[In his book The Robber Barons], Josephson missed the distinction between market entrepreneurs like Vanderbilt, Hill, and Rockefeller and political entrepreneurs like Collins, Villard, and Gould. He lumped them all together. However, Josephson was honest enough to mention the achievements of some market entrepreneurs. James J. Hill, Josephson conceded, was an “able administrator”, and “far more efficient” than his subsidized competitors. Andrew Carnegie had a “well-integrated, technically superior plant”; and John D. Rockefeller was “a great innovator” with superb “marketing methods”, who displayed “unequaled efficiency and power of organization”.
Most of Josephson’s ire is directed toward political entrepreneurs. The subsidized Henry Villard of the Northern Pacific Railroad, with his “bad grades and high interest charges” show that he “apparently knew little enough about railroad-building”. The leaders of the Union Pacific and Central Pacific, Josephson notes, “carried on [their actions] with a heedless abandon … [which] caused a waste of between 70 and 75 percent of the expenditure as against the normal rate of construction”. But it never occurs to Josephson that the subsidies government gave these railroads created the incentives that led their owners to overpay for materials and to build in unsafe areas. He quotes “one authority” on the railroads as saying, “The Federal government seems … to have assumed the major portion of the risk and the Associates seem to have derived the profits” — but Josephson never pursues the implication of that passage.
Burton W. Folsum, “How the Myth of the ‘Robber Barons’ Began — and Why It Persists”, Foundation for Economic Education, 2018-09-21.
March 16, 2026
QotD: Political entrepreneurs and federal subsidies
November 10, 2025
Enshittification, the book
Cory Doctorow originally coined the all-too-useful name for the steady deterioration of pretty much everything in the online world and now it’s the title of his latest book:
Author and activist Cory Doctorow wants you to understand why online digital platforms are failing users, and he’s fighting for a better internet. “Enshittification” — a word he coined to describe the degradation of online platforms and services — is the slightly profane albeit funny title of his latest book.
[…]
First question from me: “What does enshittification look like in Canada?” (Try saying that word without chuckling). The country had several opportunities to lead as a global digital force to be reckoned with, Cory agrees, and in his view, “we dropped the ball on market concentration”.
“The Competition Bureau has, through almost all of its history, until last year when we got a new bill out of Parliament, been, I think, the weakest competition bureau in the world,” Cory declares, emphatically. It’s hard to refute his assessment: The merger of Shaw and Rogers, two very large telecoms in Canada, was made official in 2023, the year before Canada’s competition law was modernized.
“Wouldn’t you think, at the very least, Canada would have a robust domestic network platform available by now?” I ask. Gander Social, a made-in-Canada social media platform, designed as an alternative to large U.S.-based companies, is only now being beta tested.
“There are any number of people who would like very, very much to host a few thousand of their friends on a little Mastodon or Blue Sky server that can talk to all the other ones, and everyone can be in a conversation,” Cory counters.
“We don’t all have to be on the same server,” Cory continues. “If there’s one thing we learned from the Amazon outage, it’s that putting everyone on the same server is an incredibly bad idea, right? So we can all be on different servers in the same way we’re all on different email servers, drive on different roads. We have to live in different cities; we don’t all have to be in the same place to all talk to each other and be part of a single digital network. That’s what networks are, right?
“You know, what we don’t have, the lacuna in this plan, the thing that we need public investment in, is not the bicycles on the road, it’s the bike lanes, it’s the infrastructure, and it’s the kind of thing the private sector can’t do well,” he asserts. The pain points for small businesses, communities, large businesses, cooperatives or any entity wanting to host a social media platform, Cory suggests, include things like security audits and content moderation tools.
He also recommends “some mechanism to ease people’s passage off (existing) social media and onto a new platform”. Right now, Cory explains, “you have people building these new platforms and wondering how the people on the old platforms are going to get there. This is like West Germans building housing for East Germans in West Germany, without thinking about how they’re going to get over the wall. Except that, we built the wall. We are the ones maintaining the wall. The wall is made entirely of law. The wall could be torn down with an act of Parliament at the stroke of a pen.”
And on the related topic of artificial intelligence being crowbarred into everything we use online:
Cory’s also saying very provocative things about AI. His most-memorable quip: “AI is the asbestos we are shovelling into the walls of our society and our descendants will be digging it out for generations”. While he sees the merits of AI to support the work of radiologists or lawyers or software engineers — or nearly anyone — he doesn’t believe AI can do the job. “But,” he warns, “an AI salesman can 100 per cent convince your boss to fire you and replace you with AI”.
October 28, 2025
Arguments against importing skilled workers
I’ve been against the importation of huge numbers of unskilled workers — which we have been doing at an ever-increasing rate over the last ten years — but I generally accepted the need for bringing in those immigrants with skills and talents we needed. On his Substack, Spaceman Spiff argues against even skilled immigration:
In most Western countries there is a determined campaign to normalize skilled immigration. It is not just pursued but celebrated as both enlightened and necessary for our survival.
This is so much a part of the West we overlook the observation it is rejected in most parts of the world.
Foreign people now compete with us inside our borders rather than safely outside. Individuals with whom we will typically share no history, heritage or even outlook, all needed for a stable society. In some cases, groups hostile to our way of living and unwilling to maintain it, even working to undermine it, a recipe for conflict.
