a British ice cream company.)5 Nowadays we use “cargo cult” as a lazy shorthand for “copying what someone successful seems to be doing without really knowing why and hoping you get the same result,” but that’s not what was happening at all. If the New Guinea natives built airstrips, it wasn’t out of a belief that airstrips attract cargo planes like planting milkweed brings Monarch butterflies — that would be seem silly but basically understandable from our frame of reference. No, it’s much weirder than that. They built airstrips for exactly the same reason anyone else does: because they thought cargo planes were coming. They just thought the planes were coming because of the dancing.

This is a story about epistemology. And also about Jesus sending you a case of Spam in the mail.

Jane Psmith, “REVIEW: Road Belong Cargo, by Peter Lawrence”, Mr. and Mrs. Psmith’s Bookshelf, 2025-04-21.

  1. Okay, fine, it’s actually his third career — he was a specialist in cell membrane biophysics before he started publishing on birds.
  2. Kudos to commenter Gary Mar, who did his part in this project by alerting me to this book in the first place.
  3. Just in case anyone reading this has contacts in showbiz, my other idea for a cable drama is the story of Charles V, Philip II, and William of Orange. The emperor of half the known world, the son and heir raised far away, the beloved ward who betrayed him… It would win twelve Emmys.
  4. Which is not actually a pidgin but a creole! Nowadays it’s more often called Tok Pisin (etymologically, obviously, from “talk pidgin”). Most Tok Pisin vocabulary comes from English, but the grammar and pronunciation are very different and the orthography makes it hard to read. Still, if you try saying it out loud you can sometimes get the gist: “Wetman noken haitim samting moa” pretty easily becomes “white man no can hide’em something more”, and actually means something like “the white man will not keep anything secret from us any longer”.
  5. Credit for tracking down the sources of those images goes to Ken Shirriff in this blog post, which Gwern kindly sent me when I started talking about this book review.

May 21, 2026

Evaluating the Boomers’ complaints from the Zoomers’ point of view

Filed under: Cancon, Economics, Media, Politics, USA — Tags: , , , — Nicholas @ 06:00

As a dirt-poor boomer (or Generation Jones-er as some term us extra-late boomers), I don’t have a lot of sympathy for others in my age cohort who complain about their kids and grandkids not getting ahead when they’re occasionally back in Canada from their second or third extended exotic foreign vacation since before the snow fell last fall. (It’s been more than a decade since the last time we were able to take any kind of vacation … and that was just a week’s driving holiday to South Carolina.) The Zoomers (and Millennials, and even some of the Gen X’ers) have valid complaints that the boomers generally are not capable of understanding, as John Carter explains:

I’m going to have a little rant, here, so I’ll start by emphasizing: Not All Boomers. Look, my mother is a boomer, and I love her dearly, in large part because she represents the opposite of so many boomer stereotypes. Many of you reading this are boomers; I know this because you’re in the comments, writing some of the best comments, you can ask anyone, the very best comments, everyone says it, it’s true. I know full well that much of what follows doesn’t apply to you, because you’re the good ones, the exceptional ones, the few, the proud So, please, do not take any of this personally.

With that said.

The shouting match broke down along the expected lines. Boomers – including spiritual boomers – loudly agreed with O’Leary’s remarks. If you only spend $2 a day on lunch, they insisted, the resulting $26 a day that you save adds up to $9490 a year; after 5 years, you’ve got the down payment for a $250,000 house. Checkmate, you financially illiterate layabouts!

Zoomers, millennials, and Gen-X replied that $250,000 will get you a leaky shack in rural Arkansas with black mold in the unfinished basement; that by the time you save up the money for the down-payment, that shack will be going for $500,000; that recent immigrants receive government assistance to get onto the property ladder (along with preferential employment) and so do not have to spend years of their lives saving up at all. Disaffected youth (and these days, that is just ‘the youth’) generally heaped scorn on the idea that it’s even possible to save in this economy, or that there’s anything worth saving. “If you live on instant noodles and margarine sandwiches for twenty years, you too, my son, can one day afford a van down by the river.”

