Category: History

Struan Moffett on South Africa (from my email)

I think one important point you missed is that South Africa’s recent (and ancient) history has forced the population to work quite aggressively through racial differences at speeds that other developed nations have not. ‘Racial harmony’ would be a stretch, but I would say that most (all?) South African’s have a ‘racial understanding’. South Africa is also very post-racial in the sense that most understand racial differences to actually be cultural differences – for myself, growing up English in Durban, I felt more of a kinship with educated Indians than with the (white) Afrikaners. It would make absolutely no sense from a strictly Western perspective that the English and the Afrikaners (both ‘white’) couldn’t be more different!

Here is my original post.

What should I ask Bob Spitz?

Yes I will be doing a Conversation with him, Wikipedia here.  I very much enjoyed his new book on the Rolling Stones, plus he has many older books of note, including on the 1969-1970 Knicks, Woodstock, Ronald Reagan, Bob Dylan, the Beatles, Led Zeppelin, and Julia Child.  All good books!  He also for a while worked as manager to both Bruce Springsteen and Elton John.

So what should I ask him?

AI, Unemployment and Work

Imagine I told you that AI was going to create a 40% unemployment rate. Sounds bad, right? Catastrophic even. Now imagine I told you that AI was going to create a 3-day working week. Sounds great, right? Wonderful even. Yet to a first approximation these are the same thing. 60% of people employed and 40% unemployed is the same number of working hours as 100% employed at 60% of the hours.

So even if you think AI is going to have a tremendous effect on work, the difference between catastrophe and wonderland boils down to distribution. It’s not impossible that AI renders some people unemployable, but that proposition is harder to defend than the idea that AI will be broadly productive. AI is a very general purpose technology, one likely to make many people more productive, including many people with fewer skills. Moreover, we have more policy control over the distribution of work than over the pure AI effect on work. Declare an AI dividend and create some more holidays, for example.

Nor is this argument purely theoretical. Between 1870 and today, hours of work in the United States fell by about 40% — from nearly 3,000 hours per year to about 1,800. Hours fells but unemployment did not increase. Moreover, not only did work hours fall, but childhood, retirement, and life expectancy all increased. In fact in 1870, about 30% of a person’s entire life was spent working — people worked, slept, and died. Today it’s closer to 10%. Thus in the past 100+ years or so the amount of work in a person’s lifetime has fallen by about 2/3rds and the amount of leisure, including retirement has increased. We have already sustained a massive increase in leisure. There’s no reason we cannot do it again.

Herbert Hoover is still underrated

We study the effects of large-scale humanitarian aid using novel data from the American Relief Administration’s (ARA) intervention during the 1921-1922 famine in Soviet Russia. We find that the allocation of relief closely tracked underlying food scarcity and was uncorrelated with subnational politics. We show that ARA rations reduced food prices, raised caloric intake, lowered the prevalence of relapsing fever, and increased rural birth cohorts. The aid benefited poorest peasants most and proved most effective in provinces with higher levels of human capital. Back-of-the-envelope calculations suggest that, absent ARA relief, the 1926 population would have been 4.4 million lower.

That is from a new paper by Natalya Naumenko (my colleague), Volha Charnysh, and Andrei Markevich.

The President(s) Fought the Law and the Law Won

In our textbook, Modern Principles, Tyler and I emphasize that Congress and the President are subject to a higher law, the law of supply and demand. In an excellent column, Jason Furman gives a clear example of how difficult it is to fight the law of inelastic demand:

…Today a given number of autoworkers can make, according to my calculations, three times as many cars in a year as they could 50 years ago.

The problem is that consumers do not want three times as many cars. Even as people get richer, they increase their spending on manufactured goods only modestly, preferring instead to spend more on services like travel, health care and dining out. There are only so many cars a family can own, but that’s not the case for expensive vacations or fancy meals. As a result we have fewer people working in auto factories and more people working in luxury resorts and the like.

