Share

Share Brad DeLong's Grasping Reality

Why post-1500 did the world’s wealthiest societies outsource brutality? And how did they come to create the idea of race and use it as their rationalization. Let us move from ancient misfortune to modern ideology, tracing slavery’s transformation as merchant and then industrial capitalism rlse. And we will pause for a moment to note the unseen costs of cheap goods: how the middle class became more than complicit but rather the prime mover in Atlantic slavery’s global machinery.

Start here: Whenever and wherever something is valuable, two strategies for acquiring it inevitably emerge. The first is what I might call the “nice economist” approach: resources are used to purchase the desired good or asset, transferring ownership through mutually agreed exchange. This method avoids destruction, minimizes waste, and—at least in theory—leaves all parties better off. It is, as Adam Smith would have it, the invisible hand at its most benevolent.

But there is always a second, darker option: the use of coercion, violence, or outright theft. When a prosperous mercantile or industrial economy sits at the center of a wider system—think of Britain in the 19th century, or Athens in the 5th century BCE—its very demand for resources creates perverse incentives at the periphery. Those on the outside, unable to compete with the core’s purchasing power, may instead turn to force. Thugs with spears—or, later, guns and whips—find profit in seizing people and land, compelling labor to produce goods for export to the wealthy center.

This pattern is ancient. In the 5th century BCE, the Skythian and other horse-lord elites of the Black Sea region enslaved local populations to grow wheat, which was then shipped to feed the citizens of Hellas, especially the city of the Athenai. Fast forward to the 19th century: the industrial economies of Britain and the U.S. North depended on cotton produced in the American South. After the forced “removal’ of Native Americans, the land was abundant but labor was scarce and valuable—hence, the brutal expansion of slavery.

Slavery, in any form, is a moral abomination. Within the household, and on the small farm or in the small workshop, it is moderated by the fact that the slave master has to look the enslaved person in the eye. In some cases, it is not that much worse than the "normal" household domination lineage heads exercise over poor, third cousins who have no independent resources of their own, but even there the fact that the point of buying a slave is that they are an alien without social power, a social network, or the ability to form one, making it sharper and nastier as they are easier to exploit, and to exploit more completely.

As the scale of the slave enterprise grows, and as the household becomes embedded in a merchant-capitalist sector where the slaves work is not limited by what the household can utilize, but is rather unlimited because their work can be sold on the market for money, things get worse. And the human social practice of slavery reaches its most monstrous proportions on large plantations, where enslaved people are forced to produce cash crops for distant markets. Especially absentee plantations. Owners then never need to become within eyesight of what they have set in motion. They never face any of the brutal human cost of their profits. Instead, they simply write terse letters to overseers: “Why are my returns not higher? Why have you not squeezed more wealth from this enterprise?” And what kind of person can flourish in such an intermediate overseeing position, and so becomes an overseer?

The system is then designed for maximum extraction, minimum accountability, and a studied indifference to suffering—a pattern that, I regret to say, recurs over and over throughout human—or, rather, inhuman—economic history.

After 1500, merchant capitalism became not just a sector in an agrarian-age economy, but rather the predominant mode of organization in what rapidly became imperial-commercial society. And so the typical mode of slavery underwent a profound transformation. It became plantation, and thus truly, obscenely nasty. And it became racialized in a way it had not been before.

In earlier eras, slavery was largely a matter of misfortune—being captured in war, falling into debt, or simply being in the wrong place at the wrong time. The enslaved were, for the most part, still recognized as people, albeit people in an unfortunate legal and social position. Yes, Aristotle famously mused that some non-Hellenes were actually “slaves by nature”. This, however, was more a rhetorical flourish than a dominant ideology. Slavery fit into a broader hierarchical order, where your place—slave or free—was simply your lot, not your essence, and where there were many hierarchical gradations in some Great Chain of Being.

However, as agrarian-age societies were followed by less ascriptive, more mobile-contractual societies—ones where individuals were supposed to find their own place through markets and negotiation and the construction of social networks—this old logic of slavery as a low status into which you were fixed by birth or ill-luck became harder to sustain. The world increasingly committed, at least in rhetoric, to individuals’ both getting to choose and having to find their place. The result was the valorization of individual freedom and equality.

So what then could you do with the idea of slavery?

You could eliminate it. And eventually the British Empire led the way to doing so. But it was very, very profitable! It was increasingly profitable as the commercial transoceanic economy gathered strength! Its profitability was amped-up another order of magnitude by the coming of SteamPower society. And so societies doubled down on the idea that rights, freedom, and equality were only for the true, full humans. They began to focus on a belief that some groups were inherently suited to enslavement in order to justify the continued existence of slavery within an Enlightenment-era world of humans with natural rights.

And race became the marker: Africans and their descendants were cast as “slaves by nature,” their status justified not by circumstance but by supposedly immutable characteristics. This was the ideological sleight of hand that underpinned the Atlantic slave trade and the plantation economies of the New World.

It is crucial to remember, though, that the principal beneficiaries of this system were not the plantation owners. The principal beneficiaries were the middle-class consumers at the heart of the industrial and commercial economies. Their cheap sugar, cotton, and tobacco were made possible by the brutal labor of enslaved people on distant plantations. This is the uncomfortable arithmetic of global capitalism: prosperity in one place, purchased at the cost of suffering in another.

Yet, history is not without its ironies.

The American Civil War (1861–1865) saw the states of the United States that did not secede and formed the Union volunteer to pay a staggering price to end slavery: 400,000 young men killed, another 300,000 maimed.

The magnitude of the suffering he had set in motion drove Abe Lincoln mad. As he said in his Second Inaugural Address, it appeared possible—even likely—that the war would continue until:

all the wealth piled by the bondsman’s two hundred and fifty years of unrequited toil shall be sunk, and until every drop of blood drawn with the lash shall be paid by another drawn with the sword…

Give a gift subscription

Yet he had still done a good thing in the eyes of God to have refused to allow the Confederates to secede from the United States, and preserve for a while their institution of slavery. For:

as was said three thousand years ago, so still it must be said ‘the judgments of the Lord are true and righteous altogether’…

Leave a comment

The American Civil War. 400,000 Union young men dead. Another 300,000 maimed. To rescue 5,000,000 American slaves from complete bondage. But, then, because of the substantial failure of Reconstruction, return them to a form of caste serfdom in which they had little property, less voice, and no vote. For a century. And as Claudia Goldin has pointed out, even setting aside this immense human cost, the United States wasted so much treasure on the war that, by her calculations, it could have used it to more than purchase every enslaved person in the United States at peak 1860 market prices, and also provided each freed family with 40 acres of decent farmland, plus a mule or two. Plus 300,000 Confederate young men dead, and 250,000 maimed.

Yet, still, well done by good and faithful servants, in our eyes, and hopefully in the eyes or others wiser than me.

Get 50% off a group subscription

Time to sum up, provocatively:

Slavery was not always about race—until the coöccurence of modern capitalism with Englightenment ideas demanded a new justification for old cruelties. The middle-class comforts of the nineteenth century rested on a foundation of violence and forced labor, rationalized by a newly invented ideology of race. The economic engine of empire pressured the turning of something that had been seen as random misfortune into a natural and systemic racial hierarchy, all in service of cheap cotton and sugar. What linked the Skythian horselords north of the Black Sea in the -400s to the cotton fields of Mississippi in the 1800s? The relentless logic of the plantation and the market linked them. And in the American case, the bill, grimly, came due with bloody justice of a strange and peculiar sort in the Civil War.

Refer a friend

Leave a comment

Subscribe now

If reading this gets you Value Above Replacement, then become a free subscriber to this newsletter. And forward it! And if your VAR from this newsletter is in the three digits or more each year, please become a paid subscriber! I am trying to make you readers—and myself—smarter. Please tell me if I succeed, or how I fail…

Share

I have a section from my American Economic History lectures this spring on the post-1500 Atlantic-economy racialization of early modern slavery that I want to get into good enough shape to post here. It is not yet there.

And this morning a correspondent who does not especially wish me well this morning with respect to my mental harmony sends something across my screen. He sends me a piece from the New York Times that is relevant to that item on my to-do list, And so I go down a rabbit hole.

The piece:

Richard Fausset: A White Nationalist Wrote a Law School Paper Promoting Racist Views. It Won Him an Award <https://www.nytimes.com/2025/06/21/us/white-supremacist-university-of-florida-paper.html>: ‘The University of Florida student won an academic honor after he argued in a paper that the Constitution applies only to white people. From there, the situation spiraled: Preston Damsky… law student… white nationalist… antisemite. Last fall, he took a seminar taught by a federal judge on “originalism”… argued that the framers had intended for the phrase “We the People,” in the Constitution’s preamble, to refer exclusively to white people. From there, he argued for the removal of voting rights protections for nonwhites, and for the issuance of shoot-to-kill orders against “criminal infiltrators at the border.” Turning over the country to “a nonwhite majority,” Mr. Damsky wrote, would constitute a “terrible crime.”… Mr. Damsky, 29, was given the “book award,” which designated him as the best student in the class. According to the syllabus, the capstone counted the most toward final grades….

The Trump-nominated judge who taught the class, John L. Badalamenti, declined to comment…. The granting of the award set off months of turmoil on the law school campus…. Mr. Damsky’s paper includes… a call to “reconsider” birthright citizenship, and an assertion that “aliens remain second-class persons under the Constitution.” It also argues that courts should challenge the constitutionality of the 14th Amendment, which ensures birthright citizenship, due process and equal protection under the law, and the 15th Amendment, which protects the right to vote for nonwhite citizens.

Mr. Damsky concluded the paper by raising the specter of revolutionary action if the steps he recommended toward forging a white ethno-state were not taken. “The People cannot be expected to meekly swallow this demographic assault on their sovereignty,” he wrote, adding that if the courts did not act to ensure a white country, the matter would be decided “not by the careful balance of Justitia’s scales, but by the gruesome slashing of her sword”…

Share Brad DeLong's Grasping Reality

The New York Times story does not tell us that Damsky has been banned from the campus for various of his other actions, “including a message calling for the elimination of Jews ‘by any means necessary’”. Thus the piece is, I think, not quite fair with respect to the law school administration, which I see as more likely than not doing a pretty good job in handling the situation in its full gestalt, both with respect to maintaining itself as a community and using this troll’s appearance as a teaching moment.

And I do confess that I do not understand how a paper that argues that courts “should challenge the constitutionality of the 14th Amendment, which ensures birthright citizenship, due process and equal protection under the law, and the 15th Amendment, which protects the right to vote for nonwhite citizens”. How can a duly-ratified constitutional amendment be argued unconstitutional? That claim that the XIV Amendment to the Constitution is un-Constitutional seems, to me at least, the leading candidate for MOST JUST WRONG. I cannot see how a paper that does that can be any good. This is especially the case since Damsky appears to draw very strong conclusions for the state of the law today that are totally consistent with the post-XIV Amendment Constitution.

That said, the argument that the original public meaning of “we the people” in the U.S. Constitution was “we the [white] people” seems to me to be intellectually stronger than much of what I see winning majorities in the Roberts court these days.

