17 January 2021

Managing Desire - Creating the 20th Century Consumer to Support 20th Century Productivity

In 1754, Rousseau wrote of the French,
"You aren't so rich that you have become numb to true happiness because of the distractions of luxury nor poor enough to need any financial help."

Rousseau thought French incomes at the dawn of the Industrial Revolution were at a Goldilocks' "just right" level. 

Per capita GDP in France in inflation adjusted dollars?
1750: $1,766
2016: $37,124.

The 18th century French would have to work all year to make as much as the present day French make in 2 or 3 weeks. Rousseau thought the French were perfectly satisfied; we would think of them as impoverished.

Obviously we had to create modern factories to live like we do today. Less obviously, we had to create modern consumers to live like this.

John D. Rockefeller's wife once shocked a friend by opining that a woman only needed two dresses in her wardrobe. The children wore hand me downs and John Rockefeller Jr. once reported that with three older sisters, he wore dresses until he was 8. Even the world's richest man thought it unseemly to spend money freely.


Attitudes like Rockefeller's were a big problem in the early 20th century. It was not enough to create factories that made more. You had to create consumers who bought more.

I often talk about how the information economy is characterized by knowledge workers who use their brains to manipulate the symbols of things rather than their brawn to manipulate actual things. But information technology has as much to do with advertising - alerting us to what is missing in our life - as knowledge work. Facebook and Google have created vast wealth by selling ads, ads that remind us that we do not, as yet, have everything we need. If we all suddenly believed Rousseau and thought that we needed to spend only $1,766 a year, the economy would collapse.

And that actually happened after the roaring twenties. The causes of the Great Depression were complicated but a big obstacle to recovery was stimulating enough demand to create jobs for everyone. It took a world war to create enough demand to reach full employment. After the war, the factories that had produced tanks and planes at record numbers to fight fascism were transformed to produce cars and TVs at record numbers. Consumption was helped a great deal by TVs, a device upon which you could advertise TVs (and so many other products).

Once American producers and Federal Reserve Chairs learned how to stimulate demand to keep pace with rising productivity, the economy became less dangerous. Unlike Rockefeller, we've made our peace with consumption now, finishing each year with a holiday inspired flurry of consumption (the mas' in Christmas apparently now referring to mass manufacturing and mass consumption rather than traditional Mass). Between 1900 and 1933, the American economy was in recession 48% of the time. Since 1933, it has been in recession only 14% of the time. We've learned a lot about how to manage factories, financial markets and economies. We've also learned a lot about how to manage and stimulate demand or - as medieval clerics would say - desire.

The High Value of Working Online From Home in the 1870s

Working online from home?

John Davison Rockefeller installed a telegraph line between his office and home when he was in his 30s (in 1870s). He worked from home ~3 afternoons a wk.

It didn't hurt his productivity. Net worth the same % of GDP as Rockefeller's today would be about $400 billion.

COVID's Exponential Spread in the Spring of 2020 Will Become an Exponential Contraction in the Spring of 2021

Persian new year is the first day of Spring. For 2021, it will seem like the Persians have it right.

Currently, we're losing about 3,000 per day to COVID. That is forecast to rise by the end of January to somewhere between 2,500 to 4,500 per day. The vaccine rollout will radically change things within a few months.

By the last day of February, daily deaths will fall to about 1,500 to 2,000. The death rate will halve in February. By the last day of March, daily deaths should fall to about 500 to 800 per day, falling to nearly a third of what it was a month prior. And by May 1st daily deaths should be about 200 per day, again falling to about a third of its rate from a month before. (And with universal masks and even more rapid vaccine rollouts, we could be down to 100 deaths per day.)

COVID exponentially spread in 2020. It should exponentially contract in 2021. By Spring, it'll feel like a new year.

Numbers come from here:

https://covid19.healthdata.org/united-states-of-america?view=daily-deaths&tab=trend

15 January 2021

How Education Is Likely to Change In the Next Decade or Two

One simple difference between a functional and dysfunctional society is how effectively it raises children to be productive adults. You have to evolve your education to keep up with the economy. Ideally, that education doesn't just keep up with but actually drives economic progress.

Two things that make this more challenging than ever are increases in life expectancy and the rate of economic change. 

10 year old kids are in fifth grade. Their peak earning will probably be in about 40 years. So we have about 7 to 15 years to prepare them to be productive in the year 2060. That's kind of ludicrous. The longer we live, the farther out is the target we're shooting at in terms of preparation.

