Might The Great Stagnation end with The Great Medication?

That is the topic of my latest Bloomberg column, here is the last bit:

I don’t mean to say that technological stagnation is a good thing. But sometimes the biggest advances lead to more tragedy than comfort, especially in the short run, before we learn how to adjust to their challenges. To paraphrase Peter Thiel, they promised us flying cars, and what we got was a bunch of stoned characters, and more than 140 of them. Beware the end of the productivity slowdown.

Do read the whole thing.


Who decides what is tragedy and what is confort? Human action is always rational, although many times it doesn't make sense for an observing third person. Your blog is called marginal revolution, I though it was a reference to the subjective theory of value.

You just missed the moral scolding in the past - the GMU econ dept. has been in the business of morally scolding since the early 1980s.

After all, what do you think public choice economics represents, if not moral scolding, using talking points already plain to most people? Well, at least those familiar with Will Rogers, H.L. Mencken, Mark Twain, et al.

I suggest Alexander Jones

"the GMU econ dept. has been in the business of morally scolding since the early 1980s."

They didn't take kindly to your plagiarized work.

Machine efficiency

I am on the other side of this "scolding" idea.

Tyler says "lives are destroyed by drugs, and that is sad."

You reply "don't scold us."

What is your rationale, deaths of others are no big? Freedom as a concept is more important than reality as an outcome?

Of course, to most here, freedom as a concept is more important than reality as an outcome? Isn't that what the ideology of Libertarianism is all about?

I say "lives are destroyed by car accidents, that is sad."

You reply: "don't scold us,"

What is your rationale, deaths of others are no big? (Surely it can't be anything to do with the fact that cars have important countervailing benefits that you haven't even tried to address in your statement.)

A softball reply. Cars have tons of "policy" to make them safer, from school zone speed limits to mandatory backup cameras.

Rational? I doubt it. I think, after skirting much milder forms of self-destruction, that drug addicts must start with a skewed view of life's potential, and thus make a biased judgement of risk and reward.

"Life sucks, so why not heroin?" is only very superficially a rational choice.

(By mild self-destruction I may just mean "should I go for the 'bottomless shrimp?'")

True. The findings from studies on cognitive distortions and on behavioral economics are clear. There's not really much that is rational about human choices.

That's why we need the AI-powered overlords to mind control us into things which benefit their benefit.

I was using "rational" to mean the purposeful using of means to attain a specific ends, as per Mises and the Austrian school: https://mises.org/library/human-action-purposeful-action
In this context it is irrelevant a) the effectiveness of the action (a primitive tribe dancing to make it rain is a rational action) and b) how the agent arrived to the determination of the end (life sucks, so why not heroin? is before the initiation of the human action of looking for heroin.

The point b is particularly important. If you start to decide that heroin is bad for somebody, you start a slippery slope, next you will force everybody to brush their teeths, forbid people to work for a wage that is enough for him but too low for you, forbid books that can be damaging, and you'll end up with the Nuremberg laws

Or make heroin illegal?

Absolutely. Making heroin illegal is to pretend that you know better than the potential user what is good for him, and even worse, forcing him to follow your instructions. It is amazingly arrogant and violent.

And, by the way, with a few exceptions, regulations have nothing to do with an arrogant but at least good-faith belief that it is good for the regulated. Read, as an example, this piece of late prof. Whitehead, probably the guy that knew more about the history of prohibition of narcotics in the US. It is mostly about marijuana, but it is the same for "harder" drugs.: http://druglibrary.org/schaffer/history/whiteb1.htm

It is very funny, by the way

I am interested in experiments, like pot in Colorado and more drugs in Portugal, and if fewer laws produce better results, it would be pragmatic for me to support the change.

That said, when you call what most people consider normal protections "arrogant and violent," you probably lose the median voter. You are a long way from where their head is at.

Why should I care about the median voter? As H.L.Mencken said, democracy is the theory that common people know what is good for them, and they deserve to get it good and hard.