Leave a comment

Give a gift subscription

Cast yourself back to 1857 and Chief Justice Roger B. Taney writing the decision in Dred Scott v. Sanford. Taney’s argument is:

As I recall, Roger B. Taney's principal argument was that:

• (a) if back in 1775 white Englishmen had regarded Black Africans as capable of becoming citizens,

• (b) they would not have been able to indulge in the Atlantic slavery economy as they did,

• (c) hence those enslaved and their progeny were not citizens of the several states in 1787,

• (d) did not become citizens of the United States upon the adoption of the Constitution,

• (e) have not been made citizens of the United States by congressional naturalization since, thus

• (g) while Dred Scott is indubitably a citizen of the state of Illinois,

• (h) he is not a citizen of the United States, and

• (i) has no standing to be a plaintiff before the federal courts.1

My suspicion is that back in his day our good Jacksonian Chief Justice Taney regarded this argument of his as Solomonic baby-splitting. He was trying to give each section's powerbrokers what they wanted most: Illinois could free slaves brought into it and make them citizens, but no federal court could poke its nose into the status of blacks in Missouri, or in the territories. And I would note that the infamous "black men have no rights..." Taney quote is, in context, not put forward as his opinion in 1857, but rather as an opinion underpinning the original public meaning or whatever of the words of the U.S. Constitution in 1787.

(Of course, Taney then goes on to write that if Scott had standing, he would still lose because (j) Congress has no power to prohibit slavery in the territories, and (k) slave property is in any event protected by the V Amendment.)

I do think that there is some evidence that this argument of Taney’s was seen to have some force in 1865. The framing of the 14thAamendment suggests that, at least to me: "All persons born or naturalized in the United States, and subject to the jurisdiction thereof, are citizens of the United States and of the State wherein they reside..."

Taney’s (and Damsky’s) argument about how racist white Americans were in the late 1700s seems to me to be not weak.

Consider Benjamin Franklin, writing in 1751 about the swarthy German immigrants polluting his beloved Pennsylvania:

Benjamin Franklin: Observations Concerning the Increase of Mankind, Peopling of Countries, & c.<https://founders.archives.gov/documents/Franklin/01-04-02-0107>: ‘Why should the Palatine Boors be suffered to swarm into our Settlements, and by herding together establish their Language and Manners to the Exclusion of ours? Why should Pennsylvania, founded by the English, become a Colony of Aliens, who will shortly be so numerous as to Germanize us instead of our Anglifying them, and will never adopt our Language or Customs, any more than they can acquire our Complexion.

Which leads me to add one Remark: That the Number of purely white People in the World is proportionably very small. All Africa is black or tawny. Asia chiefly tawny. America (exclusive of the new Comers) wholly so. And in Europe, the Spaniards, Italians, French, Russians and Swedes, are generally of what we call a swarthy Complexion; as are the Germans also, the Saxons only excepted, who with the English, make the principal Body of White People on the Face of the Earth.

I could wish their Numbers were increased. And while we are, as I may call it, Scouring our Planet, by clearing America of Woods, and so making this Side of our Globe reflect a brighter Light to the Eyes of Inhabitants in Mars or Venus, why should we in the Sight of Superior Beings, darken its People? why increase the Sons of Africa, by Planting them in America, where we have so fair an Opportunity, by excluding all Blacks and Tawneys, of increasing the lovely White and Red?

But perhaps I am partial to the Complexion of my Country, for such Kind of Partiality is natural to Mankind…

Get 50% off a group subscription

The only semi-saving grace I can find for Franklin here is the claim that Amerindians belong, and that the aim of “excluding all Blacks and Tawneys” is to get the benefit of “increasing the lovely White and Red”.

Thus the only potential successful rebuttal I see to the argument that the “we the people” acting to establish the Constitution in 1787 were the white people would, I think, require that you inquire and establish that freed slaves and their descendants were part of the ratifying electorate back at the establishment of the Constitution. Looking at the history as of 1787, we find:

• Vermont: Its 1777 constitution was the first in the U.S. to ban slavery outright and did not restrict voting by race. Free Black men who met the property requirements could vote, and there is some evidence that a few did.

• New Hampshire: The 1784 constitution did not specify race as a barrier to voting. The franchise was limited by property and taxpaying requirements, but there is no evidence of a formal racial bar. Some historians believe free Black men could and did vote.

• Massachusetts: The 1780 Massachusetts Constitution did not restrict voting by race. Theoretically, any free man meeting property requirements could vote. In practice, some free Black men did vote in the late 18th and early 19th centuries, though the numbers were small and local officials sometimes found ways to discourage or ignore their participation.

• Rhode Island: The property-based franchise did not explicitly bar Black men. There are scattered references to free Black property owners, but no clear evidence of Black voting before the 1840s, when the state’s Dorr Rebellion and new constitution clarified the issue.

• Connecticut: The 1662 colonial charter, still in effect in 1787, limited voting to “freemen,” and in practice, this meant white men. There is no evidence that free Black men voted in Connecticut at this time, and later laws explicitly excluded them.

• Pennsylvania: The state did not explicitly bar free Black men from voting, and some did vote, especially in Philadelphia, as long as they met property and taxpaying requirements.

• New York: Free Black men who met property requirements could vote in New York. This right was later restricted in 1821, but in 1787, Black property owners could participate in elections.

• New Jersey: Its 1776 constitution allowed “all inhabitants” worth at least £50 to vote, which included women and free Black men. This was rolled back in 1807.

• Delaware, Maryland, Virginia, North Carolina, South Carolina, Georgia?: No way.

Is that enough Black voting in the ratification elections to have made it “we the people” rather than “we the white people” back in the day? Maybe. Maybe not. Do recall the slogan of the South African Communist Party during the Rand Rebellion of 1922: “Workers of the world, unite and fight for a white South Africa”.

But Roger Taney in Dred Scott could easily have decided the standing issue the other way, noting that in eight states in 1787 sufficiently well-off freedmen were, potentially at least, in the body politic that established the Constitution, and hence that Illinois's recognition of his state citizenship carried federal citizenship with it.

Refer a friend

• Bujold, Lois McMaster. Brothers in Arms. Baen Books, 1989. https://www.baen.com/brothers-in-arms.html

• DeLong, J. Bradford. “I Have Yet Another Problem with Mark Graber…” (2008). Grasping Reality. https://delong.typepad.com/sdj/2008/08/i-have-yet-anot.html ↗008/08/i-have-yet-anot.html

• DeLong, J. Bradford. “Law Professor Mark Graber Strikes Again” (2007). Grasping Reality. https://delong.typepad.com/sdj/2007/08/law-professor-m.html

• DeLong, J. Bradford. “What Did People Expect When the Constitution Was Ratified?” (2007). Grasping Reality. https://www.bradford-delong.com/2007/01/what_did_people.html

• Fausset, Richard. “A White Nationalist Wrote a Law School Paper Promoting Racist Views. It Won Him an Award.” New York Times, June 21, 2025. https://www.nytimes.com/2025/06/21/us/white-supremacist-university-of-florida-paper.html

• Finkelman, Paul. The Origins of the Dred Scott Case: Jacksonian Jurisprudence and the Supreme Court, 1815–1859. University of Georgia Press, 1997. https://ugapress.org/book/9780820318871/the-origins-of-the-dred-scott-case/

• Foner, Eric. The Fiery Trial: Abraham Lincoln and American Slavery. W.W. Norton, 2010. https://wwnorton.com/books/9780393340662

• Franklin, Benjamin. “Observations Concerning the Increase of Mankind, Peopling of Countries, &c.” (1751). Founders Online. https://founders.archives.gov/documents/Franklin/01-04-02-0107

• Graber, Mark. Dred Scott and the Problem of Constitutional Evil. Cambridge University Press, 2006. https://www.cambridge.org/us/academic/subjects/law/constitutional-and-administrative-law/dred-scott-and-problem-constitutional-evil

• Litwack, Leon F. North of Slavery: The Negro in the Free States, 1790–1860. University of Chicago Press, 1961. https://press.uchicago.edu/ucp/books/book/chicago/N/bo3646184.html

• Oakes, James. The Radical & the Republican: Frederick Douglass, Abraham Lincoln, & the Triumph of Antislavery Politics. W.W. Norton, 2007. https://wwnorton.com/books/9780393061949

• Ratcliffe, Donald. “The Right to Vote and the Rise of Democracy, 1787–1828.” Journal of the Early Republic, Vol. 33, No. 2 (Summer, 2013), pp. 219–254. https://www.jstor.org/stable/10.1353/jer.2013.0040

• Taney, Roger B. Opinion in Dred Scott v. Sandford, 60 U.S. 393 (1857). https://www.oyez.org/cases/1850-1900/60us393

• Tomlins, Christopher. Freedom Bound: Law, Labor, & Civic Identity in Colonizing English America, 1580–1865. Cambridge University Press, 2010. https://www.cambridge.org/core/books/freedom-bound/6E4F9D7DDAF3B6E84A2A6B6E2B9C2C6B

• Waldstreicher, David. Slavery’s Constitution: From Revolution to Ratification. Hill and Wang, 2009. https://us.macmillan.com/books/9780809072354/slaverysconstitution

Leave a comment

Subscribe now

Taney: The question to be decided is whether the facts stated in the plea are sufficient to show that the plaintiff is not entitled to sue as a citizen in a court of the United States.... The question is simply this: can a negro whose ancestors were imported into this country and sold as slaves become a member of the political community formed and brought into existence by the Constitution of the United States, and as such become entitled to all the rights, and privileges, and immunities, guarantied by that instrument to the citizen, one of which rights is the privilege of suing in a court of the United States in the cases specified in the Constitution?... Are [they] citizens of a State in the sense in which the word "citizen" is used in the Constitution of the United States[?]... On the contrary, they were at that time [of the writing of the Constitution] considered as a subordinate and inferior class of beings who had been subjugated by the dominant race, and, whether emancipated or not, yet remained subject to their authority, and had no rights or privileges but such as those who held the power and the Government might choose to grant them....

In discussing this question, we must not confound the rights of citizenship which a State may confer within its own limits and the rights of citizenship as a member of the Union. It does not by any means follow, because he has all the rights and privileges of a citizen of a State, that he must be a citizen of the United States.... Each State may still confer them upon an alien, or anyone it thinks proper, or upon any class or description of persons, yet he would not be a citizen in the sense in which that word is used in the Constitution of the United States, nor entitled to sue as such in one of its courts, nor to the privileges and immunities of a citizen in the other States.... The Constitution has conferred on Congress the right to establish an uniform rule of naturalization, and this right is evidently exclusive, and has always been held by this court to be so. Consequently, no State... ca... invest him with the rights and privileges secured to a citizen... under the Federal Government, although, so far as the State alone was concerned, he would undoubtedly be entitled to the rights of a citizen and clothed with all the rights and immunities which the Constitution and laws of the State attached to that character....

It becomes necessary, therefore, to determine who were citizens of the several States when the Constitution was adopted. And in order to do this, we must recur to the Governments and institutions of the thirteen colonies when they separated from Great Britai.... We must inquire who, at that time, were recognised as the people or citizens of a State whose rights and liberties had been outraged by the English Government, and who declared their independence and assumed the powers of Government to defend their rights by force of arms....

