Trump Continues The Wild Swings Between Democrats Lowering Deficits and Republicans Raising Them

Notice how in this graph, starting with Carter and Reagan, Republican presidents sign off on the budgets that increase the deficit and Democrats signoff on the budgets that lower the deficit.
There are a few deluded souls who think that Trump will be signing off on a budget that lowers the deficit but that simply isn't the way politics works in these United States. Trump will cut benefits to the poor but not as much as he will cut taxes to the wealthy. He will increase the deficit he inherited while increasing the wealth of people already debating about whether to leave more money for charity or their kids in their will, people who won't even spend the extra money Trump will give them.

It could get much worse. One thing that few people - definitely not Trump - understand is that for every dollar of trade deficit, there is an offsetting dollar of financial inflow. It is accounting. And that means that our trade deficits with the rest of the world and the rest of the world's willingness to finance our debt are tied.

If Trump puts in place tariffs that lower trade deficits (an uncertain outcome but one he claims is his goal), it will actually raise the cost of debt as foreign capital inflows slow commensurate with a diminished trade deficit. Raise the cost of debt just as that rate of debt accumulation again rises.

Trump will cut benefits like Medicaid. Aid to the poorest. Some of those poor people voted for Trump, unclear they'd be losing benefits just for voting against immigrants and those trans people. But those budget cuts will be smaller than the cost of those tax cuts to the most affluent among us.

The gap between rich and poor will continue to widen. And the poor - still convinced that Trump policies have nothing to do with their poverty but convinced that they're brave warriors in a cultural war - will suffer more. And there will be yet another in a series of red bars that shoot upwards.

Why You Keep Hearing About Fascism

Everything evolves - and nothing is ever precise at the time. But here’s why you keep hearing the word fascism in 2020s America.

In Stalin’s Soviet Union, communism meant total state control:
Intellectuals were silenced or exiled.
The press printed only what the state deemed “true.” (Pravda means truth. )
Labor unions had no independence.
Corporations barely existed.

Fascism, as practiced by Hitler, kept all that but added corporate partnership:
Big business thrived under military contracts and infrastructure projects (think the autobahn).
The state and corporations shared power.

Communism: The state dominates everything.
Fascism: The state and corporations dominate together. Think of it as for-profit totalitarianism.

Now contrast that with FDR’s America:
Labor unions could strike. And they often did, to the annoyance of many who thought that this should not be allowed.
The courts blocked major legislation (like efforts to end child labor), to the annoyance of many who thought that this should not be allowed.
Congress resisted and often changed and sometime rejected FDR’s policies, to the annoyance of many who thought that this should not be allowed.
The press, intellectuals, and public argued – loudly, to the annoyance of many who thought that this should not be allowed.

It was slow, messy, and full of friction - but it worked. 

After WWII, Nazi Germany collapsed and the Soviet Union ossified, quality of life only slowly improving and dissent largely squelched. 

The US, after having loudly and clumsily gotten so many different moving parts aligned, enjoyed the fastest growing economy – and until about 1990 the greatest narrowing between rich and poor – in the history of the world.

So why do some Americans now flirt with fascism?

Because it’s tempting.

It promises:
Order in place of argument
Certainty in place of debate
Progress without (messy, contradictory, loud, inefficient, cognitively dissonant) process

To people exhausted by democracy’s delays and ossified, ineffective and inefficient institutions, a strongman who silences dissent and drives change looks like relief.
Dictatorship promises cognitive peace and quiet. It promises to “get things done!”

But that peace is a mirage.

Because in the end, a dictatorship must wage war on dissent - and on reality itself. Reality is always messier and more complicated than any model of it. If you try to ignore realities, you don’t just crash against different interests and opinions. You ultimately crash against reality itself.

Fascism appeals to those who want wealth and simplicity.

But the world isn’t simple.

And when systems stop evolving, something new continually emerging out of messy conflict and loud noise, they don’t thrive.
They break.

AI Promises Gales of Creative Destruction the Likes of Which We've Never Seen

 Stunning if true...

