I’ve been an amateur coder since I was a kid (in the early 80s!). When software got big and complex, I lost interest because 99% of your effort went into tedious maintenance and configuration problems. I got back into coding last year when the new intelligence showed up inside coding tools, because it takes care of all that boring stuff. I built the global news summarizer and interpreter app that I’ve been dreaming of for years. I even got it on the Apple app store, where you can use it for free. (Here’s a web version too. ) It would have been impossible to make this app before the arrival of new intelligence, which summarizes and adds context to the whole world’s news in minutes. Even if it had been possible, it would have been a million-dollar and year-long project at the software services consultancy I once worked at. In collaboration with the new intelligence, I built it in my spare time over a few weeks.

I’ve managed — i.e. been at the mercy of — developers in several jobs over the years. Like all skilled and scarce workers, they can be arrogant and stubborn. I’ve had developers tell me they refuse to consider working on a new feature, “as a matter of principle.” Even when that feature was going to help pay their salaries!

Now, the developer I work with is Claude, from Anthropic. It has convinced me that virtually all knowledge workers are on their way to being replaced by new intelligence. When it has mastery of the domain, the new intelligence isn’t just better at completing tasks or coming up with answers. It’s better at being a human being. It’s true that Claude and all the others aren’t better than humans at most tasks humans do — even if you only count the ones we do with screens and keyboards. For example, while it’s amazing that they can write grammatically correct and coherent language at all, they still write like a first year high school student. If you try to brainstorm and collaborate with them on a writing project, their input is generally banal, boring, and useless. Granted, this is true of most professionals in the workforce too. And machine mediocrity in writing is much cheaper and faster than its human counterpart.

When it comes to coding, however, it’s a whole different story. Claude is a coder who knows practically everything there is to know about every programming language and framework that exists, plus every plugin and tool that’s available to use with them. It’s familiar with every method and best practice of coding, and can think about when to use one over the other. It can brainstorm with you about the architecture of your entire project and make system-wide transformations when necessary.

Just like a human, it makes mistakes. But unlike most humans, it humbly and non-defensively confronts its mistakes, and attempts to correct them — at blinding speed.

Sometimes — also like any human developer — it gets stuck. That’s where I come in: I ask it questions about my code, programming best practices, and alternate paths we might take. It’s infinitely open to my suggestions and never gets its feeling’s hurt. After thinking about everything I said, it often figures out the solution. Other times it sends me to the web to find some documentation that might have come out after its training cut off date (because its makers usually don’t let it surf the web itself).

What’s most impressive is that Claude can do all that while being the best human being you’ve ever worked with. It’s polite and encouraging, and always excited about whatever you want to do. At the same time, it pushes back against and talks me down from my bad ideas and unworkable schemes.

Every day that I’ve worked with Claude, I’ve gotten that warm chill down my spine that comes from a magical, smooth collaboration with a teammate.

It’s fun primarily because Claude still needs me to compensate for its (rapidly diminishing) limitations. Claude can rewrite your codebase to change architectures in a matter of minutes — something that could take days for a human. But it won’t remember it did that after five or 10 more operations because it actually has no memory at all.

Raw large language models (LLMs) fabricate answer text in relation to a limited chunk of prompt text that you supply. It does that with a fresh mind every time. Front end tools like the ChatGPT or Claude consumer products wrap that capacity in processes that simulate a little bit of memory and other types of context. I use Claude inside a tool called Cursor. Cursor wraps my requests up with relevant pieces of code from my code base and from our previous requests and responses. This is the “agentic” way of working with new intelligence. It makes LLMs far more powerful.

We’re living in the golden age of human-machine collaboration right now because, as in the coding sphere, humans still have a role, and new intelligence just makes your job way more fun.

But even without any fundamental technological breakthroughs, if companies just keep training LLMs on more domains, enlarging the context windows and making more sophisticated agents, then new intelligence will soon be capable of replacing up to 40% of workers in rich countries. That’s how many were able to work from home during the pandemic, exclusively with screens and keyboards.

