Is politics holding back technological innovation?

Episode Summary

It’s tempting to look back on the technological progress we’ve seen in the past few years and marvel at how much things have changed, and they certainly have. But if you zoom out on the historical scale, it’s very arguable that the trends of today were set in motion by processes and ideas of the late 19th century.

Brad DeLong, my guest on today’s episode argues just that in his book “Slouching Towards Utopia: An Economic History of the Twentieth Century,” making the case that the world of today began through industrial, governmental, and scientific breakthroughs that began in 1870 but began stalling in the 2010s.

Why did progress slow down drastically and how can we get back toward making things better at a faster pace? Some of it appears to be that ideological conservatism in the U.S. seems to have utterly lost its ability to incorporate new information, which has in turn left Republican administrations unable to form any kind of real and coherent policies, let alone good ones.

But there are other reasons things have stalled, and we get into them in the discussion. I hope you’ll enjoy.

The video of this discussion is available. The transcript of audio is below. Because of its length, some podcast apps and email programs may truncate it. Access the episode page to get the full text.

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Audio Chapters

00:00 — Introduction

04:43 — Modernity and the beginning of the end of scarcity

07:33 — Bifurcations of liberalism

14:17 — Conservatism regressed rather than keeping pace with technological innovation

20:10 — Ronald Reagan versus Donald Trump

26:53 — Republicans are experiencing significant “brain drain”

36:56 — Technological change and societal uncertainty

42:21 — Differences between wealthy Americans and those elsewhere

49:09 — Neoliberalism and its impact

01:01:20 — The blogosphere and media integration

Audio Transcript

The following is a machine-generated transcript of the audio that has not been proofed. It is provided for convenience purposes only.

MATTHEW SHEFFIELD: So, let's maybe start with—could you give us a brief overview of your book here and what it's about. It's a very grand scope.

BRAD DELONG: It's a very grand book, right? It starts with the bet that the best way to [00:02:00] think about world history is that 1870 is the hinge, on which at which point in time nearly everything changes. That is, before 1870. Poverty and patriarchy. Yeah, the fact that technological progress was slow.

Human fecundity is great. And in a pre-industrial world, given infant and child mortality, there's kind of one chance in three that if a woman survives until middle age, she will not have a surviving son. And in a patriarchal world that puts you in a very bad position. So that before 1870, whenever any extra resources showed up.

People pretty much decided to use them about let's try to have another kid, to reduce those one in three chances of not having a son to carry on the lineage and help us at our old age to diminish those chances. And what that meant was that there was no possibility of [00:03:00] humanity ever being born.

baking a large enough economic pie for everyone to have enough. So if you wanted to have enough well you could try to become extraordinarily productive, but that would only make you a soft target for the people pursuing the other strategy, which would be to join a gang. To become one of the thugs with spears or later gunpowder weapons, or ideally one of the bosses of the thugs with spears, or maybe one of their tame accountants, propagandists, and bureaucrats and so become part of the gang that demanded the peasants and craftsmen give them one third of everything they produce just because that world of societies of domination is very much what human history was before 1870.

And in 1870, things change, we get modern economic growth. All of a sudden, technology is not advancing slowly, but instead, humanity's technological prowess is doubling every generation, which means that, [00:04:00] As humans are population can't keep up and after a while society gets rich enough and complex enough that people say, hey, wait a minute, infant mortality has fallen a lot.

The average woman really does not need to try to have seven, bring seven pregnancies to live birth over the course of her lifetime. We go through the demographic transition. Now we're approaching zero population growth. Admittedly, with eight and a half billion people, rather than the 1. 3 billion people we had in 1870, but we can see the light at the end of that tunnel.

And with population growth slowing while technological progress continues, the resource scarcity relative to technology that kept humanity so poor for so long, ebbs away.

Modernity and the beginning of the end of scarcity

DELONG: And we look forward for the first time to a world where it will be possible to bake a sufficiently large economic pie So that everyone can have enough that leaves us the problems of slicing the pie Of distributing it fairly or quote [00:05:00] fairly unquote And of properly tasting it of utilizing it Our wealth immense by the standards of any other previous human society of utilizing our wealth so that people feel safe and secure and are healthy and happy, and to build institutions economic, cultural, sociological, political, and so forth to actually manage.

Our technology, our economy, and then our sociology and our polity so we can do, the production, distribution and utilization tasks and there were pretty much flummoxed, because every generation technologies advanced and advanced unequally. So you need an entirely different set of tools. of institutions to keep things in balance, and that struggle, our attempt to find good enough institutions to keep the system from crashing completely along with occasional complete crashes, that's the way we should look at the world from 1870 to [00:06:00] Well, to today, and you over that time in the most technologically advanced parts of the world, we have gone from, commercial mercantile to call it pseudo classical semi liberal to applied science to mass production to new deal, social democratic to neoliberal to global value chain.

And now we're heading into the attention, info, biotech society and economy, whatever that is. And we've had quite a rough ride. We're here now with no great sense of what would be good institutions for the next 25 years with immense societal wealth and technologically power, still badly distributed and also unsatisfactorily utilized.

And that's where we are.

SHEFFIELD: Yeah. And then we also have the additional problem that as science and technology advanced, many of the people in the [00:07:00] population did not never had access to them either because of, so I'm talking about not just material goods, but intellectual goods. And, so now, as we're trying to do, do make a society Has never in circumstances that have never existed is not people who say that, well, we need to take advice from, bronze age go for bronze age

DELONG: perverts.

SHEFFIELD: Yeah, exactly!

DELONG: Yes.

SHEFFIELD: Yeah. So, well, and, so there,

Bifurcations of liberalism

SHEFFIELD: but there also was kind of a and, you mentioned neoliberalism that, there was also, there were multiple bifurcations of liberalism throughout its existence. And let's, maybe talk about some of those. I mean, like, obviously this is earlier than in your book starts, but you know, there were some in the beginning, let's say the 19th century with the idea that the the controversial idea that slavery should not exist and that [00:08:00] women should have the right to vote.

These were controversies and bifurcations of liberalism.

