I think there will be a longish period after all this where the country’s wealth and institutional slack will mask the loss of expertise and erosion of law but at some point it will become obvious that everyone is much worse off. It’s been weird to see long term institutional actors (universities, businesses, health care industry) bend the knee hoping to ride it out rather than taking seriously the harm to their longterm interests. I get that doing so is expedient because Trump is vindictive and maybe things will go back to normal post 2028. But bending the knee also makes it much less likely things will go back to normal.
I assume I'm not the only one remembering all the high school history class discussions about "But why did the citizens let it happen?" when countries go authoritarian.
I remember in my freshman year of college learning about the Cultural Revolution and being indignant that people just went along with it. All of my classmates scolded me.
That is a pretty odd book, it's strangely herky jerky in its storytelling. Not sure if it's because Chinese, because translation, or because hard science fiction story. I guess por que no los tres?
Agreed. The author’s note at the end explaining how difficult it was to translate was very interesting to me because it does explain the herky-jerkiness in my mind. Overall I did not like the book. But the opening will stick with me forever.
I somewhat can see the hope that pretending to be dead is the right response.
Trump reacts to movement, and you don't want to be the leader who has to lay off their team because of retribution that could have been prevented by doing nothing. More important is that 2028 isn't *that* far away in the long view, Trump is a unique figure who will probably self-destruct his party rather than establish a stable successful political movement; the goal is to make it to the next century, Trump is a single old man who will not be around to hold together his movement for much longer.
I think a lot of people have faith that there will be a 2028 election that will remove Trump (or a Trump stooge) from power at which point (almost) everything can be fixed up. I think that will happen! We have a lot of institutions in place that makes it hard for lazy and incompetent people rig elections, throw out the results, and deploy the military. Trump's current 0-1 record makes me very worried he will try, but optimistic that he'll fail. The problem is that the playing dead opposition isn't going to wake up until November 2028 and so there aren't any dry runs and until then people say you're being alarmist.
I'm not convinced that democrats will legitimately win 2028. We care about the authoritarianism but they see the end of woke, a tax cut and mass immigration raids.
I get the appeal of this logic. Standing up for things is scary and hard. In some cases, laying low might be right, but Trump and his allies have a long list of grievances and enemies. That's what powers his movement in the first place. Playing dead isn't going to save many people. It'll probably just embolden him.
I also hesitate to share these people's optimism that the fever will just pass by default, when he's gone. Trump is a vessel for rightwing populist hate, more than a driver of it. He goes along with his crowd, like he did with vaccines, gun buybacks, and trans rights. He wants adulation. He wants to rule over people with an iron fist, but part of that comes with being an expression of his tribe's will. Project 2025 is seeking to permanently change this country. Trump is barreling ahead. Lying down isn't going to make it easier.
Agree 100% with the second paragraph. The main authors of Project 2025 aren't really Trumpers or MAGA at their core. They all represent preexisting strains of American conservatism who've opportunistically jumped on the Trump bandwagon. Their vision for the US government may overlap with Trump's, but unlike with Trump, they don't want to tear down liberal democracy in order to aggrandize Trump, they want to aggrandize Trump in order to tear down liberal democracy, which has been a longstanding goal for their movement. Trump will leave the stage at some point, but these people will remain stronger and better organized than they ever were before, and they'll be an indispensable part of any conservative coalition no matter who's leading it post-Trump.
I think Trump is unique in that he's a one-in-a-billion genius at creating a public image and getting media attention, and he's charismatic enough that even doing very unpopular things mostly rolls off him in his supporters' eyes. Without him, the conservative movement will continue and will sometimes win victories, but probably won't have anyone with the same star power. Someone like DeSantis is much more competent at operating the levers of government, but when he does some inevitable-but-unpopular thing, it will stick to him more.
The concerns driving a majority of the electorate to Trump is "right-wing hate"? Really? What's your plan for dealing with those concerns? Do you even know what they are?
Democrats just need to make sure the next time they are in power that anyone harmed by Trump for resisting will be made whole, out of withheld federal funds and tax audits of Trump-supporting organizations.
I halfway think that--in the event of a Democratic Presidential victory--vindictiveness towards the institutions who bent the knee might actually be a helpful restorative, because it seems to create the correct long-term incentives (punishment for defection; prospective risks for kowtowing to illegal behavior). Norms are shot, might as well go hard game theory.
I think this is disanalogous in several important ways. First and foremost the institutions that bent the knee are presumptively ones that I am broadly sympathetic towards - Number 5 *is the point.* Secondly, there would no non-retributive purpose: nothing -- literally nothing -- the institutions could do would spare them the retribution, essentially like a criminal prosecution. The entire goal here would be to make bending the knee a way to be on death ground -- kowtowing to Trump-like figures in the future should cause the stock (or its equivalent for non-profits) to go *down*, not up. I am not trying to tell them what to opine on or coerce them in the manner that Trump is, I am saying that, having opined, failure to fight will be *worse* in expectation than vindicating the rights they so eagerly sacrificed on the altar of Friedmanism. And I'm not sure of how to create that incentive alignment except by following through.
Potentially, this is a bad idea, but I don't know how else to create appropriate incentive alignment. The key idea that keeps running through my head wrt the Trump administration is "you do not play cooperate when your opponent plays defect."
I don't think this is workable. For anything like your proposed incentive structure to work, the future punishment when the right people regain power would have to be significantly worse than the short-term pain of fighting an authoritarian. Considering the kind of strain the Trump admin already threatens to put on many institutions, you would have to promise close to certain destruction on your return to power. This means that your returning government now has to commit to severely harming many of its most valuable organizations. It also has a very obvious counterplay for future authoritarians: promise even more immediate death if an institution doesn't cooperate. The greater incentive is obvious, and once an institution works with the authoritarian its only method of avoiding future retribution is to fully commit to preventing any other government from coming to power by backing the authoritarian with all its power.
This does not mean that there should be no hefty punishments made after liberals regain control. Any and every Trump official of significance who can be accurately stated to have violated a law should be sentenced to maximal prison terms, and the pardon should be eliminated to ensure they stay in place. I'm just saying that we won't get what we want by counter-suing universities that gave into intimidation. Preventing that means finding ways to make resistance cheap or profitable today.
The reason they bent was presumably that they figured they would either lose the grants anyway or if they won, the Trump admin would find other ways to extract those costs and more. If you believe resistance will just add even more costs to your eventual defeat, then you surrender.
What I think we need to do is organize legal defense funds to make resistance free. Even better would be to pledge to cover the monetary fines and denied funding of every institution that fights the current administration. That's very expensive, but it would make fighting a much better deal.
Still, it's no substitute for backbone. What will halt the assault better than anything is seeing a group publicly fight, win, and then be left alone as it has proven itself a hard target. It is disappointing that so many groups that likely could have done this chose not to.
I don't think this makes any sense. The main problem with Trump abusing Federal power to get them to bend the knee is the abuse of power not the knee bending. If Dems abuse Federal lower Brown University for their capitulation to Trump, that reinforces the abuse of power and makes rule of law all the more arbitrary and capricious.
Unless there's actual wrong doings by institution in a legal sense nothing more should happen. The much more important thing is to have and act on a reform agenda that limits Presidential emergency powers and limits the unitary executive in whatever ways possible.
Democrats should compensate resistors rather than punish capitulators. The punishment of capitulators would only be an incidental effect of budget limitations (the money to make resistors whole needs to come from somewhere)
An individual business/university/etc. will sustain significant damage from refusing, and their individual decision to fight back or not does not really move the needle. This is to be honest a big failing with the kind of bloodless managerial mindset that prevails at most institutions -- something that I am normally willing to defend, but there's a sense in which pride and feeling that your dignity is being affronted can act as an incentive toward resistance in a way that has benefits at scale
I think this is incorrect. The individual business/university/etc. needs to fight back as part of their own self interest. Whether other people fight back is irrelevant to that decision. Virtually no one prospers in an authoritarian regime in the way that they thrive in a democratic regime. Believing that you will be the lucky one who can ride the storm is magical thinking akin to believing, really believing, that you will win the lottery. Russia's prisons and graveyards are full of people who believed they could ride the Putincoaster.
Not giving in, not kow towing is both your obligation as a goddamn citizen, and in yours and your organization's best interests. Yes there is some risk, there is risk of failure even in a well functioning system, but you have to accept some risk in order to expect any return.
Would you ever recommend a loved one pursue a career in public service? I wouldn't, and that's new.