In relation to that unfortunate race... the public history of every European nation displays it in a manner too plain to be mistaken. They had for more than a century before been regarded as beings of an inferior order, and altogether unfit to associate with the white race either in social or political relations, and so far inferior that they had no rights which the white man was bound to respect, and that the negro might justly and lawfully be reduced to slavery for his benefit. He was bought and sold, and treated as an ordinary article of merchandise and traffic whenever a profit could be made by it. This opinion was at that time fixed and universal in the civilized portion of the white race. It was regarded as an axiom in morals as well as in politics which no one thought of disputing or supposed to be open to dispute, and men in every grade and position in society daily and habitually acted upon it in their private pursuits, as well as in matters of public concern, without doubting for a moment the correctness of this opinion.

And in no nation was this opinion more firmly fixed or more uniformly acted upon than by the English Government and English people. They not only seized them on the coast of Africa and sold them or held them in slavery for their own use, but they took them as ordinary articles of merchandise to every country where they could make a profit on them, and were far more extensively engaged in this commerce than any other nation in the world...

Share

Share Brad DeLong's Grasping Reality

Down the hall from my office, Barry Eichengreen is quite annoyed:

Barry Eichengreen: The Genius Act Will Bring Economic Chaos <https://www.nytimes.com/2025/06/17/opinion/genius-act-stablecoin-crypto.html>: ‘If Donald Trump and his allies have their way in Congress, America could soon see… bank failures, personal bankruptcies and financial instability… regularly… unleash[ed]… chaos.. [from] the Genius Act… [which] would give hundreds… of American companies the ability to issue their own currencies… bypass[ing] the banking system and credit card networks.… America had a similar banking system more than 150 years ago, and it unleashed chaos and financial ruin….

[In] the Free Banking Era… sometimes the system worked, particularly in states like New York where strict regulation ensured that banks held enough assets…. But in others, those assets were sometimes all but worthless…. One estimate places the losses to Michigan residents from discounted or worthless bank notes as high as $4 million, almost half the state’s income in 1840…. Regulators have… [enough] trouble keeping an eye on insured banks, [so] how can they be expected to exercise perfect oversight of hundreds, if not thousands, of stablecoins issued not just by banks but by tech firms and crypto start-ups? The major crypto investors behind the Genius Act must know this; some of them were Silicon Valley Bank’s biggest customers….

Those are risks we are taking on by catering to crypto enthusiasts… [and others] who would in all likelihood profit substantially from issuing stablecoins with the government’s imprimatur. The arrow of history points away from the private provision of multiple kinds of money…. It seems like everything new is old again…. When Mr. Trump describes the [high-tariff] late 19th century as a time when Americans “were at our richest,” maybe someone should remind him that life expectancy was just over 40, and real income was 11 percent what it is today…

Leave a comment

Subscribe now

The principal senators who pushed the Genius Act through its Senate passage 68-30 appear to be Bill Hagerty (R-TN), Tim Scott (R-SC), Cynthia Lummis (R-WY), Kirsten Gillibrand (D-NY), and Angela Alsobrooks (D-MD). Its principal pushers in the House appear to be Bryan Steil (R-WI) and Rep. French Hill (R-AR), together with Tom Emmer (R-MN), Josh Gottheimer (D-NJ), Ritchie Torres (D-NY), Byron Donalds (R-FL), and Zach Nunn (R-IA). An interesting crew. Strongly opposed is Elizabeth Warren (D-MA), who usually knows what she is talking about. Also strongly opposed is Jeff Merkley (D-OR), who always knows what he is talking about. Maxine Waters (D-CA), Stephen Lynch (D-MA), Al Green (D-TX), Ayanna Pressley (D-MA), and Rep. Rashida Tlaib (D-MI) lead the opposition in the House.

But it may well be too late to stop this train.

What is my view? First, it is that Barry is right. Second, it is that everything that is good about company-issued stablecoins would be much better achieved by looking to the European Union, and following their lead in capping interchange fees. That would provide substantial savings to businesses and consumers without handing understaffed regulators a safety-and-soundness supervision burden they will not be able to satisfactorily bear.

Give a gift subscription

If the current draft of the Genius Act becomes law, I think the odds are good that my successors teaching economic history 50 years hence will have to distinguish the Mortgage Great Recession from the Crypto Great Recession.

It is a fact that the rapid growth of stablecoins—crypto tokens pegged to assets like the US dollar—has quietly transformed them from a small sideshow into a genuine risk for the global financial system. Already stablecoin operators may hold more Treasury bills than even major foreign investors like China. Should money flows out of stablecoins, operators would be forced to sell Treasuries and whatever other assets they hold claiming they are safe. This is a system made for a positive-feedback destabilizing interest rate and loss-of-confidence loop—the kind of thing that generated the 2008-2010 Great Recession. The kind of thing we saw appear on the horizon with amazing speed with the extraordinarily rapid collapse of Silicon Valley Bank.

The stablecoin sector is opaque, lightly regulated, and growing fast. As it grows, the requirement for stricter disclosure and tighter regulation grows muh faster. But under this second Trump administration no such thing will happen. What happens in crypto can no longer stay in crypto. The risks are now and will become increasingly everyone’s problem.

And there is a problem that growth of stablecoins might help to solve. Begin by recalling the function of interchange fees. Every time you swipe your credit or debit card, a percentage—typically 1-3%, depending on the network and card type—flows from the merchant to the bank that issued your card. This is the result of a complex dance between network power, market structure, and regulatory lassitude. The credit card companies, wielding their substantial market power, set these fees. Banks, eager for a slice of the action, do not try to compete them down. Merchants and consumers, meanwhile, are left holding the bag, splitting processing fees vastly in excess of any real resource costs.

Stablecoin advocates—those most enthusiastic for the Genius Act—argue that their digital creations will disintermediate this system, offering faster, cheaper, and more transparent payments. They may well be right. Stablecoins do have yet to demonstrate that they can deliver payments at scale with the reliability and transactor protections that the existing system provides. But they may well. So it is not completely crazy to be willing to make this Devil’s Bargain, reducing the costs of financial oligopoly at the price of adding the risks associated with the potential for fragmentation of the payment system, regulatory arbitrage, and the very real possibility of catastrophic runs.

Federal Reserve Chair Jerome Powell is cautious. He is very clear about the need for comprehensive, robust federal regulation of stablecoins. He believes that “establishing a legal framework for stablecoins is a good idea,” because these digital assets are “a form of money” and thus “robust federal oversight” is essential. “Depending on what’s in it, [a stablecoin bill] is a good idea. We need that. There isn’t one now.” And it is the “depending on what’s in it” that is the crux. What needs to be in it is a regulatory-and-supervision system to check every stablecoin issuer or group of issuers large enough to threaten to create systemic risk. And the Genius Act does not do enough. There is no “living will” regime for stablecoin issuers. There is no requirement for stress testing or scenario analysis of the kind we now demand from systemically important banks. Nor is there any clear, specified, pre-funded resolution régime established.

These absences tilt the balance against the Genius Act.

The balance is especially tilted against because there is a better way than hoping that stablecoin competition will push credit-card companies to substantially lower fees. That might work. We know that interchange fees are not set by market forces in a competitive market. Network externalities and strategic behavior rule instead. We know that these forces have given the United States extremely high such fees.

But elsewhere the workings of these monopoly-generating forces generating high fees have been overriden. The European Union has capped them since 2015.

And there have been no bad consequences.

Banks here in the U.S. argue that lower interchange fees will force them to cut back on rewards programs or raise fees elsewhere. Perhaps. But the European experience suggests that the magnitude of these effects is modest. The sky did not fall. Financial innovation did not wither on the vine. The credit- and debit-card businesses are still profitable ones that are well-served in Europe. They are just not ludicrously and obscenely profitable.

European merchants pay less, consumers face lower prices, and the payments system continues to function—efficiently, securely, and with a single, universally accepted unit of account. The monetary system has not fragmented into a patchwork.

Economists from Walter Bagehot to Milton Friedman and beyond have taught us that the “singleness” of money—the ability of a dollar to be accepted everywhere at face value, without question or discount—is a public good of the highest order. To jeopardize it in the pursuit of lower transaction costs is, to put it bluntly, a dangerous folly, when there is proven alternative.

A cap on interchange fees targets the problem directly. It reduces the rents extracted by the payments oligopoly, channels the savings to merchants and consumers, and does so without potentially undermining the integrity of the financial system. The only ones made worse off are the executives, shareholders, and option-holder of the credit-card companies. of Visa and Mastercard, who are unlikely to elicit much public sympathy.

Capping interchange fees is a policy with clear, broad-based benefits. It reduces costs for merchants, lowers prices for consumers, and preserves the integrity of the monetary system. It is, in short, the kind of technocratic, evidence-based reform that has served the American economy well in the past. It is not flashy. It does not promise to “disrupt” or “revolutionize” the payments landscape. But it works.

With an interchange fee cap, the Genius Act would reveal itself as hat it is: a solution in search of a problem.

Note that the push for stablecoin deregulation is not, at its core, a grassroots movement for consumer empowerment. It is, rather, a campaign by a well-financed coalition of crypto investors, tech giants, and financial intermediaries—many of whom stand to profit handsomely. Their interests are not aligned with those of the broader public, which has an overriding interest in financial stability.

Get 50% off a group subscription

Refer a friend

Leave a comment

Subscribe now

Share

Give a gift subscription

How bipedalism, bureaucracy, and the binding of time forged the only superintelligent hypersocial superorganism on Earth.

Or, alternatively: the improbable ascent of the East African Plains Ape to planetary dominion—by way of gossip, gift-exchange, and Google.

Or is it, perhaps: Is your smartphone really just the latest chapter in a multi million-year story of collective superintelligent cognition?

I was provoked this AM to turn back to this project by Doug Jones’s showing us a very interesting chart:

Share Brad DeLong's Grasping Reality

And writes:

Doug Jones: Calories and curves <https://logarithmichistory.wordpress.com/2025/06/16/calories-and-curves-9/>: ‘Comparing energy expenditure (TEE or Total Energy Expended) and fat among humans and our closest relations: chimpanzees…gorillas… and orangutans (Pongo)… adjusted for differences in overall body mass…. Humans are a high-energy species. Also we carry a lot more body fat… particularly… women… extra fat to meet the high energy demands of human infants, gestating and (even more) nursing. But it even applies to men…. A high-energy life-style means… an extra reserve of fat in case of emergencies. We don’t know [for] how long ago our ancestors [had done this]…. A high energy life-style also goes with extensive food sharing and changes in human kinship…

Leave a comment

(The chart is from Pontzer & al. (2016),” Metabolic acceleration and the evolution of human brain size and life history” <https://www.nature.com/articles/nature17654>.)

This bears immediately and strikingly on Joseph Henrich’s work.

Share

Remember when the future was really cheap? The market’s discounting of long-term value has quietly shifted, exposing deep uncertainties about growth, savings, and the persistence of chaos-monkey governance. The market’s real interest rate calculus has changed. The “normal” macroeconomic world of the 1990s is a fading memory, replaced by a regime where the future is more valuable, but hardly secure—still haunted by the global savings glut, if not full-blown secular stagnation, with policy uncertainty never far from the stage.