DELONG: I think they still are. I think Peter Thiel once wrote down that it was the greatest political catastrophe for America when women got the ballot And he is the principal patron of our republican vice presidential candidates right now As well as being a big fundraiser for trump at various points

SHEFFIELD: Yeah.

Well, and it's interesting also, though, that there, there, there were multiple bifurcations as this continued and like, I think the, legal professor professoriate is probably the best example of kind of this abandoned liberalism, if you will, these people that they actually think that they're liberal and they say that they're liberal, but in fact, everything that they do is right wing.

DELONG: Although [00:09:00] it's not at all clear what right wing is.

SHEFFIELD: Oh, that's fair.

DELONG: That say, if you start back in the Bad old days of societies of domination.

It's very clear. Things are hierarchical and patriarchal. And, you're not supposed to be upwardly mobile and you're not supposed to think of yourself as an individual with rights. Instead, you're per your person whom God has slotted into a particular social role, with obligations and maybe a very few privileges.

And maybe not. And you have this society at the time, you're distributing the surplus among itself, using various procedures. More or less brutal, more or less civilized with some sense, sometimes, right, that say, in societies springing from, the Germanic strain, [00:10:00] that there are big men and the big men have rights vis a vis the king or the war leader, the Drayton that they cannot simply be ignored.

And from the Greco Roman tradition, the idea that the, at least the aristocrats, of the city state and then the empire, have the right to be protected in the Roman Republic by their tribunes against unlawful exertions of force by people in authority, right? That is, imperium is only to be wielded by those who've been properly elected in the campus martius by the Roman people and then follow prescribed.

Channels, i. e. Saint Paul saying I am a roman citizen. You centurions are not simply allowed to quit me Just because you feel like it If I weren't a Roman citizen, I, they could, of course, but yeah, and those two things come together with the transformation from a hierarchical to a commercial society to a [00:11:00] society where you aren't really slotted into where your parents were, but instead you have property of your own and you have to find something to do and some network of counterparties and so on social.

Connections in order to produce, consume, exist, live, marry, raise up your children, marry them off and so forth. And these two ancestral traditions, kind of, of Greco Roman liberty of the individual, or at least the aristocrat, against arbitrary whippings and killings, and the German big men in society need to have some say and cannot be arbitrarily executed that those combined with the ideas that you need that what's really key to you are your the rights you have as an ability to maneuver in this growing commercial society, your right to life, liberty and to control of enough of your property that their property is yours [00:12:00] and not theirs in the sense that you can use it to pursue your happiness something that's ascribed to all men.

Although not to all people, even in the breach, which is the very much earthspring of liberalism. And then it starts from that nugget which, Roman historian, Brett Devereux points out is comes to the fore as commercial society rises, just as the bureaucratic power of the modern state emerges as something that might oppress you not personally, but institutionally.

And so the philosophical doctrines of liberalism become a way of attempting to vindicate yourself as an agent, as an independent, autonomous person in this commercial society with this state growing around you. And then we are off and running as what your rights are, who has rights, who properly is a full citizen, who deserves to have rights, grows and grows over the century, and we attempt to establish, [00:13:00] the liberal societies that are the most successful societies so far humanity has ever seen.

SHEFFIELD: Yeah, yeah, well, and basically, this is really kind of a debate, it's an intra-liberal debate in a lot of ways that the United States sort of, was engaged in, but still the, older tradition of authority and hierarchy that never went away. And like that in a lot of ways was diminished, right?

DELONG: My great grandmother, when she chained herself to the Missouri State House fence for, votes for women all that happened was that she was then expelled from the veiled debutante profits from the veiled profit debutante society in St. Louis and a bunch of people cut her at parties.

And, when her mother invited African American ambassador, Ralph bunch to dinner in the [00:14:00] 1920s at the house. They did get lots of nasty looks from neighbors and maybe eggs thrown at their windows a couple of but a hundred years before the social consequences would have been much, much greater much, much more negative.

SHEFFIELD: Yeah. Yeah.

Conservatism regressed rather than keeping pace with technological innovation

SHEFFIELD: And that's what I mean in that, the, these older traditions, like, I think that is kind of the. The real tension that we have is that, society has, created the created all of these fantastic technological innovations. But the political and sort of the political ecology has not been kept up.

So in other words, it's still in a lot of ways,

DELONG: still in strange ways, marked by the legacy of societies of domination. Yeah. And I was going to say, Their purpose before 1900.

SHEFFIELD: Exactly. And, in a lot of ways, the kind of the cold war and the conflicts of socialism, communism, [00:15:00] fascism, they were not resolved on an intellectual level.

They were only resolved on militarily level,

DELONG: which is why, Frank Fukuyama's belief in 1991, that the other, two big options, Fascism and communism were now off the table, communism because of its defeat in the battle for production and fascism in the ruins of Berlin in 1945, but you know, you look around the world today and it's definitely fascism does not appear to be so dead.

SHEFFIELD: Yeah. Well, and now

DELONG: was it Brian Butler this morning who was talking about how the old Republican party rested on, what was it? Patriarchy oriented family conservatism, Ayn Rand libertarian economic fantasies, and the anti communist Cold [00:16:00] War internationalism.

SHEFFIELD: Yeah.

DELONG: And then they.

So what's happened over the past 40 years has been they've swapped out the anticommunist internationalism for neoconservative internationalism. They've swapped that out for, I don't know what to call it, some strange kind of ethno place based anti-immigrants of all kinds. Rich and poor, Hispanic and Jewish.

Of all kinds. And that complex, an Ayn Rand style libertarian fantasies with its exaltation of the plutocrat and the kleptocrat the patriarchal view that, women should not be allowed to get divorces and the enormous fear of immigrants who bring bad think of one sort or another, that in itself was enough to push the Republican party over from being an.

A very uneasy coalition of groups that [00:17:00] really had next to nothing in common into something that has an attitude toward The way the world should be organized that you can only pull it that politely we call neo fascist And it's very hard to think of a different word for it.

SHEFFIELD: Yeah, I think it is it's hard to yeah, it's well and one thing that I thought about though is that kind of You There was also a, displacement within the hierarchy of the Republican party in terms of who was allowed to run things.

So, let's say under the Reagan, in the Reagan years and whatnot, like there were still some, Liberal Republicans, quote unquote, out there, like, Connie Morella, for instance, of Maryland, right.