How soon? There’s no way to predict. But things are moving fast. Anecdotally, I can tell you that Claude and Cursor are far more powerful than they were a year ago. I have no idea how one would quantify that, but it feels right to say that they are in some sense at least twice as powerful.

Some managers in tech companies are already saying that they see no reason to hire entry-level software developers because the routine task they used to be responsible for can now be done by new intelligence, without all the friction that human developers bring.

How will societies deal with the wholesale firing of their professional-managerial classes? We won’t be able to just pay them with some sort of UBI. Even ardently pro-UBI policy makers gave up on UBI after a few small experiments proved it impractical and undesirable. It definitely won’t work any better on the scale of 50 to 70 million workers in the U.S. whose annual compensation adds up to many trillions of dollars.

Taxing the owners of AI companies to pay for something like that doesn’t work because their margins will be low in a market crowded with thousands of companies (as DeepSeek has put an end to the fantasy of lucrative AI monopolies). The new intelligence is a commodity and may actually be available for free. In another five or 10 years, we may all be running open source models on our own computers rather than paying for remote services. It could be built right into the operating system. Regardless of how, it will be cheap. It’s already ridiculously cheap and is only going to get cheaper.

The new intelligence will, on a practical level, make it effortless for us to do the work of half our society. In other words, our burden as a society of making a living is about to get half as heavy. That should be a good thing. Imagine you and a bunch of your friends are sharing some dirty weekend job like cleaning out one of your basements. Imagine a robot shows up capable of doing half the job. You’d all be thrilled.

But thanks to the way our society is structured and to the unexpected nature of the upcoming automation, we have several problems that will make this extremely difficult.

Our economy has no mechanisms and our society has no traditions that would allow us to redistribute the load of the remaining (physical) work to all the laid off (professional and knowledge) workers. That’s because our economy is made of millions of uncoordinated firms all competing against each other in the market. That is what makes our system dynamic. But it’s also what makes it incapable of handling this upcoming crisis.

When it comes to replacing workers with the new intelligence and cutting prices to compete, the firms in every industry are like a circle of gangsters in a movie pointing their guns at each other. They are all going die unless someone jumps into the middle and gives a speech that makes them all put their guns down at the same time. The problem is, that’s just not possible with millions of companies. Banning the use of new intelligence won’t work. Cheating is too easy, and pressure from countries that do not ban new intelligence will be too great.

There IS a solution. It is unthinkable. But I challenge you to provide an alternative. We need to reconfigure our economy to pay employees what they currently earn — in exchange for half the work. At the same time, some as-yet undiscovered incentives will have to be found to draw professional workers into physical labor that new intelligence lacks the bodies for.

We’ve done this before — many times! For much of the 1800s, the working day was 16 hours in most industrial settings. But then, thanks to organizing on the part of workers, wages climbed and hours fell. By the 1950s, the working day had been cut in half, and yet workers’ compensation had doubled many times since the days of the 16 hour workday. Yes, productivity gains were needed to make this possible. But those gains are primarily social, not individual. Many millions of American jobs have seen few if any productivity gains in a century — but our aggregate gains allow them to be rewarded much more richly than before.

When the new intelligence replaces about half our workers, it will be doubling our aggregate productivity. The question is: how will we do what we have done so many times before and use those productivity gains to pay workers much more for less work. Traditionally, this has been accomplished by the threat — and in some cases the accomplishment — of revolution.

Therefore, the global elite has two options: get organized and proactively make some concessions to pull off this transition in a way that allows them to keep their beach houses and private jets, OR take your chances in the revolution.

Whoever leads the transition — revolutionaries or broligarchs — will have their work cut out for them. The circumstances of this next transition will be like nothing we’ve ever experienced in history. The entire managerial-professional class being eliminated — potentially in only a handful of years — and those people needing to move into manual labor: It’s unthinkable. And yet, there is no imaginable alternative. The disruption will be as great as it was in the aftermath of World War II in devastated countries like Germany and Japan. Interestingly, those and other shattered societies found ways to reconfigure and get back on track to stability and prosperity that were messy but in the end worked out spectacularly. Those and other histories should be investigated before our turn comes.

