## The Growth Rate of the Stock of Deployed Ideas Then & Now

What Is the Rate of Ideas Growth? & Why Is It What It Is? :: Background Lecture :: Econ 210a :: Introduction to Economic History :: 2021-04-07

## Five Paragraphs:

1) Cutting yourself loose from your relationship with your largest trading partner is not usually a source of strength or freedom. And with an “evasive” fabulist like Boris Alexander de Pfeffel Johnson in charge of setting the course, Britain’s future looks like one of near-stagnation. Think of what has happened in the past fifteen years to Italy, but with much worse weather:

Chris Patten: The UK’s Hard Brexit Choices Have Arrived: ‘Almost all serious economists and business leaders expect… slower economic growth for the foreseeable future (as a result of Britain having left its main export market)…. The government has not released an official projection of Brexit’s economic impact; if the figures were good, they would be published in bold…. While ministers hunt for excuses, businesses face higher costs, more red tape, and delayed supplies. “Global Britain” will apparently get around such problems by finding new markets in Asia…. [But] there is no tunnel between Folkestone and New Delhi, and there are not 10,000 goods trucks a day shuttling between Dover and Shanghai…. Stronger UK-China trade ties would present Johnson with another hard choice. Will Britain continue to stand with other liberal democracies like the United States, Canada, Australia, and Japan in trying to contain the threat that China poses to its region and the international rule of law? Or will it kowtow whenever President Xi Jinping’s regime stamps its feet?… The UK’s tough choices accumulate…. The problems lurking around the corner look menacing. Britain will have to make the best of Brexit. But it will be a long, hard struggle, all the more so with an evasive fabulist in charge…

2) The bullshit flows fast, thick, and plentifully from Facebook these days:

Alyse Stanley: Zuck Slowly Shrinks & Transforms Into a Corncob Ahead of Apple’s Looming Privacy Updates: ‘Facebook has pushed back against Apple’s planned rollout of anti-tracking tools at every possible opportunity, but now the social media giant seems to be changing its tune in a last-ditch effort to save face…. Zuckerberg said Facebook may actually be in a “stronger position” after the privacy updates…. (As you might already suspect, Facebook’s claims have been found to be misleading at best, and self-serving propaganda at the worst)…

3) I do not know whether Teslas this-is-definitely-not-an-autopilot here is simply being in human, or is also very badly programmed. But since it is going to deal with humans, acting in a way that communicates verbally and nonverbally with humans in a way that reassures and informs them is a vital importance. And that seems to have been badly neglected here:

Elizabeth Blackstock: Terrifying Drone Footage Of Tesla Making Unprotected Left Turn: ‘Full video on Chuck Cook’s YouTube channel…. His car waits and waits for an opportunity to turn left between bursts of traffic. The left turn isn’t a difficult one for most drivers…. The car just kind of waits in limbo until it deems the moment is right, which it will only do if it decides crossing is safe. So that means it just kind of… takes off. It doesn’t give Cook a warning. It just goes. And as you can see in the clip above, Cook doesn’t always deem it safe to do so, which means he needs to be on high alert to grab the wheel or hit the brakes. It kind of negates the whole purpose of it being a driver assistance program when the driver has to be more alert than normal. This comes just after last week’s video showing the absolute chaos that’s going on with Tesla’s Full Self Driving Beta program…

5) This strikes me as very, very good news indeed. Now all we have to do is teach people how to do this, and also construct truth sandwiches:

Anna Funk: Scientists Can Implant False Memories—& Reverse Them: ‘Two key methods [that] helped participants differentiate their own real recollections from the false ones: Asking them to recall the source of the memory. Explaining to them that being pressured to recall something multiple times can induce false memories. WHY THIS MATTERS—Ultimately, the team found rich, false memories can mostly be undone. And they can be undone relatively easily. “If you can bring people to this point where they are aware of that, you can empower them to stay closer to their own memories and recollections, and rule out the suggestion from other sources,” Oeberst says. “You don’t need to know what the truth of the matter is, which is why they’re nice strategies,” false memory expert Elizabeth Loftus, who was not involved in the study, tells Inverse…