DELONG: That Susan Collins is the

SHEFFIELD: very last person

DELONG: who became a Republican and then was elected as a Republican office holder because Lincoln had freed [00:18:00] the slaves.

And even she has, extraordinarily disappointed the people who 20 or 30 years thought. They knew who she was. You should talk to Norm Ornstein sometime about how disappointed he is with Susan Collins over the past 25 years compared to the woman he thought he knew back in the 1990s.

SHEFFIELD: Well, yeah.

And like that, well, that's the, I guess kind of where I'm going at though, is that basically, the, there was still a displacement that happened. So in other words, there were people like David Gerger and there were people like, uh, Daniel Patrick Moynihan, who, while he was a Democrat, he's ended up doing a lot of work for Republicans in many ways,

earlier in his career And so, there was also kind of a, more of a libertarian flavor to a lot of the rhetoric, like they had this like concept of, what they called fusionism, which was traditional, traditionalist ends through [00:19:00] libertarian means is how they named it. And essentially, I, I think the, disintegration of libertarianism is the, untold story in what happened to the Republican party.

Because in some sense they, the ones who were more, let's say, moderate inclined, they flooded into. The democratic party when, under the democratic leadership council and Paul Songhus and, some of the, Clinton backers like there was this sense among a lot of them that, this was a, that there was common cause, like a lot of the degrade regulation that happened under Reagan actually started under Carter that's fair to say.

So, but something happened along the way where they lost. Any real ability to even have a voice in the Republican party. Now, they don't have debates inside the party at all over anything.

DELONG: They do, but [00:20:00] they're conducted in an extremely odd way. Okay. Because the authority of the maximum leader has to be prominent.

Ronald Reagan versus Donald Trump

DELONG: And you need to find some quote from the maximum leader demonstrating that you are actually in accord with what he wants and since he has no idea what he wants, right, that in some sense, the difference between Reagan and Trump was that Reagan was an actor and he believed he was very good at his job, but he believed that he was.

The star and not the boss. That is, he had accountants and bureaucrats and directors and producers and so forth who worked for him, whose business it was to find the best writers and lighting directors and costumers and so forth. And that his job was to take the lines that he had given and to play the part of a president.

To the best of his acting ability of acting chops, which were not actually that small. He [00:21:00] was pretty damn good at looking like a president when he was properly briefed. By contrast, Donald Trump is a reality TV store in which they follow you around with a camera for 24 hours while you b******t.

And then they edit it down to one hour of convincing TV.

SHEFFIELD: Yeah.

DELONG: And he thinks he is both the star and the boss. And the people who work for him are not that skilled, are not that important. That all they do is take what he did, and they do the very mechanical task of chopping it down to an hour of convincing TV, which really doesn't in Trump's mind require much brains or intelligence or work at all because, everything he says is gold.

You just have to pick out the best pieces of gold and string them together. And aside from being completely insane, I think lunatic as big Trump booster Jared Baker in the Wall Street Journal was saying. Earlier this week. In spite of [00:22:00] being completely lunatic and completely wrong, it does not make for an administration.

Right, right now, Trump, if you asked him in his heart of hearts, would say his two biggest accomplishments as president he would say second was Operation Warp Speed, and he would say the first was replacing the worst trade deal in the history of America, NAFTA, with the U. S. Mexico Canada trade agreement.

Which changed into the best trade deal the U. S. has ever been. What are the big differences between NAFTA and USMCTA?

SHEFFIELD: Not a lot.

DELONG: Big differences are zero. The noticeable differences are three. First, the amount of Out of three nation content, an automobile has to be had to be considered domestic for NAFTA purposes Rises from sixty two and a half [00:23:00] percent to seventy five percent under us mcta which the uaw likes but pretty much no one else in the auto industry Likes that it forces somewhat uaw plants that would otherwise be and it raises costs for u.

s producers vis a vis foreign producers By an amount that's not huge, but that they notice the second is we finally, say we are going to live up to our promises about imports of Canadian softwood lumber, which, the fact that Tom Daschle came from the Dakotas was kind of meant that presidents kept breaking their NAFTA treaty commitments and telling the Canadians to sue us.

For decades. And the third is similarly that Canada now agrees to no longer use, relatively bogus health and safety considerations to keep us dairy products out of Canada. Those are [00:24:00] three things that matter if you're in the auto industry. If you're. Producing dairy products in the U.

S. North Midwest or in southern Ontario and Alberta and Saskatchewan. And that if you're chopping down trees, in the Canadian, hills, not for anyone else yet to see. Trump was told Trump, I think, sincerely believes that he changed NAFTA from being the worst trade deal in the history of the United States to the very best by doing this, he can be led around by the nose by whoever gets into the office and strikes the right particular note in a way that he remembers.

And he can't remember very much.

SHEFFIELD: Or for very long.

DELONG: He was supposed to pull out a box of Tic Tacs and say, See what Shrinkflation has done to the box of Tic Tacs. And he could not remember the word [00:25:00] Shrinkflation. Long enough for him to get the punchline. Now, you can say this really isn't, that big a change.

You look at the internal memos, or the internal, West Wing backstabbing memoirs from the George W. Bush West Wing. And you get very much the same idea that here is someone who has not read his brief, doesn't understand the issues and is very much flying by the seat of his pants, in every particular meeting, responsive to those who sound best or of whom he has some fear of whom Dick Cheney was at least at the start the most, um, it's not really clear how much difference this makes If the staff process runs, but you know, we have absolutely no idea what the staff process will be or how it would run in a next Trump administration, which means that we have no idea, what policies he'll attempt to put [00:26:00] through.

SHEFFIELD: Well, aside from Project 2025, which he claims is not his policies, well, he claims it's defunct,

DELONG: right? And it may well be defunct because he may well stay annoyed. At the people who put himself into somewhat of a pickle, in August, especially if they keep telling their friends that he's really a hundred percent on their side.

SHEFFIELD: Well, and

DELONG: actually grudges, he keeps grudges if he remembers them and, saying that Trump is our puppet in a way that gets it into the papers is a good way to get him to remember to keep a grudge. So I think Kevin Roberts and company, Kevin Roberts and company may be toast along with whatever that former OMB director Russell Vogt, I think they may well be toast in Trump world for now.