I am guessing we get highly degraded gov services with some private actors picking up the slack (medical trials, welfare administration, private security). I can't imagine why anyone would consider public service anymore if there's a chance a second Trump like figure could emerge.
Specifically, federal employment pays worse that the private sector but until recently offerred better job stability. If the job stability is gone, the pay needs to go up or the available workforce will decline in both number and quality.
I absolutely still would! I work in local govt and have worked in federal and state govt. There’s lots of good to be done and I still find it very rewarding.
The fall of a major power like America would of necessity be slow and multicausal and one could never see it at the moment it becomes ineluctable but it wouldn't be surprising if future historians picked Nov. 5 2024 as the date it became manifest and irreversible.
Yeah, I don't love most of Trump's policies, but endless deficits, unfilled judgeships, inability to pass a budget, and institutional failure have been going on for decades. Weaponization of the justice system against political opponents, encouraging political violence from your own side, using institutional soft power to punish dissent, tying funding for allegedly politically neutral stuff (student loans, research grants) to political ideology, those things weren't started by Trump, even though now he's running with them to our cost.
I think there will be a future that's between the two extremes people like to rave about: we'll still be a strong and dominant country, but we'll be worse off in several ways 3.5 years from now that we wouldn't have been otherwise.
Good news is he isn't and would clearly never allow geopolitical or internal dissolution. See his EU, Japan/Korea, and Israel wrangling; Gorbachev wouldn't bother! Bad news is Biden was definitely Andropov, and it's not a great situation to begin with.
The evidence is no, the longer you're a democracy the better your odds you'll remain a democracy. We used to think this means we were almost immune from risk. We're now testing that hypothesis
I 100% believe that you are on to something. I think it also helps that a lot of newer democracies have more of a parliamentary style of government typically as well.
Well, that and however long it takes our orange piece of shit to die, basically are the two main factors in whether I start looking for jobs in Brazil.
Come to Canada! If you're rich, move to Vancouver, it's beautiful. If not, settle on a plot of land in the Okanagan, start a goat farm, and earn a living selling organic sustainably-made small-batch goat milk soap and chevre to rich tourists!
Come to Brazil! @drosophilist is one of my very favorite commenters, but the weather here is much, MUCH better than in Canada, and the cost of living is a lot less.
I've been back and forth to Brazil my whole adult life, and for the past eight years I've been living here the second time, and this time for good. Twelve Julys a year where I live, and July was always my favorite month. 🌅
You will have to learn at least some Portuguese, though -- it's a rigorously monolingual country. The good news is that foreigners get a lot of partial credit just for trying.
I live in Manaus, in the middle of the waterworld where the Negro meets the Solimões to form the Amazon proper. This close to the Equator, the Sun rises every morning around 6 AM and sets every evening around 6 PM, every day of the year.
Knowing our country the impacts of being worse off will happen under a Dem President and the country will blame them for all that bad that is happening.
Reading this made me think about those mRNA cancer vaccines we're definitely not getting anytime soon. Impossible to do a counterfactual, but it's depressing to consider the implications.
"That which doesn't kill you makes you stronger" was always bullshit, because that which doesn't kill you often leaves you crippled and ill with a more dismal future.
Even if Trump turned us into a Putin-esque kleptocracy tomorrow, it would take a generation for other countries to pass us by. Blame will not accrue in real time, and the public understanding of blame may not land accurately even then.
I think either Trump dies, Vance is discredited, and things moderately improve, or things get much, much worse and the question is between dictatorship and balkanization. The status quo cannot hold.
They are in the process of setting up very traditionally authoritarian power structures. These are traditionally very fragile. When China invades Taiwan in 2027-28, the whole thing will crumble.
I assume the idea is that Trump will mishandle it enough so that the US is either directly involved or China strikes US forces in the west pacific and when the news is tens of thousands of dead Americans and huge amounts of expensive defensive assets destroyed it will cause a Norway Debate style destruction of the governments legitimacy. It of course relies on several pretty large assumptions on China's actions, Trump's actions and the US public's response.
We can't do anything if Taiwan is invaded. Our military is too weak, significantly because of the errors of the Obama Administration. Hopefully, when it happens, we'll have enough sense to stay out of it.
What a strange collection of sentences. The whole story of the last 20 years is how China has proven people's "traditional" ideas about authoritarianism to be wrong.
I'm hoping that this will be more like the McCarthy era, a sad and horribly un-American part of our history that we eventually recover from. That's more a hope than a prediction, though.
There are a bunch of periods like that, though, and we have always recovered. So far. I mean, shooting miners and their families for striking wasn't our best look. Imprisoning people for burning the flag wasn't great. Refusing credit to women was bad. All kinds of bad things, and we did work through them. Fingers crossed.
The lack of Internet didn't prevent the South from having a century-long grievance over losing the Civil War.
It did prevent people from getting overstimulated from spending too much time online and from panicking over how every little thing was the end of the country and the beginning of a fascist dictatorship.
If we can survive the Civil War, we can survive this. If some other crisis hits us when the idiots are in charge, we’d better hope for another Nat 20 (OWS in 2020, for example).
I can't recall the ironic quote, but it was something to the effect that: "It sure is good that there were no racists or sexists in charge when the Founders wrote the US Constitution, otherwise no way that a democracy could have survived".
We've made it through worse.... but indeed fingers crossed.
Germany retained a strong military capability from being on the front lines of the Cold War and only recently stopped sending arms to Israel. Japan has been pacifist largely because the US has covered its military defense, and didn't reject its history in WWII nearly as strongly as Germany. You can't rely on one big event in a country's history to guarantee its moral foundations forever, history keeps happening.
My question is how the economy is able to keep churning along despite this level of nonsense. It makes me think about all the squandered potential Republicans have burned to the ground.
The economy is more than just stocks. Second estimate GDP for Q2 was +3.3%. Corp. earnings are all hitting above mid-point estimates. To Dan's point ... this is all very strange.
Strong corporate earnings are mostly a Forex effect because the USD has declined by over 10% since “Liberation Day”; the strongest corporate performers are tech companies that earn most of their revenue abroad and thus enjoyed the largest Forex boosts.
More than all of the 3.3% “growth” was a decline in imports, which is just the way GDP is accounted for but reflects an actual decline in people’s living standards. Trumpified economic statistics are also no longer trustworthy; you saw big deviations between the official employment stats and what ADP reported and ADP turned out to be right.
"Strong corporate earnings are mostly a Forex effect"
I don't buy it. Just look at the major consumer stocks (e.g., Walmart, Home Depot, Costco). They're all holding 2025 guidance and reporting stronger than expected consumer spending. I trust Powell more than anyone and he just noted consumer spending is even picking-up. The consumer demand side is way stronger than anyone predicted back in Q1.
You’re only looking at a couple of the strongest companies. The Dow as a whole is down when adjusted for the 10% decline in DXY and the S&P 500 is only up by about 1%, mostly thanks to the tech companies that had the biggest Forex effects.
I'm explicitly not is talking about stock prices. I'm talking here just about US consumer spending. It's **much** stronger than forecasted and has nothing to do with Forex effects. If you think Powell is lying, just say that. But the idea "strong corporate earnings are mostly a Forex effect" is just nonsense.
I'm not an economist, but what I've heard it's a lot of confidence that Trump will chicken out of any idea that would *really* blow up the whole economic foundation - the standard is that he makes loud announcements and then either quietly rolls it back a week later or gets reversed in court because his legal arguments are unsound. The other thing I've heard is there is a lot of financial speculation that AI isn't just going to be a profitable business tool but is on the verge of breaking out into a general super intelligence that will be the biggest thing since the invention of fire. It's either a bubble that will pop (hopefully under Trump's watch) or getting in early on the sci-fi future.
I'm skeptical that LLMs are going to evolve into demi-gods and that Trump will know where the line on breaking things is. But people who think more about AI than I do seem optimistic and Trump is an old man surrounded by people with 401ks. So maybe it'll work out? It's hard to read the tea leaves.
"the standard is that he makes loud announcements and then either quietly rolls it back a week later"
I do think the tariffs have broken the chicken-out trend. The tariff revenue now flowing through is massive (i.e., 4x increase over baseline in just 3 months!!) and there's a ton of good articles and pods on what could be going on but the general consensus is **everyone** is surprised that the tariffs have had such a muted impact thus far.
Tariffs are bad, but bad in a "every American has a thousand dollars less disposable income", not a "Great Depression 2.0" kind of way. They sting but aren't something deadly.