When explained in plain English it clearly is an unusual thing for anyone to accept.
We need skilled workers
The importation of skilled workers is always sold as a positive. They are educated or they bring niche talents. They improve our competitiveness to help us take on the world.
The sales pitch is relentless. Even those uncomfortable with rapid demographic change parrot claims about the benefits of foreign workers who then compete with domestic workers.
We are told we are lucky to be able to attract such amazing talent as if the immigrants are choosing from a buffet of impressive options rather than fleeing poverty and corruption as is usually the case.
When all else fails, and the narratives are questioned, they trot out the classic line, that the immigrants do the work our own people won’t do. Naturally they erase the last clause in that sentence, they do the work our own people won’t do for the money offered.
Interchangeable units
We are told many of the blessings of the West would not be possible without importing talented foreigners, despite all evidence to the contrary, not the least of which is the social, economic and technological black holes many of them come from.
If they are so talented why are their homelands so disastrous?
Such obvious questions are discouraged. Instead we are encouraged to think of it as gaining access to the best from around the world, as if countries are just collections of interchangeable economic units.
We are told it is like building up a sports team. The emphasis is on the excellence of the players. The world-class performance is a consequence of being able to cast such a wide net.
But it is really more like drafting in men to play in women’s sports leagues.
July 29, 2025
QotD: Thucydides wasn’t articulating a deterministic law of geopolitics – he was writing a tragedy
These concerns were not limited to the fringes, they were real. So real were they that respected geopolitical analysts like George Friedman (later of Stratfor) wrote books like [The Coming War With Japan] The argument was that an upstart like Japan would crash head first into US economic and security interests, sparking another war between the two. This conflict was inevitable because challengers will always seek the crown, and the king will always fight to maintain possession of it.
Suffice it to say that this war did not come to pass. The Japanese threat was vastly overstated, and its economy has been in stagnation-mode for decades now (even though living standards remain very high in relative terms). What may seem inevitable need not be.
The next several years will see marked increase in tension between the USA and China, as the former completes its long awaited “Pivot to East Asia”. So anxious are the Americans to pivot that they have been threatening to “walk away” from Ukraine if they cannot hammer down a peace deal in the very near future. This indicates just how serious a threat they view China’s ascent to be to its economic and security interests. If they are willing to sacrifice more in Ukraine than originally intended, the implication is that China’s rise is a grave concern, and that a clash between the two looks very likely … some would argue that it is inevitable, appealing to a relatively new IR concept called the “Thucydides Trap“.
Andrew Latham explains the concept to us, arguing that Thucydides is misunderstood, making conflict between rising powers and hegemons not necessarily inevitable:
The so-called Thucydides Trap has become a staple of foreign policy commentary over the past decade or so, regularly invoked to frame the escalating rivalry between the United States and China.
Coined by political scientist Graham Allison — first in a 2012 Financial Times article and later developed in his 2017 book Destined for War — the phrase refers to a line from the ancient Greek historian Thucydides, who wrote in his History of the Peloponnesian War, “It was the rise of Athens and the fear that this instilled in Sparta that made war inevitable.”
Distortion:
At first glance, this provides a compelling and conveniently packaged analogy: Rising powers provoke anxiety in established ones, leading to conflict. In today’s context, the implication seems clear – China’s rise is bound to provoke a collision with the United States, just as Athens once did with Sparta.
But this framing risks flattening the complexity of Thucydides’ work and distorting its deeper philosophical message. Thucydides wasn’t articulating a deterministic law of geopolitics. He was writing a tragedy.
This essay might be an exercise in historical sperging, but I think it has value:
Thucydides fought in the Peloponnesian War on the Athenian side. His world was steeped in the sensibilities of Greek tragedy, and his historical narrative carries that imprint throughout. His work is not a treatise on structural inevitability but an exploration of how human frailty, political misjudgment and moral decay can combine to unleash catastrophe.
That tragic sensibility matters. Where modern analysts often search for predictive patterns and system-level explanations, Thucydides drew attention to the role of choice, perception and emotion.
His history is filled with the corrosive effects of fear, the seductions of ambition, the failures of leadership and the tragic unraveling of judgment. This is a study in hubris and nemesis, not structural determinism.
Much of this is lost when the phrase “Thucydides Trap” is elevated into a kind of quasi-law of international politics. It becomes shorthand for inevitability: power rises, fear responds, war follows.
Therefore, more of a psychological study of characters rather than structural determinism.
Giving credit to Allison:
Even Allison, to his credit, never claimed the “trap” was inescapable. His core argument was that war is likely but not inevitable when a rising power challenges a dominant one. In fact, much of Allison’s writing serves as a warning to break from the pattern, not to resign oneself to it.
Misuse:
In that sense, the “Thucydides Trap” has been misused by commentators and policymakers alike. Some treat it as confirmation that war is baked into the structure of power transitions — an excuse to raise defense budgets or to talk tough with Beijing — when in fact, it ought to provoke reflection and restraint.
To read Thucydides carefully is to see that the Peloponnesian War was not solely about a shifting balance of power. It was also about pride, misjudgment and the failure to lead wisely.