Liberty won't be realized through the violence of the ballot box. It will through technology (Bitcoin or tor, for example), institutional innovation (for example, private cities like the Zedes in Honduras), black markets (silk road and its me-toos), low-cost private schools, "Galting out", massive tax evasion,... meanwhile, I am wealthy enough to rent my liberty.

If you see the mere mention of something decent as "moral scolding", then, to your credit, you can at least identify it as morally good.

If you think fentanyl is bad, wait until things like 3-methylfentanyl and carfentanyl enter the market more widely. The latter is around 10,000 times more potent than morphine. Incredibly easy to smuggle since a few gram s can make thousands of doses and thus incredibly easy to overdose. It's really scary stuff.

...plain old alcohol has done just fine in America for centuries -- for folks seeking anesthesia from daily life. Exotic new drugs have little overall impact on the overall productivity that population minority.

The premise that new addictive chemicals & new social media have dramatic negative impact on U.S. labor productivity is really dumb.

Some people get really bad hangovers. Those people tend not to become alcoholics. It doesn't mean they won't take to a different kind of drug.

...if you routinely get hangovers -- you are an alcoholic.

The point, however, is that "addictive" chemicals have been readily available for centuries... for the small minority of the American labor force that seeks constant refuge in them. Novel improvements in modern chemistry do not change that longstanding situation in human behavior. Intoxication is Intoxication as an end result/objective -- the chemical that gets you there is insignificant, as long as it's routinely available to you.

Some people define addiction on the basis of whether it interferes with how you want to live your life. Some people define it on the basis of arbitrary standards. "If you consume more than 5 beverages a week, you're an alcoholic".

I think addiction to low grade TV, and all that comes with it, is probably a greater threat than the sum of all non-FDA-sanctioned usage of chemicals which influence the brain. Somehow, I think the companies that rake in billion and billion in pharma ad revenues by that medium are not going to raise a stink about it.

You've never done acid, have you?

[taken LSD]

What would be great would be if this revolution in drug design could come up with a version of LSD which didn't last an entire day. One rather has to clear ones schedule for it.

Some of the 2c chemicals have come close, but they're not quite the same.



Micro-dosing LSD and Psilocybin has become a thing for creative people in Hollywood, programmers and Wall Street guys. The claim is it improves focus and productivity. Modafinil has been used for some time to boost alertness and focus. Micro-dosing LSD does boost your mood and energy, with have the walls breath or Puff dropping by. You feel good and that tends to result in getting more done so the boost in focus could be a happy accident - literally.

Modafinil does not make you smarter, but smart people think it does because it gives them a nice boost in energy, but does not make them manic or crash after it wears off. It provides a nice boost that very slowly dissipates through the day. By evening, it is gone and you feel normal again.

Can't say I'm hugely interested in drugs to increase productivity. More to enjoy hallucinations, euphoria and generally making my brain work in a different way that usual. Modafanil is too much work

Third World immigration is slowly turning everywhere into Brazil. A small, ultra-wealthy mainly White elite together with a large, poorly educated mainly Black underclass. With nothing in between. California is well down this path already.

So frankly, it is probably best for us all if the underclass remains as medicated as possible. The alternatives are worse.

Generally agree. One of my favorite life amusements is to invite white progressives to jump in the car and go hang out with some of the people they care so deeply about.

It works better if they leave the car at home and ride the bus ;)

I will never understand why we are hated so much. We built a multi-racial, multi-cultural society without Jim Crow, church burnings, "The Troubles", Intifadas or "lone wolves". So the drug habit of desperate Americans, trying to flee from their reality of enslavement and oppression is proof of some Brazilian-like phenomenon...

Under the American regime, "greed is good" and the populace is looted by ever greedier corporate and political masters. As an old Brazilian anthem says, "to be free, it is not enough to be strong, determined and brave/ a people with no virtue will ended up enslaved". Americans lack civic virtue. As Mr. Coolidge said, "the chief business of the American people is business.” You can manage WalMart this way, but you can not rule a country this way. As Brazilian stateman José Bonifácio famously said, "the sound policy is a daughter or Moral and Reason".

>Under the American regime, “greed is good”

Ah, I see you are studying US culture by doing the serious work of watching Hollywood movies, and you've made it all the way up to 1987 already. Good for you, big guy!