Leave it to Trump to earn articles saying "Great News!!!: Man who got stung by a bee on purpose doesn't die"
The inflation under Biden was closer to "every American has less disposable income" than to "Great Depression 2.0," and that was enough to make Americans bigly mad and to vote for Trump as an FU to Democrats (yes, I know, that AND immigration/DEI).
Another way of looking at this is that it was enough to make approximately 3% of Americans/6% of Biden voters change how they voted. Basically a rounding error. Now did that rounding error matter? Of course! But acting like Americans all had totally different opinions in 2024 than 2020 is really statistically inaccurate.
It was 1 in 33 that changed, and most did so tepidly, disliking both candidates.
I'll add this is hard to remember when we have winner-take-all elections. But if there was a pie chart of 2020 vs 2024 you'd have to squint to be able to tell which was which
Just pointing out that with the speed and scale of the tariff revenue they no long fit the Trump TACO narrative. They're here and in a big way. TBD what happens. They might still tank the economy but Walmart just stated in their Q2 earnings call the markups have been lower than anticipated so again ... no one really knows what's going on.
I think mostly what we've proved is that the economy was so robust we could absorb a modest but real tax hike on the import sector and consumers without massive disruption or degrowth. A smarter plan would have been to make it a well considered progressive tax increase to slightly offset deficits. But we chose this instead.
Paul Krugman has a piece today where he argues that historically, the markets and then the economy don't typically crash until the absolute last minute.
Yes, it seems like a tactical blunder for Republicans unilaterally enact the largest tax hike since Bill Clinton in 1993. Probably will convince future Democratic legislators on the fence they can raise taxes with far less political blowback.
I work in supply chain. We are still burning through the tail end of a lot of inventory.
The biggest place this will show up is during the holiday season when there are fewer discounts than usual. Businesses are hoping nobody notices the absence of a sale (and increased prices on inelastic goods).
"The other thing I've heard is there is a lot of financial speculation that AI isn't just going to be a profitable business tool but is on the verge of breaking out into a general super intelligence that will be the biggest thing since the invention of fire. "
This will, of course, lead to the death of all humans and make the bond market moot.
I think the point was that if super intelligence speculation is what’s driving the AI investment and if this doesn’t happen, the bubble will burst. I suspect this is incorrect, as there is a huge amount of mundane utility to already existing AI technology that businesses have yet to tap into properly
I hope you're right, but dismantling the government and handing big chunks of it to the oligarchs will make the oligarchs extremely happy, and they will surround Trump with praise and compliments, drowning out the other voices.
He's not making a prediction here, he's pointing to past failures of markets to react to obvious crises until they become undeniable. "Destroying the Fed" is not something where he's going out on a limb regarding its inflationary impacts.
There is a school of thought that the Fed has a democracy deficit. That it can make mistakes without accountability. That some of its mistakes have been huge. Not saying I agree but the Fed has problems it needs to address.
The bond market really, really did not like Liz Truss, and it was not shy in letting the world know that. So obviously it can act to affect horrible public policy. But why is it not acting against Trump?
So this is a good moment to give everyone the update on my U.S. vacation they’ve been waiting for. I know, I know.
In short: it’s been good. It’s always good. I always spend a year away, build up a social media and news headline-informed set of anxieties about what America is like, tell myself it’ll be weird, and then it’s normal. And good.
Having said that, when I think about how I’ll feel to get on the plane to go home to the UK, there are some things I’m not sorry to leave - for instance, what MY mentions.
On the other side of the ledger: Vermont. Vermont is so good. I lived in Vermont for 6 years 20 years ago, and it was good. And now I’m back on a visit and it’s good. It helps that the weather is great, but Vermont is so effortlessly itself, is the best way to put it I think. Like, there’s tourists, but you get the feeling that everyone would do what they’re doing anyway (note: tourism is super important; a guy at an artisan glass workshop in Burlington told me they, and other business owners, have been hit hard by the drop in tourism from Canada, as well as tariffs).
So: Indigenous American berserk (à la Roth) on the one hand, Vermont on the other. Vermont makes a strong case that balances out a lot of the dying empire bullshit, I gotta say.
Thanks for this update - glad you're having a good time! Safe travels for your return.
I myself was on vacation last week to the "up north" Michigan of my childhood. I'm not sure how much the region has been hit by the falloff in Canadian tourism; crowds were not terrible, but school is starting again and we were there during the week. I was somewhat surprised, however, to see that it is largely frozen in amber in the 1970s when I, as a child in a family of good Michiganders who rented the same lakefront cottage every year, spent most of my time there (have not been back during this millennium until last week). Ginormous portions of meat/potatoes/fudge (plus fish, fried only); proud allusion to celebrity visitors such as Bob Seger; "Werewolves of London" on the sound system; Mackinac Island Grand Hotel (did not stay there but out-of-state friends wanted to see it) flogging "Somewhere in Time." Even the weed dispensaries that have rained down on the Lower Peninsula were so thin on the ground that I don't recall seeing any, though I wasn't looking.
It was like backward time travel. I wish I had encountered the Watergate hearings and brought them with me back to the present.
It does seem pretty bad. I keep telling myself it must have seemed like the country was going to fall apart in the late 60s/early 70s, even without the phones.
If this administration ended today, I imagine it would take at least twenty years to get back to any sort of efficient and productive government. That's not only speaking to the destruction of institutions, but the destruction of public confidence in the institutions.
And any Democratic administration is going to have to initially use a lot of the powers that Trump has asserted like clearing out all the appointed boards and firing lots of new employees wholesale in order to do that kind of reset. Then, they'll have to decide if any new legislation (if it can get through Congress) to create some kind of guardrails will satisfy the weirdly executive power-worshipping Supreme Court that we have.
I mean court packing has to come first. Even if there’s no congressional majority, the next Dem should just send in the military to the Capitol building to waylay Republican congresspeople to prevent them from voting
Trump got elected because public confidence in institutions was already destroyed. He is the result, not the cause. The keepers of those institutions are just waking up to it.
Trump is at least as much symptom as cause. Though like a guy with a 105 degree fever caused by an infection, the symptom may do us in before the cause does.
So many sources of America’s strength have just been set on fire by the Trump administration, that I’ve sometimes likened it to a kind of National suicide. Which isn’t to say that there won’t be something called the United States on the map in ten or twenty years, I’m sure there will be. But it won’t be the leading global power we’ve come to know since WW2.
It could be the beginning of the end of the American Empire. History doesn't owe any country a happy ending, nor a perpetual run at the top. On the other hand other great powers in history have gone through very difficult periods—seemingly characterized by crises, dysfunction, chaos, and acute decline—only to regroup and rise again. We've been around for more than two centuries—more than three centuries if you do the reckoning (as I like to do) starting from 1607. So I'd like to think it'll take more than four years to send us toppling over. I know some will counter: "The rot set in long before January 20, 2025." But, while one can see some ominous trend lines going back quite a while—maybe even to the late 1960s (Nixon's Southern strategy—a naked play to leverage racism for political gain—comes to mind)—I think there was a reasonable case the country was in good shape, maybe even increasingly ascendant, a mere twelve months ago. Last autumn the United States was enjoying receding crime, low unemployment, a booming stock market and falling inflation. We led all other high income countries in the post-Covid recovery. Our trillion dollar enterprises bestrode the global economy like mighty titans. Our universities and research labs were the envy of the planet. We appeared to have beaten China to the punch on AI. Even the scourge of opioid addiction was slowly being overcome.
So, America has some significant national strengths. We simply lack a government that seeks to increase and safeguard these strengths (instead, the current administration appears deadly determined to squander them). But their mandate need not endure indefinitely.
On the subject of mail in voting, 8 states have completely done away with in person voting, most of them on the West Coast. We tend to like the system a lot. Just want to point out that there would be a lot of pushback against federal legislation trying to end the practice, in case the east coast crowd wasn't aware.
The California system in particular is tailor-made to allow for weeks of menacing statements and false claims going viral. Do it like Florida and get everything counted upfront, then report final totals election night.
In WA you can still vote in person, but it’s not at your precinct, there are just a few centers. But yeah I did that when I spilled coffee all over my ballot
We've brought most of the world along with us. The whole point of the US designed world order was to spread prosperity broadly to ensure our own prosperity.
To an extent, but mostly for one decade in 2000-10 and mostly because of Chinese growth. Global inequality was otherwise mostly flat or even increasing slightly during most of the period of US hegemony. https://wir2022.wid.world/chapter-2/. Most poor countries didn’t see a lot of prosperity during most of the period of US hegemony.