Republicans are experiencing significant "brain drain"

SHEFFIELD: Yeah, at least for now. Yeah. Well, but, that raises an interesting point though, which is that in addition to [00:27:00] there being kind of a diminishment of libertarianism within the Republican party, there's also a just a complete. has happened and you have witnessed this firsthand yourself, in that you, you, worked in the Clinton administration the Republican economists and you can fill in the blanks for me here, but you know, we're, they actually, at least some of them had some, pretense of scholarship back in the day, but now it's

DELONG: but even in Trump's first term, you were left with Kevin Hassett, right?

Kevin Hassett, who would say that COVID is going to kill 50, 000 people tops. Based, I think, on a spline curve estimated in Excel on daily data. Kevin Hassett, who back in 1999 told everyone that the stock market was going to triple in the next three to five years. And they should take all their money and put it in the dot com bubble.

At the end of [00:28:00] 1999. And somehow, his career at the American Enterprise Institute survived that. And back in 1983, right? I remember Marty Feldstein telling me that, he wasn't upset that I was a Democrat because the Democrats needed lots more good economists because they had so few while the Republican bench was so very deep.

And, and Marty's looking down on us from heaven now and is completely and totally horrified.

SHEFFIELD: Well, what do you think happened, like, with all that? I mean, is it, wasn't only supply side No, it was a

DELONG: drip, right? drip, And so people give up, people leave, people can't simply stand it anymore.

Know that the Republican economists who are kind of corralled to endorse the, Ryan McConnell, Trump tax cut back in 1998 were most of them privately appalled because the right wing, but honest tax foundation was saying, Hey, wait a minute, [00:29:00] There are no incentives to boost American investment America in this thing at all.

To the extent that you're for tax for pro tax cut, because you think it's going to boost investment and economic growth, this is a zero, and yet they were kind of herded into supporting it and whimpering about how well we'll get our chance when the rules and regulations implementing this thing, are written, which they never did.

Who was it? I first saw the extent to which this was happening back in 2004, when I was supposed to go down to UCSD to be the kind of John Kerry guy at a debate at UCSD, University of California, San Diego with the Republican guy. And the Republican guy they picked was former George H. W.

Bush, CEA member Dick Schmalensee, who then I think had just finished being dean of MIT's business school, the Sloan School. And the idea that there was a debate was kind of upended at the very start when Schmalensee stood up and said, he [00:30:00] couldn't take it anymore. Too many unfunded tax cuts too much regulatory stupidity that he was going to be voting for John Kerry.

And if you're not living off politics you're instead, you're a dean at, MIT Sloan school and have your healthy consulting business on the side. And if you don't maneuver in your Republican gentry circles in which all of your friends expect you to always vote Republican and think of that as a key part in why they like you, you can do that.

And so academics can. Which is why I think there is the emigration of economists and academics from the Republican Party has been near total. While elsewhere there are, I think, a lot of internal emigres. People who are extremely unhappy with the choices they're being given, but, they're surrounded by a certain social milieu, and anyway, they really [00:31:00] did like their capital gains tax cut.

SHEFFIELD: Yeah, but I think Greg Mankiw is another example. Of what we're talking about here as well, because, he, this was a guy that was appointed to all the things in the Republican stations of the cross, if you will. And I just looked on his blog. He said, he's voting for Kamala Harris because she's against Donald Trump.

DELONG: Yeah. Although Greg was never Trump from starting in 2016. He was. Simply on the grounds of administrative competence, which is

SHEFFIELD: certainly proven correct in that regard.

DELONG: Democrats will implement a bunch of policies that are bad, but they will at least implement policies rather than be chaos monkeys.

SHEFFIELD: Yeah, well, okay, so but so what is what are some of the underlying causes though?

Do you think it's besides I mean is it anti intellectualism and a lot of this stuff of the so in other words like?

DELONG: Populism [00:32:00] as we know it. Well

SHEFFIELD: Well, let me step back. Okay, let me step back So I mean in the sense that there has been a real decline in the And I can say this, having been a former Republican myself, and one of the original right wing bloggers that, when I got started in 2000 the, there were people, there were plenty of people that were able to have discussions with, people, left wing bloggers and we had them all the time.

But now, you look at somebody like, Glenn Reynolds, who was one of the older bloggers now, he's, pushing insane conspiracy theories and just complete nonsense. And look, I mean, obviously,

DELONG: J. D. Vince says that you gotta realize that Bezos and Amazon benefit. When wild black lives matter, looters, and rioters destroy main street stores,

SHEFFIELD: undesired [00:33:00]

DELONG: effect of their support for DEI, J.

D. Vance says this Donald Trump doesn't say this only because he's not coherent enough to be able to say it. All they can do is say. Tim Walz is very extreme, very into transgender. All he can say is that Kamala Harris is very bad, very extreme, very bad. And he can't remember anything else long enough to actually get it out.

SHEFFIELD: Yeah. So, I mean, but I see this process as one that was happening before Trump. I mean, obviously it accelerated after him he came along, but you know, again, like it's just like, you look at the way that when Republicans, let's say even before Reagan, you look at Richard Nixon's Council of Economic Advisors, you look at, or even Reagan's, like, like, the quality was just, [00:34:00] it's just, it's been a, it's been a gradual decline and then rapid under Trump. Like there was something, what's your thought on that?

DELONG: I mean, as I say, I think it's that you can vote with your feet for not being an idiot. And yet, unless you voted for pretty much every Republican ticket all the time, you have next to no chance of getting one of these jobs.

And so the pool is from to pick from is very thin. And the pool of people who say, I really need to do this because I need to limit the disaster is much, much thinner that for some reason, there are always a bunch of people who will take national security jobs on the grounds that, I need to be a reasonable voice in the room.

We're for economists, I still don't know whether the reputational hit is greater or the people feel the stakes aren't as large, but it's kind of harder to get good people to sign up for team Republican these days. Yeah. And, and those who do almost surely have several screws loose. [00:35:00]

SHEFFIELD: Yeah, no, that's right.