Share Brad DeLong's Grasping Reality

Give a gift subscription

Across my screen comes the very sharp Tim Duy, who writes:

Tim Duy: Fed Watch, 6/18/25 <https://public.hey.com/p/5gobQ2gmfq4owmTHRvNSgCcY>: ‘The path to a [Federal Reserve] rate cut begins with inflation coming in below expectations [of 0.3%-points per month] over the summer, which means that tariffs are absorbed in the economy somewhere other than in consumer prices, or that service sector disinflation compensates for tariffs. There is a lot of data between now and September. The Fed’s not going to know what it’s doing until it gets its hands on that data.…

Leave a comment

The SEP projections for 2026 and 2027 show slightly more persistent inflation than previously expected. This is, perhaps, a nod to the structural forces—demographics, deglobalization, fiscal expansion—that have made the post-plague world so challenging for central bankers.

And Tim Duy notes that the Federal Reserve is now substantially and evenly split. Barkin, Hammack, Kugler, Logan, Musalem, Schmid, and Williams are expecting and hoping to hold interest rates constant throughout the rest of 2025. Bostic and Kashkari are pencilling in one 25%-point rate cut. Barr, Collins, Cook, Daly, Goolsbee, Harker, Jefferson, and Powell are pencilling in two cuts. And Bowman and Waller believe an 0.75%-point rate cut before January would be appropriate.

For the no-big-shock longer run, the hawks see the neutral Fed Funds rate that is the economy’s aggregate demand-supply balance point as still at something like 3.75%/year; the doves see it as 2.75%. (With the current 3-Month Treasury-Bill rate at 4.2%/year and the 10-Year Bond rate at 4.4%/year; and trailing-year CPI core inflation at 2.75%/year.)

With a confused and evenly split FOMC, the Fed’s stance is firmly “wait and see.” Summer inflation news, primarily driven by the evolving impact of Trump chaos-monkey tariff governance, ought to be decisive. Then again, history teaches us that “the next six months will probably be decisive” is more often than not an unhelpful cl=op-out.

Give a gift subscription

Meanwhile, the Fed is comfortable holding steady as long as the buffering labor market remains solid and growth continues, with weakness spreading but still below any recessionary trigger level. The June FOMC meeting left policy rates unchanged, as had been widely expected, given how the committee adrift between conflicting economic signals and riven by internal division. Nine participants expect one or no cuts in 2025; ten expect two or three. And those diverging paths diverge further as people try to peer through the veil of time and ignorance to assess the longer run.

Powell appears to want to downplay the significance of dot-plot division, calling it a snapshot of individual guesses rather than the result of a committee deliberation that had led to the coalescence of diverging camps. Powell emphasized that all remains in the air: “everyone would agree that they’re all going to be data dependent”. Powell emphasized that no one on the committee is wedded to their projections. “No one holds these rate paths with a great deal of conviction,” he said.

This approach is, I think, both prudent and perilous. Prudent, because the world is genuinely uncertain: the impact of tariffs is unclear, inflation has been softer but remains sticky, and the labor market—while still strong—shows some signs of cooling. Perilous, because the Fed’s explicit data dependence invites markets to overreact to each new data point, amplifying volatility and making policy communication even more challenging.

Powell hinted that the key uncertainty—of course—is the impact of tariffs. Are there any buffers to keep them from feeding through into consumer prices? Might we expect some offset from disinflation in services? As Duy says, if there is a path to a rate cut, it “begins with inflation coming in below expectations over the summer”. That requires that tariffs by absorbed somewhere, resulting in core-PCE inflation printing (when did people start using that word that way?) at 0.2s or lower starting now.

The Fed is waiting to see.

And so the Fed is, now, on autopilot—content to wait, watch, and gather information, with both doves and hawks poised to change their stance should the data shift.

Stepping back:

Starting back in the Clinton administration, the then-Alan Greenspan Fed settled on what came to be regarded as a “normal” configuration of the macroeconomy: a core inflation rate of 2.5%/year on a CPI-basis (and 2.0%/year on a PCE-basis); a short-term safe real interest rate of 2.5%/year; and a term-structure duration-risk slope of 1.25%-points/year going from the 3-month to the 10-year Treasury:

Get 50% off a group subscription

That has continued to guide expectation of a “normal” economy for more than a generation now. But the economy has never been normal.

Compare right now with the end of 1997, when we had a Treasury-Bill interest rate of 5.25%/year and a 10-Year Treasury-Bond interest rate of 5.75%/year, with a trailing annual core CPI inflation rate of 2.25%/year. Right now our trailing inflation rate is 50%-points/year higher; our 10-Year rate is 1.35%-points/year lower, and our Treasury-Bill interest rate is 1.00%-points/year lower. That gives us a long real interest rate 1.5%-points/year lower than back in the later 1990s, and a term-premium slope that I interpret as (most likely) a market that is aligned with the doves and that expects a further four 25%-point rate cuts over the next year and a half should the economy return to normal.

OK. By now your eyes have all glazed over. This is what all this means:

Relative to the ideas of a “normal” macro-financial economy as they settled back in the 1990s Clinton-Greenspan “Great Moderation” era:

1. The market sees a “normal” long-term safe real interest rate in a balanced economy of not 3.75%/year but of 2.5%/year.

2. The market sees either (a) chaos-monkey governance ending, and short-term Treasury rates falling by an additional 1.5%-points as the economy normalizes; or (b) a recession, and a serious need for rate cuts to try to cushion the damage.

3. Half the Fed sees that—that is, either (a) or (b) above.

4. The other half of the Fed sees either growth stronger, saving weaker, or the burden of the debt starting to bite to such a degree that “secular stagnation” or the “global savings glut” is no longer a thing.

Refer a friend

In that context, we can say:

The period from 2010 to 2022 was defined by what Larry Summers dubbed “secular stagnation”—a regime in which the equilibrium real interest rate, r*, hovered perilously close to zero. The implication was stark: the market, in its collective wisdom (or perhaps folly), valued a dollar of real purchasing power two decades hence nearly the same as a dollar of real purchasing power today. Capital was so abundant, and investment opportunities so scarce, that the time value of money effectively vanished at the margin.

This was not some theoretical curiosity but a lived reality for pension funds, insurance companies, and anyone else seeking long-duration safe assets. The causes—demographic stagnation, tepid productivity growth, a global glut of savings from East Asia and Germany, and the hangover from the Global Financial Crisis—have been dissected ad nauseam, but the empirical upshot was clear: the normal rules of intertemporal choice seemed suspended.

In contrast, during the earlier “global savings glut” configuration that had emerged post-2001 and pre-2009—memorably diagnosed by Ben Bernanke—was much less extreme. However, it was still remarkable by historical standards. The world, awash in excess savings from export-driven economies, bid up the price of safe assets and drove down yields. Yet, unlike the secular stagnation era, the market still assigned a non-trivial discount to the future: a unit of purchasing power twenty years out was judged to be worth roughly two-thirds of one today.

This régime was not “normal” in the 1990s sense—when the twenty-year real cumulative discount was effectively half. But it was still a world in which the future mattered less than the present, just not as much as it once had. The persistence of this configuration, despite ballooning U.S. deficits and the Federal Reserve’s attempts to “normalize” policy, suggests that the underlying drivers—demographic shifts, global capital flows, and a nagging fear of chaos-monkey policy chaos—remain stubbornly in place today.

But this is just the market view. And the market view is often wrong.

Leave a comment

Subscribe now

Share

Share Brad DeLong's Grasping Reality

I learned back in the 1990s, back when I was working for the US Treasury, that every single honest technocratic cut you take at the issue reveals that tariffs are an extraordinarily inefficient and regressive way of raising money. Just whatever analytical take we took, the inevitable conclusion was that cutting our tariffs was the way to go. This held true even without any reciprocity in terms of trade barrier reduction by other countries. Yes, it would be better if other countries reduced their trade barriers also. But it was very hard to get a benefit-cost minus unless you assumed that other countries would raise their trade barriers to our exports when we reduced ours against their imports. And it is completely impossible to get an increase in our trade barriers producing benefits either in terms of productivity, efficiency, income distribution, or national economic welfare if you incorporate any reciprocal increase in other countries’ trade barriers at all.

And so this is very nice to see. It is Adam Posen in front of a Senate Spotlight Forum <https://www.youtube.com/watch?v=AvTPW1-46AQ> on Capitol Hill:

Adam Posen: The Household Impact of Trump’s Tariffs <https://www.piie.com/commentary/testimonies/2025/household-impact-trumps-tariffs>: ‘Compared to other forms of taxation, tariffs create chaos and uncertainty for small businesses, individuals, and consumers while encouraging corruption and abuse driven by taxpayers seeking deals and exemptions…. The middle quintile of the U.S. income distribution would pay $2,600 a year in additional taxes, in lost… real after-tax income. That number goes up, the further down the income distribution you go…

Leave a comment

Plus the policy chaos has been further amped-up by Trump’s refusal to take the G-7 seriously. Together the rest of them outweigh the U.S. economically and diplomatically, and have the potential to do so militarily as well within a decade. And now the G7 has been, de facto, replaced by a U.S.-excluding G6.

Adam Posen: The Household Impact of Trump’s Tariffs <https://www.piie.com/commentary/testimonies/2025/household-impact-trumps-tariffs>: ‘What has in the past been a formidable showing of unity across seven countries is now a shadow of its former self…

Give a gift subscription

And because Trump’s word is no good, there is no way any additional channels can be used to coordinate policy.

The most important of Adam’s points here are, I think, institutional. Trump’s tariffs are, for institutional reasons, even an order of magnitude worse than the garden-variety permanent, consistent tariffs the Treasury’s Office of Economic Policy spent its time analyzing back in the 1990s. It is the lies about projected fiscal benefits—1.5%-points of GDP in revenue, supposedly—and the downsides for when those chickens come home to roost.

I am beginning to think that my guess that TRUMPXIT will be like BREXIT is too low. I am now thinking it is likely to be a more than 1%-point of GDP per year growth headwind for the United States over the next decade.

Tariffs are bad. Neofascist populism is bad. Neofascist tariff populism is worse. And neofascist tariff pluto-populism, as Martin Wolf calls it, is worst of all.

I think this is the place to draw the curtain. I confess that I do not understand the persistence of the fantasy that tariffs can serve as a clever lever to “shore up American industry”. It is, I think, a particularly persistent and damaging species of economic folklore. Yes, big losers from neofascist tariff pluto-populism include cosmopolitan elites and globe-spanning corporations with their globalized value-chains, but they buy from, sell to, and employ ordinary American households. They will find themselves paying higher prices, facing greater uncertainty, and watching the social safety net more than fray.

Trump’s trade wars, waged with the subtlety of a chaos-monkey let loose in the machinery of global commerce, will leave the United States increasingly isolated and bereft of reliable trading partners willing to coordinate with it on those tasks it cannot perform most efficiently itself. Every other country, faced with American unpredictability, can and will find alternative partners—substituting away from the U.S. in supply chains, trade agreements, and the informal networks of trust and cooperation that lubricate the world economy.

The rest of the world, I guess, will not escape the fallout entirely; but they will, as the British might put it, get off “low-scot,” finding new equilibria while the U.S. absorbs the brunt of its own folly.

The upshot, then, is a grimly asymmetric distribution of pain.

Get 50% off a group subscription

• Boller, Lysle, & al. 2025. “The Economic Effects of President Trump’s Tariffs.” Penn Wharton Budget Model, April 16. <https://budgetmodel.wharton.upenn.edu/issues/2025/4/10/economic-effects-of-president-trumps-tariffs>.