## PODCAST: Hexapodia VII: Forecasting þe Economy, Now Þt Biden-Rescue Has Been Enacted

### with Claudia Sahm, Noah Smith, & Brad DeLong

Listen in podcast app

In the last resort, the the way the government budget constraint balances itself is through the fiscal theory of the price level: levying this inflation tax on holders of money balances, redistributing wealth away from those who have nominal assets to nominal debts, and imposing a large cognitive-load tax on doing your economic calculation arithmetic. That makes this a lousy tax to impose. Larry and Olivier think we are heading down the road toward a world in which, because Republicans will not allow taxes to be raised, this lousy inflation tax will be levied unless Democrats gird their loins and prepare for an eventuality in which they sober-eyed recognize the costs to real people of letting the government budget constraint balance itself via the inflation tax…

with the erudite, witty, & highly influential Claudia Sahm

## References

Olivier Blanchard: In Defense of Concerns Over the $1.9 Trillion Relief Plan <https://www.piie.com/blogs/realtime-economic-issues-watch/defense-concerns-over-19-trillion-relief-plan> Wendy Edelberg & Louise Sheiner: The Macroeconomic Implications of Biden’s$1.9 Trillion Fiscal Package <https://www.brookings.edu/blog/up-front/2021/01/28/the-macroeconomic-implications-of-bidens-1-9-trillion-fiscal-package/>

Neil Irwin: Move Over, Nerds. It’s the Politicians’ Economy Now<https://www.nytimes.com/2021/03/09/upshot/politicians-not-central-bankers-economy-policy.html>

Lawrence H. Summers & Paul Krugman: A Conversation with Lawrence H. Summers & Paul Krugman <https://www.youtube.com/watch?v=EbZ3_LZxs54>

Claudia Sahm: A Big Fiscal Push Is Urgent, The Risk of Overheating Is Small<https://www.ineteconomics.org/perspectives/blog/a-big-fiscal-push-is-urgent-the-risk-of-overheating-is-small>

Larry Summers: The Biden Stimulus Is Admirably Ambitious. But It Brings Some Big Risks, too <https://www.washingtonpost.com/opinions/2021/02/04/larry-summers-biden-covid-stimulus/>

&:

Vernor Vinge: A Fire Upon the Deep <https://books.google.com/books?id=fCCWWgZ7d6UC>

## Paragraphs

1) Ben Thompsen's idea that writers have "value" seems to me to be simply wrong. What has value is "easiest way to tap into this element of the zeitgeist". That usually gets attached to a single writer because we are social network animals hotel and listen to stories. But that is a matter of time, chance, opportunity, and market structure—as well as insight, fluency with prose, and ability to produce regularly and to meet deadlines. Ben Thompsen has the last four and happened to hit the sweet spot with respect to the first floor, plus adding a lot of sweat equity and taking a big gamble. More power to him. But he should not think that he has unique or large “value”. To see the business of the sovereign writer as being to sift gold nuggets out of the sand fundamentally mistakes what is going on:

Ben ThompsonSovereign Writers & Substack: ‘Media has reason to fear Substack… not that Substack will compete with existing publications for their best writers, but rather that Substack makes it easy for the best writers to discover their actual market value…. The media’s revenue problems are a function of the Internet unbundling editorial and advertising…. Media’s impending cost problem—as in they will no longer be able to afford writers that can command a paying audience—is a function of the Internet making it possible to go direct… Substack is [just] one of many tools competing to make this easier….

This explains three other Substack realities….Substack is going to have a serious problem retaining its most profitable writers unless it substantially reduces its 10%…. Substack is… [not] threatened by Twitter and Facebook…. Social networks… want to own the reader, but the entire point of the sovereign writer is that they own their audience. Substack’s real threat will be lower-priced competitors…. It would be suicidal for Substack to kick any successful writers off of its platform for anything other than gross violations of the law or its terms of service….

Substack Pro is a good idea…. What would be truly valuable is helping the next great writer build a business…. Ideally these writers would be the sort of folks who would have never gotten a shot in traditional media…. I am by no means an impartial observer here; obviously I believe in the viability of the sovereign writer. I would also like to believe that Stratechery is an example of how this model can make for a better world: I went the independent publishing route because I had no other choice (believe me, I tried). At the same time, I suspect we have only begun to appreciate how destructive this new reality will be for many media organizations….