Meanwhile, economic change is accelerating. One of the great things about globalization is that we now have 7.5 billion people engaged in invention and entrepreneurship. One of the bad things about globalization is that the odds that the technology we're using this year, the company we're working for this year, the processes we're using this year ... are still the company, technology and processes we're using in a decade are incredibly low. 

We're not just shooting at a target 40 years out. That target is moving faster than ever.
I suspect that two of the dimensions to how we'll change education to accommodate this reality will be this. 

1. We will eventually adopt a model of lifetime education. 10 year old kids will already be spending 5 to 15% of their time at "work." They won't just learn principles. They will begin applying those to the creation of value for their community. 60 year old people will be spending 5 to 15% of their time in "school." They won't just be applying old principles. They'll be learning new ones.

2. We will teach entrepreneurship and innovation. Stanford has Sand Hill Road on its campus. Sand Hill Road is to venture capital what Wall Street is to stocks. That combination of education and financing helped to create Silicon Valley. (Terman, one of the visionaries who saw Silicon Valley before it existed, introduced two of his students who he thought should collaborate to create a business. The students? Bill Hewlett and David Packard.) The notion that schools will be launching pads for new businesses (and new government agencies and schools and social inventions we have yet to think of) will become common. Skills and ability for technological and social invention are something that will still be valuable in the year 2060 even if AI has automated the jobs of driving trucks or programming, say. 
And making school and work coincident means that both will evolve more quickly to keep pace with the progress we're trying to drive.

14 January 2021

Kamala Harris - Another Californian Who Could Signal a Shift in American Politics

Kamala Harris will represent so many firsts when she’s sworn in next week as Vice President. First woman. First Asian. First Black. She will not, however, be the first Californian sworn in as VP. Richard Nixon won that honor in 1953.

Between 1933 and 1969, Democrats had the White House and a majority of the House and Senate 72% of the time. Two Californians ended that dominance. Nixon in 1968 and 1972 and Reagan in 1980 and 1984 won the presidency in landslide victories. Nixon brought the Dixiecrats –southerners who left the Democratic party after Johnson signed Civil Rights legislation ending segregation – into the party of Lincoln. Reagan was big government’s most charismatic critic. They so shifted American politics that Democrats did not win back the White House until they ran Bill Clinton – a southerner who as president declared, “the era of big government is over.”

Blue jeans, Hollywood, Silicon Valley and the late-20th century conservative movement of Nixon and Reagan came out of California. Kamala Harris could easily represent the next wave to come out of the state.

California is now no place for Republicans. As the Republican Party has become more anti-immigrant and pro-conspiracy theory, it has lost support in the state.

California lets the top two candidates in a primary race run against each other in the general election. It doesn’t matter if one is Republican and another is Democratic or both are Democrats (as happened in seven House races in 2020). In 2016, Kamala Harris ran for senate against a fellow Democrat. Democrats won 27 House seats by more than a two to one vote in 2020. (And another 15 by smaller margins.) 27 is the same number of representatives that New York and Florida send to Congress. Republicans represent only 11 of the state’s 53 districts.

Why have Republicans done so poorly in California? California has built an economy dependent on education, research, immigrants and access to foreign markets.

In 1960, California governor Pat Brown signed legislation that made California the only state in the nation to offer free education from kindergarten through grad school. Clark Kerr – who headed the committee that drafted the plan Brown turned into law – was head of the University of California and had a theory about economic progress. In the same way that the railroad in the late 1800s and the automobile in the early 1900s had reshaped the economy, he thought that the late 1900s would be transformed by knowledge workers; Kerr’s education plan was designed to produce them.
Kamala Harris was born of Clark Kerr’s vision to create a world-class university system. Her mother came from India and father came from Jamaica, two grad students who met at UC Berkeley, fell in love, and had two children, Kamala and her little sister Maya. (Kamala’s mother insisted on giving her daughters names from Hindu mythology stating that, “a culture that worships goddesses produces strong women.”) Kamala wasn’t the only birth resulting from Kerr’s vision.

California became home to Silicon Valley. Intel was founded in 1968, Apple in 1976, and Google in 1998. California’s early investment in education paid off with millions of high-paying jobs and trillions of dollars in new wealth. The late 1900s – as Kerr predicted - was transformed by the knowledge economy. His plan had prepared California for this new reality.