• Butler, Creon. 2025. “What will global trade look like after the chaos of Trump’s tariffs?” The World Today, Chatham House, June 9. <https://www.chathamhouse.org/publications/the-world-today/2025-06/what-will-global-trade-look-after-chaos-trumps-tariffs>.

• Guida, Victoria. 2025. “How Trump’s Top Economist Envisions Victory in the Trade War.” POLITICO, June 18. ttps://www.politico.com/news/2025/06/18/trump-economist-stephen-miran-trade-war-00410450>.

• Posen, Adam S. 2025. “The Household Impact of Trump’s Tariffs.” Peterson Institute for International Economics, June 11. <https://www.piie.com/commentary/testimonies/2025/household-impact-trumps-tariffs>.

• Sfakianakis, John, James A. Haley, Wang Yong, & Héctor Cárdenas. 2025. “Trump’s Economic Disruption: The World Adapts.” Council on Foreign Relations, May 1. <https://www.cfr.org/councilofcouncils/global-memos/trumps-economic-disruption-world-adapts>.

• Wolf, Martin. 2025. “For whom does Trump govern?” Financial Times, June 17, 2025. <https://www.ft.com/content/31f40bc4-9d19-41b8-ae4e-d3ef07a38b29>.

• World Economic Forum. 2025. “US-China trade framework agreed and other trade news to know.” June. <https://www.weforum.org/stories/2025/06/us-china-deal-and-other-international-trade-stories-to-know-this-month/>.

Leave a comment

Subscribe now

Share

The MADE IN THE USA “T1SM Phone” Trump Mobile smartphone is not about technology and manufacturing. It is about confidence games.

Plus it is about the willingness of an awful lot of people who know better to sanewash Donald Trump and his family, in the interest of helping those confidence games succeed.

It is about profiting from fantasy narrative. It is a case study in the persistent American fantasy of industrial self-sufficiency, a fantasy that collides, again and again, with the realities of comparative advantage and global value chains. The economics are clear: unless one is willing to pay a premium—often a steep one—“Made in America” is, for now, a slogan, not a supply chain. The performance is the point. The T1 understood as a $499 phone made in America that beats Apple’s biggest, priciest iPhone models will never ship. But its myth is already in circulation, and being propagated by people who know better.

The Trump Organization <https://trumpmobile.com/> says:

Get ready to experience the power of TrumpSM Mobile. Our MADE IN THE USA “T1SM Phone” is available for pre-order now. Reserve your phone TODAY!! The “T1SM Phone” will be available in September 2025…

Share Brad DeLong's Grasping Reality

It has, according to its launch text, a “5000mAh long life camera”. That means that its camera can deliver 5 ampere-hours of current to the phone before it is exhausted. The problem is that cameras on smartphones are described in units of megapixels—1,048,576 picture elements. Batteries are described in units of mAh. Batteries do not have picture elements. Cameras do not have cumulative DC electric current-delivery capacities.

Leave a comment

Nobody touching or taking a look at the Trump Mobile phone-offer website <https://trumpmobile.com/t1-phone> before its launch understands a smartphone well enough to be able to distinguish between its battery and its camera.

And I doubt very much that anyone building a phone would offset the fingerprint sensor at the bottom to the right of the center of the screen.

But I would also doubt very much that anyone drawing a mockup image of a phone would offset the fingerprint sensor at the bottom to the right of the center of the screen.

So there are many mysteries here.

Another mystery is the Wall Street Journal <https://www.wsj.com/tech/trump-t1-phone-components-features-2415c7cd> here.

It claims that this MADE IN THE USA “T1SM Phone” “shows some specs that would beat Apple’s biggest, priciest iPhone models”.

It headlines the story “Trump’s Smartphone Can’t Be Made in America for $499 by August”, focusing on the fact that this phone—if it exists at all—is right now being assembled in China. But it’s not just that you cannot make a smartphone in the United States with specifications that beat Apple’s biggest, priciest iPhone models and sell it at $499 this summer. It is that you cannot make a working smartphone with specifications that beat Apple’s biggest, priciest iPhone models anywhere in the world and sell it at this price.

And neither Wilson Rothman nor Ben Raab of the Wall Street Journal (a) knows this and (b) dares to say it.

Ben Raab is an intern. So he is excused.

Wilson Rothman is “deputy Tech & Media editor… [who] manages an award-winning team of columnists and reporters who cover technology in our lives and our businesses…” And Wilson Rothman also appears to lack either knowledge of shame, or both. Yet more evidence that these days there are an awful lot of people working at the Wall Street Journal who do not work for the readers.

Better to get your news from somebody else. For example, from Vox Media’s The Verge, where we find:

David Pierce: The Trump Mobile T1 Phone looks both bad and impossible <https://www.theverge.com/gadgets/687492/trump-mobile-phone-t1>: ‘It’s supposedly made in the US, cheap, and coming this fall. I doubt it all…. All we have is a website that was clearly put together quickly and somewhat sloppily, a promise that the phone is “designed and built in the USA” that I absolutely do not believe, a picture that appears to be nearly 100 percent Photoshopped, and a list of specs that don’t make a lot of sense together….

The… spec list and… image… no resemblance to any phone I could find…. Ignoring the obviously and poorly Photoshopped picture…. Where things get especially strange, though, is its supposed combination of Android 15, 5G, and a 3.5mm headphone jack. In many ways, these are opposing specs….

It seems utterly unfathomable that you could build a phone with this set of specs, at this price, to be delivered in September. Either Trump Mobile has done something truly remarkable here (and I’d bet you a T1 Phone 8002 that it hasn’t), or the phone it ends up shipping will not be the one buyers are expecting. Like we always say here at The Verge, it’s vaporware until it ships. And the Trump Mobile T1 Phone 8002 is as vapor-y as it gets…

Give a gift subscription

Plus:

Allison Johnson: Who is really behind the Trump Mobile T1 phone? <https://www.theverge.com/tech/687800/trump-t1-phone-suspects-revvl-ulefone-doogee>: ‘Our money’s on… the T1… be[ing] a white label device with most or all of its production handled by a Chinese ODM…. These dozen or so companies are responsible for as much as 44 percent of smartphone shipments globally, largely handling budget models while OEMs like Samsung and Huawei focus on producing their own high-end devices.… We’ve narrowed it down to a handful of devices…. Was this all a silly waste of time because this phone does not and will never exist at all? Who can say?… DOOGEE Note 58…. Ulefone Note 18 Ultra…. Revvl 7…. Blu G84…

Get 50% off a group subscription

Which points us to what looks like a very good guess:

Max Weinbach <https://x.com/MaxWinebach/status/1934632952366764447>: ‘And the answer is... Wingtech REVVL 7 Pro 5G! Same device as the T-Mobile REVVL 7 Pro 5G, custom body. Wingtech, now owned by Luxshare, makes it in Jiaxing, Wuxi, or Kunming China…

Leave a comment

Subscribe now

Share

Share Brad DeLong's Grasping Reality

I have never given this “utopia” lecture. In every course I have ever taught, it has been one single slide. Thus it has only been five minutes, a maybe a few more. It would have taken an hour. And I never had an hour.

But I wish I had, at least once.

Behind the paywall for now, as I still have hopes of revising it this summer of 2025…

Leave a comment

In the process of economic growth, as we visionaries of a future science-based utopia see it, technological research and development is supposed to enlarge the storehouse of human capabilities to master nature and productively organize ourselves, and so lead us towards if not to peace, prosperity and utopia.

But what kind of society would a “utopia” be?

We need references: things we can point to. We need societies if which we can say: if only things were like they were in that society, only if it were more like itself. They can, perhaps, serve as intellectual bencharks—orienting us for dreams that history never delivered.

Spoiler: the answer is as complicated as human desire itself. But we can at least peer into the gap between myth and reality, and asks whether economic growth is the bridge or the barrier to the good life.

Give a gift subscription

What, exactly, do we mean when we invoke “utopia”? Is it a society defined by perfect order, where every individual is meticulously trained and deployed for their social role, regardless of whether they regard what they experience as personal happiness?

If so, you are describing what the ancient Hellenes imagined as “Sparte.”

In the view of it as seen from classical Hellas’s city of the Athenai, Sparte, the city that was the unwalled grouped villages of the Lakedaimonai, was less a real place than a rhetorical device—a foil constructed by Athenian aristocrats to criticize what they saw as the chaos and decadence of their own city: actual historical Sparte bore only a passing resemblance to this idealized version. The myth served a polemical function more than it did a descriptive one. Do not mistake the Athenian-aristocratic image for the actual on-the-ground reality of life in Laconia, in southern Greece’s Eurotas Valley underneath Mount Taygetos.

The Spartan model of utopia is not about maximizing individual flourishing or personal fulfillment. Rather, it prioritizes collective discipline, martial prowess, and the subordination of individual desires to the needs of the state. The “well-ordered society” here is one in which usefulness and conformity are elevated above all else, and where the lives of citizens—at least the male citizens, women and helots need not apply—are orchestrated in service of a higher communal goal.

If you find yourself drawn to visions of utopia that emphasize structure, hierarchy, and an almost militaristic sense of purpose, you are in distinguished company: Platon’s Politeia, for example, is shot through with Spartan undertones. But before you sign up for the agoge, recall that this vision of order comes at the expense of personal liberty and, often, of basic human joy. The “Sparte” archetype is a cautionary tale as much as a blueprint—a reminder that the pursuit of order, taken to its logical extreme, may crowd out the very things that make life worth living.

(A parenthesis: Why do I say “city of the Athenai”, “Sparte”, “Platon”, “Politeia”, and so forth; rather than “Athens”, “Sparta”, “Plato”, and “Republic”? Because the second set of words are far too familiar to us. We think that they are part of our culture. Maybe mid-1950s Oxford or Harvard students or professors. People like us. They were not. Really, they were not. We need, if we are to see clearly what they were, to distance themselves from us: to make them strangers to us and estranged from us. That is what I am trying to do here.)

Suppose your vision of utopia is not one of rigid order, but rather of people living contentedly in harmony with their environment, unburdened by the pursuit of luxury or excess?

This is the Arkadian ideal—a notion popularized by Virgil, who romanticized a rural Greek backwater into a symbol of pastoral simplicity and happiness. Arkadia, in the classical imagination, was a land where shepherds played their pipes, communities were egalitarian, and existence was untroubled by the corrupting influences of wealth and ambition.

Of course, the historical reality was rather more prosaic: the actual Arkadia was a marginal, mountainous region of Greece, so poor and infertile that it was left largely alone by its more powerful neighbors. Its peace was less the product of a philosophical commitment to moderation than of simple geographic and economic irrelevance. Yet for millennia now, Arkadia has served as a canvas onto which intellectuals project their fantasies of the “natural” good life—a society where happiness comes not from abundance, but from living in accordance with one’s nature, accepting limits, and eschewing the rat race of status and consumption.

In our era of relentless striving and engineered scarcity, the Arcadian model stands as a quietly subversive alternative: utopia as sufficiency, not surplus; as contentment, not conquest. But, as ever, one should be wary of mistaking the myth for the reality.

Are all material desires for comfort, entertainment, and amusement instantly and completely satisfied?