These forces — rising productivity but steady demand — explain why the United States was losing manufacturing job share as far back as the 1950s and 1960s, long before trade became a major factor.

Sentences to ponder

This matters for the AI question, and the book leaves it unfinished. If the breakthroughs of the past required social conditions, not just cognitive capacity, then what does it mean when the next breakthroughs are produced by systems that have no social conditions at all? A neural net does not need a university chair or financial independence from the church. It does not need to reorganize its commitments. It does not, in any recognizable sense, have commitments. The machine that replaces the marginalist is not a better marginalist. It is a different kind of thing entirely.

That is from Jônadas Techio, presumably with LLMs, this review of The Marginal Revolution is interesting throughout.  And this:

Maybe the book demonstrates only that Cowen personally remains good at something the field no longer needs.

What should I ask Andrew Graham-Dixon?

He is one of the world’s leading art critics, all of his books are excellent, and he has a new and very good work coming out titled Vermeer: A Life Lost and Found.  He also has a well-known book on Caravaggio, on Michelangelo, and I am especially fond of his book on British art.

Here is his Wikipedia page.  Here is his home page.  So what should I ask him?

My excellent Conversation with Paul Gillingham

Here is the audio, video, and transcript.  Here is the episode summary:

Tyler calls Paul Gillingham’s new book, Mexico: A 500-Year History, the single best introduction to the country’s past—and one of the best nonfiction books of 2026. Paul brings both an outsider’s eye and ground-level knowledge to Mexican history, having grown up in Cork — a place he’d argue gave him an instinctive feel for fierce local autonomy and land hunger —earning his doctorate on the Mexican Revolution under Alan Knight at Oxford, and doing his fieldwork in the pueblos of Guerrero.

He and Tyler range across five centuries of Mexican history, from why Mexico held together after independence when every other post-colonial superstate collapsed, to why Yucatán is now one of the safest places on earth, what two leaders from Oaxaca tell us about Mexican politics, how Mexico avoided the military coups that plagued the rest of Latin America, what Cárdenas’s land reform actually achieved versus what it promised, whether the ejido system held Mexico back, why Mexico worried too much about land and not enough about human capital, how Mexico’s fertility rate fell below America’s, why Guerrero has been violent for two centuries, why the new judicial reforms are a disaster, where to find the best food in Mexico and Manhattan, what a cache of illicit Mexican silver sitting on a ship in the English Channel has to do with his next book, and more.

Excerpt:

COWEN: Now, after independence in 1821, why did not the rest of Mexico fragment the way Central America did a few years later, where it splits off from the Mexican empire? What determines the line? What sticks together with Mexico, and what does not?

GILLINGHAM: That’s a very good question because it’s one of the things that really makes Mexico stand out in that period, those histories, is that after independence, the rest of the Americas, you get a series of super-states. You get Gran Colombia, which is most of the Andes, and going across what’s now Venezuela. You get the United Provinces of the Rio Plate. These are huge, very difficult to conceive of super-states, and they fail within a decade. Elsewhere, you look at other post-colonial states, thinking particularly of India, within a couple of years, you’re fragmented and failed. Mexico doesn’t. Mexico actually stands up with the exceptions you put of Central America, which is formally part of it, in fact, but leaves within short order.

It’s one of these questions of what Álvaro Enrigue calls the miracle that Mexico exists. To explain it is a paradox. To make a try at it, I think that there is a common theme in Mexican history, which runs across most of those five centuries, which is a remarkable degree of hands-off government. It’s imposed. Mexico has a lot of mountains. It’s very difficult to rule from any central pole. Savvy governments, or governments with no choice, which are quite often the same thing, are very hands-off. Federalism is built into Mexico’s soul. I think that’s one of the reasons, from early on, Mexico actually out-punches the rest of the Americas in terms of sticking together as a territorial unit.

COWEN: As you know, in the early 19th century, there are rebellions in Yucatán, the Caste Wars, but Yucatán does not split off from Mexico. What keeps that together?