And which is interesting though, because like, there is also the, right has seen that this has happened but that academia has, become much less Republican over time. John

DELONG: Quiggin points out, it is stronger in the natural sciences than in the humanities or the social sciences.

Yeah.

SHEFFIELD: I know, that's the idea. You're Wait, what is wrong? Unlikely.

DELONG: You're unli You're extraordinarily unlikely to find a biologist, or a chemist, or a physicist. Who wants to sign on for Team Republican these days?

SHEFFIELD: Well, yeah, I mean, well, because if you have people saying the universe is 6, 000 years old It

DELONG: could be!

It could be! There's nothing wrong with it having, it's not impossible. If it were in a state of thermal equilibrium, suddenly switching into a 6, 000 BC or 4, 000 BC configuration is a statistical possibility. It could be. And in [00:36:00] an eternal universe, it will happen once,

Multiverse,

and Boltzmann's brains are real potential problems for modern science as we know it.

Right. Indeed. We do not know. We do not know that we were not that the whole universe was not created the moment this podcast started with everything in its state and everything in motion going forward. Very true. And the argument from Occam's razor that's extraordinarily unrealistic. Runs up against the possibility that if the universe is indeed eternal, that only one of the times that we show up here, is it the real thing?

And the rest of the time, it's just stance chance, statistical fluctuations, and what we think is the unknown, and forever future.

SHEFFIELD: Yeah.

but you know what though? Like.

Technological change and societal uncertainty

SHEFFIELD: That uncertainty, like uncertainty though, and this is [00:37:00] a thing that you do talk about in the book, like the idea, with of inclusion that when the economy expanded to include more people and civil rights included more people, this created a huge amount of uncertainty and also conflict that had not existed before.

DELONG: Well, well, the uncertainty had always been there, right? That, I mean, last month I was thinking about the poor stockingers of late 1700s England. Who made stockings, for which there was a huge demand in that time of hose instead of pants. And, they had their technologies.

Admittedly, their technologies were only 200 years old. They had their place as skilled workers. They had their things they did. They had respected positions in society. They more or less had, gained the ability to enforce relatively high wages because of riots in the past. They had acts of Parliament protecting them.

And then along comes the technological changes of the [00:38:00] British Industrial Revolution and Parliament's desire to accommodate them. And they find what they thought were their legal rights to a respected position in society as skilled workers can absolutely vanish in a generation. And it is not true that the British Empire deployed more soldiers to suppress the Luddites.

In 1811, then it's sent to Portugal to fight Napoleon. Even though Eric Hausbaum claims it is definitely not true. But they did send a bunch. And starting in 1770s, technological progress becomes fast enough that some large group of people who think they have a respectable Position are going to find themselves be in the bullseye of Arian creative destruction and their ability to live their lives the way they thought they were going to doing what they thought they were going to do is going to vanish and is going to vanish in a matter of decades.

Whether it's poor [00:39:00] stockings, The outworking spinners herded into factories with the machines, handloom weavers, the peasants and also the landlord Yonkers of Eastern Europe, the all the way down to the blue collar manufacturing workers of the U. S. Midwest, stuck in.

In the bullseye, when technological change plus the Reagan budget deficits produced the huge wave of imports from, started the huge wave of imports from Asia and greatly diminishes demand for manufactured goods left in the United States. Everyone finds themselves in, or some large group finds themselves in the bullseye.

Every generation. And the question is, are the, do they suffer enough to make them potentially revolutionary as opposed to just disorderly? And do they have enough social power that they can try to gamble in some sense to preserve their position? [00:40:00] And, then that's a question that every society pretty much has to manage.

In the case of the Prussian Junkers, the way they gambled was they doubled down on their role not just as landlords growing rye and shipping it to Hamburg, but as military bureaucratic henchmen of the Prussian king, and so created a very large pro war caucus. To demonstrate their indispensability for society in response to the wave of grain imports from America, Argentina, and so forth that the, and Ukraine actually, that the technological changes of the 1890s brought.

In the case of the French peasants of the 1840s, it was the fact that they had what they regarded as a good thing. They'd gotten their land as a result of the great French revolution, but they found themselves. Threatened by the idea that a French state controlled by an urban mob might decide that [00:41:00] they were a good class to get a lot of resources out of it caused them to definitely go for the most anti socialist leader they could find on short notice, which was the nephew of the great Napoleon, which was Louis Bonaparte.

We used to call such figures Caesarists, and now I suppose we have to call them Trumpists. Who was regarded by the Rothschilds and by Karl Marx, an awful lot as we regard Donald Trump as someone totally unqualified for the job who nevertheless managed to get it by being a circus clown.

And in some sense, we're going through another of these. And here we have not managed to figure out how to, Distribute our wealth fairly, so that people can accept that the process is win or largely win or at least win for their children and also create sufficient institutions of voice and vote and respect [00:42:00] so that the people who do have social power are happy to continue with a liberal democratic system.

Instead of turning into plutocrats who, instead of our plutocrats turning into people who imagine that kleptocrats are their friends And people who at all costs want to hold on to their tax cut

SHEFFIELD: Yeah, well, and it's, yeah, like,

Differences between wealthy Americans and those elsewhere

SHEFFIELD: and it is interesting also when you look at high net worth individuals in Europe or let's say Japan versus in the United States, like there is a significant different ethos in in the United States among high net worth people that does not exist anywhere else in the world in any large way.

DELONG: Yeah, it's called classical liberalism. Yeah, it's called classical liberalism. It really ain't, at most it's pseudo classical because it was brand new. It wasn't classical back then before 1914. And at [00:43:00] most it was semi liberal because it also paid an enormous amount of respect to hierarchy, patriarchy, and to inheritance.

Which is not a big liberal value that, the idea was we would take our commercial society and have been respected and have the government act to boost it and boost technological development as fast as possible to make people think, that they were getting richer as a result. And so they shouldn't revolt while at the same time melding together, A rising entrepreneurial industrial mercantile bourgeoisie of rich with an old set of rich, of super rich, whose wealth depended on land, hierarchy, position, the fact that their great grandfathers had been accountants for Henry IV.