Get 50% off a group subscription

Then we have the city of Sybaris, a well-ordered society in which people do their jobs without friction and all are satisfied, a society in which people have enough that material need is not a substantial distraction from the real business of life, and a society of abundant luxury and blissful and ecstatic civilization.

These three are options for “utopia”:

• a well-ordered society in which people do their jobs without friction and all are satisfied (Sparte),

• a society in which people have enough that material need is not a substantial distraction from the real business of life (Arkadia), and

• a society of abundant civilization, blissful luxury, and ecstatic experience (Sybaris).

  Refer a friend

But those are not the only options.

There is, of course, another vision of utopia—one that departs sharply from the rigid order of Sparte or the bucolic innocence of Arkadia. Here, the ideal is not discipline or simplicity, but openness: a society built on freedom of thought, robust debate, and the contestation of ideas. This is the city of the Athenai, at least in the image that its -400s leader Perikles tried to make its people live up to. And ever since, at least in the imagination of the streams of culture that have flowed from it, Athens has been the polis where free speech (parrhesia—speaking frankly, openly, and boldly; fearless candor as a duty) and democratic participation were elevated, at least for the privileged cohort of male citizens, to the highest civic virtues.

To be clear, this Athenian utopia was not a utopia for most living in the city and the district of Attike. Citizenship, and thus the right to speak and vote in the Assembly, was restricted to a narrow slice of the population—women, metics, and the poor need not apply. Plus the wood for the structures and the grain for the bread of the people of the Athenai arrived at its port of Peiraieus shipped in from Thrake and Makedonia, and Sikelia (Sicily) and Skythia (southern Ukraine), where trees were cut and farms worked by serfs and slaves under the dominion of landlords and horselords.

Yet for those inside the charmed circle, Athens offered a model that has echoed down the centuries: a society where abundance, good order, and a norm of moderation in consumption provided the foundation for a public sphere defined by open argument.

This vision is not without its ironies. Athens, after all, was a city as famous for its demagogues and exiles as for its philosophers and playwrights. Sokrates, the quintessential Athenian gadfly, was sentenced to death by that same democracy for speaking too freely. Still, the Athenian ideal persists: a utopia where the highest good is not order or simplicity, but the freedom to think, speak, and challenge both tradition and authority—a vision that remains as seductive, and as fraught, and as attractive as ever.

Then there is yet another variant of the utopian ideal—one that prizes not just freedom of speech or harmonious simplicity, but the collective, deliberative pursuit of a common purpose. Picture a society where decisions about the direction of the polity are made through broad participation and debate, where the public sphere is dominated by the rituals (and, let’s be honest, the tedium) of civic engagement. Roma. The Romans, or at least the Romans of the Republic, aspired to this model: an endless churn of assemblies, senatorial deliberations, and magistracies, all theoretically open to any male citizen who could elbow his way into the forum.

Of course, as with Athens, the franchise was restricted—women, slaves, and the non-citizen majority were excluded from the deliberative process. Moreover, when the most important votes—election of the highest magistrates and so forth—were taken in the Comitia Centuriata, the assembly by centuries, senators and knights made up 18 centuries, the first-class of the heavy infantry made up 80, the second- through fifth-classes made up 90, the proletarii 1 single century, and then 4 for engineers, musicians, and orderlies (maybe: we really are not sure). 100 senators or knights made up a century. First-class centuries were several hundred each. Second- through fifth-class centuries were larger, up to thousands. And all those without property were in the last, proletarian, headcount century. Centuries voted by wealth. And if a candidate or a vote reached the magic number of 97, the poorer rest of the centuries never got to vote at all.

Plus the outcomes, more often than not, were less about the common good than about the aggrandizement of a handful of aristocratic families. Still, Rome’s republican machinery represented a genuine attempt at collective self-government, however flawed in practice.

If you find yourself yearning for a utopia of civic participation and shared purpose, be careful what you wish for. The Roman model is a reminder that collective decision-making can all too easily slide into factionalism, gridlock, and, ultimately, a consensus that the best use of collective energy is to conquer the world.

Share

And then, inevitably, we arrive at the dystopias—those cautionary tales where the utopian impulse curdles into something far more sinister. Consider:

• Zamyatin’s We: here, the hyper-ordered society of Sparta is taken to its logical extreme and collapses into a mechanized nightmare, individuality erased in the name of collective perfection.

• Huxley’s Brave New World offers a sybaritic dystopia—material pleasure and comfort are ubiquitous, but so are genetic caste systems and psychological conditioning, all deployed to ensure that no one ever thinks to question the system’s underlying emptiness.

• And then, of course, there is Orwell’s 1984: the technological apparatus of the modern state is weaponized not for the common good, but for the preservation of power—a boot stamping on a human face, forever.

Each of these works is, in its own way, a meditation on the dangers of utopian ambition unmoored from human complexity. They serve as reminders that the pursuit of the perfect society, if untethered from liberty, dignity, and the possibility of dissent, tends not toward paradise, but toward the abyss.

And then, for those who find even the most dystopian collectivisms insufficiently bracing, there are the “utopias” crafted for the select few—the self-anointed Übermenschen—who see themselves as standing above the herd.

Enter Ayn Rand’s Atlas Shrugged, a work best understood as a kind of neo-Nietzschean fever dream, in which the world’s productive elite, tired of carrying the ungrateful masses on their backs, retreat to their own private Shangri-La (Galt’s Gulch) to let civilization collapse under the weight of its own mediocrity. Here, “utopia” is not a shared project but a gated community for the powerful, the creative, the “makers”—a society in which solidarity and mutual obligation are replaced by the iron law of merit (as self-defined by those at the top, naturally).

It is a vision that has proven endlessly seductive to a certain strain of Silicon Valley libertarian and Wall Street titan—a fantasy of escape from the messy realities of democracy, equality, and the claims of the less fortunate. Whether such a world would be livable, let alone just, is left as an exercise for the reader. But one suspects that even Nietzsche, arch-critic of herd morality though he was, might have raised an eyebrow at the spectacle of so many would-be Atlases, all convinced that it is they alone who hold up the sky.

Five kinds of utopia. Sparte, Arkadia, Sybaris, the city of the Athenai, Roma.

Let us be clear-eyed: the historical realities of Sparta, Arcadia, Sybaris, Athens, and Rome bear, at best, a passing resemblance to the utopian ideals their names now evoke. These are not blueprints, but rather intellectual shorthand—convenient markers in the landscape of political philosophy. The actual Sparta was less a paragon of virtuous order than a brutal, oligarchic barracks-state. Arcadia, for all its poetic charm, was more a hardscrabble backwater than a pastoral Eden. Sybaris, Athens, Rome—each, in its turn, has been mythologized far beyond the facts on the ground. The ideals persist because they are useful: they give us a vocabulary for our aspirations and anxieties, not because they were ever fully realized.

And then, as a kind of meta-commentary on the whole exercise, we have Ayn Rand’s Galt’s Gulch—a utopia so idiosyncratic it is barely a society at all, more a thought experiment in radical individualism than a plausible model for collective life.

Share Brad DeLong's Grasping Reality

Which brings us, inevitably, to the economist’s question: what, if anything, does economic growth have to do with any of these visions? Are we to believe that a rising tide of productivity and technological advance will naturally deliver us to Arkadia, or Sybaris, or some as-yet-unimagined utopia? Or does the record suggest that growth merely gives us more resources with which to pursue the same old dreams—sometimes noble, often contradictory, and always, in the end, shaped by the limits of human imagination and the realities of power?

I think the answer, as usual, is: it’s complicated.

A society beset by scarcity cannot plausibly claim the mantle of utopia; deprivation is, after all, the antithesis of the good life, however one defines it. But once the baseline of “enough” is established, the path forward fractures into competing visions. For some, the very essence of utopia lies in the Promethean expansion of technological mastery—what Francis Bacon called “the knowledge of causes and secret motions of things; and the enlarging of the bounds of human empire, to the effecting of all things possible.” This is the utopia of the laboratory, the workshop, the think tank: a society where the frontiers of possibility are not merely explored but relentlessly pushed outward, and where the satisfaction of material wants is only the beginning.

Yet, as the history of ideas (and, frankly, the annals of disappointment) demonstrate, this technological optimism often morphs seamlessly into a more hedonistic aspiration. The line between “mastery over nature” and “the pursuit of pleasure” is, I would argue, vanishingly thin. The sybaritic ideal—ecstatic, sensuous, abundant—becomes the logical endpoint of the technological project, at least for those who see the purpose of progress not in virtue or civic engagement, but in maximizing the sum total of pleasurable experience. The question, then, is not whether economic growth is necessary for utopia (it is), but whether it is sufficient—or whether, as history suggests, it simply delivers us to new and more sophisticated forms of dissatisfaction.

Another school of utopian thought, let’s call it the “Epicurean-ascetic synthesis,” focuses less on the relentless pursuit of material abundance and more on the alignment of human desire with available resources. For some, utopia is achieved simply by ensuring that everyone has enough—that the distractions of want and deprivation are banished, freeing people to pursue whatever higher aspirations they may have. But for others, the real trick lies not in increasing supply, but in curbing demand: teaching people to want less, to dismiss the allure of material goods and sensory pleasures as so much “propertarian” baggage.

This is the vision embodied in Ursula K. Le Guin’s The Dispossessed: An Ambiguous Utopia. Le Guin’s anarchist moon-colony is not a paradise of plenty, but a society that has, quite intentionally, reengineered its citizens’ desires. The inhabitants are socialized to see acquisitiveness as a vice, to treat luxury as suspect, and to find satisfaction in sufficiency and solidarity rather than accumulation. It’s a utopia that, for all its ambiguities, is built on the radical proposition that happiness is as much about the management of wants as it is about the satisfaction of needs. Plus the creation of solidarity, in which without the free development lf all there cannot be the free development of each, or, indeed, of anyone.

One might be tempted to see this as a mere rationalization for poverty, or as the ideological handmaiden of stagnation. But Le Guin’s point is subtler: in a world of finite resources, perhaps the highest form of wisdom is not to chase ever more, but to learn how to want less. Whether such a society would be stable, let alone desirable, is left as an exercise for the reader.

Leave a comment

There is also a more skeptical strand in the utopian tradition—one that regards the relentless pursuit of prosperity not merely as a distraction, but as a positive impediment to human flourishing. The idea here is that the accumulation of wealth, when elevated to the status of a cultural or personal end in itself, becomes pathological: a treadmill of acquisition that never quite delivers on its promise of satisfaction.

You might be surprised to learn that economist John Maynard Keynes counted himself in this company.

Keynes, in his rather well-known essay “Economic Possibilities for our Grandchildren,” offers a pointed critique of this dynamic. Keynes’s vision of utopia is not one of boundless consumption or ever-increasing GDP, but rather a society that has become so materially secure that it can finally dispense with the “money-motive”—that is, the compulsion to pursue profit for its own sake. He anticipates a future in which humanity, liberated from the struggle for subsistence, can turn its attention to what he calls “the art of life itself”: culture, creativity, relationships, and the cultivation of the self.