One of the best predictors of how a community will vote has become levels of education. Harris split her childhood between two Bay Area counties; 77% of adults in those counties have a BA. That education ties to income; median household income in the two counties where Harris grew up is $119,00 a year. The Bay Area is defined by returns to intellectual – not industrial - capital. On two campuses six miles apart – Google and Facebook – median employee pay is $200,000 and $240,000. Billionaires get a lot of attention but stock options have made multi-millionaires out of thousands of west coast employees.

In the California counties where Harris spent her childhood, Trump won only 17%. In California, Trump’s campaign promises sounded like threats. Trade wars with China? A wall to keep immigrants out? It is connection to and not protection from the rest of the world that has helped California to thrive. A regional Hollywood is a playhouse. A regional Google search engine is the yellow pages. Silicon Valley is capital of the worldwide – not the nationwide - web.

It seems safe to bet that the country will follow Silicon Valley into a more entrepreneurial, information economy dependent on knowledge workers and global markets rather than follow Mitch McConnell’s Kentucky into coal mines, “protecting” workers and consumers from trade and immigration. That is, it seems safe to bet that Kamala Harris – like Nixon and Reagan before her – represents a set of policies and philosophy that will shape national politics for a generation.

12 January 2021

Militias - Obsolete Products of Our Violent Past

It makes perfect sense that you would refuse to marry a guy who acts like a two-year old. It makes no sense that you would refuse to marry a guy because once upon a time - back when he was two - he acted like a two-year-old.

Which brings me to our violent past. The US was founded by white supremacists. The militia mentioned in the 2nd amendment were armed groups that were sort of government, sort of not government groups who captured and returned escaped slaves and drove indigenous people off their homeland through genocide. Killing indigenous women and children - which militia regularly did - was something the federal government preferred to do through militia rather than official troops, an apparent quest for plausible deniability. (Although by the time of Andrew Jackson - himself a violent Indian fighter - the federal government no longer worried about distancing itself from these policies.)

We are supposedly no longer governed by racists. Militia supposedly do not officially coordinate with the US military to intimidate, incarcerate or kill minorities. And yet we have more guns than people and within the next week or two militias will take up arms against democratically elected officials, will storm capitol buildings across the country in defiance of the will of the people who regularly vote for our politicians and policies.

Even if militias were the Model T of their time (the Model T was an amazing product but no one wants to drive one today), we need to revisit this odd notion encoded into our constitution. One of the reasons that government generally gets a worse Yelp rating than business in this country is that people never deify Model Ts and insist that we all should drive them in deference to the divinely inspired Henry Ford. Products continually evolve and old models are discarded. In government? We're still left with the deification of militias.

We're no longer two. We're over two hundred. It's time to get intentional about the future we want to create with less reverence for the past that earlier generations created. As Paul wrote in his first letter to the Corinthians, "When I was a child, I spake as a child, I understood as a child, I thought as a child: but when I became a man, I put away childish things." Armed militias accountable to no one seems like an idea we should have grown out of by now. But they'll have a chance to prove me an alarmist in the next little while; I certainly hope they do.

11 January 2021

Riding the Tiger: 2021 and Trump's Dismount

In his inaugural address, John Kennedy used the line, "those who foolishly sought power by riding the back of the tiger ended up inside."

Riding the tiger is an apt phrase to describe an abuse of power. The good thing is that anyone coming after you risks getting destroyed. The bad thing is that if you try to dismount from the tiger, you risk getting destroyed.

Saddam Hussein and Muammar Gaddafi are two of the more recent rulers who lost their life shortly after losing power. Benito Mussolini first popularized the term fascist and after ruling with an iron hand was killed by a mob as Italy fell to Allied forces.

Julius Caesar was famously assassinated by senators defending the Roman Republic from coming under the rule of a tyrant. Julius died violently but so did the centuries-old Republic, giving way to a Roman Empire that would be ruled by a series of emperors, each adopting the title Caesar.

Trump is desperate to hang onto power. All indications are that he's broken a series of laws both before taking office and once in office, his inciting a mob to attack the legislative branch as it finalized the democratic vote for his opponent only the most recent and egregious of these violations. He's been riding the tiger, from the time he first insulted former prisoner of war John McCain ("I like heroes who weren't captured," said the man with bone spurs) to his order to the Proud Boys to, "stand by," to thousands of petty and major lies and insults to law, propriety and friends and foes. Out of office, he will have to refinance hundreds of millions in debt, and likely faces a series of legal challenges that could mean endless trials with criminal and civil consequences. Desperate, he would have happily toppled the republic to avoid all that.

He's had quite the ride on this tiger. The dismount is going to be a spectacle.