Google’s Jeff Dean predicts we’re about one year away from having an AI capable of performing like a junior engineer - 24 hours a day, 7 days a week. And the bigger challenge? Senior engineers may soon find themselves managing the equivalent of 40 AI assistants. (These claims are made around the 24-minute mark of this video.)

https://www.youtube.com/watch?v=dq8MhTFCs80

If this doesn’t stir really, really strong feelings - both amazement and unease - you’re wired differently than me. It’s hard to imagine this won’t have sweeping implications for productivity, pay, and employment.

Engineers and developers may soon shift from being solo contributors or small teams to managing entire squadrons of AI assistants. On the surface, that sounds like a dream: productivity through the roof, rapid iteration, endless capacity.

But it should also make you pause - because it raises profound questions.

Will this replace jobs - since one person can now do what once took forty?
Probably.

Or will it create jobs - as companies scramble to hire every engineer who can manage a digital army and generate compounding returns?
Also probably.

The economic logic for hiring skilled people becomes overwhelming. The leverage of a single employee expands dramatically. And the fear that someone, somewhere, will be replaced by a machine is matched only by the hope that those machines will unlock new opportunities, industries, and tools we’ve only begun to imagine.

Either - or especially both - promises gales of creative destruction of hurricane force. It’s hard to imagine this playing out like anything we’ve experienced before.

In a moment like this, I feel like the only honest way to spell AI is as an exclamation:

“AI… Ay yi yi!”

It may be artificial intelligence - but the feelings it provokes?
Very real.

The Pyramids Created the Egyptian Empire

Consider the possibility that it was not the Egyptian Empire that created the pyramids. It was the pyramids that created the Egyptian Empire.

This inversion captures something essential about how civilizations emerge. It’s tempting to see great structures as the product of centralized power — as monuments built by empires. But it might just be that it’s the other way around: the ambition to create something transcendent becomes the catalyst that brings an empire into being.

To construct pyramids required coordination across regions, professions, and generations. They necessitated systems able to organize labor, standardize materials, distribute food, transmit and preserve ideas, and turn meaning into something everyone could see and grasp. Before you could create pyramids, you had to create institutions like religion, rulers, priests, managers and work hierarchies. And those institutions – like language itself – turned out to be plastic, could be used for something more than simply constructing a pyramid. Or more to the point, one had to create so many subassemblies before one could create a pyramid: an economy, a dynasty, a religion, and a mythology. All of that added up to an empire. Oh, and with pyramids as literal monuments to what they’d constructed.

Survival organizes tribes. Shared purpose organizes civilizations. When a society takes on a task that outlives any individual - whether a pyramid, cathedral, transcontinental railway, or a moonshot - it activates capabilities and connections that redefine what that society is. The monument becomes both product and producer of civilization. Not merely a reflection of something bigger than an individual life or lifetime, but the foundation and context for them.

Progress Is Reversible

 John Gray makes a quietly unsettling point.

Technology tends to build. Once we figure out how to split the atom or send emails or make vaccines, that knowledge tends to stay with us. We can build on it. Add layers. Each breakthrough has the potential to become the starting point for the next.

But moral and political progress? That’s more complicated.

Gray calls it entropic. It falls apart if you don’t keep after it.

Democracy doesn’t maintain itself. If a people or a generation ignore or distort it, it won’t be automatically discovered by the next generation who can use it as a starting point. It can be lost. Rights can be rolled back. People forget. Norms get corroded. One generation's hard-won freedoms can slip away in a generation — or less.

We like to think:

"Civil rights? That was a problem in the past but we’re beyond that now."

"Democracy? Obviously."

"War? We have peace treaties now. We’re not animals.”

But history says otherwise. The Roman Empire collapsed. Its roads outlasted its laws. Technology often endures. Civilization’s ethics and social norms are more fragile.

And here’s the really sobering thing.

We’re still running modern society on ancient hardware. Our instincts, impulses, and tribal reflexes haven’t changed much in thousands of years. Civilization is a thin layer of software running on old biology. No wonder it sometimes glitches.

Parents know this.