Next up, you'll learn that we let 12-year-olds run our toy corporations after they visit the magic Zoltar machine at the carnival. So we're not all bad!

Keep studying!

The film was as a social commentary on the so-called America ever growing focus on the bottom line as the
mea. Brazilian writer Lima Barreto in one of his most famous - and beautiful - writings had already, in the 1920s, pointed out the of this thought. As he said, under the American system, there is only one command: "make money. Honestly if you can, but make money". Brazillian intellectuals have been studying the USA for decades. In the 1960s, American writer Erico Verissimo pointed out Americans are too much pharisaic, unlike Brazilians. I read much of what has been written in Portuguese about so-called America and so-cakled Americans.

"We built a multi-racial, multi-cultural society"

Yes, and where does the notion that that is something that is supposed to be wonderful come from? It's an import from America, itself a fusion of the old Yankee negrophilia and the (((influence))). And many ignorant Americans go on believing that "racial democracy" bullshit, but we know the truth:


I'll try again to link it.


Oh, wow, it worked that time. LInk is to the article I mentioned below this comment.

I find it hard believe Brazil's belief in treating fairly all its citizens is an import from America when it dates from the before the days when American Blacks were fated to the back seats of the bus.

As a Brazilian anthem from the 1880s says,

"We cannot believe that in another age

Slaves there were in so noble a country.

Now the rosey glow of dawn

greets brothers, and not hostile tyrants.

We are all equal! In the future, united,

We will know how to take up

Our august banner that, pure,

glows triumphant from the altar of the fatherland!"

My goodness. You are so full of crap. Brazil is wildly racist compared to America. Brazil is one of the most violent countries in the world. Yet, in the past decade, homicides among whites have decreased 24 percent. But among the black population they have increased 40 percent. The police treat black like zoo animals, often shooting them for sport. There's a reason skin bleaching is so popular with Brazilians. They look at their ruling class and see nothing by blancos.

Wow, you had to go back to 1914 to find a way to criticize Brazil's ideas and practices regarding race-- or to claim that racism is wonderful, wherever and whenever it exists. Not sure which of those you were doing, or maybe you were doing both. But it must be very important to you, for you to go back to 1914 to make this point.

"Wow, you had to go back to 1914 to find a way to criticize Brazil’s ideas and practices regarding race– or to claim that racism is wonderful, wherever and whenever it exists."

Why can't I? Liberals criticize America based on things which happened long before 1914. The ideology of branqueamento didn't disappear in 1914. More accurate to say it peaked in 1914, didn't really disappear until the 1930s, when the Portuguese elite started to get nervous of all the businesses being in the hands of the immigrants.

There has been much academic criticism from the left of the "racial democracy" notion in modern Brazil.

Yeah, Thiago, give us lyrics which were composed at a time in which Brazil was the last western country to still have slavery.

Jill, the reason Tyler won't let you link things is because your links are spam, irrelevant to the conversation at hand.

"Yeah, Thiago, give us lyrics which were composed at a time in which Brazil was the last western country to still have slavery."

It was composed after the Emancipation ("Golden Law") when Brazilians didn't think fit burden the former slaves and their children with even more legal limitations. There is not, in Brazilian history, anything like your church bombings and lynching and Racial Segregation.

Thiago, Brazilians are not hated so much by most Americans. This blog is unusual in that there are a lot of Right Wingers who love to hate lots of people-- e.g. anyone who is not also Right Wing, whether they are Americans Democrats or people who live outside of the U.S. Read this article below to find out how Right Wing Americans have been taught to hate government, anyone Left of Center etc., for decades now, because that wins elections. You can google the title. For some reason, I have lost the ability to put links into my comments, so I can't link it for you.

The political scientist who saw Trump's rise coming
Norm Ornstein on why the Republican Party was ripe for a takeover, what the media missed, and whether Trump could win the presidency.
by Andrew Prokop on May 6, 2016

I read that article. It is sad that America has come to that.