Consider his famous observation, “Ignorance is bold and knowledge reserved”. This isn’t a structural insight — it’s a human one. It’s aimed squarely at those who mistake impulse for strategy and swagger for strength.
Or take his chilling formulation, “The strong do what they will and the weak suffer what they must”. That’s not an endorsement of realpolitik. It’s a tragic lament on what happens when power becomes unaccountable and justice is cast aside.
and
In today’s context, invoking the Thucydides Trap as a justification for confrontation with China may do more harm than good. It reinforces the notion that conflict is already on the rails and cannot be stopped.
But if there is a lesson in The History of the Peloponnesian War, it is not that war is inevitable but that it becomes likely when the space for prudence and reflection collapses under the weight of fear and pride.
Thucydides offers not a theory of international politics but a warning — an admonition to leaders who, gripped by their own narratives, drive their nations over a cliff.
Latham does have a point, but events have a momentum all their own, and they are often hard to stop. Inevitabilities do exist, such as Israel and Hezbollah entering into conflict with one another in 2022 after their 2006 war saw the latter come out with a tactical victory. Barring a black swan event, the USA and China are headed for a collision. The question is: in what form?
Niccolo Soldo, “Saturday Commentary and Review #188 (Easter Monday Edition)”, Fisted by Foucault, 2025-04-21.
July 24, 2025
The vicious competition for Indian civil service jobs
Once upon a time in most of the Anglosphere, the advantage of civil service jobs was that they were nearly impossible to get fired from and had a relatively good pension at the end of a long career. Private sector jobs were far less permanent, but paid more, had better benefits, and more prestige. Over the last fifty years, little of that is still true — civil servants still have fantastic job security, but they’re also better paid, have better benefits, and for many there are opportunities to retire and get re-hired back into a similar position with even higher pay while collecting a generous pension. The private sector no longer pays better nor offers significantly better benefits, so lots of people look to get into the civil service who once would have shunned positions like that.
It’s apparently much worse in India:
In India, government jobs pay far more than equivalent jobs in the private sector — so much so that the entire labor market and educational system have become grossly distorted by rent-seeking to obtain these jobs. Teachers in the public sector, for example, are paid at least five times more than in the private sector. It’s not just the salary. When accounting for lifetime tenure, generous perks, and potentially remunerative possibilities for corruption, a government job’s total value can be up to 10 times that of an equivalent private sector job. (See also here.)
As a result, it’s not uncommon for thousands of people to apply for every government job — a ratio far higher than in the private sector. In one famous example, 2.3 million people submitted applications for 368 “office boy” positions in Uttar Pradesh.
The consequences of this intense competition for government jobs are severe. First, as Karthik Muralildharan argues, the Indian government can’t afford to pay for all the workers it needs. India has all the laws of, say, the United States, but about one-fifth the number of government workers per capita, leading to low state capacity.
But there is a second problem which may be even more serious. Competition to obtain government jobs wastes tremendous amounts of resources and distorts the labor and educational market.
If jobs were allocated randomly, applications would be like lottery tickets, with few social costs. Government jobs, however, are often allocated by exam performance. Thus, obtaining a government job requires an “investment” in exam preparation. Many young people spend years out of the workforce studying for exams that, for nearly all of them, will yield nothing. In Tamil Nadu alone, between one to two million people apply annually for government jobs, but far fewer than 1% are hired. Despite the long odds, the rewards are so large that applicants leave the workforce to compete. Kunal Mangal estimates that around 80% of the unemployed in Tamil Nadu are studying for government exams.
Classical rent-seeking logic predicts full dissipation: if a prize is worth a certain amount, rational individuals will collectively spend resources up to that amount attempting to win it. When the prize is a government job, the “spending” is not cash, but years of a young person’s productive life. Mangal calculates that the total opportunity cost (time out of the workforce) that job applicants “spend” in Tamil Nadu is worth more than the combined lifetime salaries of the available jobs (recall that jobs are worth more than salaries, so this is consistent with theory). Simply put, for every ₹100 the government spends on salaries, Indian society burns ₹168 in a collective effort of rent-seeking just to decide who gets them.
The winners are happy but the loss to Indian society — of unemployed young, educated workers who do nothing but study for government exams — is in the billions. Indeed, India spends about 3.86% of GDP on state salaries (27% of state revenues times 14.3% of GDP). If we take Mangal’s numbers from Tamil Nadu, a conservative (multiplier of 1 instead of 1.68) back-of-the-envelope estimate suggests that India could be wasting on the order of 1.4% of GDP annually on rent-seeking. (Multiply 3.86% of GDP by 15 (30 years at 5% discount) to get lifetime value, and take 0.025 as annual worker turnover.) Take this with a grain of salt, but regardless, the number is large.
July 22, 2025
The internet keeps getting worse. Let’s talk about why.
Jared Henderson
Published 16 Jul 2025Why do major online platforms keep getting worse? Cory Doctorow’s work helps us understand the pattern of growth, decline, and eventual demise.