As an aside, isn’t it incredible how fashion has barely changed since Chris Farley did this skit on SNL back in 1993? Stuck culture is everywhere.
Image and caption from Postcards from Barsoom

I can see both sides of this. I tend to live frugally myself, not so much because I consider it virtuous but out of simple necessity. Throughout my 20s and 30s I was a career student living paycheck-to-paycheck, as a result of which I became very accustomed to cooking my meals and buying only what’s necessary. I’ve never once used DoorDash or Uber Eats. I buy my clothing at thrift stores, only purchase a new laptop once every decade or so, and have somehow managed to avoid racking up much in the way of debt … and by ‘somehow’ I mean that I’ve never owned a house or a car, partly because I changed continents too regularly to make such big-ticket purchases practical or necessary, but mostly because I couldn’t afford them. Even finishing my doctorate did not really bring anything you could call prosperity in its wake: my first position was for the princely some of just over USD30,000 per year. By the time I reached the median national income in my late 30s, I’d gotten so accustomed to frugal living that money started piling up in my account just because I had no idea what to do with it, and little inclination to spend it because I was honestly just happy to not have to worry about budgeting to make rent. That turned out to be very helpful when DEI came for my career track; I lived on those savings for a couple of years after.

[…]

There was a famous Stanford experiment called the Marshmallow Test which measured time preference in young children. A child would be left in a room with a single marshmallow on the table. They were of course free to eat the marshmallow, the experimenter would tell them, but if they didn’t, then later on they would get a second marshmallow. Children with high time preference – meaning that they strongly prefer the immediate reward to the hypothetical future reward – would cram the marshmallow into their candy-holes without a second thought. Children with low time preference – meaning that they value the future at a similar or even higher level to the present – would patiently wait, and be rewarded with a second marshmallow. These children were then followed, and it was demonstrated that the children with low time preference demonstrated better life outcomes: they maintained higher grades, were less likely to fall into debt, were less likely to develop drug addictions, were less likely to get pregnant before marriage, were less likely to get fat, and so on. All of which makes sense. The capacity to endure present pain – by studying, dieting, working out, what have you – in order to obtain a better future outcome is obviously going to be linked to better outcomes.

How would a smart kid react if the experimenter failed the marshmallow test?

For instance, say the experimenter simply lied. There was no second marshmallow; the child waited for nothing. Or, even worse, the first marshmallow was snatched away, and replaced with two marshmallows, each one half the size of the original? Or a third the size? Here are your two marshmallows, sucker, joke’s on you. What would the results be if, after this experience, the children were tested a second time? I don’t know if such an experiment has ever been conducted, but the outcome is not hard to guess. Every single one of the children, whether they’d passed the marshmallow test the first time or not, would scarf down the marshmallow the moment it was in front of them.

The capacity for low time preference may be largely innate, but whether it expresses or not is entirely a function of social trust. In order to defer gratification for a greater future reward, one must believe that there is a reasonably high chance of that reward manifesting. The less likely the future reward becomes, the more steeply a rational actor will discount the future.

I don’t want to minimize the hardships that boomers endured when they were young. Boomers worked hard, and they didn’t enjoy the same conveniences that we enjoy now. They fought in the Vietnam War (well, about 3% of them), they spent most of their lives under a nuclear sword of Damocles, they suffered through the oil shock and stagflation in the 70s, they were punished by double-digit interest rates in the early 80s, and they spent their working lives trying desperately to stay one step ahead of the skyrocketing inflation that was unleashed when Bretton-Woods fell apart and the last vestigial support of the gold standard was kicked out from under the brrrring money printer.

But, despite all of that drama, the one thing boomers could generally rely upon was that – so long as thermonuclear annihilation was averted – things would generally get better. Technology would advance. Working conditions would get safer. The special effects in movies would become more convincing. Houses would get larger. Cars would get nicer. Air conditioning would get quieter. The environment would get cleaner. Society would become more just. The world would become freer and safer for democracy. And so on and so forth. Baby boomers have enjoyed a charmed life such as no other generation has known: free of major wars, full of technical wonders, in which whatever difficulties you might endure now, you could generally count on the future being a better place. For the boomer, deferred gratification always had a payoff.