There are no costs to other countries developing. In fact we are now incurring costs to try to stop them from tariffs that are hurting US growth more than anyone else’s to a walls going up all over the world and even a growing risk of war. The world is not zero-sum, but us treating it like it is becomes a self-fulfilling prophecy.
America hasn’t treated other countries development in a 0 some way, before Trump, for about 80 years. In fact, its acquiescence contribute to the rise of Trump and its overextension. The world, and America, would be better for it to take a few steps back
“Before Trump” is a pretty big caveat, given that he’s been the most powerful force in US politics for nearly ten years and Biden continued much of his foreign policy.
And even before Trump we brutally impoverished a bunch of small third-world countries; it’s only when we tried to run the same playbook against Russia and China that it ran into limits.
It really does feel we're in the opening days of Erdogan/Orban-ization. That's a much more plausible outcome than the whole "1933"/"THIS IS FASCISM" rhetoric that's going around.
But I know that to many other people it feels different. To them, Trump is visible and doing things while Biden was low-energy and decrepit-looking. All the fired federal workers complaining must be the disloyal deep staters who are responsible for all the bad things in foreign policy and public health in the past few years. It's very easy to be in a media bubble where all the arrested immigrants are illegal gangbangers and all the Democrat-controlled areas of the country are chaotic lawlessness.
Despite all the dire warnings from the pundits, nothing terrible has visibly happened yet to the economy. The stock market is at an all-time high and gas prices are down. Rising prices from tariffs are just a sign that Trump cares about Americans more than foreigners; what's a little sacrifice to help your fellow Americans?
I don't know what the answer is to convince those people of how bad much of this is in the short and especially longer run. But I don't think that counting on an economic downturn to change their views is going to work.
This seems right to me, which makes me want to learn a bit more about Erdogan and Orban. Did they......also do a bad job, on top of the backsliding? Did they get the trains running on time?
From what I can tell, trains run but not on time. Periodic purges of government employees, attacks on independent institutions (media, academia, etc.), okay but mediocre economic growth, petty corruption/nepotism everywhere, lots of weird rhetoric, etc. Also a lot of shenanigans around election time.
"Is this what collapse looks like from the inside?"
No. IMO none of these personal moves matter. But if the USD continues to decline and our long-term bonds continue to sell off ... I think that's what a real collapse will look like.
Only if you assume all they wouldn't follow orders; which I'm sure they all would. But it's just really hard to take anything seriously when Hegseth and RFK Jr. are Secretaries.
JEsus. Just go ahead and give all of Ukraine to Russia. Hegseth seems like the sloppiest of all drunks while Putin's staff -- literally -- start their day with a glass of vodka. Maybe if Hegseth was from Wisconsin but even then ...
I definitely was but more as a competitive response to China's currency manipulation. This seems different; certainly when coupled with the bond market. I might also just be ~ depressed after listening to all the Odd Lots interviews from Jackson Hole.
The American empire has to end eventually. Not sure if it is right now though.
Once Japan and Germany's economies had recovered by the early 70s the writing was on the wall for the USA. But after that, things seemed to lumber along just fine for the next 30 years. However, the rise of China no one foresaw except Deng after he visited Japan in the 80s and decided he wanted their economy for China.
I'd be very worried as an American as China is no longer just producing cheap crap. Their products are getting better and there haven't been any real cracks in its leadership for a long time.
Over the long haul, a political movement based on one guy (i.e., Trump) is bound to recede. When it does there is still a chance for an American comeback though it looks pretty bleak at the moment.
This is a very zero-sum way of looking at the world. The US could easily have continued to prosper along with other countries. Other than maybe environmental constraints, which will be offset by declining populations, there is no reason why it would harm the US for other countries to be as rich as us. But Trump chose to make things zero-sum, and in doing so created a self-fulfilling prophecy.
I was referring to when Germany and Japan recovered roughly 20 years after WW2, the US no longer had such a huge share of global GDP. In the immediate postwar years they were the big dog economically and militarily making them basically an empire. To a certain extent, those postwar advantages still exist but are slowly eroding.
I think there will be a longish period after all this where the country’s wealth and institutional slack will mask the loss of expertise and erosion of law but at some point it will become obvious that everyone is much worse off. It’s been weird to see long term institutional actors (universities, businesses, health care industry) bend the knee hoping to ride it out rather than taking seriously the harm to their longterm interests. I get that doing so is expedient because Trump is vindictive and maybe things will go back to normal post 2028. But bending the knee also makes it much less likely things will go back to normal.
I assume I'm not the only one remembering all the high school history class discussions about "But why did the citizens let it happen?" when countries go authoritarian.
I remember in my freshman year of college learning about the Cultural Revolution and being indignant that people just went along with it. All of my classmates scolded me.
They were right.
"All of my classmates scolded me."
At least it was just scolding...
Well, it was 2002, you see.
The opening chapters of The Three Body Problem are the most haunting thing I’ve ever read.
That is a pretty odd book, it's strangely herky jerky in its storytelling. Not sure if it's because Chinese, because translation, or because hard science fiction story. I guess por que no los tres?
The second book is much better IMO
Agreed. The author’s note at the end explaining how difficult it was to translate was very interesting to me because it does explain the herky-jerkiness in my mind. Overall I did not like the book. But the opening will stick with me forever.
Yeah, as an origin story for "why would this woman prefer aliens to humans" it is very understandable.
They didn't let it happen, they voted for it! It's another topic if they really comprehend what they voted for...
And you're demonstrating here why they did it.
I somewhat can see the hope that pretending to be dead is the right response.
Trump reacts to movement, and you don't want to be the leader who has to lay off their team because of retribution that could have been prevented by doing nothing. More important is that 2028 isn't *that* far away in the long view, Trump is a unique figure who will probably self-destruct his party rather than establish a stable successful political movement; the goal is to make it to the next century, Trump is a single old man who will not be around to hold together his movement for much longer.
It’s not a crazy thing to hope for but the downside to being wrong is very bad!
I think a lot of people have faith that there will be a 2028 election that will remove Trump (or a Trump stooge) from power at which point (almost) everything can be fixed up. I think that will happen! We have a lot of institutions in place that makes it hard for lazy and incompetent people rig elections, throw out the results, and deploy the military. Trump's current 0-1 record makes me very worried he will try, but optimistic that he'll fail. The problem is that the playing dead opposition isn't going to wake up until November 2028 and so there aren't any dry runs and until then people say you're being alarmist.
I'm not convinced that democrats will legitimately win 2028. We care about the authoritarianism but they see the end of woke, a tax cut and mass immigration raids.
"Trump reacts to movement"
So . . . we're the kids trapped in the Jeep in Jurassic Park?
That is exactly what it looks like. All because of stupidity, hubris, and greed.
It does feel like the Newman's of the world are ultimately responsible.
I get the appeal of this logic. Standing up for things is scary and hard. In some cases, laying low might be right, but Trump and his allies have a long list of grievances and enemies. That's what powers his movement in the first place. Playing dead isn't going to save many people. It'll probably just embolden him.
I also hesitate to share these people's optimism that the fever will just pass by default, when he's gone. Trump is a vessel for rightwing populist hate, more than a driver of it. He goes along with his crowd, like he did with vaccines, gun buybacks, and trans rights. He wants adulation. He wants to rule over people with an iron fist, but part of that comes with being an expression of his tribe's will. Project 2025 is seeking to permanently change this country. Trump is barreling ahead. Lying down isn't going to make it easier.
Agree 100% with the second paragraph. The main authors of Project 2025 aren't really Trumpers or MAGA at their core. They all represent preexisting strains of American conservatism who've opportunistically jumped on the Trump bandwagon. Their vision for the US government may overlap with Trump's, but unlike with Trump, they don't want to tear down liberal democracy in order to aggrandize Trump, they want to aggrandize Trump in order to tear down liberal democracy, which has been a longstanding goal for their movement. Trump will leave the stage at some point, but these people will remain stronger and better organized than they ever were before, and they'll be an indispensable part of any conservative coalition no matter who's leading it post-Trump.
I think Trump is unique in that he's a one-in-a-billion genius at creating a public image and getting media attention, and he's charismatic enough that even doing very unpopular things mostly rolls off him in his supporters' eyes. Without him, the conservative movement will continue and will sometimes win victories, but probably won't have anyone with the same star power. Someone like DeSantis is much more competent at operating the levers of government, but when he does some inevitable-but-unpopular thing, it will stick to him more.
The concerns driving a majority of the electorate to Trump is "right-wing hate"? Really? What's your plan for dealing with those concerns? Do you even know what they are?
