What I’ve been reading

1. Michael Kempe, The Best of all Possible Worlds: A Life of Leibniz in Seven Pivotal Days.  A good book, I had not realized the full import of Leibniz in the history of binary computation, his understanding of “novels as models,” his theory of social distancing during epidemics, or just how much attention he devoted to the historical episode of a woman as Pope.

2. Judith Scheele, Shifting Sands: A Human History of the Sahara.  A quite good, informative, and readable book on a very much undercovered topic.  Saharan civilization is something that runs deeper, and is more coherent, than any set of national boundaries in the region.  The author spent years living in the Saharan region of Chad.  Recommended, a good example of “you should read a book about a topic you are not thinking of reading about.”

3. Frank Close, Destroyer of Worlds: The Deep History of the Nuclear Age 1895-1965.  A good look at the underlying scientific history behind nuclear, most of all in the pre-Manhattan project years.  I had not sufficiently realized how dangerous this research was, and how many of the people died prematurely from cancer, quite possibly from radiation exposure.

4. Bijan Omrani, God is an Englishman: Christianity and the Creation of England.  Some might argue this book is a “duh,” nonetheless I found it a good overview of the importance of Christianity in British history, and suggesting that those ties should not be lost or abandoned,

5. Sam Dalrymple, Shattered Lands: Five Partitions and the Making of Modern Asia.  Are you excited by the prospect of learning more about why Burma split off from the rest of the Raj in 1937?  If so, this is the book for you.  It also has good coverage on the role of the Middle East in the history of the Raj.

6. Perry Anderson, Disputing Disaster: A Sextet on the Great War.  This strikes me as the kind of book where a very established author is seeking to work out issues that preoccupied him as a much younger man.  Such books tend to be interesting but also incomplete and unsatisfying?  Overall I am glad I read this one.

7. Diana Darke, Islamesque: The Forgotten Craftsmen Who Built Europe’s Medieval Monuments.  Perhaps overargued in places, but an excellent book, with super-clear explanations and wonderful illustrations.  Excerpt: “No architectural style just ‘appears’ magically out of nowhere.  All the key innovations attributed to Romanesque — new vaulting techniques, the use of decorative frames, interlace and ornamental devices like blind arcades, Lombard bands, blind arches, lesenes, Venetian dentil and the use of fantastical beasts and foliage in sculpture — can be traced back to their origins, and all of these without exception lead us eastwards [to Islam].”

New York facts of the day

It’s truly astonishing how fiscally irresponsible New York is. The state budget proposal calls for $254 billion in spending, which is 8.3 percent higher than last year. That comes despite New York’s population having peaked in 2020. It’s a spending increase far in excess of the rate of inflation to provide government services for fewer people.

Ditch compares the New York state budget to the Florida state budget, a sensible comparison since both are big states with major urban and rural areas and high levels of demographic and economic diversity. He finds:

  • New York’s spending per capita was 30 percent higher than Florida’s in 2000. It was 133 percent higher last year.
  • New York’s Medicaid spending per capita was 112 percent higher than Florida’s in 2000. It was 208 percent higher last year. Florida has not expanded Medicaid under Obamacare, while New York has expanded it more aggressively than any other state. “For perspective, in 2024 New York spent nearly as much per capita on Medicaid ($4,551) as Florida did for its entire state budget ($5,076).”
  • New York’s education spending per student is highest in the country, at about $35,000. Florida spends about $13,000 per student. Florida fourth-graders rank third in the country in reading and fourth in math. New York fourth-graders rank 36th and 46th.
  • Florida has surpassed New York in population and continues to boom.

Here is more from Dominic Pino.

Friday assorted links

1. More uses for ChatGPT?

2. How the AI regulation moratorium fell apart (WSJ).

3. Good Noah Millman piece on BBB (NYT).

4. Puffin found in Hereford garden (Times of London).

5. Economic impacts of a united Ireland?

6. Sofie Channel, curated anonymous discussion of ideas.  Not sure how good or legit it is, but it seems to have some content.

7. One man’s takeaways from reading Moby-Dick.

8. Natasha Sarin on some different things in BBB.

A consumption basket approach to measuring AI progress

Many AI evaluations go out of their way to find hard problems.  That makes sense because you can track progress over time, and furthermore many of the world’s important problems are hard problems, such as building out advances in the biosciences.  One common approach, for instance, is to track the performance of current AI models on say International Math Olympiad problems.

I am all for those efforts, and I do not wish to cut back on them.

Still, they introduce biases in our estimates of progress. Many of those measures show that the AIs still are not solving most of the core problems, and sometimes they are not coming close.

In contrast, actual human users typically deploy AIs to help them with relatively easy problems.  They use AIs for (standard) legal advice, to help with the homework, to plot travel plans, to help modify a recipe, as a therapist or advisor, and so on.  You could say that is the actual consumption basket for LLM use, circa 2025.