For the zoomer – and the millennial, and generation X – this has simply not been the case. After 9/11 a police state panopticon settled over society. The 2008 real estate crash pulled the rug out from under the millennials, after which real-estate got ZIRPed to the Moon. Mass immigration pumped real estate demand further, while undercutting wages and rendering public spaces steadily more alienating, unpleasant, and dangerous. Black Lives Matter immolated quaint notions of racial harmony. DEI threw young white men, their careers, their futures, and their unborn children to the wolves. COVID stole two years from young people’s lives so that old people could feel safe from the coof. Now, AI^2 (Artificial Intelligence + Actual Indians) means that the only thing the young expect in their future is gig work in the sex trade industry (until robots take that, too).

May 20, 2026

QotD: “Gilded Age” Robber Barons didn’t have access to what even working-class Americans have now

Filed under: Business, Economics, History, Quotations, USA — Tags: , , , , , , , — Nicholas @ 01:00

Where Marx really went wrong was — and I know this sounds flip, but I’m as serious as cancer — being born in 1818. He lived his entire miserable life in a world where “labor” really was a physical thing. The richest robber baron of the Gilded Age lived a far different life, materially, than the poorest serf-in-all-but-name working in his factories …

… but the robber baron knew he needed the serfs. Their relationship was purely dialectical. Without his factory hands, no robber baron. And in a strange but very real way, the higher up the food chain your Gilded Age robber baron went, the more he was dependent on his serfs for his lifestyle. J.P. Morgan is usually credited as being the first guy to become a Robber Baron purely through finance. Carnegie, Rockefeller, all those guys had most of their wealth in financial instruments, of course, but those financial instruments rested on control of a physical product — Carnegie Steel, Standard Oil.

I’m probably being unfair to Jay Cooke, the Michael Milken of his day, but since more people have heard of J.P. Morgan let’s roll with it. Even though Morgan’s wealth was entirely on paper — he was nothing but a securities trader — his lifestyle utterly depended on a battalion of servants. In a very real way, you yourself, right now, live much better than J.P. Morgan did in his heyday. And not just because you have aspirin, antibiotics, and air conditioning, three taken-for-granted things ol’ J.P. would’ve given half his kingdom for. But because you have more time. If you’re hungry, you can open the fridge or the microwave and have all the food you need in a matter of minutes.

J.P. couldn’t. J.P. had to deploy an army of servants every time he wanted a snack, and those servants were constrained by things like “availability of ice” and “when is the fishmonger at his stall”. You’re hungry at 2am, you jump in your car and get some Taco Bell. It takes ten minutes. J.P.’s hungry at 2am and it’s tough titty, J.P., your ass is going hungry. Because even though you’re the richest man in the world and have legions of manservants at your beck and call, Taco Bell just isn’t there. Even if someone had had the brilliant idea to create a Gilded Age Taco Bell, it still would’ve taken hours:

Wake up the manservant. Wake up the groom and stableboy. Hell, wake up the horse, then saddle the horse, ride to the drive thru window … which in this case means “the house of the guy who runs Gilded Age Taco Bell”. At which point he has to fire up the oven, start pounding the tortillas, send his own legion of valets and stableboys and whatnot out to get the refried beans …

And that’s the other thing, J.P. — you’d best not pull that shit too often, because those people know where you live. Not only do they know where you live, they live with you. Literally under the same roof. You want to sleep easy? You’d best not beat the servants too often, buddy.

