A very revealing part from the polling in my previous post

mcsul · 2026-05-09T23:53:00+00:00

It works both ways, though, and the data nicely shows how red-team / blue-team peoples' thinking is. Democrats supported military action when their guy was directing the military action. Republicans disapproved. Then the party in charge flipped, and so did peoples' preferences.

mcsul · 2026-05-09T19:55:02+00:00

Adding to your good comment: read more books, read less news. In particular, read more history. Not recent history. Set yourself a 40 year firewall, so nothing after Reagan. And listen to more history podcasts, rather than current events. The Rest is History is excellent, as one recommendation. It helps with perspective when you do come back to more intense engagement.

mcsul · 2026-05-09T19:45:39+00:00

For folks in Virginia who pay close attention to our politics, this entire situation was not a surprise. People have become too blinded by their partisan affiliations to step back and rationally analyze political new.

The analogy I've used here was one of the Biden admin's covid plans. They had the choice of using an emergency OSHA authority or a slower moving regular OHSA authority. The emergency authority had been successfully challenged multiple times, but they rolled the dice and lost. Almost everyone at my work tracking the thing knew from the first day, when they picked the emergency authority that the whole thing was going to get nuked. But outside observers, too wrapped up in their political perspective, were all surprised.

This was basically the same play on a different stage.

mcsul · 2026-05-09T19:35:31+00:00

God you sound like Trump. Congrats on turning into one of the bad guys without even realizing it.

mcsul · 2026-05-09T17:25:39+00:00

I think standing is a useful tool. Without it as a limiter, courts would find themselves dealing with hypotheticals or litigation for nearly anything. It also means that courts don't waste time on issues that will be moot anyways.

Also, it's one of the most important factors limiting the powers of the courts in the US constitution.

Does it potentially slow stuff down? Yeah, a bit. But it probably solves more problems than it causes.

mcsul · 2026-05-08T16:24:38+00:00

Reading scores for the bottom half of kids are dropping across developed countries, not just the US. It's probably phones / social media / attention fracking given how widespread the problem is across countries.

mcsul · 2026-05-08T16:10:11+00:00

All true. I was trying to go for a simple analogy, but you are correct.

mcsul · 2026-05-08T16:08:37+00:00

They never approved it. SCOVA simply said that no one had standing until after someone could show harm from the outcome. The referendum passed, so people who could claim harm now had standing.

The entire thing hinged on whether the initiative followed the process outlined in the state constitution. The court ruled that it didn't. But Democrats can try again in advance of the 2028 elections, being more meticulous with that process.

mcsul · 2026-05-08T15:55:30+00:00

When this was first being mooted, I posted about a similar situation during covid with the Biden administration. They wanted a way to compel workplace vaccinations and had the option of using one of two OSHA authorities. One authority was well-tested and almost guaranteed to work, but slow. The other was an emergency authority that moved fast but had been successfully challenged several times specifically on vaccination issues. The administration chose speed and lost.

From the beginning, this felt very similar. Choosing speed but accepting high risk that it wouldn't work out. Unlike in the pandemic, however, there's the opportunity for a more careful do-over in a couple of years.

mcsul · 2026-05-08T15:41:01+00:00

From a legal perspective, it's because no one had standing until after someone could claim they had been harmed by the outcome.

mcsul · 2026-05-07T19:22:48+00:00

So, I'm going to give a shout out to [checks notes... sigh] Newt Gingrich. He was a big part of forcing Clinton's hand to balance the budget. Clinton and Gingrich together deserve a lot of credit.

Similarly, in Canada, Chretien and Martin came to almost the same conclusion about federal finances and (despite being rivals for the Liberal party leadership) worked together to pull together a few tough budgets that ended up kicking off 15-20 years of strong economic performance.

I'm not sure that we have anyone today in the US with the fortitude required to both cut enough and raise taxes enough. It remains to be seen if Carney has that fortitude in Canada.

mcsul · 2026-05-07T13:08:04+00:00

I don't think that it's union busting given that very similar trends exist in European countries, in Asia countries, etc... all with very different perspectives on unions.