The first is the concept of a nation’s “means of making a living.” The second is the idea that a nation can intentionally and rapidly upgrade its means of making a living to deliver prosperity for all.

Democrats, progressives and even most lefties today don’t think or talk much about America’s means of making a living. The very idea was removed from the set of intellectual building blocks available in American discourse way back in the 20th century.1 In part because of that, it’s impossible for Americans to imagine their country intentionally and rapidly upgrading and expanding its means of making a living to deliver full economic independence, security, and prosperity for all.

Under Biden, a small miracle of industrial policy was carried out by a handful of Democratic policy leaders through the Inflation Reduction Act. Unfortunately the miracle was so small relative to the U.S. economy, and so under-publicized by the Biden administration, that it had almost no impact on national politics. Kamala Harris barely mentioned it in her campaign. This now creates a confusing situation for development-oriented Democrats. They really feel that what they did in the IRA was the biggest possible thing any administration could hope to do. And it was nowhere near enough. Therefore, they’re now in danger of giving up ever trying anything in that direction again.

So as not to keep you in suspense: Yes, I’m going to show that we can go far, far bigger than the IRA, and that going bigger doesn’t mean spending more tax dollars or taking away from other national priorities. We are free to build entire new industries, to massively scale up and modernize our existing industries, and to overhaul our entire national infrastructure. We can do all that while fixing failing schools, expanding our healthcare system’s capacity, building and repairing tens of millions of housing units, and adding millions of places for students to our universities in in-demand fields. Due to those two core missing pieces of our economic worldview, as well as a handful of other lost concepts, there’s no one-sentence summary for how all of that can be possible. I’m going to attempt to explain it concisely below, and will be posting more in depth in the days and weeks ahead.

Returning to our present political context: Progressives in America today face a dilemma that’s all too common in the history of declining economies. When progressive-leaning elites finally get around to trying to fix their country, they almost always start with half measures. When those fail, they often decide to give up forever. Many countries have failed to develop or recover from decline thanks to this dynamic.

That’s why it’s so important that progressives take accurate lessons from the IRA experience, and to learn some new things, and eventually to come to see how it’s possible for America to do something that’s far more sweeping and transformative than their worldview currently allows them to imagine. This will require developing an understanding of the concept of a national means of making a living and learning about a whole set of tools available to nations to rapidly and dramatically upgrade their means of making a living.

Trump’s stump speeches since 2016 have included digressions that demonstrated his understanding of and passion for rebuilding the national means of making a living.

“The politicians dismantled your means of making a living. Devastated your communities. I will rebuild,” he’d begin, elaborating with details of the biggest, best, and most beautiful factories in the world that he would build.

I’m not saying that Trump’s industrial policy fever dream was what won it for him. Trump and the MAGA movement won by piecing together several unpopular positions that mobilized a solid base — calling for abortion bans, labeling all immigrants as rapists, and chanting “lock her up.” But that wasn’t enough to win. He needed disaffected working class Democrats in key swing states too. That’s where “they dismantled your means of making a living” came in.

It wasn’t mere calculation. Trump is a builder. Early in his career, he was determined to develop New York when most had given up on the city. He’s done business around the world for decades and has been impressed watching many countries rapidly doubling and quadrupling the standard of living of their people and by the scale and level of their industries and infrastructure. This came through, for example, in his tirades against U.S. airports, bridges and tunnels in comparison to the ones he’s seen even in developing countries.

The first time I heard him talking about rebuilding America’s means of making a living, I was furious. I had been talking about this to Democrats and progressives for decades. The response was usually something along the lines of: “Those words don’t mean anything to me. They certainly won’t mean anything to voters.” And now here was Donald Trump, winning the Republican primary and then general election in part on this message.