09 January 2021

More Us and Less Them - a guide to peace, prosperity and progress for thousands of years

More us and less them.

Even before tribes there were bands, very small groups of people who banded together for survival and companionship.

Freud says that civilization began when the first person threw an insult rather than a rock. Once upon a time, two bands encountered one another. Likely adrenalin levels spiked. They prepared for a conflict. Someone, though, made a gesture of conciliation. Maybe they offered food. Or a gift.

We are fiercely reciprocal creatures and this reality is a foundation upon which any social construct rests. Salespeople know that our feelings of reciprocity are so strong that if they offer you a free meal and night's lodging, you'll feel obliged to buy one week per year of a timeshare for life. That gesture of giving triggered the other band to offer something in exchange just as surely as landing a blow would have resulted in a fight. From that day on, these two little bands would periodically meet and make exchanges.

One may have had a unique fruit from a tree in their area. Another may have had some fibers they'd learned to weave into a garment. As they began to trade things ideas came along with them. "No," they would say in words or demonstration. "You don't eat the fruit like that. You first open it like this." Or they laughed and said, "No, this is not a hat. It is a loincloth." Or maybe in that moment of confusion they realized it could be a hat and that could solve the problem of cold heads. And the exchange of goods became the exchange of ideas that work like genes, mingling to become something and someone new.

The two bands learned from each other and traded the excess of one for the excess of the other (the 100th orange from my tree has less value to me than my first apple from your tree; I will happily trade you my 100th orange for your 100th apple). They also began to exchange ideas and goods that could be combined to create new ideas and goods.

Progress comes from more us and less them. "They" are a group who may steal our apples. "We" are a group who may trade apples for oranges. Trade networks didn't just enrich lives by exchanging goods and ideas. It also made their world safer. If something happens to the tree in my little patch of the world, I don't automatically starve. After trade comes finance: you can loan me oranges now until my apple tree is again producing. And then comes investment: I will set aside some grapes to turn into wine that we won't drink for months or years and eat your apples in the interim.

Arrangements break down. Businesses dissolve. Groups go to war. But progress is the steady expansion of us, a richer group with whom to exchange and to be inspired by.

More us generally means more options and more prosperity. Less them means fewer enemies, fewer people excluded from the process of negotiating and defining our shared world. This is the route to peace and prosperity however unwieldly it may be.

By contrast, more them means more enemies, more people from whom to feel estranged, to see as vile or unworthy. Fewer us means fewer people with whom we can trade, inspire, borrow or lend. This is the route to conflict and impoverishment.

More us and less them. It has been a useful guide for peace and prosperity for thousands of years. It still is.

08 January 2021

A Third Wave of Feminism and the Social Inventions It Will Depend Upon

Everything is made up but the consequences are very real.

Something like public schools is obviously a social invention. One generation a child’s parents teach him or her what she needs to know about farming or cooking or sewing. Another generation has dozens of teachers during about a dozen years and learns math, reading and writing, history, etc. Both are just made up and both have very real consequences, at turns enabling, hindering or neglecting the work of the child to become an adult able to create a life they and their community value and find joy in.

Less obviously, even what it means to be a woman is a social invention. And given our growing mastery of surgery and genetics, even the givens that past generations never imagined could be made up are – increasingly – made up. (For instance, in the 1960s, the average bra size was 34B. Today it is 34DD.)

100 years ago, women got the right to vote. That was totally made up and it has very real consequences. Had only women voted, Biden would have won by 12.2 million votes. Had only men voted, Trump would have won by 5.9 million, a swing of more than 18 million votes. Women have changed politics.

Why did women not have the vote before 1920? Did a male-dominated society suddenly decide to treat women as equals? Maybe. Or maybe technology allowed women to shift their attention outside the home. In 1900, a woman would carry about 10 tons of fuel (wood and coal) and 40 tons of water in and out of the house each year. Running water and electricity came to most homes by 1920 and women could literally shift their energy from inside the home to outside. They became political.

In the 1960s and 1970s, women began to gain an equal role with men in education and finance. In 1969, Yale made its undergraduate program coed. In 1969, Hillary Clinton graduated from Wellesley – an all-woman’s university – and began study at Yale law school. In 1975, women (some of them fresh graduates from the universities that had just let them begin studying there 5 years earlier) could open a checking account without their husband’s signature.

Again, this was coincident with new technology. The pill was approved in 1960 and within years millions of women were on it. Birth control technology gave women the ability to plan their families, deferring children until after they’d finished university and began the better paying careers that made banks being to treat them as equals to men.