Substack is not in control of this process. The sovereign writer is another product of the Internet, and Substack will succeed to the extent it serves their interests, and be discarded if it does not.

2) a very large number of journalists who want to know better, and their bosses, very much want Biden to say good things about Trump which are (a) false, (b) ludicrous, and (c) never anything they would ask Trump to do if positions were reversed. I wonder why:

Kate Riga & Josh Kovensky: No, Trump Doesn’t Deserve Credit For Planning Vaccine Distribution: ‘With the COVID–19 vaccines starting to bring the pandemic to an end, former President Trump has stepped in to take credit for the feat. What’s surprising is that he’s been aided in this by the Washington Post and New York Times, both of which have run articles this week arguing that the speed-up in the vaccine rollout under President Biden only builds off of a plan put into place by Trump…. That’s flat wrong…. Trump… lacked a plan for the “last mile” of distribution, leaving that to the states while lobbying Congress not to pass much-needed funding that would spur state and local governments to get the vaccine into arms….

The Trump… plan to distribute the vaccine… [was] “let the states figure it out.”… Trump… left the country with… a partnership with pharmacies to vaccinate nursing homes—the only real footprint of a federal plan to deliver vaccine into people’s arms. And even that foundered…. What’s more is that that one plan only covered the first phase of distribution: nursing home residents and hospital workers, who received inoculations from the medical facilities at which they worked…

3) For “high quality voters” read “white voters”:

Jonathan Chait: ‘Everybody Shouldn’t Be Voting,’ Republican Blurts Out: ‘Representative John Kavanagh, a Republican legislator who chairs Arizona’s Government and Elections Committee and is shepherding through a bill to make voting more cumbersome and therefore rare, described his party’s motives with blundering candor; “There’s a fundamental difference between Democrats and Republicans,” he told CNN. “Democrats value as many people as possible voting, and they’re willing to risk fraud. Republicans are more concerned about fraud, so we don’t mind putting security measures in that won’t let everybody vote — but everybody shouldn’t be voting … Not everybody wants to vote, and if somebody is uninterested in voting, that probably means that they’re totally uninformed on the issues. Quantity is important, but we have to look at the quality of votes, as well”…

4) Those who always thought J.D. Vance was a con artist, come down and collect your chips!:

Steve M.: The Worst Senate Race: ‘J.D. Vance, author of Hillbilly Elegy… Ohio Senate seat…. Peter Thiel has given $10 million to a Vance super PAC… Newsweek op-ed… “Nno one seems to care that many migrants test positive for COVID every day and will directly compete with our struggling service sector workers…. Why are we promising amnesty… when… vicious transnational drug cartels use that promise to sell desperate people on the promise of crossing the border?… Scott Lemieux writes…. If you’re wondering why J.D. Vance was throwing out some preemptive racisms, well here you go: ‘Josh Mandel, a candidate in the 2022 Republican primary in the U.S. Senate, had a post removed by Twitter on Thursday… Of the various types of illegals flooding across the border, will more crimes be committed by… Muslim Terrorists or Mexican Gangbangers…. However, there’ll be a third major candidate in the primary… Jane Timken… describes herself as the ”one candidate in this race who was hand-picked by President Trump to run the Ohio Republican Party."… The first words in her first campaign ad are: “President Trump won Ohio twice because he stood up and fought for hard-working Americans. I’m Jane Timken, and I’m running for the U.S. Senate to defend the Trump agenda….” It’ll be a three-person race… all be trying to out-MAGA, out-meme, and out-xenophobe one another. It wll be a race to the bottom, the worst Senate primary in America… 5) Scott Lemieux: Rich Lowry upholds National Review’s Longstanding Policy on Voting Rights: ‘Verbatim Rich Lowry: “That many Democrats say that the filibuster should fall for this bill is a symptom of the fevered state of the party, which despite holding or winning every elected branch of the federal government has conjured out of nothing a vast conspiracy to stop people from voting that allegedly justifies one of the most blatant federal power grabs in memory.” Arizona Rep. John Kavanaugh, defending propose Republican vote suppression measures: “There’s a fundamental difference between Democrats and Republicans…Democrats value as many people as possible voting, and they’re willing to risk fraud. Republicans are more concerned about fraud, so we don’t mind putting security measures in that won’t let everybody vote — but everybody shouldn’t be voting”… 6) John Ganz: Some Thoughts on Free Speech & Cancel Culture: ‘One of the many ironies of the interminable debates over cancel culture and free speech is that cancel culture is not a phenomenon of censorship so much as one of unrestricted free speech. The fear is not that one will be censored, so much as one will be denounced…. Social media allows anybody a platform for accusation and calumny and allows anyone to join with them to form associations. I think most people agree open criticism of others and freedom of association is just part of having a free society. But who, then, decides when criticism is unfair or even calumnious? Or when associations are mobs and seditious conspiracies rather than public-spirited groups?… We have a long tradition in this country of free, even raucous, criticism and attacks on public figures…. We’ve now seen very ordinary attacks on politicians branded as “cancel culture,” which is an attempt to make alien and new a very old tradition in our democratic society. It’s attempting to “cancel” criticism in advance, if you will…. We have entered a kind of state of universal hypocrisy on these subjects. Everyone is glad to see their enemies skewered: no one really comes to the defense of principle. Or maybe they feel that principle is best defended through a faction, to which allowances must be made for the sake of political expediency… 7) Charles I. Jones: Time Series Tests of Endogenous Growth Models: ‘According to endogenous growth theory, permanent changes in certain policy variables have permanent effects on the rate of economic growth. Empirically, however, U. S. growth rates exhibit no large persistent changes. Therefore, the determinants of long-run growth highlighted by a specific growth model must similarly exhibit no large persistent changes, or the persistent movement in these variables must be offsetting. Otherwise, the growth model is inconsistent with time series evidence. This paper argues that many AK-style models and R&D-based models of endogenous growth are rejected by this criterion. The rejection of the R&D-based models is particularly strong… LINK: <https://pdfs.semanticscholar.org/6016/78f3aecbbeac6be9d2154b593376e12b12c7.pdf?_ga=2.165174207.1051621454.1616040529-2146537243.1615524750> ## Briefly Noted: 2021-03-21 Su ### Things that went whizzing by that I want to remember... ## Very Briefly Noted: ## Six Paragraphs: Of all the things I understand least well, it is that we dare not aim to have production hit potential output and thus hit the inflation target because we cannot handle even a small overshoot because… of what, exactly? This kind of thinking perhaps avoids some risk of a bumpy future by creating an eternal very bumpy present: Benjamin Wallace-WellsLarry Summers Versus the Biden Administration’s Coronavirus-Stimulus Plan: ‘The Biden rescue package will pour out enough sand to fill a hole, and then keep pouring. In Summers’s view, this is economically risky, because it means that the Federal Reserve will probably eventually need to manage inflation, a recipe for a bumpy future. “My reading is that there are roughly zero historical examples where we got inflation to the point where the Fed got nervous and had to tighten and the whole thing happened smoothly,” Summers told me last week. He also sees the stimulus as politically risky, in that there are only so many times the Biden Administration can ask Congress to spend huge amounts of money without raising taxes to offset it, and fewer still if they spend this round inefficiently… The Malthusian picture, the 1870-1914 escape, and fears that World War I had permanently deranged the economic growth process in such a way as to raise the specter of the return of the Devil of Malthus: John Maynard Keynes (1919): The Economic Consequences of the Peace: ‘[Their] view of the world… filled with deep-seated melancholy the founders of our Political Economy. Before the eighteenth century mankind entertained no false hopes. To lay the illusions which grew popular at that age’s latter end, Malthus disclosed a Devil. For half a century all serious economical writings held that Devil in clear prospect. For the next half century he was chained up and out of sight. Now perhaps [with World War I] we have loosed him again… Ummm… You target asset bubbles by reducing leverage, not by raising interest rates. I have a bad feeling about this: Ruchir Sharma: By Targeting House Prices, New Zealand Shows the Way: ‘While consumer prices have been held in check by globalisation and automation, easy money pouring out of central banks has been driving up the price of assets from stocks to bonds and housing…. A global political celebrity, the liberal Ardern was elected on a promise of affordable housing. Fed up, her government has ordered the central bank to add stabilising home prices to its remit, starting March 1. It is novel and healthy for a politician to recognise the unintended consequences of easy money. If this idea catches on, it could lead to greater financial and social stability worldwide…. Ardern’s move may not slow the housing boom soon, because supply-and-demand dynamics are too strong. But ordering the central bank to make housing price stability a higher priority is a start, and could inspire others to rethink the role easy money has played in driving financial instability… I confess hope that Facebook dies rapidly. Silicon Valley needs a very obvious and pointed lesson that treating your users like cattle to be exploited and misled leads to your bankruptcy and to your permanent exclusion from all polite society. Feeding your users to the likes of Alex Jones for the Luz & the advertising dollars is despicable. This applies to you to, Google, for the current state of Youtube: Justin Bariso: Tim Cook May Have Just Ended Facebook: ‘Cook aptly points out, “advertising existed and thrived for decades” without using data that was collected in less than transparent ways. And as customers are offered more choice when it comes to how apps and websites track their data, experts predict that more and more people will opt out of said tracking. If you’re an advertiser, you’ll need to adapt. Or die.But there’s also a bigger lesson at stake. Now is the time to ask yourself: Which philosophy do I want to pursue? Do I want a business that serves my customers? Or one that takes advantage of customers to serve my business? Because in the end, only one of these philosophies is sustainable for the long-term. The other will lead you to crash and burn. And while the long-term solution may initially prove more challenging, remember: “The path of least resistance is rarely the path of wisdom”… But, Scott, the ARP is not “a bloated, stealth, and wholly partisan vehicle”. If it were, Republicans would be running against it rather than trumpeting its accomplishments and hoping to make voters think they voted for rather than against it, capisce?: Scott Lincicome: While You Were Seussing: ‘While Republicans fight the culture war on TV, Democrats enact progressive priorities into law…. Republicans are only now scrambling to define the ARP and are left to hope that it doesn’t work, while Democrats are on the attack. A big reason for that is that instead of mounting an effective messaging campaign to highlight these provisions—ones almost entirely unrelated to the pandemic—and others (such as that ridiculous union pension bailout or the$60 billion in tax hikes), and to define the ARP as a bloated, stealth, and wholly partisan vehicle to achieve progressive social change under the cover of Covid, Republicans were on TV yelling about children’s books and cancel culture…