Or their great to the 10th grandparents had kind of come over with William the Conqueror, that kind of thing, which was the British Duke when asked if he had advice to people as to how to get rich would say, [00:44:00] well, have an ancestor in the paternal line who is best buds with William the Conqueror.

And, you can say that and kind of that kind of attitude, right, that we

SHEFFIELD: are

DELONG: lucky and the system works for us and we need to be careful is one that has come down from the European aristocracies to today's European rich who do also to some degree think that they actually have some kind of obligation to provide good lordship.

As opposed to the Ayn Rand addicted Americans who get greatly, excited and annoyed when Barack Obama tells them that they did not build their businesses. Lots of people did. They just happened to be lucky enough to sit in a place where when the stuff was distributed, they got the lion's share, right?

SHEFFIELD: Yeah, no, it's true. and I don't, I'm, and it is, [00:45:00] it's tricky though, because I don't so many universities Are also kind of beholden to these types of people as well, which is very ironic because at the same time, the, the right wing says that universities are communistic and socialistic, uh, they spend all their, time, their president's time and whatnot on, sucking up to oligarchs as everybody in the Ivy league is finding out.

DELONG: This is the president's time. It's not the provost's time. Hopefully the president sucks up and the provost actually runs the university. And they're not all oligarchs that, Andrew Carnegie, well, started out as the child of a handloom weaver in Scotland. He was, family was under the gun of that round of Schumpeterian creative destruction with the coming of the power loom.

And his father was smart enough to see the handwriting on the wall and for them to run to the United States. And he was then lucky enough, to be a [00:46:00] boy working in a telegraph office who caught the eye of senior managers. Andrew Carnegie wound up the second richest person of the year in the art on the earth with lieutenants who would say such politic things as I can hire half the working class to kill the other half of the working class.

Which is not quite the same as Eric Schmidt's, you grab everything you can, and then if you make it, you hire enough lawyers to, to square it afterwards, and if you aren't rich enough, it doesn't matter but it's along the same line, although in a much stronger direction. But, Carnegie also very much believed that he who dies rich dies in disgrace and also believed that the market mechanism is amoral and nasty enough that it's only justification is that it is necessary for the progress of the human race and we cannot think of a better set of institutions which was very much why he tried to [00:47:00] create the culture of philanthropy and in Carnegie's idea, it was I would say much more real philanthropy than most of the university gifts I have seen.

Over the past 40 years, that kind of most, yeah. Much of the gifts I've are self-serving. 40 years are, well, they're not self-serving. The money goes away,

SHEFFIELD: oh, I mean, self-serving Harvard. Right. That they're promoting the industry of the, of

DELONG: Yeah. But like, how many have Harvard's gotten 60 billion of private gifts since say, my father matriculated in 1956.

And do you know when he. When he entered the Harvard class, there were 900 men and 300 women and maybe a hundred of the men were development cases and maybe a hundred of the men were legacies, and the other 600 no, maybe 200 legacies, a hundred development cases and 600 [00:48:00] meritocrats around the world.

Today, Harvard has 1600 undergraduates in the class. Instead of having 300 women, it has 900. Instead of having 900 men, it has 700 and as best as I can see, it now has 150 development cases and 250 legacies leaving 350 places for male meritocrats compared to, 600 back when my father went which is truly extraordinary in terms of the use you managed to make.

Of 60 billion of private gifts that have been given by people who don't just want a building with their name on it, but also presumably are trying to make some gesture toward increasing educational opportunity and educational excellence in America.

SHEFFIELD: Yeah, no, it's not a big return on investment,

DELONG: not a big return on investment.

And they've made [00:49:00] it very clear that they do not want presidents who will attempt to upset that apple cart.

SHEFFIELD: Yeah.

DELONG: It

SHEFFIELD: is really unfortunate. Well, and yeah. All right.

Neoliberalism and its impact

SHEFFIELD: So before we get to the end here, I did want to, Just have a discussion about neoliberalism. So you have, of course, had your own change of viewpoint on that.

and I wanted to talk about that. the, democratic party, and this is going back to what I was saying, like the, I think of, libertarianism as sort of the conservative Cousin of neoliberalism. And it's, yeah. Like they have basically decided to just be quiet and go away in the Republican party and Democratic party.

I don't

DELONG: know. I don't know.

SHEFFIELD: You don't think so? what, neo, what, libertarians have power in the Republican party now?

DELONG: Zero. Neoconservatives. Well,

SHEFFIELD: A lot of them, most of them left or were [00:50:00] kicked out.

DELONG: I would say that just as his father, Irving Kristol, transformed himself from a quirky, conservative intellectual to a talentless hack when he scented power and when Irving Kristol signed up for Team Ronald Reagan.

So when Bill Kristol decided that the game was up, he changed from being a talentless Republican hack to an interesting and quirky public intellectual. Definitely worth reading. I do think Bill Kristol is very much worth reading these days,

SHEFFIELD: so that's at least one. Okay. Well, but he's still not in the Republican party though, is what I'm saying.

but okay. You're saying, oh, you're saying in the Democratic party as a, yeah, Neo liberal. Okay. Okay. Okay. Yeah. Well, but the

DELONG: idea that the, people should read more than as if there's interested in neoliberalism as a whole, rather than the whole 20th century. People should read, not my book, but Gary Sal's, the Rise and Fall of the Neoliberal Order.

Which I think is superb and it does make the point that, [00:51:00] the, some of the neoliberal impulse originally was not wrong, that democratic socialism entirely and social democracy substantially, was too bureaucratic. was too entrepreneurial, was too caught up in red tape and rent seeking.

That the idea that of the New Deal, of the social democratic order, you know, that in the modern age, big business or big labor or big government would have your back, was not always true and was not true for a fairly large part of the population. And so, you'll call it the Washington Monthly Neoliberalism of the late 1970s.

We need to deregulate where regulation is really stupid. And Miwaymo will find that market means are a better way of crowdsourcing solutions to social democratic ends in very many contexts. than is government command and control. And indeed, we'd say that it was [00:52:00] precisely because the world between 1980 and today has not been neoliberal enough that greater San Francisco and greater Los Angeles are now places where it is nearly unaffordable.