GILLINGHAM: Yucatán has always felt itself to be a different country, effectively, and that runs through to the present. You can see the cultural reasons, obviously, and the Maya and the other great, sophisticated urban culture of the 16th century and before. It makes sense that they should feel themselves very different from the rest of what becomes Mexico. In fact, it comes through in small but revealing ways. Back in the 20th century, people find themselves being asked whether they want a Yucatán beer or a foreign beer, and a foreign beer being anything in Mexico outside Yucatán.

Why doesn’t Yucatán leave? I think that it came extremely close. In fact, there’s a moment in the 1840s when Mexico and Texas form an alliance, and Texas is chartering warships out to Yucatán to try and prevent any naval incursions. Why on earth does Yucatán stay? I think it’s because of the absence of an alternative capital, because Yucatán is profoundly racially divided. It’s one of the few places in Mexico where you could say that really is a fairly stark racial divide. You have a plantocracy, in some ways, like the US South before the Civil War.

You’ve got a relatively small white plantocracy centered in Mérida. They have no interest whatsoever in leading an independent struggle. While the Maya achieve an underestimated level of sophistication as a state, it’s still not at the point where you would get, for more than a couple of years, a really joined-up independence movement spanning all races, all areas, and the entire peninsula.

Recommended, interesting and substantive throughout.  In the United States at least, Mexico remains a greatly underdiscussed nation.

*The Marginal Revolution: Rise and Decline, and the Pending AI Revolution*

I am offering a new piece of work — I do not quite call it a book — online and free.  It has four chapters, is about 40,000 words, is fully written by me (not a word from the AIs), and it is attached to an AI with a dual page display, in this case Claude.  Think of it as a non-fiction novella of sorts, you can access it here.  You can read it on the screen, turn it into a pdf (and upload into your own AI), send it to your Kindle, or discuss it with Claude.

Here is the Table of Contents:

1. What Is Marginalism?

2. William Stanley Jevons, Builder and Destroyer of Marginalism

3. Why Did It Take So Long for the Science of Economics to Develop?

4. Why Marginalism Will Dwindle, and What Will Replace It?

Here are the first few paragraphs of the work:

How is it that ideas, and human capabilities, become lost? And how is that new insights come to pass? If eventually the insight seems obvious, why didn’t we see it before? Or maybe we did see it before, but didn’t really know we were on to something important? Why do new insights arrive suddenly, in a kind of flood? How do new worldviews replace older ones?

And what does all of that have to do with the future of science, the future of research, and the future of economics in particular? Especially when we try to understand how the ongoing artificial intelligence revolution is going to reshape human knowledge, and the all-important question of what economists should do.

Those are the motivating questions behind this work, but I will address them in what is initially an indirect fashion. I will start by considering a case study, namely the most important revolution in economics, the Marginal Revolution (to be defined shortly). The Marginal Revolution made modern economics possible. What was the Marginal Revolution? How did it start? Why did it take so very long to come to fruition? From those investigations we will get a sense of how economic ideas, and sometimes ideas more generally, develop. And that in turn will help us see where the science, art, and practice of economics is headed today.

Recommended!  I will be covering it more soon.

What should I ask Katja Hoyer?

Yes, I will be doing a Conversation with her.  Here is Wikipedia:

Hoyer was born in Wilhelm-Pieck-Stadt GubenBezirk CottbusGerman Democratic Republic (GDR), where her mother was a teacher and her father an officer of the National People’s Army. She received a Master’s degree from the University of Jena and moved to the United Kingdom in about 2010.

Hoyer is a visiting research fellow at King’s College London and has published two books about the history of Germany. She is also a journalist for The Spectator, The Washington Post, Times Literary Supplement, UnHerd, and Die Welt.

Her first book, Blood and Iron, about the German Empire from 1871 to 1918, was well reviewed, even though some reviewers suggested that she had played down the negative aspects of the period and of Otto von Bismarck‘s legacy. Her second book, Beyond the Wall, about the history of the GDR from 1949 to 1990, was well reviewed in the United Kingdom, but less well received in Germany.