Democrats just need to make sure the next time they are in power that anyone harmed by Trump for resisting will be made whole, out of withheld federal funds and tax audits of Trump-supporting organizations.
And that everyone who supported Trump is harmed with the full force of the state
I halfway think that--in the event of a Democratic Presidential victory--vindictiveness towards the institutions who bent the knee might actually be a helpful restorative, because it seems to create the correct long-term incentives (punishment for defection; prospective risks for kowtowing to illegal behavior). Norms are shot, might as well go hard game theory.
I don't think I buy this; see https://www.astralcodexten.com/p/some-practical-considerations-before.
I think this is disanalogous in several important ways. First and foremost the institutions that bent the knee are presumptively ones that I am broadly sympathetic towards - Number 5 *is the point.* Secondly, there would no non-retributive purpose: nothing -- literally nothing -- the institutions could do would spare them the retribution, essentially like a criminal prosecution. The entire goal here would be to make bending the knee a way to be on death ground -- kowtowing to Trump-like figures in the future should cause the stock (or its equivalent for non-profits) to go *down*, not up. I am not trying to tell them what to opine on or coerce them in the manner that Trump is, I am saying that, having opined, failure to fight will be *worse* in expectation than vindicating the rights they so eagerly sacrificed on the altar of Friedmanism. And I'm not sure of how to create that incentive alignment except by following through.
Potentially, this is a bad idea, but I don't know how else to create appropriate incentive alignment. The key idea that keeps running through my head wrt the Trump administration is "you do not play cooperate when your opponent plays defect."
I don't think this is workable. For anything like your proposed incentive structure to work, the future punishment when the right people regain power would have to be significantly worse than the short-term pain of fighting an authoritarian. Considering the kind of strain the Trump admin already threatens to put on many institutions, you would have to promise close to certain destruction on your return to power. This means that your returning government now has to commit to severely harming many of its most valuable organizations. It also has a very obvious counterplay for future authoritarians: promise even more immediate death if an institution doesn't cooperate. The greater incentive is obvious, and once an institution works with the authoritarian its only method of avoiding future retribution is to fully commit to preventing any other government from coming to power by backing the authoritarian with all its power.
This does not mean that there should be no hefty punishments made after liberals regain control. Any and every Trump official of significance who can be accurately stated to have violated a law should be sentenced to maximal prison terms, and the pardon should be eliminated to ensure they stay in place. I'm just saying that we won't get what we want by counter-suing universities that gave into intimidation. Preventing that means finding ways to make resistance cheap or profitable today.
Columbia faced the loss of $400 million in grants - I don't know how you make resistance not cheaper than that already.
The reason they bent was presumably that they figured they would either lose the grants anyway or if they won, the Trump admin would find other ways to extract those costs and more. If you believe resistance will just add even more costs to your eventual defeat, then you surrender.
What I think we need to do is organize legal defense funds to make resistance free. Even better would be to pledge to cover the monetary fines and denied funding of every institution that fights the current administration. That's very expensive, but it would make fighting a much better deal.
Still, it's no substitute for backbone. What will halt the assault better than anything is seeing a group publicly fight, win, and then be left alone as it has proven itself a hard target. It is disappointing that so many groups that likely could have done this chose not to.
I don't think this makes any sense. The main problem with Trump abusing Federal power to get them to bend the knee is the abuse of power not the knee bending. If Dems abuse Federal lower Brown University for their capitulation to Trump, that reinforces the abuse of power and makes rule of law all the more arbitrary and capricious.
Unless there's actual wrong doings by institution in a legal sense nothing more should happen. The much more important thing is to have and act on a reform agenda that limits Presidential emergency powers and limits the unitary executive in whatever ways possible.
Democrats should compensate resistors rather than punish capitulators. The punishment of capitulators would only be an incidental effect of budget limitations (the money to make resistors whole needs to come from somewhere)
An individual business/university/etc. will sustain significant damage from refusing, and their individual decision to fight back or not does not really move the needle. This is to be honest a big failing with the kind of bloodless managerial mindset that prevails at most institutions -- something that I am normally willing to defend, but there's a sense in which pride and feeling that your dignity is being affronted can act as an incentive toward resistance in a way that has benefits at scale
I think this is incorrect. The individual business/university/etc. needs to fight back as part of their own self interest. Whether other people fight back is irrelevant to that decision. Virtually no one prospers in an authoritarian regime in the way that they thrive in a democratic regime. Believing that you will be the lucky one who can ride the storm is magical thinking akin to believing, really believing, that you will win the lottery. Russia's prisons and graveyards are full of people who believed they could ride the Putincoaster.
Not giving in, not kow towing is both your obligation as a goddamn citizen, and in yours and your organization's best interests. Yes there is some risk, there is risk of failure even in a well functioning system, but you have to accept some risk in order to expect any return.
Yeah it’s a collective action problem and Trump is strategic about how he goes after them to keep them from working together. Sucks!
Would you ever recommend a loved one pursue a career in public service? I wouldn't, and that's new.
I am guessing we get highly degraded gov services with some private actors picking up the slack (medical trials, welfare administration, private security). I can't imagine why anyone would consider public service anymore if there's a chance a second Trump like figure could emerge.
Specifically, federal employment pays worse that the private sector but until recently offerred better job stability. If the job stability is gone, the pay needs to go up or the available workforce will decline in both number and quality.
I absolutely still would! I work in local govt and have worked in federal and state govt. There’s lots of good to be done and I still find it very rewarding.
The fall of a major power like America would of necessity be slow and multicausal and one could never see it at the moment it becomes ineluctable but it wouldn't be surprising if future historians picked Nov. 5 2024 as the date it became manifest and irreversible.
There are no good actors here, only bad and worse (Trump).
Yeah, I don't love most of Trump's policies, but endless deficits, unfilled judgeships, inability to pass a budget, and institutional failure have been going on for decades. Weaponization of the justice system against political opponents, encouraging political violence from your own side, using institutional soft power to punish dissent, tying funding for allegedly politically neutral stuff (student loans, research grants) to political ideology, those things weren't started by Trump, even though now he's running with them to our cost.
I think there will be a future that's between the two extremes people like to rave about: we'll still be a strong and dominant country, but we'll be worse off in several ways 3.5 years from now that we wouldn't have been otherwise.
"we'll still be a strong and dominant country"
The Soviet Union was a "strong and dominant" country in the 1960s. I'm just saying.
"Trump is Khrushchev" is the take I never knew I was waiting for all along.
Best hope he's not actually Gorbachov.
Good news is he isn't and would clearly never allow geopolitical or internal dissolution. See his EU, Japan/Korea, and Israel wrangling; Gorbachev wouldn't bother! Bad news is Biden was definitely Andropov, and it's not a great situation to begin with.
Comrade Khrushchev betrayed The Revolution™ and capitulated to Kennedy, the capitalist imperialist pig-dog!!
Banging on desk with shoe: Nyet, Nyet, Nyet!
I’m closer on the “worse” side than you.
But I’m also waiting to see whether Bolsonaro makes a Trumpian comeback.
I wonder if newer democracies are actually more protective of democracy. There are living Brazilians who remember living under dictatorship.
The evidence is no, the longer you're a democracy the better your odds you'll remain a democracy. We used to think this means we were almost immune from risk. We're now testing that hypothesis
I 100% believe that you are on to something. I think it also helps that a lot of newer democracies have more of a parliamentary style of government typically as well.
Why would whatever Bolsonaro does influence your view on this?
Well, that and however long it takes our orange piece of shit to die, basically are the two main factors in whether I start looking for jobs in Brazil.
Come to Canada! If you're rich, move to Vancouver, it's beautiful. If not, settle on a plot of land in the Okanagan, start a goat farm, and earn a living selling organic sustainably-made small-batch goat milk soap and chevre to rich tourists!
Not Schitt’s Creek?
Also, sadly, I don’t think I could convince Boo to come. But she wouldn’t mind Rio.
The Okanagan has nice weather. Sunny and warm in the summer. And it has wineries!
a fellow canadian slow borer?
Polish-Canadian-American in California!
There are… dozens of us, possibly!
Another Canadian here. Maybe we need to form a Slow Boring Canadian caucus? First topic, why can't the federal NDP win elections anymore?
Chèvre. Sounds suspiciously FRENCH.
Just mispronounce it like folks in Maine mispronounce all French words, and everyone will just think you're a Jared Golden fan.
Canada is a bilingual nation, officially! 😊
I want to move to Letterkenny.
You always struck me as a skid.