Keynes’s optimism, of course, is tempered by his recognition that habits of mind are slow to change. Even in a world of abundance, he worries, we may remain prisoners of our acquisitive instincts, unable to imagine a life not organized around the pursuit of more. His essay stands, therefore, as both a blueprint and a warning: prosperity is a necessary precondition for utopia, but it is not sufficient. The real challenge lies in learning how to live once the economic problem has, at last, been solved:

We shall be able to rid ourselves of many of the pseudo-moral principles which have hag-ridden us for two hundred years, by which we have exalted some of the most distasteful of human qualities into the position of the highest virtues. We shall be able to afford to dare to assess the money-motive at its true value. The love of money as a possession--as distinguished from the love of money as a means to the enjoyments and realities of life--will be recognised for what it is, a somewhat disgusting morbidity, one of those semicriminal, semi-pathological propensities which one hands over with a shudder to the specialists in mental disease. All kinds of social customs and economic practices, affecting the distribution of wealth and of economic rewards and penalties, which we now maintain at all costs, however distasteful and unjust they may be in themselves, because they are tremendously useful in promoting the accumulation of capital, we shall then be free, at last, to discard…

But Keynes goes on to warn against any premature away from bourgeois accumulative society and mentality, and any premature derogation of the profit motive and of the high status accorded those who win the game of wealth accumulation:

But beware! The time for all this is not yet. For at least another hundred years we must pretend to ourselves and to every one that fair is foul and foul is fair; for foul is useful and fair is not. Avarice and usury and precaution must be our gods for a little longer still. For only they can lead us out of the tunnel of economic necessity into daylight…

Give a gift subscription

Or consider Aristoteles of Stagire, who believes that a gentleman who wants to pursue philosophy and lead a good life must study and obtain a substantial knowledge of economic affairs in order to properly manage and supply his household.

But he must not know too much about such things, or be too interested in them:

The business of drawing provision from the fruits of the soil and from animals is natural to all. But… one branch being of the nature of trade while the other belongs to… household [management]… the latter branch is necessary and in good esteem, but the branch connected with exchange is justly discredited (for it is not in accordance with nature, but involves men's taking things from one another)…. Usury is most reasonably hated, because its gain comes from money itself and not from that for the sake of which money was invented…. Whereas the theory of such matters is a liberal study, the practical pursuit of them is narrowing.

The practically useful branches of the art of wealth-getting are… an expert knowledge of… horses or cattle or sheep, and similarly of the other animals… corn-growing and fruit-farming; also bee-keeping, and the breeding of the other creatures finned and feathered…. Of the kind that deals with exchange, the largest branch is commerce… ship-owning, transport and marketing… the second branch is money-lending, and the third labor for hire…. There is a third form of wealth-getting that… mediate[s] an element both of natural wealth-getting and of the sort that employs exchange… the felling of timber and all sorts of mining….

While we have even now given a general description of these various branches, yet a detailed and particular account of them, though useful for the practice of the industries, would be crude…

Get 50% off a group subscription

The full range of classical tropes about utopia is easy to name—Sparte for order, Arkadia for simplicity, Sybaris for pleasure, the Roman Republic for collective purpose, perhaps the Roman Empire for cosmopolitan order.

In Sparte: Here we have what I think is dystopia often mistaken for utopia among the élite—a regime of equality, yes, but equality enforced through terror, slavery (the Helots), militarism, and suppression of individuality. Rousseau admired it. But it was a society where no music could be played save that which the state approved. It aimed for arete (virtue) through discipline and austerity. No flourishing here, only endurance. The sheer scale of the society-of-domination it ran relative to its élite population base required Sparte to be what it was or vanish, but that infected the quality of life for even the élite, severely.

In the city of the Athenai": We have classical liberal’s utopia. A democracy (for male citizens), a marketplace of ideas and goods, an incubator of arts and philosophy. The ideal of Athens often inspires modern utopias—Jefferson’s vision of yeoman farmers, Mill’s liberty-infused society. But it, too, had its limits. And it was also an empire: a soft society-of-domination within the walls, but a hard one outside.

In Sybaris: Here we have the anti-Sparta. A city of luxury, indulgence, and commerce. Think of it as the ideal of pleasure and consumption. Often caricatured as decadent, it nevertheless represents a vision where wealth and abundance are not sins, and where the good life is to be enjoyed rather than merely endured.

In the Roman Republic: Here we have at least the ideal of a utopia of collective purpose. Ctizens—at least those within the privileged circle of male property holders—participated in public life through debate, deliberation, and the shared pursuit of the common good, in a society animated by the rituals (and, yes, the tedium) of public participation, where the direction of the state was, in theory, a matter for collective decision. The image of a people bound together by law, debate, and a sense of shared destiny remains a powerful touchstone for those who dream of a utopia built on civic virtue and collective purpose.

In the Roman Empire: We see a different utopian vision: that of cosmopolitan order. Under the Pax Romana the empire became a vast, albeit hierarchical, and infrastructurally advanced civilization, integrating peoples and markets from Britain to Egypt, from Spain to Syria. Roads, aqueducts, and the rule of law knit together a world where, for a time, urban prosperity and a kind of cosmopolitanism flourished, even as deep inequalities and the realities of a slave-based economy persisted. During the Empire’s third, Antonine, Dynasty, “the condition of the human race was most happy and prosperous”, at least in Edward Gibbon’s eyes. Utopia, for some, is not found in the messy business of collective self-government, but in the stability and cosmopolitanism of a well-ordered, interconnected world.

Later utopian visions in Europe were inflected by Christianity’s vision of the City of God—universal brotherhood, peace, and an end to suffering—but deferred to the next world. Then came Thomas More’s Utopia (1516), which mocked and mirrored his own world, and became the template. Property was communal; work was shared; learning prized. But even here, it’s a society of uniformity and little privacy—an echo of Sparte with a Christian gloss.

In the Enlightenment: It gave us more optimistic visions: of reason governing man, of progress as achievable. Diderot and Condorcet imagined futures where science and education lifted all. This was a telos of Enlightenment utopia: progress not as dream but destiny.

In Marx: For all his protestations about not being a utopian, he was. gave us a utopian horizon—classless, stateless communism where “the free development of each is the condition for the free development of all.” It was supposed to arise inevitably from history. But we know what happened when Lenin and Stalin tried to shortcut the dialectic. Here, utopia—like Sparta—became a justification for dystopia.

Post-WWII Western Europe gave us a more plausible, less totalizing utopia: social democracy. Think: universal healthcare, mass education, high wages, low inequality. It was, in the words of one of my book chapters, “Thirty Glorious Years.” Not perfect. But close, perhaps, to what many today would consider utopian.

In the Silicon Valley Variant: Today’s aspirants in tech—especially in the Valley—envision a future of abundance: universal basic income, eternal life, AI-enhanced minds. This is Sybaris updated for the age of Moore’s Law. Yet it too runs the risk of deepening inequality rather than dissolving it.

Sparte for order, Arkadia for simplicity, Sybaris for pleasure, the city of the Athenai for freedom, Roma for collective purpose—even though it is impossible to realize in this Fallen Sublunary Sphere that is the world. But each does stand for a different vision of the good life for humanity.

And then there is Yerushalayim—the city of peace, or is it the foundation-stone, the bedrock, of dusk, of work finished, of the time of rest, of things completed?

What we can do is question the myths, assess the realities, and wonder whether abundance leads to happiness or just new forms of dissatisfaction. Sparte was a brutal, oligarchic barracks-state; Arkadia, a hardscrabble backwater; Sybaris, Athenai, and Roma, each more myth than model, even in its day, even to its residents. Yet these names persist, functioning as intellectual shorthand for our aspirations: order, simplicity, pleasure, freedom, purpose.

And, along the way, we also meet dystopias, plus Galt’s Gulch, whatever that ia. And we meet the ghosts of John Maynard Keynes of Cambridge and Aristoteles of Stagire.

Can economic growth finally deliver us to the promised land, or does it only move the goalposts? The real lesson may be that, in the end, with the power of the scientific method and of humanity as an anthology intelligence, the problem of scarcity is easier to solve than the problem of what we truly want.

Refer a friend

• Aristoteles. 1984. Politics. Trans. Carnes Lord. Chicago: University of Chicago Press. <https://archive.org/details/aristotlespolitics01984aris>.

• Huxley, Aldous. 1932. Brave New World. London: Chatto & Windus. .

• Keynes, John Maynard. 1930. “Economic Possibilities for Our Grandchildren.” In Essays in Persuasion, 358–373. New York: Harcourt, Brace and Company. <https://www.econ.yale.edu/smith/econ116a/keynes1.pdf>.

• Le Guin, Ursula K. 1974. The Dispossessed: An Ambiguous Utopia. New York: Harper & Row. .

• Orwell, George. 1949. Nineteen Eighty-Four. London: Secker & Warburg. .

• Platon [Aristokles son of Ariston of the Athenai]. -380 [2016]. Politeia. Trans. C. D. C. Reeve. Indianapolis: Hackett Publishing Company. <https://archive.org/details/republicofplato00platiala>.

• Rand, Ayn. 1957. Atlas Shrugged. New York: Random House. .

• Virgilius Maro, Publius. -39 [2009]. Eclogae. Trans. Guy Lee. New York: Penguin Classics. <https://archive.org/details/ecloguesofvergil00virgrich>

• Zamyatin, Yevgeny. 1924. We. Trans. Clarence Brown. New York: Viking Press. .

Leave a comment

Subscribe now

Share

Share Brad DeLong's Grasping Reality

A very nice catch from the very sharp Edward McLaren, on the English language’s premier novelist, Jane Austen, and on a persistent ambiguity throughout her work, as her female characters make their choices and marry Darcies, Bingleys, Wickhams, Brandons, Collinses, and Willoughbies:

Edward McLaren: Jane Austen’s Rake Problem <https://www.commonreader.co.uk/p/jane-austens-rake-problem>: ‘In Sense and Sensibility Marianne, heartbroken over Willoughby… marries Colonel Brandon, who is “On the Wrong Side of Five-and-Thirty”, whereas she is only seventeen…. Willoughby has impregnated Colonel Brandon’s ward… is… engaged to a Miss Grey… [with] £50,000.… Willoughby… [admits] he did fall in love with Marianne…. Notably, Mrs. Dashwood says: “I am very sure myself, that had Willoughby turned out as really amiable…Marianne would yet never have been so happy with him, as she will be with Colonel Brandon…” To this, Elinor’s reaction is as follows: “She paused.—Her daughter could not quite agree with her, but her dissent was not heard, and therefore gave no offence.”

To me, this is a deep and important silence…. Marianne is “settling”…. Willoughby… would make a good lover… nuy be a bad husband…. [Marianne] will have a better life as Colonel Brandon’s wife…. Brandon’s cousin Eliza is said to have died of “lovesickness” for Willoughby…. So Colonel Brandon it is—but at what cost? When she is in love with Willoughby Marianne’s eyes are “bright”, or “bewitching”, whereas after her recovery she has “a rational, though languid, gaze”… [ad] can set her mind on a new “cured” rationality and… marrying Colonel Brandon… [but] the fire is snuffed out. The romantic, passionate Marianne is transformed into a happy little drone and an acceptable wife….