She also has a new, forthcoming book on the history of the city of Weimar, namely Weimar: Life on the Edge of Catastrophe.  So what should I ask her?

Physician Incomes and the Extreme Shortage of High IQ Workers

Physician incomes are extraordinarily high in the United States. A new NBER paper finds that U.S. physicians earn roughly two to four times as much as their counterparts in Canada, the Netherlands, and Sweden.

Why? Is it some feature particular to the US health care sector? Probably not. The same paper finds that physicians in the US have about the same relative income ranking as in Canada, the Netherlands, and Sweden. In other words, lots of high-skill workers in the US earn high incomes and physicians don’t look unusual relative to these other high-skill groups.

That is exactly what one would expect in an economy with an extreme shortage of high-IQ, high-skill workers. The US is a uniquely productive economy for high-skill workers which is why the US demand for foreign workers and the foreign demand to immigrate are so strong, especially at the high end.. By one estimate, “immigrants account for 32 percent of aggregate U.S. innovation.”

Immigration of high-skill workers such as with the H-1B and EB-1,2,3 programs, together with stronger U.S. education, is one way to reduce the shortage of high-skill workers. The alternative is simpler: make the economy less dynamic and less rewarding for talent. Then wages would fall and fewer ambitious people would bother coming. A solution but only if your preferred cure for scarcity is decline.

On the Giving Pledge

From my latest piece from The Free Press:

A lot of America’s most effective giving was done by the early “robber barons,” such as Carnegie, Mellon, and Rockefeller. Andrew Carnegie, for instance, helped to create what is now Carnegie-Mellon University, and Carnegie libraries to this day dot the country and encourage literacy and reading. The Mellon and Rockefeller art collections seeded some of America’s highest quality museums.

None of this was done with any kind of pledge. Those great 19th-century industrialists pursued high-quality philanthropic opportunities when they saw them, unencumbered by today’s massive foundation staffs. If a town wanted to set up a Carnegie library, they had to meet some standard criteria, and they started by sending a letter to Carnegie’s private secretary, James Bertram. The Carnegie Corporation, which in later years led much of the philanthropy, had mainly clerical staff and did not have a full-time salaried president until after Carnegie’s death. It remains to be seen whether today’s philanthropists, including the ones who signed the Giving Pledge, will do as well.

There is much more at the link.

More on the David Lang opera version of Wealth of Nations

In 18 parts, Lang explores some of Smith’s central themes, including one of the book’s most famous passages, where Smith uses a wool coat worn by a very poor Scottish worker as a way to examine trade. “He asks, ‘Did you ever think of how many people need to be employed in order to make that coat?’” says Lang, whose movement “the woolen coat” names all the artisans and laborers who contributed to the garment in song:

the shepherd
the sorter of the wool
the wool-comber or carder
the dyer
the spinner
the weaver
the fuller

There are also the workers on the ship that brought in the dye and all the people who built the ship. An ordinary coat is revealed to be a kind of miracle of skilled labor and global collaboration, the product of “many thousands” of workers coming together in (selfish) harmony. Part of me wanted to run out of the theater right then and buy something … perhaps a coat… for America.

Here is more from Bloomberg, via John De Palma.  The opera seems to be ultimately a rather gloomy view of the book?

The hyper-NIMBY of earlier Cape Town and South Africa

The most controversial of the forced removals occurred in the second half of the 1960s, with the expulsion of 65,000 coloureds from District Six, a vibrant inner-city ward of Cape Town, where whites, many of the slumlords, owned 56% of the property.  Against their will, District Six residents were moved out to the sandy townships of the Cape Flats.  In Johannesburg, the inner-city suburb of Sophiatown, where blacks could own freehold property, was another notorious site of forced removals.  Often long-established community institutions such as churches and schools had to be abandoned.

That is from the very good book by Hermann Giliomee The Afrikaners: A Concise History.