Progress is never over, though. We don’t simply hit a median income of $20,000 a year and say, “Hooray! We’re economically advanced now.” We don’t finally get Model T cars and stop improving on the design and manufacture of cars. And we don’t just point to a 21-year-old woman in 1975 and say, “We’re done! She has all she needs to now realize her potential.” And to my mind, a big change that will be on par with the right to vote and equal access to educational and financial opportunities will mean social invention that again changes our institutions to accommodate the reality and potential of women.

For now, the biological reality is that it’s tough to be pregnant and have a young child and have as much energy and attention to put into work as man who gets to share in the most euphoric 15 minutes of a pregnancy. And yet a community has a real interest in their best and brightest young women not feeling penalized for deciding to perpetuate the species. Women having babies is a huge benefit for a community but we still charge women disproportionately to have those babies.

Right now, with the incentives and penalties in place with the current design of work, a record percentage of babies are born to the lowest income and least educated women in our community. For them, the opportunity cost of having children is lower. Curiously, the opportunity cost of having children rises along with education and work opportunities. One, we need to do more to support the poorer women having babies. Two, we need to lower the penalty to better educated women for choosing to have a child or three.

I’m not sure of the details of how we’ll stop penalizing women who could be working to stop or cut back on work enough to have and raise children without undue stress. I do know that everything is made up even though the consequences are real, though. Designing work so that women could more easily have and raise children should not be as complicated as designing a new drug or rocket. And I’m sure that women would have all kinds of design suggestions for work that stops pretending that there is no difference between men and women in terms of the demands that pregnancy, babies and small children place upon them.

We’ve benefitted enormously from making up new norms and technologies that enable women to join men in politics, in education, in work and finance. It is well within our ability to change those institutions so that they allow half the population to fully realize their potential. We just have to make it up – even though the consequences will be very real.

07 January 2021

Why Melania Will Quickly Divorce Donald

You know Melania is going to quickly divorce Trump but not for the reasons you might think. Now kicked off of Twitter and Facebook, his audience gone, he's going to be texting her nonsense 40X a day.

"I WON GEORGIA! IT WAS A LANDSLIDE!"

'GROWN MEN COME UP TO ME AND CRY!'

"WHERE IS MY DIET COKE!'

"Donald!," she will cry. "Text someone else!"

"But no one texts me back. Everyone used to pay attention to everything I said. Now? No one. Nothing. You need to listen to ME!"

"I will not listen. And I refuse to role play and dress up with you. We're not playing Trump rally anymore. I'm done wearing that stupid hat and chanting 'Build that wall!' for you. I'm done!"

"MELANIA! PLEASE!"
"Stop texting me!"

Trump's Instinct for Arousing Tribal Impulses

Tribal impulses are at odds with the modern world. Stirring up tribal impulses is Trump's particular gift and his instinct for doing that was always at odds with the institutional norms and structures we depend on to sustain our quality of life in the modern world.

The Hatfield and McCoys were mountain people in the US who kept up a feud between each other for generations, the epitome of backwoods, backwards Americans. They showed up at the capitol yesterday.

The Dunbar number is 150. This is the number of people our brains can manage in terms of not only knowing who someone is but who they are friends or foe with, whether they'd be a reliable ally or a probable competitor, etc. Robin Dunbar argues that our brains first evolved to navigate the natural world around us and then - as that world became increasingly social - our brains evolved to navigate the social reality around us. We are social creatures and woefully unable to make it alone. Social reality is our reality and the Dunbar number defines the number in the natural tribe we're wired to feel part of.

There is a problem with a group of 150, though. It simply isn't a large enough group to allow us to live above a level of what we'd now call subsistence. 150 doesn't allow much in the way of specialization. You want the benefit of a stent that would keep your arteries open and you alive another 5 to 25 years? The team to design, test, make and sell that will involve thousands of people. When I began working with teams developing those kinds of products more than 20 years ago, typically about 10 to 20% of their work was done by another company; today it is pretty normal that about 20% to 40% is. What does this mean? Even a single step within the production of a modern product is often done by an outside company and not just a person within a company. A single step in a production process might take the knowledge and resources of an entire company, itself defined by dozens or thousands of people. Even a product as simple as a number two pencil is made with resources from multiple continents. No one company has the skills, knowledge and resources to make a product as seemingly simple as a computer mouse from raw materials. Our modern world is full of products, processes and services that depend on a vast, vast network of strangers. Our lifestyle depends on an invisible network of people, technologies, knowledge and processes that no one group of 150 could ever replicate. The Dunbar number may describe a social reality for which our brains are wired; it no longer describes our economic and political reality. This is a vulnerability we too rarely talk about.