This sounds like an update to the classic song from Rent: https://www.youtube.com/watch?v=tHmKaG4ZDNE
As long as they don't assign me the Oilers as my hockey team I'll consider it. I cannot root for Connor McDavid.
https://www.youtube.com/watch?v=wPb8YGd7dhA
Come to Brazil! @drosophilist is one of my very favorite commenters, but the weather here is much, MUCH better than in Canada, and the cost of living is a lot less.
I've been back and forth to Brazil my whole adult life, and for the past eight years I've been living here the second time, and this time for good. Twelve Julys a year where I live, and July was always my favorite month. 🌅
You will have to learn at least some Portuguese, though -- it's a rigorously monolingual country. The good news is that foreigners get a lot of partial credit just for trying.
Bro I done learnt Portuguese last time I was down there.
Loved every minute of it.
Wya no país?
You're set then!
I live in Manaus, in the middle of the waterworld where the Negro meets the Solimões to form the Amazon proper. This close to the Equator, the Sun rises every morning around 6 AM and sets every evening around 6 PM, every day of the year.
Yeah, don't be like him: https://www.youtube.com/watch?v=UMukOhD_tXU
Knowing our country the impacts of being worse off will happen under a Dem President and the country will blame them for all that bad that is happening.
Reading this made me think about those mRNA cancer vaccines we're definitely not getting anytime soon. Impossible to do a counterfactual, but it's depressing to consider the implications.
"That which doesn't kill you makes you stronger" was always bullshit, because that which doesn't kill you often leaves you crippled and ill with a more dismal future.
Even if Trump turned us into a Putin-esque kleptocracy tomorrow, it would take a generation for other countries to pass us by. Blame will not accrue in real time, and the public understanding of blame may not land accurately even then.
I think either Trump dies, Vance is discredited, and things moderately improve, or things get much, much worse and the question is between dictatorship and balkanization. The status quo cannot hold.
They are in the process of setting up very traditionally authoritarian power structures. These are traditionally very fragile. When China invades Taiwan in 2027-28, the whole thing will crumble.
Why do you think Trump supporters will care about Taiwan?
I assume the idea is that Trump will mishandle it enough so that the US is either directly involved or China strikes US forces in the west pacific and when the news is tens of thousands of dead Americans and huge amounts of expensive defensive assets destroyed it will cause a Norway Debate style destruction of the governments legitimacy. It of course relies on several pretty large assumptions on China's actions, Trump's actions and the US public's response.
They will when Trump loses
Okay, I'm not following the logic.
Trump wouldn't do anything if Taiwan was invaded. He doesn't care about Ukraine, why would Taiwan be different?
If China agrees on paper to buy $1b in soybeans in exchange for Taiwan, Trump will call it a great victory
We can't do anything if Taiwan is invaded. Our military is too weak, significantly because of the errors of the Obama Administration. Hopefully, when it happens, we'll have enough sense to stay out of it.
What a strange collection of sentences. The whole story of the last 20 years is how China has proven people's "traditional" ideas about authoritarianism to be wrong.
Are you saying the authoritarian government of China will collapse when they try to invade Taiwan?
I'm hoping that this will be more like the McCarthy era, a sad and horribly un-American part of our history that we eventually recover from. That's more a hope than a prediction, though.
There are a bunch of periods like that, though, and we have always recovered. So far. I mean, shooting miners and their families for striking wasn't our best look. Imprisoning people for burning the flag wasn't great. Refusing credit to women was bad. All kinds of bad things, and we did work through them. Fingers crossed.
Confounding factor: we didn't have the Internet back then. Cooler heads could prevail once the spotlight was off.
The lack of Internet didn't prevent the South from having a century-long grievance over losing the Civil War.
It did prevent people from getting overstimulated from spending too much time online and from panicking over how every little thing was the end of the country and the beginning of a fascist dictatorship.
If we can survive the Civil War, we can survive this. If some other crisis hits us when the idiots are in charge, we’d better hope for another Nat 20 (OWS in 2020, for example).
I can't recall the ironic quote, but it was something to the effect that: "It sure is good that there were no racists or sexists in charge when the Founders wrote the US Constitution, otherwise no way that a democracy could have survived".
We've made it through worse.... but indeed fingers crossed.
But can you really say we recovered when we keep doing things like this?
“Recovered” should mean like post-WWII Germany or Japan, just completely rejected their historical past and became more or less pacifist.
Sadly, history doesn't work like that.
Germany retained a strong military capability from being on the front lines of the Cold War and only recently stopped sending arms to Israel. Japan has been pacifist largely because the US has covered its military defense, and didn't reject its history in WWII nearly as strongly as Germany. You can't rely on one big event in a country's history to guarantee its moral foundations forever, history keeps happening.
Stay tuned for chapter 2?
Honestly this just reminds me of the 1890s
My question is how the economy is able to keep churning along despite this level of nonsense. It makes me think about all the squandered potential Republicans have burned to the ground.
It's all AI stocks. The non AI stocks are tepid
The economy is more than just stocks. Second estimate GDP for Q2 was +3.3%. Corp. earnings are all hitting above mid-point estimates. To Dan's point ... this is all very strange.
https://www.bea.gov/news/2025/gross-domestic-product-2nd-quarter-2025-second-estimate-and-corporate-profits-preliminary
Strong corporate earnings are mostly a Forex effect because the USD has declined by over 10% since “Liberation Day”; the strongest corporate performers are tech companies that earn most of their revenue abroad and thus enjoyed the largest Forex boosts.
More than all of the 3.3% “growth” was a decline in imports, which is just the way GDP is accounted for but reflects an actual decline in people’s living standards. Trumpified economic statistics are also no longer trustworthy; you saw big deviations between the official employment stats and what ADP reported and ADP turned out to be right.
"Strong corporate earnings are mostly a Forex effect"
I don't buy it. Just look at the major consumer stocks (e.g., Walmart, Home Depot, Costco). They're all holding 2025 guidance and reporting stronger than expected consumer spending. I trust Powell more than anyone and he just noted consumer spending is even picking-up. The consumer demand side is way stronger than anyone predicted back in Q1.
You’re only looking at a couple of the strongest companies. The Dow as a whole is down when adjusted for the 10% decline in DXY and the S&P 500 is only up by about 1%, mostly thanks to the tech companies that had the biggest Forex effects.
I'm explicitly not is talking about stock prices. I'm talking here just about US consumer spending. It's **much** stronger than forecasted and has nothing to do with Forex effects. If you think Powell is lying, just say that. But the idea "strong corporate earnings are mostly a Forex effect" is just nonsense.
Tepid is not what I would expect to this level of dysfunction!
The US economy is so strong that you can throw a lot of stupid policies at it without destroying it.
Also, some of the damage will take a while.
I'm not an economist, but what I've heard it's a lot of confidence that Trump will chicken out of any idea that would *really* blow up the whole economic foundation - the standard is that he makes loud announcements and then either quietly rolls it back a week later or gets reversed in court because his legal arguments are unsound. The other thing I've heard is there is a lot of financial speculation that AI isn't just going to be a profitable business tool but is on the verge of breaking out into a general super intelligence that will be the biggest thing since the invention of fire. It's either a bubble that will pop (hopefully under Trump's watch) or getting in early on the sci-fi future.
I'm skeptical that LLMs are going to evolve into demi-gods and that Trump will know where the line on breaking things is. But people who think more about AI than I do seem optimistic and Trump is an old man surrounded by people with 401ks. So maybe it'll work out? It's hard to read the tea leaves.
"the standard is that he makes loud announcements and then either quietly rolls it back a week later"
I do think the tariffs have broken the chicken-out trend. The tariff revenue now flowing through is massive (i.e., 4x increase over baseline in just 3 months!!) and there's a ton of good articles and pods on what could be going on but the general consensus is **everyone** is surprised that the tariffs have had such a muted impact thus far.
https://www.npr.org/2025/08/11/g-s1-81934/trump-tariffs-record-revenue
Tariffs are bad, but bad in a "every American has a thousand dollars less disposable income", not a "Great Depression 2.0" kind of way. They sting but aren't something deadly.
Leave it to Trump to earn articles saying "Great News!!!: Man who got stung by a bee on purpose doesn't die"
https://www.cato.org/commentary/no-economists-didnt-botch-trumps-tariffs
The inflation under Biden was closer to "every American has less disposable income" than to "Great Depression 2.0," and that was enough to make Americans bigly mad and to vote for Trump as an FU to Democrats (yes, I know, that AND immigration/DEI).