→ Timestamps
00:00 Beginning
00:51 How Platforms Die
08:29 The Death of a Platform (From the Inside)
12:14 Ads, Everywhere
14:47 Yes, I Make Money from Ads
16:32 Bots
22:04 The Internet We Need
(more…)
July 7, 2025
QotD: The mythological “perfect market” and “perfect competition”
The narrative that is constructed and logically follows from this model is that observed deviations from perfect competition in the marketplace are indicative of imperfections, also known as “market failures”, associated with the existence of monopoly power, pervasive externalities, the provision of public goods, and macroeconomic instability. According to this narrative, government intervention is the deus ex machina that saves the market from its own “imperfections” through regulations, taxes, subsides, and other public policy measures. Why? To use a quote from Frank Knight often used by James Buchanan, “to call a situation hopeless is to call it ideal”. The narrative that is constructed is one in which, outside the conditions of the ideal of perfect competition, there is no hope but for government intervention to save the market from itself. Anyone who has taken an economics course is well aware of what I’ve stated thus far, and therefore this should not be surprising.
But what is the implicit meaning of the word “imperfect” that is baked into the narrative, which is constructed into the model of perfect competition? What is implied when we postulate that markets are “imperfect” in comparison to the benchmark of perfect competition is that markets are flawed, non-ideal, or otherwise sub-optimal, and therefore in need of correction through government intervention. Who could dispute the logic of this narrative?
However, if we simply reinterpret our understanding of the word “imperfect”, not only will it reframe the narrative being told about the marketplace, but also the public policy implications that flow from this narrative. If we analyze the etymology of the word imperfect, breaking it down from its Latin origins, you will learn that “im” expresses the negation, “per” comes from the Latin word meaning “thoroughly” and “fect” comes from the Latin verb “facere“, meaning “to do”. Thus, rather than saying that something, or some state of affairs, is flawed, suboptimal, or non-ideal, another way to interpret the meaning of “imperfect” is an act or process that is not thoroughly done, or incomplete. In fact, from a quick perusal of the Merriam Webster’s Dictionary, you will find a similar definition of the word imperfect: “constituting a verb tense used to designate a continuing state or an incomplete action” (emphasis added).
Rather than regarding the market as a flawed or sub-optimal state of affairs, a better understanding of an “imperfect market” reveals that the market is a process of continuous tendency towards perfection, or completion, where are all the gains from trade are exhausted and all plans between buyers and sellers are perfectly coordinated. As Ludwig von Mises states in his magnum opus, Human Action, the “market process is the adjustment of the individual actions of the various members of the market society to the requirements of mutual cooperation” (1949 [2007]: 258).
Thus, markets will always be imperfect, but that is precisely why markets exist in the first place! Markets never conform to the “ideal” of perfect competition, but this is completely irrelevant, since under such state of affairs, markets are unnecessary and redundant, since all resources are already perfectly allocated to their most valued uses. Market processes exist precisely because to generate the information necessary to better coordinate the plans and purposes of individuals in a peaceful and productive manner. The entrepreneurial lure for profit and the discipline of loss is what guides such imperfect processes in a tendency towards the creation of more complete information between buyers and sellers.
Rosolino Candela, “Are Markets Imperfect? Of Course, But That’s The Point!”, Econlib.org, 2020-05-18.
May 13, 2025
For boys, sometimes a touch of competition is all that’s required
Jon Miltimore was concerned when a report from his son’s school indicated that his son was lagging behind in reading compared to his classmates:
“Old Victorian Childrens’ Books” by pettifoggist is licensed under CC BY-SA 2.0 
.
So the fact that my own son — who is quite bright and scores extremely high in math — was struggling hit me a little, but it was not a surprise. Like many children, he had fallen behind in reading during the pandemic, and our efforts to get him caught up at home were pretty ineffective. Part of the problem was that as parents we did not do a good enough job of finding the right books to naturally kindle his interest and curiosity, but another issue was that at some point he began to feel self-conscious about this reading, which created an aversion to books.
[…]
A few months later, I had just finished reading a story to my 6-year-old son, who shares a bedroom with his older brother. I went to flick the light off when my older son said something I’d never heard before.
“Can I read for just ten more minutes,” he pleaded, showing me his book on pro football players.
I quickly gave my approval, then went downstairs to tell my wife. She was not as surprised as I was.
“They’re doing a reading competition at school. It’s boys against girls,” she said. “Every minute he reads is now added to their score. So now he wants to read — because it’s a competition.”
My wife did not say this disapprovingly, but she said it in a way that said of course he wants to read now. (My son is competitive.)
Over the next several weeks I watched as my son made a point of reading every night. Oftentimes he’d ask — just like on that first night — if he could read just 10 more minutes. Many nights he’d fall asleep with a book on his chest.
I have to admit that at first I found this strategy a tad cynical, but then I got the results. Over the span of seven weeks, my son leapt nearly two reading levels. He’s reading comfortably at the third-grade level and we’re now focusing more on reading comprehension than reciting sentences. He’s asking for books on World War I, World War II, and Vietnam for Christmas.
“His fluency has improved so much! I am so proud of him,” his teacher later told me.
Competition as a Virtue
I don’t doubt that some will look on this strategy with disdain.
We’re taught today that competition is crass, even harmful. George Soros, in a highly read piece from the 1990s published in The Atlantic, could have been speaking for many when he wrote that competition can “cause intolerable inequities and instability”. For many, competition is a dirty word, a sinister force to be suppressed and controlled.