Here is the deal, though. We are wired for 150. We all have tribal instincts. We are wired to become Hatfield or McCoy clans, wired to become a group of us who see them and square off against them. Whoever them is. And we're all as susceptible to tribal impulses as we are susceptible to the lure of alcohol, drugs, ice cream, sex, and naps. It's a very normal instinct and one easily aroused. In fact, professional sports is literally -and not symbolically - dependent on these feelings. (I was working at a big company in San Diego the year the San Diego Chargers went to the Super Bowl. One I day I heard a manager talking about guys within the company at the director and VP level as "They," and then another manager talking about the Chargers as "We," as in, "We are going to the Super Bowl!" I thought, "You work with the 'they' guys. You have never even met the 'we' guys. How weird is that?" I don't think any business has more effectively hacked our tribal instincts than has sports. But I digress. Sort of.)

Trump's appeal was simple. He hacked directly into tribal instincts. There is always a "They" available to make us feel like a special "We." They are the Chinese. Big city liberals. Muslims. Mitt Romney Republicans. And you can win elections or fans by tapping directly into that tribal impulse. The danger is, if you don't have a clue what you're doing, you go as far as Trump. How far is that? Well, you decry trade and immigration as "They" are taking "Our" jobs. That right there makes "us" smaller, diminishing our economic possibilities. You attack "blue" states that are still a part of the United States of which you're supposedly president. You attack any institution - whether the UN or even a court of law - as an abstract "they," that is not on our team. First it is court cases that are suspect (who are "they" to judge us?) and then entire elections. You continually undermine the very institutions on which our modern world depends because they - too - are peopled by strangers who think or live differently.

The good news is that selling a message of Us! and Them! has a big and easily excitable market. The bad news is that it leads to the erosion of - often an attack on - the very institutions upon which we depend for our quality of life. It is no coincidence that so many of Trump's supporters are the survivalists who love the notion of surviving in a post-apocalyptic world in which all those institutions and norms have broken down. The modern world is too abstract for them; by contrast, this world of tribes actually makes sense.

Yesterday the Hatfields and McCoys stormed Congress. These were the mountain people who love the way that Trump awakens the tribal instincts that make a confusing, abstract world real and visceral.

Trump ability to arouse tribal instincts and his disdain for institutions is the exact opposite of the skills that have taken us from the feuds and poverty of isolated mountain people to the peace and prosperity of modern city folks. Progress comes from the ability in entrepreneurs and political leaders to create a bigger us, to make us part of a vast network of people, processes and knowledge that dwarfs what any group of 150 could accomplish. We know what the America Trump is trying to create looks like: it looks like the unruly mob who yesterday attacked the institution that struggles to create the laws and agreements that makes us part of a country with 330 million others (millions and millions of whom are VERY different from us) - part of a world of 7.5 billion people. That world is an endless struggle to maintain, manage and expand. It is vulnerable in so many ways and yet our quality of life depends on sustaining and even expanding that world of abstractions and institutions, laws and processes. (And my writing about abstractions and institutions makes your eyes glaze over in ways that appealing to tribal impulses never does.) And among its various vulnerabilities, perhaps the most obvious and scary is the one Trump represents: an appeal to tribal instincts that sees as foreign the odd and abstract institutions that allow us to collaborate with strangers to create peace and prosperity.

We are not out of the woods yet - there is still a chance that we could descend fully back into the world of the Hatfields and Mccoys - but with Trump gone in a couple of weeks, we might yet avoid becoming the poor white trash of the developed world.

06 January 2021

One Seemingly Subtle But Huge Benefit That Could Come from Having Lived Through a Pandemic

Folks do a terrible job of projecting anything exponential. I wrote a post early last year about how stupid it was that officials were recommending such dramatic action in response to COVID when it had affected so few. Friends smarter than me politely corrected me and when I computed the numbers, I was reformed. 

We don't have good intuition for things that grow exponentially.

Last year at this time we hadn't heard of COVID. It may kill 500,000 Americans. Exponential growth is huge.

The good news is that exponential numbers work to our favor as well. Assuming we manage the rollout effectively and actually vaccinate people at the rate justified, the spread of immunity through our community (particularly for our most vulnerable) will eventually cause as dramatic a drop in the rate of infections and death as the rise we saw last year.