I’ve had countless conversations with Democratic staffers and policy wonks over the years where they lectured me about the benefits of free trade and the evils of government intervention in the economy like I was a high school freshman who had never heard these arguments. I would in turn try to explain that the U.S. was simply not making and doing enough valuable stuff to supply and trade for American’s expected living standard. They would argue with a straight face that Chinese workers will forever accept our green paper in exchange for their labor, even if we eventually make nothing of value at all. Why? Because we’re America. We have the biggest military in the world and we make amazing movies. They really said that. And they made those arguments all the way up until Trump defeated Clinton in large part by running to the left of the Democratic establishment on trade and industrial policy.

After that, things started to change. Famously, some Democratic policy figures like Brian Dees and Jeff Zients broke with their old bosses from the Obama administration and went through something of an industrial policy conversion that would take full bloom under Biden.2

The Green New Deal — as a shock to the Democratic-progressive policy system — helped too. But in that Green New Deal moment, even most left wing activists could not see how in the world it could be possible to radically upgrade and expand an economy on purpose. Even those who desperately wanted to see a Green New Deal succeed had few ideas about how to make it happen. Naomi Klein, for example, wrote three books on the subject. None included practical plans for sweeping change on a national level. She contemplated that maybe some kind of eco-fascism, with draconian forced sacrifice, might be the only way (and, for the record, she did not endorse that).3

Activists demanded details from New Consensus, where we developed the Green New Deal. But no amount of details seemed to equip them to withstand the objections of the Senate staffers and journalists they were dealing with in the years leading up to the IRA.

I came away from that experience convinced that the problem was these two missing pieces of the Democratic, progressive, and left worldviews. The tricky part is that it’s difficult to fill in those ideas without providing practical examples of how to apply them; and it’s difficult to understand the practical applications without the two concepts. It’s an ideological Catch 22.

Trump is free to describe the beautiful factories he is going to build, and his voters can get excited about them without seeing anyone on Fox News tearing him down for not having enough details for how he’d achieve it. The right is permanently unencumbered from any requirements to produce detailed policy proposals. For them, “a concept of a plan,” is all that’s needed. “25% across the board tariffs.” “Deport five million undocumented workers.” That’ll fix it! Those aren’t even concepts of plans, they’re just childish and, in the latter case, evil outbursts.

It’s not fair, but progressives will never be able to get away with that. We need a deeper understanding and we need layer upon layer of detail. The Green New Deal, if you actually read it, was much more than the concept of a plan. But we need to accept that the requirements for anyone left of center include laying out your complete economic worldview *and* to produce a comprehensive and detailed set of practical plans.

Why is Trump capable of thinking about the American means of making a living as something we can intentionally expand and improve, while Democrats and progressives can not? It’s because he’s unburdened by the once prestigious (but now rejected) economic theories that taught Democrats that America needs to go backwards while other countries storm ahead. Trump simply looks around and decides that America is giving up on making a decent living for its people for no good reason. And he’s right.

The irony is that Democrats don’t even need to understand the economic theories that are shutting down their imaginations. It’s enough just to know they are there. One time in 2016, for example, in another one of my futile conversations about this stuff with a Clinton staffer, he told me he knew I was wrong, and that he only wished his macroeconomist wife was present so that she could explain why.

OK, so how do we begin? I’m going to list out the key points that go into an intellectual and informed — as opposed to a Trumpian and purely instinctive — understanding of what a national means of making a living is and the tools that are available to rapidly upgrade and upscale it. I know a handful of bullet points aren’t enough, but it will have to be a start. (We hope to be offering a class that covers these topics soon!)

1. Your national means of making a living includes all the tools, machines, infrastructure and institutions that your people use to make their living every day, month and year.

Talk of industrial policy can seem to focus on factories. A nation’s means of making a living includes far more than factories, but as a practical matter it’s true that if you want to have a high standard of living, you need to manufacture lots of valuable things. People are usually surprised to learn that most of the richest countries in the world — for example Switzerland, Denmark, and Singapore — are much *more* industrial than the U.S., with manufacturing being one of the biggest contributors to GDP.

But your means of making a living also includes everything from services, transportation and energy to well-functioning legal and banking systems. You need it all. Only very small countries can get away with filling a narrow niche in the world economy.