To live where David Autor tells me that if you're at the upper 10 percent of the income distribution, the income gain you will gain from moving to Boston, San Francisco, Los Angeles, is greater than the cost of living increase. But if you're below the top 10 percent of the income distribution, it doesn't make any sense making this past generation, the first generation in which blue collar and even not only white collar workers have been unable to move to where the opportunities are.

So, the neoliberal impulse was not, is not completely Understandable. And there were those of us who thought we could be more effective social democratic wolves in neoliberal sheep's clothing by talking the talk. Unfortunately, that was only us left [00:53:00] neoliberals and they were the right neoliberals.

For whom the rapid rise in wealth inequality that followed the coming of the neoliberal order was not a bug, but a feature.

SHEFFIELD: Yeah, well, because, yeah, the going back to Daniel Rand. And who were not very

DELONG: interested, who were not very interested at all in policies that actually would boost economic growth.

SHEFFIELD: Right. What do you mean by that?

DELONG: No, I mean simply that Reagan, right, that whatever good Reagan did with deregulation was vastly outweighed by the fact that he wanted to cut taxes on the rich and also restart the military industrial complex for a Cold War II in which it turned out to be totally the most unnecessary set of expenditures the American military ever embarked upon.

And the deficits that resulted starved America of investment for 15 years or so, it was only in the late 1990s after the Clinton administration had done its work that we actually saw what the [00:54:00] growth rate of America in the age of computerization could be. And Reagan's policy stupidity kept us with all those Republican allies kept us from seeing that 15 years earlier.

And for George W. Bush, deregulation was only an irritable impulse. And it landed us with the biggest economic catastrophe since the Great Depression. And with a lost half decade of economic growth in the United States and a lost decade of economic growth in Europe, that no, I mean, actually boosting American economic growth.

As the benefit you get from increasing income and wealth inequality was not the business of Reagan, Bush one or Bush two. Their business was the inequality was the point.

SHEFFIELD: Well, and it's interesting also that, just from a technological propagation standpoint that, the, all that investment that was done by Reagan to build up the defense industrial complex, what it [00:55:00] did is it kept technological innovation centralized actually and it prevented it from growing like that.

That I think was the big thing of the nineties was that. Everybody was able to partake in this stuff that had existed since the 70s. but, almost nobody got to use it. And like, that's, not something that they talk about anymore.

DELONG: So, although on the other hand, you can't really view Silicon Valley in the late 1990s as a victory for Ayn Rand, because Bill Gates, Steve Jobs and company did not really want to become billionaires.

Right. They wanted to do cool things and change the world.

SHEFFIELD: Yeah. Well, which is why they're very people

DELONG: who currently run the platforms and such that they and their ilk and their successors [00:56:00] established, who are very much on how can I make sure I maintain a monopoly place in this value chain so I can squeeze good luck. All you Patriot and good luck. All you Patreon creators out there.

SHEFFIELD: Yeah, exactly. Great. As we are seeing, as we're seeing well, okay, so, but, I mean, it does seem like, though, that, there, there are some people out there in the, Republican side of things that they, claim that they are populist, quote, unquote, and that they are not. Part of this Ayn Rand stuff.

And yet, when you look at the

DELONG: write a big book about how he's growing up, how he man's growing up in which he regards himself as being saved in the end by his maternal grandfather and grandmother and never, points out that the only reason he was able to save them was because, his maternal [00:57:00] grandfather's uncle had gotten a good steel job.

in suburban Cincinnati or in Cincinnati, and then had managed to bring his grandfather along, as a nepotism hire that, the combination of the UAW and the Midwestern industrial culture is the source of J. D. Vance's, or was one of the earthsprings of J. D. Vance's success as a kid from suburban Cincinnati, even though he wishes that he were from Appalachia.

SHEFFIELD: Well, okay, so then you're, it sounds like you don't find any of those claims to be credible in any way, that they're

DELONG: When the rubber meets the road, the Sam's Club Republicans deliver absolutely zero. Except sometimes they say women should knuckle under their husbands and stay undivorced because we need intact families.

And I can assure them all, when a woman decides it's time to [00:58:00] move out and that this loser isn't worth it anymore, they are very keenly aware of what that means for their likely economic security, right? To move from a two or one and a half to a one or half a breadwinner family. They are very aware of that, it's not that they don't understand that staying matter, staying married gets you an extra income and also an extra pair of hands to help with all the things the household has to do in raising its children.

It's that they've taken account of that and decided, no, this person, not maybe they're good for someone else. They're not good for me. Maybe I can find someone better. But you know, that kind of having more unhappy marriages while at the same time, you're opposed to child credits. You're opposed to school lunches.

You're opposed these days to the earned income tax credit you're for. More tax breaks for the plutocratic rich. And you don't even require, [00:59:00] that they pass tax foundation kind of benefit costs tests for affecting economic growth. That Sam's club republicanism was a nice, it was a nice, is a nice catchphrase, but you know, it was never backed up by.

Any serious policy work whatsoever.

SHEFFIELD: Yeah. Yeah, I think that's right. Colorado Senator. It's rhetorical.

DELONG: Has, like Michael Bennett has been looking for Republican partners on a kind of centrist, poach, pro child, pro family agenda as long as he has been in the Senate, if not longer, and, has he gotten, has anything gotten passed as a result?

SHEFFIELD: Yeah. And has it, yeah. When in fact, JD Vance. In the recent child care or the child tax credit, he didn't even show up to vote on it. That's

DELONG: a

SHEFFIELD: little bit

DELONG: [01:00:00] unfair. He is a vice presidential candidate and his running mate is off the trail.

SHEFFIELD: Well,

DELONG: in fact, his running mate and the first and the potential first lady are completely off the trail.

And so if there is going to be any member of the Republican ticket making the daily news cycle, it's gotta be him. Yeah,

SHEFFIELD: which is, yeah, an interesting dynamic, not

DELONG: the job I would have taken were I J. D. Vance.

SHEFFIELD: Yeah. Although I have to imagine he wasn't told that going into it. This is, yeah, Trump's going to stay home all summer.