I'm vulnerable to bouts of wild optimism. One weird bit of optimism I have about post-pandemic life? Having been immersed in the effects of rapid compounding of growth, we will get more serious about investments that bump GDP growth by 1/4% to 2% per year, knowing that the affect on the incomes of the next generation will be huge.

Given current income, a difference of half a percentage point in growth rates means a difference of $10,000 in median income in a generation; a difference of 1.5% would mean a difference of $35,000.

A difference of half a percent compounded over a generation sounds trivial. And maybe the average voter will always treat it as such. But if the exponential spread of a pandemic leaves us with a keener sense of the cumulative effect of small, compounding changes it would be huge. I mean, once compounded over time.

04 January 2021

Why The Washington Football Team Has a New Name (no explanation for how a 7-9 team made it to the playoffs, though)

Trigger alert: this has a gruesome punchline.

The Washington Football team made it to the playoffs with a record of 7-9.

In the early 1600s, the English conquered Ireland and announced half a million acres in the north open to settlement. As you might imagine, the Irish resisted. The English had never before had to remove so many indigenous people to replace with settlers. They even tried a "wild Irish" reservation for a time.

Sir Humphrey Gilbert was made the governor of this Irish province and he paid a bounty for Irish heads. Over time, the bounty was simply paid for scalps. Gilbert moved to America and brought this practice with him. In America, officials privatized genocide, a war within this new land against indigenous people by paying for scalps.

Roxanne Dunbar-Ortiz writes in An Indigenous Peoples' History of the United States, "The settlers gave a name to the mutilated and bloody corpses they left in the wake of scalp-hunts: redskins."

In 2020, after 87 years, the Washington Football team has dropped that name in response to protests from first nations' people.

02 January 2021

A Revolutionary University, the Natural World and the Policy Focus for Our Founding Fathers

Jefferson asked that his three proudest accomplishments be captured on his tombstone. President was notably absent, while "father of the University of Virginia" was included.

To me, the most remarkable thing about this new university was simply this: it was the first university in the history of the West that was not originally founded as a school of divinity.

The United States' first president had been a land surveyor. Jefferson's university was designed to focus students on the natural - and not the supernatural - world. The founding fathers were Enlightenment thinkers who sought to observe and explain the natural world. Land - this world - was their focus.
Americans went to war with the British for a host of reasons but a big and often overlooked reason was that the British in 1763 forbade colonial settlement west of the Alleghanies. Land speculators like George Washington weren't terribly excited about this. Throwing off British rule was one way to expand holdings further west.

As president, Jefferson funded Lewis and Clark's expedition to explore this vast continent. It is easy to gloss over the fact that this new country initially hugged a strip of land along the Atlantic ocean that was about one quarter of the land mass the US now occupies. As proof that Jefferson's interest in the continent was not just academic, he spent a sum double the new country's federal budget to make the Louisiana Purchase. By the time Lincoln took office, the "lower 48" defined this country.

What defined policy from the presidency of Washington the land speculator to the presidency of Lincoln the inventor? (Abe is still the only president to hold a patent.) Land. It's exploration, conquest and monetization. (Farming and gold were obvious ways but by no means the only. By the end of the 1800s, Michigan's lumber industry would have created a billion dollars more in value than the California gold rush. This new continent was rich in opportunities to become rich.)

European serfs were legally bound to the land, unable to move. They didn't own land; land owned them. This new country offered possibilities of ownership that had literally been outlawed for their parents.
The serfs were freed gradually throughout Europe but serfdom was not completely ended until terribly late. The last of the serfs in Scotland were freed in 1799, the last in France in 1789, in Germany in 1830. Chinese immigrants (by 1870, they made up 9% of California's population) fled similarly bleak prospects for this new land of opportunity. It was truly revolutionary for these former serfs and sons of serfs to come to the US to own land and a flood of immigrants came; the population Lincoln governed was six times larger than the one Jefferson presided over. Land was the magnet that drew these immigrants.

With the ascent of Lincoln and his new Republican Party, a new force would shape and be shaped by Americans but most of what you need to know about the policy and politics that succeeded from the founding of the country to the founding of the Republican party could be answered by the question of what got the country more land or extracted more value from that land. It was both that simple and that complicated (and messy and violent).