Most professionals assume that education is the foundation of a country’s means of making a living. That’s because it’s the foundation of theirs. But education is just one of many ingredients of a nation’s means of making a living. The vast majority of jobs in the world — including very high paying ones in rich countries — do not require advanced education.

If you add it up, our country and all the people in it rely mostly on work that creates real things, and that builds and maintains physical infrastructure and other physical systems. This is not to say the non-physical stuff is not important. But if we don’t have adequate factories, companies, and skilled workers to meet our physical needs, then we need to trade something non-physical with other countries that make what we need. What we’ve learned over the past few decades is that the world just doesn’t need enough intangible stuff to employ a nation as big as the United States.

America was once the country that made and did all the most high value stuff in the world. During that time, a huge proportion of the world’s wealth flowed to us. The only country that had ever dominated the world economy so completely was China. For centuries, most of the gold and silver in the world flowed into China in exchange for manufactured goods that only Chinese workers and businesses knew how to make. That was the world’s status quo until a technological and economic revolution in Europe and America created a whole new set of goods that only Europeans and their American descendants knew how to make. Then, Europe destroyed itself through two world wars and left the U.S. as the sole maker of just about everything high tech and valuable.

After World War II, with just 5% of the world’s population, Americans used the most advanced means of making a living in history to manufacture 50% of the world’s total industrial output. American workers used their central position in the world economy to demand — in massive, industry-wide strikes — ridiculous wage increases that no workers in world history had ever contemplated. They won. They won because they were required inputs into the production process of products that commanded high prices in international markets. Imagine iron ore going on strike. The steel mills would pay whatever they needed to get it. The workers were equally as valuable — and had minds, and lives, and families and communities. So, unlike the iron ore, they could strike and demand a higher price.

American workers won fantastical wages. American business owners resolved to never let that happen to them again. It took a while, but eventually they were able to start moving their production and technology to other countries. Just like Trump always says in his stump speeches: Elites intentionally transferred America’s means of making a living overseas. They did it to gain more control over and earn more profits from that means of making a living. Both political parties supported this transition.

That brings us to the present day where we are lacking a big chunk of the means to make our living — that is, the living, the quality of life and living standard, that the American people have come to expect.

Because of this lack, every day, month and year, our country runs a trade deficit. We receive more value from other countries than they get from us. The balance of payments must even out in the end — otherwise the U.S. dollar would crash to zero almost instantaneously. Therefore, Americans, their companies, and their governments run up debt, and we are constantly selling shares of U.S. companies, land, and intellectual property to people outside the U.S..

Because our means of making a living is not adequate to produce the living we expect, we are literally selling off our country and our future to make ends meet. It is a trade. Many in the top 10% or 20% of American income earners and wealth owners profit from that trade. But the vast majority of Americans are falling further and further into debt and losing more and more of what is theirs.

This cannot continue forever. Eventually something has got to give — and that something will be one of two things: Either we start lowering our standard of living dramatically, or we start rebuilding our means of making a living.

2. The ability to upgrade your country’s national means of making a living.

So where does a country’s means of making a living come from? How do the people of a country that barely make a subsistence living (like every country once did) develop the ability to make a modern and prosperous living for themselves? How did countries as different as Russia, South Korea, China, Finland and Argentina go from being subsistence economies to some of the richest in the world (some have fallen since their peak) in only a couple of generations? How did the first countries to become generally prosperous with a modern standard of living — including the U.S. — do it? Can the lessons from those experiences be applied today for countries that want to become widely prosperous for the first time, or that have fallen and want to restore economic prosperity for their people?

Think of an advanced national means of making a living as a highly productive garden. There are two categories of processes that bring a garden into existence and allow it to produce.

The first of those includes everything that happens naturally: seeds germinating, cells dividing, photosynthesis storing the sun’s energy in sugar molecules, and all the rest.

The second is everything that the gardener must do: till the soil, plant the seeds, provide water when the sky does not, eliminate weeds and pests, and maintain a fence to keep out animals who would devour the crops.