There’s only so much “class consciousness” one can develop in that world. Oh yeah, J.P. thought of himself as one of the Masters of the Universe, there’s no denying that. But J.P. lived in what was still a brutally physical world, in a way we PoMo people really can’t grasp. If you can’t imagine what it would take to get some Gilded Age Taco Bell, maybe geography will do the trick. Ever seen Gangs of New York? Even if you haven’t, you’ve probably heard the name “Five Points”. The worst slum in America in the 19th century, and 19th century American slums were world class …

That was right down the street from Wall Street. Literally. I am not in any way joking, and if I’m exaggerating a little for effect when I say “J.P. could’ve hit Five Points with a five iron from his swanky digs on Central Park West”, I promise you I’m not exaggerating much. You can look it up for yourself. The main reason the Union rushed troops straight from the Gettysburg battlefield, and no-shit shelled parts of the city with gunboats, during the Draft Riots was because Five Points (et al) was right fucking there, and they might’ve gotten it into their heads to lynch a few Masters of the Universe. Rich man’s war, poor man’s fight, right? Let’s see how you like it, you bankster bastards …

The PoMo “information economy” removes all that. The other day I joked about colleges like Bennington and Goucher. I cracked some jokes, yeah, but I wasn’t really joking. Those places aren’t for us. Wall Street is still a physical location, but it might as well be on the dark side of the moon for all any of us have access to it. J.P. couldn’t beat the servants too hard, or too often. The modern equivalent of J.P. isn’t even aware that he has servants. He just clicks on a website, and stuff appears at his door. Like magic. Hell, it IS magic for all he knows, and he surely doesn’t care, because all that shit is his by right. He went to Bennington, after all. He has achieved full class consciousness.

All of which suggests, of course, that while Marx was wrong about the end state — the State will not, in fact, wither away — he might well have been right about the solution to the “contradictions of capitalism”, if you follow me. And if that makes me some kind of godless pinko Commie subversive, well … I’ve been called worse by better.

Anybody got the lyrics to La Marseillaise in English?

Severian, “On Losing the Cold War”, Founding Questions, 2022-07-02.

Update, 21 May: Welcome, Instapundit readers! Have a look around at some of my other posts you may find of interest. I send out a daily summary of posts here through my Substack – https://substack.com/@nicholasrusson that you can subscribe to if you’d like to be informed of new posts in the future.

May 19, 2026

“That is not diplomacy. That is national self-harm wearing a lanyard.”

Filed under: Cancon, China, Economics, Europe, Government, Media, Politics — Tags: , , , , — Nicholas @ 04:00

On the social media site formerly known as Twitter, L. Wayne Mathison responds to a post about the Canadian government’s amazing nonchalance about protecting Canada’s sovereignty:

Canadians voted in a federal election, not in a referendum to turn the country into a Davos policy lab with a maple leaf sticker slapped on the front.

The line “we will never be the 51st state” is easy politics. Most Canadians agree. But then the same elbozos turns around and flirts with every other form of sovereignty dilution they can find.

Join the EU? Canada is not in Europe. Geography still matters, apparently. Joining the EU would mean importing another layer of bureaucracy, regulation, courts, trade rules, and political obligations from people Canadians cannot remove from office. That is not independence. That is outsourcing control with better stationery.

Give China influence over resources? That is even worse. A serious country protects strategic assets: energy, minerals, food, ports, telecom, data, and critical infrastructure. You do not hand leverage over your future to an authoritarian state and then call yourself sophisticated. That is not diplomacy. That is national self-harm wearing a lanyard.

The real issue is this:

Canada’s elites love sovereignty when it means rejecting America.

They seem much less interested in sovereignty when it means resisting Brussels, Beijing, the UN, global finance, or climate bureaucrats.

So the question is fair:

Who voted for Canada to stop acting like a country?

Not Canadians. Not directly.

This is elite mission creep. They run on patriotism, then govern like national borders are an administrative inconvenience.

Other items that popped up in the news over the weekend included the United States Department of War announcing that they will be “pausing” their participation in the Permanent Joint Board on Defence, a US-Canadian body that has been continuously operating since 1940 when US President Franklin Delano Roosevelt and Canadian Prime Minister William Lyon Mackenzie King established it in a meeting in Ogdensburg, New York. Is this a big deal? Some people certainly think so:

In a bit of a sudden, surprise move, Under Secretary of War Elbridge “The Biggest Cheese” Colby has announced on X of all places that the Unites States would be pausing participation in the Permanent Joint Board on Defence, the Oldest and most Foundational node of the Canada-US security partnership.