It would be interesting to chart the rate of LLM progress, weighted by how people actually use them.  The simplest form of weighting would be “time spent with the LLM,” though probably a better form of weighting would be “willingness to pay for each LLM use.”

I strongly suspect we would find the following:

1. Progress over the last few years has been staggeringly high, much higher than is measured by many of the other evaluations  For everyday practical uses, current models are much better and more reliable and more versatile than what we had in late 2022, regardless of their defects in Math Olympiad problems.

2. Future progress will be much lower than expected.  A lot of the answers are so good already that they just can’t get that much better, or they will do so at a slow pace.  (If you do not think this is true now, it will be true very soon.  But in fact it is true now for the best models.)  For instance, once a correct answer has been generated, legal advice cannot improve very much, no matter how potent the LLM.

As in standard economics, consumption baskets change over time, and that can lead to different measures of progress (or in the economics context, different estimates of advances in living standards, depending on whether the ex ante or ex post bundle weights are used).  Researchers could attempt the more speculative endeavor of estimating how LLMs will be used five years from now in everyday life (which will differ from the status quo), and then track progress on that metric, using those value weights.  “How rapidly are we improving these systems on their future uses?”

This alternate consumption basket approach gives you a very different perspective on progress in AI.

Note also that the difference between the “Math Olympiad measurements of AI progress” and the “consumption basket measurements of AI progress” may iincrease over time, especiallly if the basket of everyday uses does not change radically.  The everyday uses will peak out near maximum levels of performance, but there will always be a new series of very hard problems to stump the AIs.  It will become increasingly unclear exactly how much AI progress we really are making.

The new Javier Cercas book

The new Cercas book is El loco de Dios en el fin del mundo. That title translates roughly as “The crazy man of God at the end of the world,” noting there are ambiguities in who that man is (Cercas? The Pope?), and whether the end of the world refers to a trip to Mongolia or the apocalypse or perhaps death.

Cercas, arguably Spain’s greatest living writer, decides to shed his purely secular perspective and accompany Pope Francis on his Mongolia visit, a country with about 1500 Catholics. Like many of Cercas’s novels, it is a mix of non-fiction and fiction, and it is also self-consciously a detective story – which truths will Cercas unlock during this journey? Most of all, he wants to know if his mother will meet her husband (Cercas’s father) when she dies.

We live in a time when an atheistic European author puts down his preoccupation with Spanish history and spends almost five hundred pages engaging with the Pope and also the possibility of God. A vibe shift if there ever was one.

Cercas reports that he came away from the trip more anti-clerical than before, but on the matter of God and the miracle of the Resurrection, I read his text as ever so ambiguous.

Do not despair, the works of Cercas usually end up translated into English in a reasonably prompt manner.

Big Beautiful Bill critiques

So far I am not finding them very impressive.

To be clear, there are many things — big things — I do not like about the bill.  I would sooner cut Medicare than Medicaid (that said, I do not find the idea of cutting health care spending outrageous per se).  The corporate rate ends up being too low, given the budget situation.  No taxes on tips and overtime is crazy and cannot last, given the potential to game the system, plus those are not efficient tax changes.

I strongly suspect that if I knew more of the bill’s details (e.g., what exactly is the treatment of nuclear power in the current version?), I would have more complaints yet.  I do not wish to boost taxes on solar power.  Veronique de Rugy criticizes the underlying CEA projections.

That all said, doing the budget is not easy, especially these days.  Maybe I have read fifteen or so critiques of BBB, and have not yet seen one that outlines which spending cuts we should do.  Yet comparative analysis is the essence of economics, or indeed of policy work more generally.  In that sense they have not yet produced critiques at all, just complaints.  Alternatively, the critics could outline all the tax hikes that would put the budget on a sustainable path, but I do not see them doing that either.  Again, no comparative analysis.

If you don’t want to cut health care spending, what do you want to cut?  I am willing to cut health care spending, preferring to start with richer and older people to the extent that is possible.

You can always spend more on health care and save more lives and prevent some suffering.  But what is the limiting principle here?  Simply getting angry about the fact that lower health care spending will have some bad outcomes is more a sign of a weak argument than a strong argument.  Again, a strong argument needs comparative analysis and some recognition of what is the limiting principle on health care spending.  I am not seeing that.  I am seeing anger over lower health care spending, but no endorsements of higher health care spending.  I guess we are supposed to be doing it just right, at least in terms of the level?

It is commonly noted that the depreciation provisions and corporate cuts will increase the deficit, but how many of the critics are noting they are also likely to increase gdp (but by enough to prove sustainable?)?  I write this as someone who thinks the proposed Trump corporate tax rate is too low, but I am willing to recognize the trade-offs here.