And can't he

DELONG: look around and see,

shouldn't he have insisted on a weekend or a full week with Trump to decide rather than doing it on one phone call and telling [01:01:00] his kid to shut up the blather blathering about Pikachu. This is the most important phone call of my life. I'm talking to somebody much more important than you.

SHEFFIELD: Yep. Good parenting.

Pro family 101. yeah, All right. Well, last topic here.

The blogosphere and media integration

SHEFFIELD: Let's, you're one of the first bloggers. what year did you start posting on the internet? 19, was it before 2000? 1996. Okay. Yeah. Yeah. Because

DELONG: one of my ex roommates had said that physics has moved to archive. org, archive.

org for all of their scholarly publications and such. And so you should start your own website so you can transfer it over to the economics archive. org when it starts up.

SHEFFIELD: Okay. It never was

DELONG: left with a website. And then I found that people like Nobel prize winner Jagdish Bhagwati, or no, Jagdish died before they could give him the Nobel.

[01:02:00] Where did he, maybe I'm simply totally confused. I think I'm totally confused. I will check this because I don't want to cut that part out. Are dead. Oh,

yes, he's still alive. That's excellent. Jagdish Bhagwati, wonderful guy, ought to have been a Nobel one. One of the trade Nobel prizes has not due to, dumbness on the part of the Nobel Prize Committee. People like Jagdish Bhagwati and also future Nobel Prize winner, Paul Krugman, were picking up things.

From my website back in the late 1990s at a time when I kind of was not in their intellectual circles. And so it seemed to me that websites were something worth doubling down on.

SHEFFIELD: Yeah, okay. Well, and it's and you've been there ever since. Yeah. Yeah. Well, so It's now. So I, as, I mentioned I, was one of the earliest right wing bloggers, so I started in 2000 [01:03:00] Yeah.

With going after Dan Rather. I, that was, what I, did in the early days. That Bizarre was so Totally, it was a very strange, I presume

DELONG: the people who created the document thought that they weren't actually forging things because a document like this must have had existed at some point.

SHEFFIELD: That's what it seems like. Yeah. Otherwise, obviously,

DELONG: incomprehensible.

SHEFFIELD: Well, and the fact that he didn't bother to run it by anyone. Like he, he should have just said, look, okay, yeah, there was a hell of a drug. Yeah, but it is interesting though, looking at the back now, 24 years, let's say after the 2000 election, we'll say as the starting point that it seems to me that the right.

Did a much bigger integration of the blogosphere than the left did and I'm curious what you think of that. I [01:04:00] think there's

DELONG: a channel from the old line weblogs to Fox News and company, the, to which there is not really a counterpart was not really a counterpart on the left. There were a bunch of people who were kind of eager to make the media jump. Yeah. Well, people on the left or the center left, at least in large part, because they had more of the existing media sphere back in 2000, the obvious thing was to become a journalist.

rather than become a blogger. And it was only those of us who saw some, who were doing it for some other reason. Either trying to get a jump on the webification of an academic discipline, in my case, or people who simply could not stand having a boss in a news [01:05:00] organization on the other, who wound up doing it.

And then plus the, institutions that then left institutions, then bet on it, were kind of little magazines of one sort or another that then found themselves with a problem because the blog business was doing better than their print business, but was not making any money at all.

SHEFFIELD: Yeah. When it, and it is, and it's interesting.

I'm sorry. Go ahead.

DELONG: No, at least I think that's what happened.

SHEFFIELD: Yeah. Well, I, it's also that. I think if you look at the way that the right is much more interested in publicity and publicity seeking. So right wing organizations are very focused on that. Whereas, more left, let's say even all the way center to left are interested in policy formation and land less on public advocacy.

[01:06:00] And I think that's probably the big. The big difference, which is why there isn't, the, if you look on the right, like there are no sort of centrist center, right. Organizations out there

DELONG: in the scanning center.

SHEFFIELD: The what? Oh, the scanning center. Okay. Yeah. Well, they actually identify as centrist.

They do not identify.

DELONG: They do not identify as center, right?

SHEFFIELD: No, they do not. They do not. And but, I'm saying just from a media standpoint that, all of the, outlets that exist are either, extremely conservative or reactionary fascist. Like that's the spectrum. it's all clustered over on the far right, all the media.

And whereas on the left, the larger media institutions tend to be clustered into the center. and, there's not. Is much interest on the further left and creating media. It seems like, I don't know. What do you think? And,

DELONG: [01:07:00] well, I don't understand what the thing is that calls itself the further left.

SHEFFIELD: Well, let's say why, for instance, why is there no media? Why were there no media outlets that grew out of the Bernie Sanders campaign? Let's say, or why do like our revolution raised You know, at least 50 million and they created no media out of them. That's just one example.

DELONG: that's a good point.

And I will say, I have to think about that a lot more and I don't really have an answer for you.

SHEFFIELD: Okay. All right. Well, it's one, it's a subject that I'm, going to be writing on at some point in the near future. Okay. Okay. All right. So, for what's your recommendations for people to keep up with you just on your website? Yeah.

DELONG: Yeah.

SHEFFIELD: Just

DELONG: on the sub stack.

SHEFFIELD: Okay. Now you have a podcast as well, though.

DELONG: We have a podcast that appears on the sub stack, infrequently made. We're hoping to record next week.

The [01:08:00] sub stack is braddelong. substack. com. Please come one and all. And as I say, the links to the podcast are on the sub stack.

SHEFFIELD: Okay. And which social networks are you posting on primarily nowadays?

DELONG: Posting announcements. Posting announcements kind of everywhere I can find that's print oriented.

Actually I find myself spending more time on threads than on BlueSky or Mastodon, and doing so somewhat unwittingly because I think sooner or later Facebook is going to figure out a way to destroy its quality in an attempt to monetize it.

Moving to threads is like moving to the tender, dry foothills of the Sierra Nevada right now with the monetization firestorm in your future.

SHEFFIELD: Yeah, very likely. All right. Well, thanks for being here. I'll let you know when it comes out.

DELONG: Sure. Please do. And thanks for doing this.

SHEFFIELD: All right. So that is the program [01:09:00] for today. I appreciate you joining us for the conversation and you can always get more episodes. If you go to theoryofchange.show. And I did want to mention also the theory of change as part of the flux media networks.

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