I always keep hoping we have "hit bottom" in the U.S. We seemed to, temporarily, when we elected G W Bush. Afterwards, we got Obama, who has been a good president in most ways. Maybe the person we elect next time, after Trump is gone, will also be good.

"I always keep hoping we have 'hit bottom' in the U.S."

"And worse I may be yet. The worst is not
So long as we can say 'This is the worst." - William Shakespeare

I am not a "right-winger" nor I hate anybody. And I find Thiago the most sublime, consistent and funny troll ever existed.

Yo, Virtuos political tribe, check your privileges.

About 50% of San Jose would qualify as "ultra wealthy" most parts of the country. And most of those folks ain't white.

After cost of living adjustments?

Wow, either you're entirely off base or I really have lost track of how San Jose is doing.

The median income in San Jose is $77K per household versus the US average of $51K. So, no 50% of San Jose is not “ultra wealthy”.

It helps when you know connected people with money.

Have you ever heard the story about a minority coming from a poor place to a rich place, and then becoming a dominant class there?

Me neither. No matter how hard working or smart, eventually there comes a time when you have to meet someone to get the deal. (Somewhat more exceptions than previously due to the internet, but still ...)

You have whittled down the list to 10 candidates. You feel that they are all roughly appropriate for the job.

5 are immigrants. 5 are not immigrants.

One of the applicants has the same last name as a friend of yours, and it is a rare last name.

Who do you hire?

When I was working for the Boston Consulting Group in Chicago in the ´90s, maybe 15% of employees were of Indian ancestry. They were there because they were good, the "diversity" bullshit had not started yet.
Many of the great entrepreneurs of the US are immigrants. But generally, they do not perceive themselves as "pertaining to a minority", they perceive themselves as individuals endowed with the same natural right of any other individual.

I am an immigrant. I've felt like a minority at times in my life, while not in others: Minority means underclass, and you don't choose to feel like a member of an underclass: It's being treated differently (and far worse) that brings in said feeling. It's being underestimated and undervalued on first impression. It destroys performance, and the best one can do is try do is to change environments. An immigrant can just change cities and social circles. Someone whose status is mostly determined just by skin color and that can't go to another country will not do so well.

I understand it, Bob, I myself spent most of my life as an immigrant. A few times I felt I was discriminated against. But racism or nativism is a natural right of the individual. If you agree that you own your body, you have the natural right of associating with whom you feel like, and the corresponding right of disassociating. We might consider a racist an asshole, but it's his right to be an asshole.

My response has been to ignore the assholes, and in a few cases to beat the shit out of them in the market, driving them to bankruptcy.

But I understand that as an Italian Wop, the discrimination was much, much less than what other people endure.

Fentanyl gets headlines because it's involved in the death of housewives and Prince. Fentanyl was first synthesized in 1960, 57 years ago. All the drugs for cancer, vascular diseases, AIDS, and a very long ETC, where found after Fentanyl. Smallpox was eradicated by 1978-1979. It would be great to know if Tyler's life quality depends on a drug discovered or synthesized after 1960.

Ps. I liked a lot this WSJ article. It kills the stereotype of "drug abuse is a first world problem". Also, it poses an implicit question: as patents expire, how many more addicting substances can be easily synthesized in EM labs? After looking at the prices, it makes no sense to plant opium or marijuana, it pays more a graduate degree in chemistry. http://www.wsj.com/articles/tramadol-the-opioid-crisis-for-the-rest-of-the-world-1476887401

" the new drug fentanyl "

I thought it unfortunate when Tyler used this phrase.

Quite right about the fact that it is not a new drug. It was first synthesized by one of the greatest pharmaceutical chemists of all time Paul Janssen back in 1960.

You're right, but I think he was just referring to the fact that fentanyl only recently started to be commonly synthesized by drug dealers for illicit use.

Check what opium and marijuana prices would be in a genuinely free market before concluding that synthetic alternatives would be cheaper.

A lifetime supply even for a heavy user would cost less than your average trip to the grocery store.

To paraphrase Peter Thiel in another vein, what they promised us was a free Internet, and what we got was a billionaire secretly funding a lawsuit to destroy an Internet media company.