Another major point concerns AI advances.  A lot of the bill’s critics, which includes both Elon and many of the Democratic critics, think AI is going to be pretty powerful fairly soon.  That in turn will increase output, and most likely government revenue.  Somehow they completely forget about this point when complaining about the pending increase in debt and deficits.  That is just wrong.

It is fine to make a sober assessment of the risk trade-offs here, and I would say that AI does make me somewhat less nervous about future debt and deficits, though I do not think we should assume it will just bail us out automatically.  We might also overregulate AI.  But at the margin, the prospect of AI should make us more optimistic about what debt levels can be sustained.  No one is mentioning that.

It also would not hurt if critics could discuss why real and nominal interest rates still seem to be at pretty normal historical levels, albeit well above those of the ZIRP period.

Overall I am disappointed by the quality of these criticisms, even while I agree with many of their specific points.

Wednesday assorted links

1. “Cool people are perceived to be more extraverted, hedonistic, powerful, adventurous, open, and autonomous, whereas good people are more conforming, traditional, secure, warm, agreeable, universalistic, conscientious, and calm.

2. Henry George and American libertarianism.

3. More Scott Sumner movie reviews.

4. Restaurants rated by the hotness of their clientele (NYT).  You know what to do!

5. A new bank called Erebor? (FT)  Here are further bits of detail.

6. “Proxy quitters” in Japan — the service is still growing.

7. Reddit debate on early massive galaxy formation.

8. ChatGPT-assisted retrieval practice had positive effects in an educational setting.

Tyler Cowen travel tips

That is my latest column in The Free Press.  Here is one excerpt from the middle:

I am a fan of going places where things are happening, whether good news or bad, at least if the locales are sufficiently safe. When communism fell, I rented a car and drove around Eastern Europe for one of my most interesting and memorable trips. More recently, I visited El Salvador and Argentina (repeat visits in both cases) to see what was going on with El Salvador president Nayib Bukele’s radical imprisonment policies and the free-market reforms of Argentina’s Javier Milei. I do not pretend to completely grasp the problems of either country, but my understanding is richer than before. I also found that the locals are keen to narrate their points of view, which makes the trip more interesting.

And from the very end:

Finally, I have a radical travel suggestion. Perhaps it is not for families or for the frail, but seasoned travelers should consider it. Imagine you have been to many places, and you are wondering where to go next. Select a country (putting aside danger) where you are quite sure you do not want to go, simply because it does not interest you much. Go there.

The point is that your instincts can be quite wrong about places you have not seen. What’s more, if you go with low expectations, there is a high likelihood you will be pleasantly surprised. Under my proposed method, you will not be disappointed.

When I started traveling, I thought I would love Southeast Asia most, but over time my true affections turned toward Latin America. A few years back I ended up in Baku, Azerbaijan, not because I really wanted to go, but because going through Baku was the easiest way to get to my final destination. The same was true for my trip to Pristina, Kosovo (“where can I fly direct from Zurich airport, where I have not already been?”). Both were fantastic experiences, more interesting, and also easier than I had been expecting.

So often in travel, our greatest enemies are inertia and status quo bias. Recognize that change is real, and that you need some yourself. Isn’t that why you are traveling in the first place?

Do it!

The anti-alcohol campaign in the USSR

Although alcohol consumption remains high in many countries, causal evidence on its effects at the societal level is limited because sustained, society-wide reductions in alcohol consumption rarely occur. We take advantage of a country-wide 1985-1990 anti-alcohol campaign in the Soviet Union that resulted in immediate, substantial and sustained reductions in alcohol consumption. We exploit regional differences in precampaign alcohol related mortality in the Russian republic and show immediate declines in male and female adult mortality in urban and rural areas across the entire age distribution, which translate into a rise in life expectancy. The campaign led to a substantial decline in deaths that are both directly (alcohol poisoning, homicides and suicides) and indirectly linked to alcohol consumption (respiratory and infectious). We find a decline in infant mortality rates among boys and girls due to causes most affected by post-natal parental behavior (choking and respiratory). Finally, both divorce and fertility rates rose, while abortions and maternal mortality due to abortions declined. This study provides novel evidence that alcohol consumption not only directly affects the mortality of drinkers but can have spillover effects on family outcomes.

That is from a recent paper by Elizabeth Brainerd and Olga Malkova.

Tuesday assorted links

1. The true populist is for air conditioning? (in French)

2. Microsoft is pursuing medical superintelligence.  And some reservations from a (human) doctor.

3. What do contemporary economists do?

4. What Michael Tilson Thomas learned from James Brown.

5. Some YIMBY progress in California.

6. “There have been more than 60 U.S. initiatives on Africa since the 1990s. Few have survived.

7. Fannie and Freddie reform?