This is nonsense, of course. Competition isn’t just innate to humans; it brings out the best in us.
It’s the force that drove Roger Bannister to break the four-minute mile. It’s given us the achievements of Michael Phelps and Michael Jordan. Socially, competition is what prompted the Brooklyn Dodgers to do the unthinkable and sign Jackie Robinson, breaking the color barrier and forever changing sports and America.
April 13, 2025
Gender is a social construct … or isn’t a social construct [confused screaming]
Is it a good thing or a bad thing that some female athletes choose not to compete against transgendered athletes? Yes. No. Answer unclear, ask again later:
Feminist and gender ideologies have always appealed to women (and continue to appeal) with the promise that women are strong and should be applauded for competing with and winning against men. Any woman who does so is almost automatically granted elevated status in our culture, praised for her guts, stamina, and even “balls”. Women who “break [gender] barriers” enter a special pantheon of heroines. Cartoons and action-movies are filled with super-athletic females who successfully battle all manner of male antagonists.
Feminists were, for a long time, extremely enthusiastic about this view of things. It was radical feminist Kate Millett, author of feminism’s bible Sexual Politics (1970), who praised sexologist John Money for experiments allegedly showing that gender had little or nothing to do with biological sex. She declared approvingly that “In the absence of complete evidence, I agree in general with Money and the Hampsons who show in their large series of intersexed patients that gender role is determined by postnatal forces, regardless of the anatomy and physiology of the external genitalia” (p. 30).
Many other feminists similarly emphasized gender’s social character and declared transgenderism a form of sexual liberation for women, with feminist writer Jacqueline Rose pronouncing in an essay for The New Statesman that “The gender binary is false” and that “Challenging the binary by transitioning becomes one of the most imaginative leaps in modern society”.
Feminist sociologists Judith Lorber and Patricia Martin argued extensively in “The Socially Constructed Body” (see especially the gob-smacking pp. 258-261) that women would at last pass men in many traditional sports when they truly believed they could, for “If members of society are told repeatedly that women’s bodily limitations prevent them from doing sports as well as men, they come to believe it […]”. Lorber and Martin lamented that opportunities were so rare for men and women to compete directly with one another (strongly implying that the patriarchy kept men and women apart so that women couldn’t judge for themselves), and they looked forward to a feminist future in which women could at last demonstrate their true physical capabilities.
From the first, the machinery of this kind of celebration backed men into an impossible corner. Most men have always known that women are not as strong as they; few men want to compete against a woman in sport or elsewhere. Yet no man dared gainsay the right of any woman to show herself equal to or better than a man if she could, whatever the context. If a man refused to compete with a woman, to welcome her into his club, to hire her into his firm, to respect her in any athletic endeavor — then he was a Neanderthal and a misogynist who should be shamed, shouted down, and immediately dismissed from his job.
But a man who competes with a woman, or treats her as he would treat a man, is often in trouble too, as we are seeing now. Yes, a woman was just as good as a man, our culture has insisted, but always and only on the woman’s terms. Sometimes the woman did not wish to be treated as an equal or a competitor, and that too was her right. Men had no say in the matter.
Over the years, there have been cases in which women didn’t like the culture men had created in their places of business; didn’t like male jokes, male camaraderie, male means of competition, or male methods of evaluation. Some women felt harassed, disrespected, held to an unreasonable standard, judged too harshly, given inadequate mentoring, singled out, left too much alone, treated cruelly, looked down upon, forced to behave in ways they didn’t prefer.
In general, women like competing against men and getting praise for it, but they don’t like losing to men.
Some women have turned in fury on the men who took the feminists at their word, preposterously claiming, as did “gender critical” (i.e. anti-trans) feminist journalist and former academic Helen Joyce in her Quillette essay “The New Patriarchy: How Trans Radicalism Hurts Women, Children, and Trans People Themselves” (2018), that trans women exemplify the latest form of the patriarchy that seeks to subjugate women, usurping their bodies and silencing their voices.
Many men, keen to avoid the gender wars they’d never wanted to fight in the first place, have felt understandably flummoxed and on the defensive. Which is it? Are women equal to men in all areas of endeavor, or not? Should women be kept out of direct competitions, or encouraged to show their mettle? Should men champion male-female sameness, or respect male-female difference?
In some once-exclusively-male areas, elaborate protocols have had to be worked out to protect women from feeling as if they have been beaten by men, while also protecting them from the knowledge that they were being protected.
March 17, 2025
QotD: Myths from Norman Rockwell’s America
The complaint generally continues that we were robbed of this by bad policy choices. But that is at best only half true.
World War II smashed almost the entire industrial capacity of the world outside the U.S., which exited with its manufacturing plant not only intact, but greatly improved by wartime capitalization. The result was that for about 30 years, the US was a price-taker in international markets. Nobody could effectively compete with us at heavy or even light manufacturing.
The profits from that advantage built Norman Rockwell’s America — lots of prosperous small towns built around factories and mills. Labor unions could bid up salaries for semi-skilled workers to historically ridiculous levels on that tide.
But it couldn’t last. Germany and Japan and England recapitalized and rebuilt themselves. The Asian tigers began to be a thing. U.S. producers facing increasing competitive pressure discovered that they had become bloated and inefficient in the years when the penalty for that mistake was minimal.