Good point Thiel made there.

I judge this by thinking "If I were in the same position, would I have done the same thing?" Ubetcha!

There's a lot I don't like about Peter Thiel, but on this one, I raise my glass and say "Good work, Peter, good work! You got 'em!"

A portion of this development is the fruit of feminism. Girls just wanna be guys; drunk, stoned guys. In the past it was limited to slutdom or closeted. The feminists have made it acceptable for the liberated female to be publicly besotted or zoned out as long as she's not driving a car.

It is liberating that there are more female boxers and MMA fighters than in past decades. CTE is progressive.

More than half of the people on earth are female. It is ridiculous to say that more than half the people on earth should be made to follow rules that do not apply to the other side, the almost half of the world population that is male. There are some biological differences between the sexes, but very few that affect any other aspects of life than sex and childbirth.

Being drunk and stoned a lot of the time, or being promiscuous, is risky, regardless of what gender you are. Protecting women from real or imagined risks has at least as many drawbacks as benefits. So why do it? It certainly doesn't seem like a very Libertarian thing to do.

Moon, Jill, et al,

His name is Chuck Martel. He's obviously an alt right whacko. Whatever gave you the impression he was libertarian?

Sex and childbirth only? I suppose that accounts for the big bad patriarchies that have dominated human history.

We should still hold people accountable for their actions and not blame technology or society. This comes down to personal responsibility and discipline.

Maybe the people who can't hold down a job, and are not disciplined enough to find a new one, or accept a different job, share the same traits as people who abuse alcohol and drugs.

I don't think it is quite this black and white. There have been an extraordinary number of successful and prominent functioning alcoholics. The British Navy ruled the waves on a solid portion of spirits every day. Lots of people I know smoke, haven't been able to quit, which is a mild self medication, and they function very well, run businesses and are productive members of society. I also know quite a few users of marijuana who are functioning, but less so.

These drugs are very very potent. Someone told me the other day that his father was in Vietnam and used opium. When he came back to the US he wasn't addicted, and the gentle high helped deal with the awfulness while he was there.

This doesn't happen with these drugs. They are designed to be pure and very effective at getting to the body functions that control pain. Which also creates the physical addiction. The withdrawal is hard and dangerous. Someone who in a previous generation would have gotten drunk on the weekend and been functional all week is now incapable of functioning.

There are experiments in progress where we have the hard anti-drug, harm reduction, and legalization of the milder drugs. We will see which turns out. Vancouver has been seeing a high death rate from fentanyl, notwithstanding the harm reduction programs.

Excellent points, Derek. Thanks for making them.

Will someone explain to me what "a bunch of stoned characters, and more than 140 of them means"?


I don't know but getting stoned is significantly less popular now than it was 20 or 30 years ago. Does TC mean to say "drunk". That usage of stoned went out in the 60's. Or is TC trying to claim "stoned" for the effects of prescription drugs now? If so, careful. Getting stoned sounds pretty cool. Ask Ray Charles or Bob Dylan.

But why "more than 140"?

Fentanyl has been around for at least 40 years. When I was an Intern in 1982 we used it to sedate stroke patients in order to do CT scans.

With any drug that increases its own likelihood of administration the only thing that prevents its widespread use is availability. In that group of people there is a high probability of addiction. Because of that dynamic, there are waves of permissiveness and prohibition when it comes to using drugs. Legal and illegal factors like inappropriate prescribing can be factors. These epidemics are generally self limiting because of the toll they take on the participants and eventually the general public - but that period can be as long as 15-30 years. There is generally a net negative when it comes to productivity. The CDC for example has calculated that each drink consumed in the US represents a loss of $1.90 due to morbidity and mortality. I would speculate that with illegal fentanyl use the cost is much higher.

... guess you are trying to say that Fentanyl isn't that big a deal in the overall drug world ?

Thus, it's emphasis in TC's Bloomberg column is bogus. I agree. That entire Bloomberg essay is bogus IMO.

Mitch, that's not how I interpreted what George said at all. 15 to 30 years of this does not sound good to me.