The huge gap between the performance of the biomedical establishment and the performance of the Trump administration is truly remarkable:

Jason Kottke: How Were the Covid–19 Vaccines Developed So Quickly?: ‘1. The need was urgent…. 2. Funding & focus. Companies and governments threw billions and billions of dollars at this… 3. Availability of volunteers & high incidence of disease…. 4. International & corporate collaboration. Countries and companies shared research, data, and resources…. 5. We knew a lot about coronaviruses from previous work…. 6. Scientific and technological capability…. Humanity’s general scientific and technological abilities have never been stronger or more powerful…. Bloomberg: “Remember also that technology has evolved rapidly—for example, we’re now about able to sequence the genomes of every mutant version of the virus in less than a day. That helps in speeding up vaccine development.” Dr. Mark Toshner sums up the effort: “However we have collectively now shown that with money no object, some clever and highly motivated people, an unlimited pool of altruistic volunteers, and sensible regulators that we can do amazing things”…

Why is it, anyhow, that a “measurement” is a self-adjoint operator? A measurement is entangling the quantum wave function of the experiment with that of a measuring device that has a macro-visible pointer. What does that have to do with a self-adjoint operator?

Sydney Coleman: Quantum Mechanics in Your Face: ‘The state of a physical system at a fixed time is a vector in Hilbert space… ѱ…. It evolves in time according to the Schrödinger equation i∂ѱ/dt = Hѱ, where the Hamiltonian H is some self-adjoint linear operator…. Some, maybe all, self-adjoint operators are “observables”. If the state is an eigenstate of an observable A, with eigenvalue a, then we say the value of A is a, is certain to be observed to be a.... There’s an implicit promise in here that, when you put the whole theory together and start calculating things, that the words “observes” and “observable” will correspond to entities that act in the same way as those entities do in the language of everyday speech under the circumstances in which the language of everyday speech is applicable. Now to show that is a long story. It’s not something I’m going to focus on here, involving things like the WKB approximation and von Neumann’s analysis of an ideal measuring device8, but I just wanted to point out that that’s there…