Were there bad policy choices? Absolutely. Taxes and entitlement spending exploded because all that surplus was sloshing around ready to be captured; the latter has proven politically almost impossible to undo.
When our windfall finally ended in the early 1970s, Americans were left with habits and expectations formed by the long boom. We’ve since spent 50 years trying, with occasional but only transient successes, to recreate those conditions. The technology boom of 1980 to 2001 came closest.
But the harsh reality is that we are never likely to have that kind of advantage again. Technology and capital are now too mobile for that.
Political choices have to be made within this reality. It’s one that neither popular nor elite perception has really caught up with.
Eric S. Raymond, X (the social media platform formerly known as Twitter, 2024-07-08.
February 1, 2025
China produced DeepSeek, Britain is mired in deep suck
In the Sean Gabb Newsletter, Sebastian Wang discusses the contrast between China’s recent release of the DeepSeek AI platform that appears to be eating the collective lunches of the existing LLM products by US firms and the devotion of the British Labour government to plunge ever deeper into their Net Zero dystopian vision:
Net Zero image from Jo Nova
For those few readers who may be unaware, DeepSeek is an advanced open-source artificial intelligence platform developed in China. Released in late 2024, it has set a new standard in AI, outperforming American counterparts in adaptability and capability. It excels in natural language processing, machine learning, and data analysis, and — critically — it is open source. Unlike the proprietary models that dominate the American tech landscape, DeepSeek allows anyone to adapt, improve, and use it as he sees fit. It’s not just a technological triumph for China; it’s a serious challenge to American domination of information technology and an opportunity for those who want to break free from the stranglehold of Silicon Valley.
As a Chinese person, I take pride in this achievement. It’s a testament to what my people can achieve with focus and ambition. But my concern is less about taking pride in what China has done and more about lamenting how little Britain has contributed to this revolution. Britain, the birthplace of the Industrial Revolution, seems to have no place in this new world of AI-driven progress. The question is why?
The answer is simple: The people who rule Britain have chosen decline. Crushing taxes on income and capital gains, and inheritance taxes, punish those who want to create wealth. Endless regulations stifle ambition, making it easier to conform than to innovate. Worst of all, there are the net zero policies, which have made energy costs the highest in the world, making electricity unaffordable and unreliable. Industries that depend on energy have been priced out of existence, and the dreamers and doers who might have built the next DeepSeek are being ground down by a system designed to reward mediocrity.
Net zero is not a noble goal born of misconception; it’s a disaster by design. It’s a wealth transfer scheme that takes from ordinary working people and hands billions to a small clique of green profiteers. The winners are the wind farm builders, the financiers running opaque carbon trading schemes, and the activists cashing in on government handouts. The losers are everyone else — families struggling to pay energy bills, businesses forced to close, and an entire country left unable to compete.
Compare this to China. DeepSeek wasn’t luck — it was the product of a system that rewards innovation. Electricity in China is cheap and reliable. Regulations focus on enabling progress, not blocking it. Ambition is celebrated, not treated as a threat. The ruling class there, for all its many and terrible faults, understands the value of creating wealth and technological self-reliance. Britain’s ruling class, by contrast, has abandoned the idea of building anything. They’d rather sit in the City of London, counting money made elsewhere, than see industry and innovation flourish in the country at large. They have chosen decline — not for them, but for us.
December 30, 2024
RIP Jimmy Carter, “The Great Deregulator”, 1924-2024
ReasonTV
Published 29 Dec 2024Nobel-Winning Economist Vernon Smith says the 39th president radically improved air travel, freight rail, and trucking in ways that still benefit us immensely.
______Jimmy Carter was perhaps the most successful ex-president in American history, winning the Nobel Peace Prize in 2002 for his work promoting human rights and economic and social development.
But his single term as president (1977–1981) is largely remembered as a series of failures and missteps, sometimes literally. Gas lines, a record-high combination of unemployment and inflation on the “misery index”, and Americans being held hostage by Iranian revolutionaries for over a year all fueled the perception that Carter was a weak and ineffective leader. When he collapsed during a six-mile run, it personified for many the exhaustion of the country under his leadership.
But there was at least one way in which Carter excelled as president. He was, in the words of 2002 Nobel–winning economist Vernon Smith, the great deregulator. Carter forced the airline industry, along with interstate trucking and freight rail, to compete for business, with powerful and positive effects that continue to this day.
I talked to Smith about Carter, whom he met at a White House event for American Nobel Prize winners, and what it was like to fly in the days when the government controlled air travel.
December 15, 2024
“Outside Sub-Saharan Africa, Homo sapiens are vermin, in the Australian sense — an introduced species with no co-evolved local predators”
You have to admit that Lorenzo Warby has a way with words to introduce a new essay, yes?
Outside Sub-Saharan Africa, Homo sapiens are vermin, in the Australian sense — an introduced species with no co-evolved local predators. That means that their strongest selection pressures — both genetic and cultural — have almost always been about dealing with other humans.
We are the cultural species par excellence. Cultures can be reasonably thought of as collections of life-strategies. Culture tends to be persistent — aspects of culture can be highly persistent.