You used fentanyl, really? Why not a barbiturate or a benzo?

We used fentanyl only in the case where the patient was agitated and often unable to respond or communicate in a coherent manner. It was the only way imaging could be done. A team of us had typically accompanied the patient from the ED to the scanner and observed them carefully. There were no complications.

As a psychiatrist, I have used benzodiazepines for the same application and they are not as reliable. I have always been reluctant to order high dose benzodiazepines without closely observing the patient through the entire process. But these days anesthesiologists are available to rapidly sedate and observe the patient. They typically use IV high potency benzodiazepines.

Fentanyl is a big deal, especially if it is used outside of medical supervision. That is why there have been all of the deaths with that drug and the current opioid epidemic. With increased in availability we basically approach similar situation to the turn of the 19th->20th century where opioids and cocaine were all available over the counter in various forms. That situation eventually led to the Controlled Substances Act because of widespread problems.

well, Fentanyl kills maybe a couple thousand people per year; alcohol kills 88,000+.
Which one is the big deal relative to the premise of national labor productivity ?

"well, Fentanyl kills maybe a couple thousand people per year; alcohol kills 88,000+. Which one is the big deal relative to the premise of national labor productivity ?"

The old basis for many a drug legalization argument. You need to look at the population at risk to conclude which drug is more lethal:

Looking at the acute mortality related to alcohol and opiates, I don’t think that there should be any doubt that opiates are probably more lethal than alcohol. The CDC states that about 2,200 people die every year from acute alcohol poisoning (3). The population at risk appears top be 38 million binge drinkers. Men ages 35-64 are at highest risk. In 2014, there were 18,893 overdose deaths from prescription painkillers and 10,574 deaths from heroin overdose (4). In this case the estimated populations at risk include 1.9 million people with a prescription painkiller problem and 586,000 heroin users. Furthermore the death rate from prescription painkiller and heroin use parallels the availability. I am puzzled by the author’s suggestion that opiates are “much safer” and that there is “honest disagreement among health care practitioners over just how harmful long term opiate use can be…”.

I don't expect everyone to respond to reason. Clearly we are in the midst of liberalized drug intake of various intoxicants. Many of the legalization advocates hope for more widespread legalization of a number of drugs.

I can tell you unequivocally that the widespread availability of fentanyl or other opioids will lead to a death rate that rapidly eclipses that of alcohol. As I previously stated that experiment has already been done right here in the USA.

" each drink consumed in the US represents a loss of $1.90 due to morbidity and mortality"

Did they forget to calculate the value of economic activity that happened as a direct result of conversations had while getting drunk?

If everyone who DOESN'T drink alcohol DID, the death rate from heart disease would plummet.

THAT'S not a loss of $1.90 from morbidity & mortality.

Rather, the opposite.


Someone better tell Cowen.

I am afraid it is:


Notice the specific reduced productivity.

The conclusions in the table in the article you link to is tremendously inconsistent. There is no net positive effect of heavy alcohol use on cardiovascular disease. Most heavy drinkers who require detoxification have hypertension even after completing detox. Many of those blood pressures are in the emergency treatment range.

We're not talking heavy use, GD.

Rather, moderate drinking by people formerly teetotallers.

Did you even open the article?

I am referring to Table 3.

And of course I am talking about problematic use. The reason why people come to medical attention.

In those cases Table 3 is inaccurate.

Interesting article as usual. Technological innovation, the spreading of ideas through the internet, has certainly improved the quality of food in the US. Anyone who lives in a major US city with ethnic markets can make ethnic food, say Chinese or Indian or Vietnamese or Thai better than most local restaurants could have ten or twenty years ago. The information is all on the internet if you can source the ingredients.

Hi Tyler (and other commentators),

Your claim in the piece regarding the role of social media in popularizing drug use was a new one for me; are there any resources you could share on that which have shaped your views?

Additionally, you seem to be implying that the Fentanyl crisis is indicative of a much broader social phenomenon regarding drug abuse / self-medication, but don't make this explicit; what are your concerns beyond Fentanyl and what are some good resources on this topic?


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