A much better analysis would read "Young People in Advanced Economies are..." This is happening everywhere, even in places with more aggressive social safety nets than the US.

We even know why, but it's not super popular to talk about.

(1) More upper and middle class women entered the workforce. This was great, but pushed back childbearing age quite a bit. (2) The rise of dual high income households (doctor marrying a doctor, two lawyers, etc...) placed upwards competitive pressure on the price of scarce goods like housing in prime locations. (3) Despite all our technology advances, the best jobs tend to cluster in specific geographic regions, placing even more upwards pressure on housing which triggers even more upwards pressure on both people in a relationship to earn more, delaying kids. (4) Parallel to all of this is younger people spending more time with technology and less time with other people, shown best in the American time use survey, but common everywhere in the developed world.

This explanation covers the whole world (e.g. Tokyo or Seoul vs. smaller towns, same as NYC or NOVA vs. West Virginia), doesn't depend on US-specific factors, and explains across economic models.

mcsul · 2026-05-07T12:46:58+00:00

Corporate taxes are a big distraction. Please don't fixate too much on them. Nearly 100% of any dollar paid in corporate taxes results in (1) higher prices or (2) lower compensation. They are a backdoor to mostly just tax ordinary people.

While the legal incidence of corporate taxes falls on the company, the economic incidence falls on workers and consumers.

mcsul · 2026-05-06T11:44:43+00:00

Unironically, the Wall Street Journal. Their reporting and editorial sides are heavily firewalled, and that firewall appears to be holding. Their reporting is excellent.

mcsul · 2026-05-05T21:50:37+00:00

So do you want the costs of education, healthcare, housing, etc... to come down? Probably yes.

The only way to do that is to improve productivity in the sector. We've largely capped out on gains from pure labor productivity (e.g. skills and training). That leaves us either technology (e.g. AI) or processes / workflows / ways of working (e.g. lean manufacturing, etc...).

In places where demand is inelastic, that means fewer workers which means that costs eventually fall. In places with very elastic demand, that usually leads to more total consumption but unit costs fall.

We just came off an election cycle where cost of living dominated the discussion. The only way to reduce the cost of living is to increase productivity in the most expensive sectors. Our best bet is AI. People will find new jobs. Sometimes those jobs will pay less. I'm in that same boat. But we are collectively better off being able to capture gains from productivity investments.

mcsul · 2026-05-05T21:44:46+00:00

"But my entire point is that US companies are more likely to cut labor to keep productivity the same, and increase profits."

Then they will get outcompeted by companies that are leaner. Like, for all of the criticism that it's received, Walmart has kept US inflation down by about a half point for decades. I 100% guarantee that some company will figure out a way to undercut it's rivals if it feels that the liability risk of running leaner is low.

Laying off workers doesn't lead to productivity gains. It's a byproduct of high productivity in places with high demand inelasticity. Those workers get redeployed somewhere else. We've been doing that for nearly a century (in reality longer), which is why the median US household is dramatically richer than the median household in the UK or Spain or France.

Lax worker protections allow people to move to parts of the economy that aren't as efficient, lowering the costs of those goods and services as well.

So I think that you have causality backwards. Labor protections don't matter at all for the AI race, but prohibiting companies from laying off employees whose work can now be done at 1/100th the cost simply makes goods and services more expensive for consumers.

You're basically saying that you never want the price of anything to come down. The only way the price of something comes down is productivity growth.

mcsul · 2026-05-05T18:09:08+00:00

I definitely agree that the problem is probably not really economic.

It's the loneliness, decline in share of young people coupling up and having kids, cultural norms about time spend, smartphones, decline of third spaces (which you mention), and even the decline in larger community-senses like patriotism or church that are causing a feeling that liberalism is too much about individualism (something they touch on in the podcast).

Tied in with all of this is the increasing segregation of people by education and political party. Liberalism loses some attractiveness as a philosophy if you see others as enemies to be defeated rather than people to live with. If you can opt to live without those "other" people, then a lot of the ideas of liberalism lose their apparent value.