Another way of looking at this is that it was enough to make approximately 3% of Americans/6% of Biden voters change how they voted. Basically a rounding error. Now did that rounding error matter? Of course! But acting like Americans all had totally different opinions in 2024 than 2020 is really statistically inaccurate.
It was 1 in 33 that changed, and most did so tepidly, disliking both candidates.
I'll add this is hard to remember when we have winner-take-all elections. But if there was a pie chart of 2020 vs 2024 you'd have to squint to be able to tell which was which
This was way more the media narrative than it was material hardship, though.
Everyone having a thousand dollars less won't turn into electoral results unless it becomes part of the narrative.
It wasn't the inflation, it was the response to it from people who thought the issue would just go away if they talked around it.
Just pointing out that with the speed and scale of the tariff revenue they no long fit the Trump TACO narrative. They're here and in a big way. TBD what happens. They might still tank the economy but Walmart just stated in their Q2 earnings call the markups have been lower than anticipated so again ... no one really knows what's going on.
https://abcnews.go.com/Business/earnings-walmart-target-reveal-tariff-driven-price-hikes/story?id=124876075
https://www.statista.com/statistics/1557485/average-tariff-rate-all-imports-us/
It looks like tariff rates went from 2.X% to 11.X%? So if the whole tariff is passed on to the customer that's 9% inflation on certain goods.
Definitely not significant enough to "tank" the economy if that's all Trump has done
9% of the imported good cost...not 9% of the final price. That's why the increase is mooted.
I think mostly what we've proved is that the economy was so robust we could absorb a modest but real tax hike on the import sector and consumers without massive disruption or degrowth. A smarter plan would have been to make it a well considered progressive tax increase to slightly offset deficits. But we chose this instead.
Paul Krugman has a piece today where he argues that historically, the markets and then the economy don't typically crash until the absolute last minute.
I like the term he referred to…
Something like the market being a “conventional wisdom aggregator” rather than the best available knowledge atm.
Yes, it seems like a tactical blunder for Republicans unilaterally enact the largest tax hike since Bill Clinton in 1993. Probably will convince future Democratic legislators on the fence they can raise taxes with far less political blowback.
I work in supply chain. We are still burning through the tail end of a lot of inventory.
The biggest place this will show up is during the holiday season when there are fewer discounts than usual. Businesses are hoping nobody notices the absence of a sale (and increased prices on inelastic goods).
"The other thing I've heard is there is a lot of financial speculation that AI isn't just going to be a profitable business tool but is on the verge of breaking out into a general super intelligence that will be the biggest thing since the invention of fire. "
This will, of course, lead to the death of all humans and make the bond market moot.
I think the point was that if super intelligence speculation is what’s driving the AI investment and if this doesn’t happen, the bubble will burst. I suspect this is incorrect, as there is a huge amount of mundane utility to already existing AI technology that businesses have yet to tap into properly
I hope you're right, but dismantling the government and handing big chunks of it to the oligarchs will make the oligarchs extremely happy, and they will surround Trump with praise and compliments, drowning out the other voices.
The bond market doesn't seem to care all that much. Maybe they know something we don't.
Krugman today is relevant: https://paulkrugman.substack.com/p/why-arent-markets-freaking-out
TL;DR: The Efficient Markets Hypothesis Is False.
The Krugster predicted a recession if Trump won, his track record in partisan matters is uh, quite mixed. 90s Krugman is sadly gone.
He jumped the shark toeing the Biden Team Transitory line.
From his latest: "The inimitable Nathan Tankus..." this is the guy who said Biden should send troops into the Federal Reserve.
I couldn't have made this up if I tried. One can only laugh.
Ending Central Bank Independence is not a point of view on which reasonable minds can differ as to its being a good idea.
I'm not saying it's a good idea, I'm saying Krugman's predictions are not very good. These are different claims!
He's not making a prediction here, he's pointing to past failures of markets to react to obvious crises until they become undeniable. "Destroying the Fed" is not something where he's going out on a limb regarding its inflationary impacts.
There is a school of thought that the Fed has a democracy deficit. That it can make mistakes without accountability. That some of its mistakes have been huge. Not saying I agree but the Fed has problems it needs to address.
The bond market really, really did not like Liz Truss, and it was not shy in letting the world know that. So obviously it can act to affect horrible public policy. But why is it not acting against Trump?
It’s a good question. Betting in SCOTUS to save the Fed based on its utterly unprincipled dictum?
AI cap ex is floating the whole thing.
Why would the economy suddenly change in response to any of these events?
So this is a good moment to give everyone the update on my U.S. vacation they’ve been waiting for. I know, I know.
In short: it’s been good. It’s always good. I always spend a year away, build up a social media and news headline-informed set of anxieties about what America is like, tell myself it’ll be weird, and then it’s normal. And good.
Having said that, when I think about how I’ll feel to get on the plane to go home to the UK, there are some things I’m not sorry to leave - for instance, what MY mentions.
On the other side of the ledger: Vermont. Vermont is so good. I lived in Vermont for 6 years 20 years ago, and it was good. And now I’m back on a visit and it’s good. It helps that the weather is great, but Vermont is so effortlessly itself, is the best way to put it I think. Like, there’s tourists, but you get the feeling that everyone would do what they’re doing anyway (note: tourism is super important; a guy at an artisan glass workshop in Burlington told me they, and other business owners, have been hit hard by the drop in tourism from Canada, as well as tariffs).
So: Indigenous American berserk (à la Roth) on the one hand, Vermont on the other. Vermont makes a strong case that balances out a lot of the dying empire bullshit, I gotta say.
Thanks for this update - glad you're having a good time! Safe travels for your return.
I myself was on vacation last week to the "up north" Michigan of my childhood. I'm not sure how much the region has been hit by the falloff in Canadian tourism; crowds were not terrible, but school is starting again and we were there during the week. I was somewhat surprised, however, to see that it is largely frozen in amber in the 1970s when I, as a child in a family of good Michiganders who rented the same lakefront cottage every year, spent most of my time there (have not been back during this millennium until last week). Ginormous portions of meat/potatoes/fudge (plus fish, fried only); proud allusion to celebrity visitors such as Bob Seger; "Werewolves of London" on the sound system; Mackinac Island Grand Hotel (did not stay there but out-of-state friends wanted to see it) flogging "Somewhere in Time." Even the weed dispensaries that have rained down on the Lower Peninsula were so thin on the ground that I don't recall seeing any, though I wasn't looking.
It was like backward time travel. I wish I had encountered the Watergate hearings and brought them with me back to the present.
Heartening to hear, as a fellow up north enjoyer
Up North Michigan or Yooper Michigan? Two different things.
Spent part of the time on Mackinac Island at the behest of friends we were traveling with, and part in the UP near Tahquamenon Falls. So both!
SNL Vermont
https://www.youtube.com/watch?v=nKcUOUYzDXA
Should've been NH, Vermont isn't like that
I guess I missed a lot of your writing here because I don't get the context.
No matter! Isn't it quite dry there this summer?
Could be? I think I recall hearing that it’s been an especially dry summer.
But in any case late summer is just a fabulous season - still warm but no mugginess and just a hint of the autumn to come.
I got married in Vermont, was lovely in the summer.
Seriously good place, Vermont.
Vermont also gave us Bernie, for which I will never forgive Vermont.
It does seem pretty bad. I keep telling myself it must have seemed like the country was going to fall apart in the late 60s/early 70s, even without the phones.
yes literal bombings
Hundreds of them!
If this administration ended today, I imagine it would take at least twenty years to get back to any sort of efficient and productive government. That's not only speaking to the destruction of institutions, but the destruction of public confidence in the institutions.
The US arguably hasn't had an efficient and productive government since the end of WW2
And any Democratic administration is going to have to initially use a lot of the powers that Trump has asserted like clearing out all the appointed boards and firing lots of new employees wholesale in order to do that kind of reset. Then, they'll have to decide if any new legislation (if it can get through Congress) to create some kind of guardrails will satisfy the weirdly executive power-worshipping Supreme Court that we have.
I mean court packing has to come first. Even if there’s no congressional majority, the next Dem should just send in the military to the Capitol building to waylay Republican congresspeople to prevent them from voting
This is bugf--k nuts. Go burn down someone else's country.
It’s probably the only way to save America, and I’ll never forgive Obama and Biden for not doing the same
Republican executive worshiping*
Trump got elected because public confidence in institutions was already destroyed. He is the result, not the cause. The keepers of those institutions are just waking up to it.
+1
Trump is at least as much symptom as cause. Though like a guy with a 105 degree fever caused by an infection, the symptom may do us in before the cause does.