Thomas Jefferson's Tragic Conflict He Left the Country to Violently Reconcile

Thomas Jefferson was still in his thirties when his wife Martha died. As she lay on her deathbed, grieved at the thought of some other woman raising her children as her own, Martha made Thomas promise that he would not remarry. The way that Jefferson kept that promise illustrated the odd conflict between his - and this new nation's - philosophy and practice.

The man who penned the revolutionary words, "that all men are created equal," and also owned slaves offers us a weird choice. If we take him seriously - honoring his words - we can't take him seriously as a man who was a slaveholder. If we discount him, we're left without the words that have gradually eroded the institutionalized forms of racism and misogyny that make the US of 2021 so different from the US of 1789. His words did inspire a better world. His life, not so much.

Sally Hemings was Martha Jefferson's half-sister. It's not clear whether this was something clearly acknowledged between them or by anyone else but Hemings was the daughter of John Wayles and the slave Betty Hemings. John Wayles was also Martha's father. In marrying Martha Wayles, Jefferson also acquired her slave (and half-sister) Sally.

Modern DNA testing has confirmed old rumors that Jefferson went on to father six children with Sally Hemings after Martha died.

Hemings came to Paris when Jefferson served as ambassador to France. France had abolished slavery so there she was free. Before they left France to return to the US (she could have stayed and remained free), she made Jefferson promise that their children would not be slaves. They all lived free and all but one lived as white.

But think of how odd this was. Your father was one of the founding fathers, third president, first secretary of state, author of the Declaration of Independence and ... you couldn't tell people. What would most define anyone else in the country was instead something you could not tell people..

Some day future generations will vilify us for our carbon footprint, how casually we would drive places on a whim, the coal we would burn to generate the electricity used to power our virtual worlds. No generation immediately moves into the world they imagine or set as an ideal. But there seems to me something particularly tragic about Jefferson as this man who so brilliantly built on the ideas of Enlightenment philosophers like John Locke to co-create a new government - and man whose own children were born into slavery. Perhaps the oddest thing about it is that we have so little remaining evidence of this prompting Jefferson to feel at all torn at the gap between the world he'd penned and the world he lived in. He was one of the most inspirational revolutionaries in the history of the world and his own children were born into slavery. Closing the gap between Jefferson's ideals and his reality would take a violent civil war. He never properly reconciled the gap and left that for a future generation, an entire nation to reconcile.

01 January 2021

Trump by the Numbers: Stock Market, Deficits and Job Creation

Some numbers on the Trump presidency.

With twenty days left in office, the market has done better under only one other president since Gerald Ford. The average of S&P 500, NASDAQ and the Dow rose 84% under Trump, nearly as high as it did under Clinton (84.5%) and considerably higher than it did under Carter, Reagan, Bush 1 and 2, and Obama. Had you only this data, you'd have to conclude that the market loves a lothario in the Oval Office. Hmm. Well, investment is a form of seduction.



Curiously, while the stock market performed similarly well under Clinton and Trump, deficits moved in opposite directions. Clinton turned a significant deficit into a surplus and Trump turned a significant deficit into a truly numbing number. Clinton inherited a $366 billion deficit and left behind a $157 billion surplus, the last president to leave behind a surplus. By contrast, Trump inherited a $585 billion deficit and is leaving behind a $3.132 TRILLION dollar deficit. Obama inherited a deficit that was nearly 10% of GDP and bequeathed to Trump a deficit of only 3.1%; Trump added a huge tax cut and then pandemic spending to raise that 3% deficit to a stunning 15% of GDP.




Finally, the jobs market was killed by the pandemic. Before 2020, Trump's jobs numbers were wonderful, his rate of job creation less than that under Obama during his last term but given that the unemployment rate was so low, this made perfect sense: there were simply fewer new people to hire each month. Southeast Asian countries and the EU actually kept employment levels up throughout the pandemic but Trump's throw up your hands and insist that [a. COVID will magically go away, b. COVID isn't a real threat, c. COVID is not his responsibility but instead the responsibility of mayors or whoever, d. he actually won in a landslide] approach to the pandemic meant that the US's death rate and job loss was incredibly high. The result is that Trump becomes the first president since [at least] the 1930s with fewer Americans employed than when he came into office; during his presidency, the economy destroyed an average of 65 thousand jobs per month, about 300 thousand less than it averaged during Clinton's presidency.




The punchline? During Trump's four years, wealth rose, employment fell and government finances worsened. And for the second time in this young century, Biden will come into office expected to turn the economy around while Republicans impatiently tap their foot, wondering why he's taking so long to repair the mess they left him.