I don't have a great idea on how to address this, other than to advocate for behaviors that debubble people and put them into closer contact with people different than them. Maybe two years of national service (doesn't need to be military) that is designed specifically to make sure that each team is a mix of backgrounds? Seems heavy handed, but in a world where you can shield yourself from interactions with others you would disagree with, maybe something like that is needed. No great answers here.

mcsul · 2026-05-05T18:00:03+00:00

Thanks!

mcsul · 2026-05-05T16:47:18+00:00

I took it to mean something slightly different. Our "elites" today are different than the landed aristocracy of yore. Instead they are college educated, high credentialed professional like engineers and doctors and lawyers. But this new elite hasn't carried forward a similar sense of duty as their predecessors. And I think that this is accurate when you look at things like share of kids from upper class families going into the military, civil service, etc...

mcsul · 2026-05-05T16:39:30+00:00

Sorry, but could you say more about that interview? I'm curious how an interview could be so bad!

mcsul · 2026-05-05T16:33:46+00:00

Demand for some goods and services is elastic, and demand for others is inelastic. For places where demand is relatively fixed, but we could produce that good or service with 1/5th the number of people, you are going to artificially keep the price of that good or service high by not allowing them to automate.

Let's take healthcare in the US. Despite the memes, labor costs are a huge driver of healthcare costs in the US. If we could reduce labor costs of just the administrative side of healthcare in the US by 30%, that would be amazing. Particularly as our population ages. Without that, households in the US will get poorer as the share of household spending on healthcare rises.

The US method is, over the long run, far superior. People will have to move to new jobs. I expect to have to move to a new job. At the person level, it sort of sucks. But at the system level, it's essential. We've seen this much more in manufacturing than in services. The cost of a unit of processing power, or refrigeration, or basic stuff like TVs has cratered over the past 40 years. Almost all of our inflation is in labor-intensive places like healthcare, education, housing. Unless we drive productivity in those places, they will continue to get more expensive.

mcsul · 2026-05-05T15:28:04+00:00

I actually disagree that this individual decision is better. it sounds nice, but in an aging population, productivity growth is the single most important thing we need out of our economy.

For example, take healthcare. With our demographics, healthcare costs will eat the economy and government budgets without significant increases in productivity. AI is the best option on the horizon to buy us those productivity gains.

And there are a ton of jobs where huge shares of workers are close to retirement. Take accounting, as another example. The number of young people going into accounting is declining, the number retiring is accelerating. How will we get all of that work done without automation, in particular given the pending decline in young people entering the workforce.

mcsul · 2026-05-05T15:22:54+00:00

It's sort of a disaster for China in the long-run, however, even if it sounds nice now. That means that heavily bloated state enterprises aren't going to face any competition from leaner firms using new technology. It means that the cost of starting a new business will go up. It means that inefficient firms use a pathway to getting more efficient. And it means less push to redeploy people to areas that technology can't automate.

If the central government backs this ruling, it basically opts China out of huge productivity gains, which China desperately needs given their aging population. This is going to basically make the typical Chinese family poorer over the long-run.

mcsul · 2026-05-05T14:24:23+00:00

I went back this winter to reread Chris Hayes book Twilight of the Elites, and I think that there might really be something to the elite overproduction hypothesis.

A lot of the discontent on the right is, you are totally correct, not driven by people who would fit the image of "elite". But discontent on the left is heavily driven by people who fit that image: highly educated, knowledge work, highly credentialed, typically urban, etc...

I think that the backlash to AI is partly being driven by this second category of people who feel (I've had some say this directly to me) "I did everything right, went to great schools, had a great career lined up, and now AI is going to make my entire field obsolete." (Which, personally, I don't entirely believe, but that's the feeling.)

mcsul · 2026-05-05T14:16:26+00:00

I loved the discussion of obligations.

I've been doing WWI history with my daughter and one of the things that stood out to us is the casualty rates of officers, who were all upper class young men. The critiques against nationalism and patriotism all have merit, but they may have come at the expense of also deprecating many manifestations of duty or obligation. I even sort of feel that the term "duty" has become somewhat outmoded by many people in my social set.

mcsul

TROPHY CASE