Public confidence in the institutions was declining for a long time before Trump. He couldn't attack them without that decline in confidence.
So many sources of America’s strength have just been set on fire by the Trump administration, that I’ve sometimes likened it to a kind of National suicide. Which isn’t to say that there won’t be something called the United States on the map in ten or twenty years, I’m sure there will be. But it won’t be the leading global power we’ve come to know since WW2.
A National and potentially permanent diminishment.
It could be the beginning of the end of the American Empire. History doesn't owe any country a happy ending, nor a perpetual run at the top. On the other hand other great powers in history have gone through very difficult periods—seemingly characterized by crises, dysfunction, chaos, and acute decline—only to regroup and rise again. We've been around for more than two centuries—more than three centuries if you do the reckoning (as I like to do) starting from 1607. So I'd like to think it'll take more than four years to send us toppling over. I know some will counter: "The rot set in long before January 20, 2025." But, while one can see some ominous trend lines going back quite a while—maybe even to the late 1960s (Nixon's Southern strategy—a naked play to leverage racism for political gain—comes to mind)—I think there was a reasonable case the country was in good shape, maybe even increasingly ascendant, a mere twelve months ago. Last autumn the United States was enjoying receding crime, low unemployment, a booming stock market and falling inflation. We led all other high income countries in the post-Covid recovery. Our trillion dollar enterprises bestrode the global economy like mighty titans. Our universities and research labs were the envy of the planet. We appeared to have beaten China to the punch on AI. Even the scourge of opioid addiction was slowly being overcome.
So, America has some significant national strengths. We simply lack a government that seeks to increase and safeguard these strengths (instead, the current administration appears deadly determined to squander them). But their mandate need not endure indefinitely.
On the subject of mail in voting, 8 states have completely done away with in person voting, most of them on the West Coast. We tend to like the system a lot. Just want to point out that there would be a lot of pushback against federal legislation trying to end the practice, in case the east coast crowd wasn't aware.
Mail-in voting is fine. It is having >1 month to cast your vote plus another month to count votes that is the problem.
I think it's really the month to count that's the bigger problem.
All ballots should be required to be in by election day, if they arrive late, too bad. And states need to be able to count everything that night.
This is definitely doable
How sure are you the Trump in charge US Postal Service will deliver mail in ballots equally throughout the land?
The California system in particular is tailor-made to allow for weeks of menacing statements and false claims going viral. Do it like Florida and get everything counted upfront, then report final totals election night.
Uhh, no state has eliminated in person voting, has it? They just mail you a ballot but you can still vote in person if you want?
In WA you can still vote in person, but it’s not at your precinct, there are just a few centers. But yeah I did that when I spilled coffee all over my ballot
California does not allow in person voting at least in my county.
Yes. They are working for the other side, as you put it. The American century is over
Probs for the best. It was unsustainable
It would’ve been sustainable if we had brought other countries along with us, instead of treating their development in such a zero-sum way.
We've brought most of the world along with us. The whole point of the US designed world order was to spread prosperity broadly to ensure our own prosperity.
To an extent, but mostly for one decade in 2000-10 and mostly because of Chinese growth. Global inequality was otherwise mostly flat or even increasing slightly during most of the period of US hegemony. https://wir2022.wid.world/chapter-2/. Most poor countries didn’t see a lot of prosperity during most of the period of US hegemony.
We’ve did bring the world along, but at increasingly high costs that are going to be unsustainable
There are no costs to other countries developing. In fact we are now incurring costs to try to stop them from tariffs that are hurting US growth more than anyone else’s to a walls going up all over the world and even a growing risk of war. The world is not zero-sum, but us treating it like it is becomes a self-fulfilling prophecy.
America hasn’t treated other countries development in a 0 some way, before Trump, for about 80 years. In fact, its acquiescence contribute to the rise of Trump and its overextension. The world, and America, would be better for it to take a few steps back
“Before Trump” is a pretty big caveat, given that he’s been the most powerful force in US politics for nearly ten years and Biden continued much of his foreign policy.
And even before Trump we brutally impoverished a bunch of small third-world countries; it’s only when we tried to run the same playbook against Russia and China that it ran into limits.
It really does feel we're in the opening days of Erdogan/Orban-ization. That's a much more plausible outcome than the whole "1933"/"THIS IS FASCISM" rhetoric that's going around.
But I know that to many other people it feels different. To them, Trump is visible and doing things while Biden was low-energy and decrepit-looking. All the fired federal workers complaining must be the disloyal deep staters who are responsible for all the bad things in foreign policy and public health in the past few years. It's very easy to be in a media bubble where all the arrested immigrants are illegal gangbangers and all the Democrat-controlled areas of the country are chaotic lawlessness.
Despite all the dire warnings from the pundits, nothing terrible has visibly happened yet to the economy. The stock market is at an all-time high and gas prices are down. Rising prices from tariffs are just a sign that Trump cares about Americans more than foreigners; what's a little sacrifice to help your fellow Americans?
I don't know what the answer is to convince those people of how bad much of this is in the short and especially longer run. But I don't think that counting on an economic downturn to change their views is going to work.
This seems right to me, which makes me want to learn a bit more about Erdogan and Orban. Did they......also do a bad job, on top of the backsliding? Did they get the trains running on time?
From what I can tell, trains run but not on time. Periodic purges of government employees, attacks on independent institutions (media, academia, etc.), okay but mediocre economic growth, petty corruption/nepotism everywhere, lots of weird rhetoric, etc. Also a lot of shenanigans around election time.
There is a lot of chaos going on in the federal government, and that will inevitably show up in terms of worse functioning.
"Is this what collapse looks like from the inside?"
No. IMO none of these personal moves matter. But if the USD continues to decline and our long-term bonds continue to sell off ... I think that's what a real collapse will look like.
https://privatebank.jpmorgan.com/eur/en/insights/markets-and-investing/is-this-the-downfall-of-the-us-dollar
They matter for national security.
Certainly not much in comparison to having Pete **Fucking** Hegseth as Secretary of Defense.
Matters even _more_, given who SecDef is!
Only if you assume all they wouldn't follow orders; which I'm sure they all would. But it's just really hard to take anything seriously when Hegseth and RFK Jr. are Secretaries.
Well, they have been fired. So it's likely they said no.
I still like the proposal to have Hegseth and the Russian defense minister have a drinking contest to settle the whole Ukraine thing.
JEsus. Just go ahead and give all of Ukraine to Russia. Hegseth seems like the sloppiest of all drunks while Putin's staff -- literally -- start their day with a glass of vodka. Maybe if Hegseth was from Wisconsin but even then ...
https://nypost.com/2023/06/14/putins-staff-start-each-day-with-bottle-of-vodka-report/
It matters in terms of the operation and incentives of our intelligence operatives.
I always thought you were more openminded to the benefits of a weakening dollar? Not an accusation, I hold that view!
I definitely was but more as a competitive response to China's currency manipulation. This seems different; certainly when coupled with the bond market. I might also just be ~ depressed after listening to all the Odd Lots interviews from Jackson Hole.
So this is how liberty dies: with a thunderous yawn.
IMO US has been in slow decline since 2001. Trump’s stupidity and incompetence just accelerated things a bit and laid it bare for all to see.
The American empire has to end eventually. Not sure if it is right now though.
Once Japan and Germany's economies had recovered by the early 70s the writing was on the wall for the USA. But after that, things seemed to lumber along just fine for the next 30 years. However, the rise of China no one foresaw except Deng after he visited Japan in the 80s and decided he wanted their economy for China.
I'd be very worried as an American as China is no longer just producing cheap crap. Their products are getting better and there haven't been any real cracks in its leadership for a long time.
Over the long haul, a political movement based on one guy (i.e., Trump) is bound to recede. When it does there is still a chance for an American comeback though it looks pretty bleak at the moment.
This is a very zero-sum way of looking at the world. The US could easily have continued to prosper along with other countries. Other than maybe environmental constraints, which will be offset by declining populations, there is no reason why it would harm the US for other countries to be as rich as us. But Trump chose to make things zero-sum, and in doing so created a self-fulfilling prophecy.
I was referring to when Germany and Japan recovered roughly 20 years after WW2, the US no longer had such a huge share of global GDP. In the immediate postwar years they were the big dog economically and militarily making them basically an empire. To a certain extent, those postwar advantages still exist but are slowly eroding.
China has some cracks of its own mind you. There was a Peak China? piece in the Guardian that did a good job in itemizing some of them.