It is worth keeping in mind that genetic selection can occur surprisingly quickly — i.e., in a relatively short number of generations, depending on the intensity of the selection pressures. A very clear example of this is the evolution of lactase persistence in pastoralist, or agro-pastoralist, populations. (The decades-long experiment in domesticating silver foxes is an extreme example.)
The great advantage of cultural selection is that it is faster than genetic selection but culture still has to show some “stickiness”, some persistence, to be useful. Especially in the evolution of signals, norms and social strategies.
The regions where the local physical environment has been successfully managed longest — or most thoroughly — are Europe, particularly North-West Europe, East Asia and India (especially by high-jati Indians). So, those are the areas where natural and cultural selection has been most focused on selection for dealing usefully with other humans. Those populations have also been the most successful in dealing with the modern world, wherever they go. This hardly seems a coincidence.
The regions where dealing with the local physical environment has been most salient are Sub-Saharan Africa — all those co-evolved parasites, pathogens, predators and mega-herbivores — and Australia — which is full of deserts and spiky things likely to poison you. Much of Africa is also semi-desert forager lands, while the tsetse fly stopped the central African plains generating the equivalent of the connecting — for good or ill — pastoralist cultures of the Eurasian steppes. Both continental-scale regions therefore historically had low human population densities.
The consequence in Africa was that Sub-Saharan Africa has, for millennia, been a region of endemic slavery. Labour was more valuable than land, which led — as it usually did historically — to labour bondage: the violent/coercive extraction of labour’s scarcity value. In this case, the low population density meant that folk were regularly seized and transported, thus requiring the level of domination for folk to be moved at will — i.e., slavery rather than some form of serfdom.
Increased selection to deal with the physical environment meant comparatively less selection to deal with other humans. Sub-Saharan African and Australian Aboriginal populations have been rather less successful at dealing with the modern world than have other populations. (Claims about the success of recent African immigrants seem to be overstated.) The key element of the modern world is domination of social outcomes by human interactions to the greatest extent yet achieved in history. Again, that relative lack of success hardly seems like a coincidence.
Yes, it is true that selection for transportation across the Atlantic as slaves was negative in all sorts of senses. The churn of slavery massively undermined cultural transmission, the selection was for physical robustness and, if anything, against executive functions (which are highly heritable). Nevertheless, with the partial exception of recent African immigrants — who are selected for initiative and education — both populations have been markedly less successful than other groups.
There are certainly factors which affect that either way. Not inflicting on Australian Aborigines the dual metabolic disasters of the farming and processed-food revolutions at the same time would be good. Not under-policing the localities in which folk live is also good.
Nevertheless, there is no reason to think that capacities — which are a genetic, epigenetic and cultural matter — will be evenly distributed across all populations. Indeed, we have very good reasons to think that that will not be the case, due to the variations in selection pressures — whether genetic, environmental or cultural, including interactions between the three. It is not a good idea, for instance, to spend 1400 years marrying your cousins.
Even when means and medians are the same in the distribution of some trait across groups, differences in the size of tails — i.e. the number of extreme outliers — can lead to differences in the distribution of outcomes. Any population with a persistently larger tail of high physical robustness and lower executive functions — which can be an ethno-racial pattern but also a class pattern — will tend to have higher rates of violent crime. Conversely, any population with a smaller tail of lower executive functions — for example, East Asians with a long history of underclass males not breeding but selection for reproductive success through passing examinations and cooperative farming — will tend to have lower rates of violent crime.
Sufficient variance in traits — so having a larger “right tail” of positive-for-human-flourishing characteristics — can be enough on its own to increase a group’s success. Tail effects matter.1
The persistence of gene flows across human populations does undermine any strong notion of human subspecies among Homo sapiens. It does not imply equal distributions of capacities across human populations.
Hence, evolutionary thinking is neither comfortable nor comforting.
1. Given that human males — like males across species — have a flatter distribution of traits — so more positive and negative outliers — having equal numbers of males and females at the top ends of hierarchies suggests some level of discrimination against males. Conversely, having female prison populations begin to approach male populations in size suggests some level of discrimination against, even persecution of, females.
November 30, 2024
QotD: Unrealized promises of a “Great Society”
Amity Shlaes, Great Society: A New History, 2020.
November 19, 2024
The state and society
Lorenzo Warby explains why Karl Marx was wrong about the origins of what he called “the three great inventions” and therefore also mistaken about the societal impact of those inventions:
Gunpowder, the compass, and the printing press were the 3 great inventions which ushered in bourgeois society. Gunpowder blew up the knightly class, the compass discovered the world market and founded the colonies, and the printing press was the instrument of Protestantism and the regeneration of science in general; the most powerful lever for creating the intellectual prerequisites.
Karl Marx, “Division of Labour and Mechanical Workshop. Tool and Machinery” in Economic Manuscripts of 1861-63, Part 3) Relative Surplus Value.
With this quote we can see what is wrong both with Marx’s notion of the role of technology in social causation and with a very common notion of the relationship between state and society.
The false — but very common — view of the relationship of state and society is that the state is a product of its society, that the state emanates from its society. This gets the dominant relationship almost entirely the wrong way around. It is far more true to say that the state is a fundamental structuring element of the social dynamics of the territory it rules rather than the reverse.