[…]

As we all know, on August 17, 1940, U.S. President Franklin D. Roosevelt and Canadian Prime Minister William Lyon Mackenzie King met in a railway car in Ogdensburg, New York. They issued the Ogdensburg Declaration, an agreement to create a joint board to study sea, land, and air defense problems.

For over 80 years the PJBD has serves as one of the major intersects of the Canada-US relationship. It has been the forum where we have been able to engage and work collaboratively on matters of National Security, Continental Defence, and Critical Infrastructure.

Obviously, given how late it is for me, I sadly can’t dive head first into things. However, I did wanna get something out there. It’s no doubt a very petty move to make, part of a long line of petty moves between everyone in the last year. The pressure is obviously there to push Canada along, and the inclusion of the Prime Ministers Davos speech by Colby should go as a sign to one of the areas that is troubling the current administration.

Trying to apply pressure through such acts though isn’t something that I think will be successful. Granted, being a bit of a dick and doing petty shit in hopes of manipulating opinions, only for it to backfire due to a general miscalculation, is something this Administration does on the regular, and so I can’t be surprised to see it done here.

Nor is it surprising for the performative PM and his government to be utterly blindsided when one of their petty performances triggers a strong negative reaction from the United States.

Another issue that the Liberals in Ottawa seem to think both uncontroversial and straightforward is one of their batch of anti-civil-liberties bills before Parliament, in this case Bill C-22, which the US Congress considers to be a dangerous attempt to control US companies who do business in Canada:

The government’s plans for lawful access have gone off the rails. In recent days, Signal has warned it would pull out of the Canadian market rather than comply with Bill C-22. Windscribe, the Toronto-headquartered VPN provider, has said it would relocate its headquarters out of Canada and NordVPN has warned it would consider following suit. Apple and Meta have both raised public concerns about the bill’s effect on encryption and cybersecurity. The Canadian Chamber of Commerce, the Cybersecurity Advisors Network, civil liberties groups, and a long line of legal and security experts have all called for changes. The chairs of the U.S. House Judiciary and Foreign Affairs Committees have written to Public Safety Minister Gary Anandasangaree warning that the bill threatens U.S. national security and the integrity of cross-border data flows. Even the bill’s own oversight body, the National Security and Intelligence Review Agency, has told the SECU committee it does not have the access it needs for effective oversight. If the government thought it could push through the bill largely unnoticed, it has been proven painfully wrong as there are now trade frictions with the U.S., the prospect of leading companies exiting the Canadian market, and weaker cybersecurity protections for ordinary users.

[…]

The bill nominally protects against the worst outcome through a systemic vulnerability safeguard, which says that core providers are not required to comply with a regulation if compliance would require the introduction or maintenance of a systemic vulnerability. But the safeguard falls apart on careful reading. First, the term “systemic vulnerability” lacks specificity in the statute, which means the government could define encryption and vulnerability narrowly enough to hollow out the protection. Second, Sections 5(5) and 7(5) state that providers are not required to comply where doing so would result in a systemic vulnerability, but Sections 12 and 13 unconditionally require compliance with orders and provide that orders prevail over inconsistent regulations. The net effect is that providers are stuck with contradictory provisions in a system shrouded in secrecy and which could lead to the weakening of security systems. That is why Signal, Windscribe, NordVPN, Apple, Meta, the Canadian Chamber of Commerce, the Cybersecurity Advisors Network, and the U.S. Congress are raising the alarm.

The best approach to address these risks is to go back to the drawing board on Part 2 of the bill. Committee hearings should be extended to ensure that the long list of expert witnesses, industry voices, and international counterparts who have asked for changes receive a full hearing. Further, real amendments should be on the table that better balance law enforcement needs with Canadians’ privacy rights. Failure to do so will result in some of the world’s most privacy-protective services exiting the market, leaving behind a law that is vulnerable to constitutional challenge with millions of Canadians facing genuine privacy and cybersecurity risks.

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