Raising a child is re-teaching civilization from scratch. Language. Fairness. How not to hit. How to live with others. How to find meaning or recover from failure or heartbreak.

We can build on past successes but it is not automatic. The lessons have to be learned. Again. And again. They’re vulnerable. They can be lost or distorted.

Progress in ethics and politics is not permanent. It’s provisional.

Again - and as Gray reminds us - entropic. It will lose energy without reinvestment. Ignore it for too long or begin to distort it with lies and moral shortcuts, assume that it’s already been solved, and you can start to lose it. You’ll think you’re building on the third floor and you might suddenly find yourself in the basement.

Of all the investments we make, working against entropy in the realm of politics and ethics might be the most essential.

250th Anniversary of the Wealth of Nations and the Declaration of Independence and The Pursuit of Happiness as the Compass for Progress

"Well, it means exactly what it says, it's a declaration. A declaration of unity and love and respect, and it means a lot. And it's something very special to our country."
— Donald Trump, on the Declaration of Independence

Let me offer a slightly different explanation.
2026 will be the 250th anniversary of two extraordinary documents.

In 1776, Thomas Jefferson drafted the Declaration of Independence, and Adam Smith published The Wealth of Nations.

One became the foundation of a new democratic government. The other, a defining statement of market economics. Together, they shaped the modern world through the interplay of democracy and markets — two forces through which ordinary people, not kings, express their will and shape their world.

Much of Jefferson’s Declaration is devoted to grievances against King George III, whose authority rested on divine right. By contrast, the new American executive would draw legitimacy from votes — not divine claims, but choices that could be counted and verified. Jefferson’s words marked a profound shift: from power ordained by heaven to power grounded in reason and consent.

Newton defined natural laws that governed the fall of an apple or the orbit of the moon around the earth or the earth around the sun. Jefferson extended that idea to government: political authority, too, should arise from natural laws or rights. Earlier documents, like the Magna Carta and England’s Bill of Rights, advanced liberty but did not fully embrace this view. Jefferson went further. In the Declaration’s opening, he invoked “the Laws of Nature and of Nature’s God,” anchoring Enlightenment thought at the heart of American self-government.
Isaac Newton had revealed the laws governing the physical universe. John Locke applied that logic to society, arguing for inherent rights to life, liberty, and property. Jefferson followed Locke, but famously revised his formula, replacing “property” with something at once more expansive and more human: “the pursuit of happiness.”

That change mattered. Divine right could not be verified. Votes could be counted. Where monarchs ruled by decree, presidents would govern by consent. Jefferson's was a world where legitimacy would no longer descend from above but rise from below, from what the people perceived would make them happy.

This was revolutionary. Britain held parliamentary elections, but the United States combined regular legislative and executive elections in a way that arguably made it the world’s first modern democracy.

Jefferson’s idea seemed modest: happiness, not divine will. Yet in that modesty lay its radical promise. Government and markets alike would exist not to impose order but to enable individuals to shape their own lives. Smith’s invisible hand and Jefferson’s ballot box became twin arenas where citizens, through dollars spent and votes cast, could pursue their ambitions and shape their world.

When Abraham Lincoln rose at Gettysburg to justify a war that threatened the nation’s survival, he did not turn to the Constitution. He returned to Jefferson. It was the Declaration’s assertion — that all are created equal and that government exists to serve the governed — that Lincoln called the nation’s true founding idea.

The Declaration of Independence did something extraordinary. It replaced the invisible decrees of monarchs with the visible hopes (or at least countable ballots) of citizens. It made happiness the compass for navigating this new world.

Jefferson’s Declaration and Smith’s Wealth of Nations together launched a world shaped not by kings or mystics, but by citizens — expressing their will through markets and ballots, building a future no monarch could command or predict.

Two hundred and fifty years later, that interplay continues. Happiness remains elusive, unfinished, and yet still animates the choices we make — at cash registers and ballot boxes alike.

So no — the Declaration has not always delivered unity or love or even respect. But it did deliver something far more enduring. It gave ordinary people the right to shape the government and markets as their tool, not a king’s.

And that, more than anything, is what the Declaration of Independence is about.