It is perhaps easiest to see this by noting the glaring flaw in Marx’s reasoning. The gunpowder, the compass and the printing press were all originally Chinese inventions. Indeed, Europe acquired — via intermediaries — gunpowder and the compass from China. (Gutenberg’s printing press appears to have been an independent invention.)
Source: Nova Reperta Frontispiece, 1588.
Yet, as Marx was very well aware, China did not develop a bourgeoisie in his sense. Indeed, Marx’s notion of the Asiatic mode of production grappled with precisely that lack.1
In 1620, Sir Francis Bacon wrote in his Instauratio magna that
… printing, gunpowder, and the nautical compass … have altered the face and state of the world: first, in literary matters; second, in warfare; third, in navigation …
This was true of the effect of these inventions in European, but not Chinese, hands.
Why were these inventions globally transformative in European, but not Chinese hands? Because of the differences in the structure of European state(s) compared to the Chinese state.
Unified China …
The first difference is that the European states were states, plural. Europe had competitive jurisdictions, it had centuries of often intense inter-state conflict. From the Sui (re)unification (581) onwards China was, with brief interruptions, a single polity.2 What the evidence — both Chinese and Roman — shows quite clearly is that civilisational unity in a single polity is bad for institutional, technological and intellectual development.
The second difference is with the internal structure of European states compared to the Chinese state. The Sui dynasty, by introducing the Keju, the imperial examination — refining the use of appointment by exam that went back to the Warring States period — created a structure that directed Chinese human capital to the service of the Emperor.
There were three tiers of examinations (local, provincial, palace). You could sit for them as often as you wished. So a significant proportion of Chinese males devoted decades of their lives to attempting to pass the exams. Over time, the exams became more narrowly Confucian — probably because it required a high level of detailed mastery, so had more of a sorting effect — thereby promoting intellectual conformism.
[…]
… and divided Europe
Conversely, when gunpowder, the compass and the printing press came to Europe, European states already had a military aristocracy; self-governing cities; an armed mercantile elite; organised religious structures; so a rich array of cooperative institutions. Moreover, kin-groups had been suppressed across manorial Europe, forcing — or giving the social space for — alternative mechanisms for social cooperation to evolve.3, 4 In particular, due [to] its self-governing cities with armed militias, medieval Europe had an (effectively) armed mercantile elite before gunpowder, the compass or printing reached Europe.
Alfonso IX of Leon and Galicia (r.1188-1230) first summoned the Cortes of Leon in 1188. This became the start of the first institutionalised use of merchant representatives in deliberative assemblies. Emperor Frederick Barbarossa (r.1155-1190) had tried something similar earlier, but the mercantile elites of North Italy preferred de facto independence, defeating him at the Battle of Legnano in 1176.
The first European reference to the compass is in a text written some time between 1187 and 1202, with its use appearing to expand over the 1200s. The first reference to gunpowder in Europe is not until 1267 and it took centuries before gunpowder played a major role in European warfare.
Both the compass and gunpowder really only have transformative effects from the late C15th onwards, which is also when the printing press is spreading across Latin Europe. By that time, medieval Europe has already become a machine culture and it had been for centuries the civilisation with the most powerful mercantile elite. A reality driven by competitive jurisdictions, a rural-based military aristocracy, law that was not based on revelation (so it could entrench social bargains), suppression of kin-groups, and self-governing cities.
Competition between European states was a powerful driver of the transformative use of technologies. But so was the level of striving within such states: adventurers able to mobilise resources — and seeking wealth, power, prestige — had far more room to operate (and receive official sanction) in Europe than in China.
In other words, the differences in the development and use of technology — and in social dynamics and formations — between China and medieval Europe was fundamentally driven by the differences in state structures, in how the relevant polities worked.
1. Marx was not an honest intellectual reasoner:
As to the Delhi affair, it seems to me that the English ought to begin their retreat as soon as the rainy season has set in in real earnest. Being obliged for the present to hold the fort for you as the Tribune’s military correspondent I have taken it upon myself to put this forward. NB, on the supposition that the reports to date have been true. It’s possible that I shall make an ass of myself. But in that case one can always get out of it with a little dialectic. I have, of course, so worded my proposition as to be right either way.
Marx to Engels, [London,] 15 August 1857, (emphasis in the original).2. The Song (960-1279) failed to fully unify China, but they were the only significant Han polity. That the Song were effectively within a mini-state system does seem to have affected their policies, including the unusually — for a Chinese imperial dynasty — strong focus on trade and technological development.
3. Kin-groups had already been suppressed in the city-states of the Classical world, including Rome. They re-emerged with the incoming Germanic peoples, and then were suppressed again by the Church and the manorial elite, remaining in the agro-pastoralist Celtic fringe and Balkan uplands.
4. Economists Avner Greif and Guido Tabellini define clan (i.e. kin-group) as “a kin-based organization consisting of patrilineal households that trace their origin to a (self-proclaimed) common male ancestor“. They contrast this with a corporation: “a voluntary association between unrelated individuals established to pursue common interests“. They note they perform similar functions: “they sustained cooperation among members, regulated interactions with non-members, provided local public or club goods, and coordinated interactions with the market and with the state“. Triads, tongs and cults can also perform these functions.