There are men that a woman can marry, who are willing to invest lots of time in them, and there are men that a woman can truly erotically love, who are frequently the target of other women’s conquests…. The ideal… simply isn’t real… Marriage in Jane Austen isn’t a big romantic affair, as we see in adaptations, but is a tool for a functioning society. Jane Austen was still a conservative, and she still approved of marriage, but she kept a twinkle in her eye for the rakes…

Give a gift subscription

What do I think of this? Well, I definitely get off of the Edward McLaren train here. Where I get off is where he asserts that this is a truth human biology imposes on us about the way the human world has to work rather than a combination of Regency upper-class culture and Jane Austen’s not-wholly-accurate view of the world.

Why do I think this?

Get 50% off a group subscription

Because I think a much better view about human psychology and how fully sane people view the situation comes from comedian Orny Adams:

Orny Adams: LOW T! And they talk about it like it’s a bad thing? It’s great! <https://www.youtube.com/watch?v=DoWQ8tsBCSM>: ‘Men actually get better with age. It's biological…. The TV commercials start talking to you…. “Are you a male over the age of 40?” That's me…. “Do you not have as much energy as you used to?”… I'm exhausted…. “You might have a treatable conditioncalled Low-T.” Low testosterone. They're making ——— up…. They talk about it like it's a bad thing. Low-T is the greatest thing to happen to men. Every, every bad decision I ever made was on High-T…

Leave a comment

And from comedian Neal Brennan:

Neal Brennan: <https://www.tiktok.com/@mrnealbrennan/video/7350383399107841322>: 'Back to men…. Testosterone… has got nothing but bad ideas all day. Women have estrogen. The worst thing estrogen will suggest is "let's get some wine and go on Etsy". Not that bad. Whereas testosterone… is like having a prison inmate living inside you…. You're like: "Take it easy man! It's 7:30 in the morning!" He's like: "I don't give a f----, bro! I'll be doing dips till you're ready!"…

Share

This is comedic recognition. But it is a comedic recognition of a profound truth. We can see that this is something that we humans have long known. How? Because we have explicit evidence that humans have recognized for more than 3000 years.

Witness Akhilleus in the Iliad on the irrational actions of the T-maddened Agamemnon:

Josiah Ober: The Greeks & the Rational <https://doi.org/10.1525/9780520380172>: ‘Achilleus has promised to protect the seer Kalkhas from Agamemnon’s wrath…. Rather than accepting the situation, [Agamemnon] employs a threat of force… to take Briseis, Achilleus’s prize captive…. It [becomes] obvious in retrospect that Agamemnon has made a very bad choice…. Agamemnon’s own [retrospective] explanation is… that [his] fateful choice had been motivated… by atê—a sort of divine madness… by a force outside of himself….

[But earlier,] in critically describing Agamemnon… Achilleus says this: “Truly he rages with baneful mind, and knows not at all to look both backwards and forwards in time (hama prossô kai opissô)…”. The phrase hama prossô kai opissô is a standard Homeric formula…. The agents who are said to have this capacity are older men, who are in a position of having to assess a high-stakes situation, forming a judgment, and offering advice about the best, although not the most obvious or most popular, course of action. That advice would, in each case, avoid catastrophic outcomes—were it followed…. Achilles’ point… is that Agamemnon, raging with baneful mind, lacks… wisdom and therefore is shown up to be a poor leader: He puts his own army in danger…

Leave a comment

Whoever got women to believe they were the emotional sex ran the greatest successful con job in human history…

Give a gift subscription

• Adams, Orny. 2023. “LOW-T! And they talk about it like it’s a bad thing? It’s great!…” YouTube, December 1. <https://www.youtube.com/watch?v=DoWQ8tsBCSM>.

• Austen, Jane. 1811. Sense and Sensibility. 3 vols. London: Thomas Egerton. <https://archive.org/details/sensesensibility131aust/>.

• Brennan, Neal. “Back to men… Testosterone… has got nothing but bad ideas all day.” TikTok, April. <https://www.tiktok.com/@mrnealbrennan/video/735038339910784132>.

• McLaren, Edward. 2025. “Jane Austen’s Rake Problem.” The Common Reader. June 15. <https://www.commonreader.co.uk/p/jane-austens-rake-problem>.

• Ober, Josiah. 2024. The Greeks & the Rational. Oakland: University of California Press. <https://doi.org/10.1525/9780520380172>.

• ‘Omeros of Khios & al. -750 [1991]. [The Iliad]. Trans. Robert Fagles. Intro. Bernard Knox. New York: Penguin Books. <https://archive.org/details/iliad00home>

• Tave, Stuart M. 2019. Some Words of Jane Austen. Chicago: University of Chicago Press. <https://archive.org/details/somewordsofjanea0000tave>.

• Tomalin, Claire. 1997. Jane Austen: A Life. New York: Alfred A. Knopf. <https://archive.org/details/janeaustenlife0000toma_g0r7>.

Leave a comment

Subscribe now

Technology’s greatest overpromiser & overdeliverator has met America’s chao-monkey-in-chief. The result is a Musk entangled in the Trumpian vortex and no longer able to outmaneuver failure, for he did not recognize that Trump is not a transactional politician at his core…

Share

Share Brad DeLong's Grasping Reality

Last fall, I thought I understood what Elon Musk was doing.

Face it: The guy is annoying. He lies a lot. He overpromises, constantly. But there is, or there was, a but: Although he massively overpromised, nearly always, he substantially overdelivered. Tesla made cars. Starlink carried voice and data. SpaceX launched rockets. And it was not implausible to think it was his presence and actions and salesmanship and overpromising that had kept those three operations from being wound-up and wound-down. And those three operations were immensely valuable to humanity as technology-forcers, and substantially valuable to all their stakeholders from raw-material suppliers to users as globalized value-chain economy production networks. He had somehow turned overpromising into a kind of business and financial sorcery, delivering rockets, cars, and satellites against the odds, as his audacity propelled technological revolutions.

So I was surprised and disappointed when he showed up as a value-subtracting chaos monkey with Twitter. And then I was disappointed when he began spending all of his time attending on America’s chaos-monkey in chief, Donald Trump. But I was not surprised when he began spending all of his time attending on America’s chaos-monkey in chief, Donald Trump: I thought I understood what he was doing.

But now I don’t understand. It appears that he tried to arm-wrestle Washington and lost. This is the story of a man who mistook political chaos for a new frontier, only to discover that Trump’s dealmaking is not a zero-sum game.

But wasn’t this very predictable? I mean, Musk thought he was the frog and Trump the scorpion in the Russian fable of the frog and the scorpion crossing the river. But how could he not understand Trump’s nature, and not see that Trump who knows his own nature well had strapped on a jetpack?

Give a gift subscription

The guy truly broke through in the years after 2015. He became in some sense the richest man in the world from sky-high bubble valuations of his companies. Successful SpaceX launches per year went from 7 in 2015 to 21 in 2018, 31 in 2021, and 133 in 2024. Teslas shipped went, in thousands per year, from 50 in 2015 to 245 in 2018, 936 in 2021, and 1,789 in 2024. Those raging against his continual overpromising ran up against that track record. And that track record made many willing to bet their money on his enterprises even at their sky-high bubble valuations in the hope that he might overdeliver again.

Why would a man going from such extraordinary success to success start hanging out with Donald Trump fulltime in the fall of 2024? Why would he pivot to high politics to become Donald Trump's #1 comrade in arms and most trusted ally?

I thought I knew.

Francis Ford Coppola and Mario Puzo wrote the line "keep your friends close, and keep your enemies closer" for their Michael Corleone character.

In the culture war—in advancing Elon Musk's cause which he truly and deeply believes in that it is essential for America's future to fight the Woke Mind Virus—Donald Trump was a great friend to Elon Musk: potentially his most valuable ally.

But with respect to the profitability and sustainability of his businesses, and hence the sustainability of his wealth built on their high market and private valuations, Donald Trump was a threat: a clear and present danger and extistential threat to Elon Musk. For, as of mid-2024, there were too many applause lines in Trump's speeches about how electric vehicles were a flop, kept alive only by government subsidies that he would immediately terminate.

So what, as of mid-2024, was Musk to do in this situation?

It was to hug Donald Trump his culture-war ally close: become his #1 cheerleader, his #1 funder, and the guy who would take the heat for actually cutting back the federal bureaucracy and making it subservient to Trump. And it was to hug Donald Trump the existential business threat closer: to get, in return for Musk's support, Trump undertaking actions as president to get:

1. Justice Department harassment of his businesses stopped,

2. The EV tax credits that made it worthwhile to buy Teslas preserved,

3. tariff carve-outs so Tesla could continue to make cars for less than their sale price and so survive as a globalized-economy value-chain production network, and

4. the bulk of the NASA budget transferred to SpaceX.

But Elon Musk was naïve. Many people could have told him that, if you make such a bargain with Trump, it cannot be wink-wink implicit, and it cannot be verbal. At the very least you get a letter. Handwritten. Laying out the terms of the deal. And you get leverage: ways that you can punish him if he welshes. You need to put him in a situation so that if he double-crosses—or rather, when he is tempted to double-cross you—you have something to show, and some way to harm, and thus when he thinks about double-crossing you he says: “naaah”.

Musk failed to do that.

Trump delivered on investigation quashing. Trump did not deliver on EV credits or tariff carve-outs. Then Trump pulled the plug on NASA.

So what was Musk to do?

It seemed to me that Musk's natural next move would be to demonstrate that he could, using balanced-budget purity-Republican ideology, his money spent now on ads, and his money spent next year on elections to protect his allies, form and hold a bloc of four Republican senators in opposition to the reconciliation bill—and so have it fail, have Trump-Thune-Johnson have to go back to the well for another budget resolution, and at the very least postpone Trump's renewal of his tax cuts for six months or so, and gain credit among purity Republicans for holding the good-policy anti-welfare state line.

But that is not what he did. Individual tweets, yes. Calling Donald Trump a pedophile, yes. But an actual serious bill of particulars on changes that need to be made in reconciliatilon before he will support it and his allies will vote for it? No.

It does look much more like a ketamine-addled emotional wreck undergoing hour-by-hour adrenaline-testosterone fueled rage mood swings.

And so the test of strength never came. Rand Paul and Ron Johnson have announced opposition to what they describe as a “completely unsustainable” budget buster. But that is two, rather than the four whom Musk would need to have leverage. And I see no attempts on his part to recruit others to join that ilk. And I see no attempt by Musk to fund and form a caucus uniting the two dissatisfied fractions of Republicans, because in addition to the deficit hawks there are Collins, Murkowski, Hawley, and Grassley opposed to the cuts in rural and low-income health programs.

And now it seems that Musk is in full retreat without even seeing how much leverage he can generate. We have Carla Norrlöf:

Carla Norrlöf: Lessons From the Trump-Musk Feud: ‘Elon Musk's public retreat after a high-profile fight with Donald Trump demonstrates that even the world's richest person is no match for the US government. Money may buy you access, but it cannot shield you and your interests…. Trump can inflict tens of billions of dollars of losses on Musk, who as a private magnate lacks any reciprocal mechanism to bankrupt the Treasury.

True… SpaceX’s Dragon spacecraft is now NASA’s only operational transport…. [But] Musk underestimated just how dependent his own businesses are on state support. Notably, his apology came after Trump threatened “very serious consequences” in response to Musk’s threat to shift his financial support away from Republicans. Such a public retreat demonstrates that money may buy access, but it provides no shield against the unrivaled tools of state power…

Leave a comment

Subscribe now