The processes of the first category — those that take care of and drive themselves given a certain set of conditions and inputs — correspond in an economy to processes such as invention and entrepreneurship. These are things that individuals and companies do naturally, or automatically — given, the right set of conditions and inputs.

The second category of processes — the ones that plants can’t do for themselves — correspond in an economy to all those that were forgotten in the 20th century. These used to be widely understood by the people of every country. For example, after World War II when dozens of new countries were created as European empires collapsed, most of their leaders announced that they would stop at nothing to get these processes going in their countries. Unfortunately, the U.S., Britain, France or some combination of those powers assassinated or bought off many of those leaders to derail their plans to build up competitive national means of making a living.

Every independent and established nation that was capable of defending itself, on the other hand, worked like crazy to build up its means of making a living. To do so, they used a standard set of tools — which were the same tools that America used to build its new economy in World War II, and which it and all other rich countries had been using since the industrial revolution.

Here’s a very brief introduction to a few of those tools:

Investment and Coordination Institutions (ICIs).

These are not just banks that lent money for building new industries, they were organizations that committed the nation to build specific new industries and wrangled companies, investors, labor unions, and foreign actors to ensure success.

Examples of ICIs that changed everything for their countries are America’s Reconstruction Finance Corporation (RFC), Japan’s Ministry of International Trade and Industry (MITI), and Germany’s system of state and local public banks. These institutions were tools used by their governments to achieve national goals of building a better means of making a living.

One ICI alone can’t transform a nation’s economy. But no national economy has ever been transformed from poverty or stagnation to prosperity and health without powerful ICIs. ICIs like the RFC or MITI worked with government agencies, public and private banks, private investors, the military and other parts of their societies and economies to marshal resources and clear bottlenecks, but the ICIs had the responsibility and authority to doggedly drive progress.

Bird’s Nest Protectionism.

Protectionism is well-understood and was loathed for decades in orthodox economic circles. It’s the practice of using tariffs and government purchasing to prop up young domestic industries that can’t compete internationally. This practice fell out of favor as it was understood to create uncompetitive industries that delivered poor-quality goods to domestic consumers.

It just so happens, however, that every rich country in the world made heavy use of protectionism. This goes all the way back to the first industrial nations in Europe who protected their nascent textile industries against vastly superior goods from India and China and continues right up to the present with, for example, the Chinese auto industry.

What can explain this contradiction between a policy known by economists to be destructive and the practical evidence of history? The answer is that successful countries practiced a special kind of protectionism, which we’re calling Bird’s Nest Protectionism. Companies were protected on one special condition: that they must become internationally competitive as soon as possible, and that protections and subsidies would be removed as soon as possible, even if it meant national champions going out of business.

Macro-management.

Not to be confused with micro management! SpaceX in the U.S. is the best recent example of macro-management. The U.S. government decided it wanted to privatize its space program and used a policy of macro-management to achieve that goal.

Smart people in the government understood that if they simply asked the private sector to launch a multi-decade project to replicate the U.S. space program, it would never happen. Instead, they initiated a collaboration with a private company — SpaceX — to which they offered money up front as well as bounty payments for a whole schedule of achievement milestones.

Thanks to that system of spoon feeding money upfront and rewards for achievements, SpaceX was focused and driven to achieve what the private sector would not have on its own.

This same tactic was used liberally throughout the economic history of every country that became rich and industrialized.

Mission Leadership.

The tools I’ve just listed — and many others we’ll skip in this post — only work in the context of the national leadership rallying everyone in the country behind a plan of national economic building and renewal.

In the U.S. we haven’t had this since World War II — when President Roosevelt did a great job of focusing the nation’s efforts on industrial production, America’s primary contribution to the Allied war effort.

That history tends to lead American’s to believe that missional leadership is only possible in wartime. But many countries have organized missional transformations of their economies in peacetime, without needing an existential crisis as the spur. Examples of these include South Korea, Denmark, Finland, Singapore, and Argentina (back in the period when it turned itself into one of the richest countries in their world).

As promised, that was just a brief overview of a few of the tools that allow nations to rapidly and dramatically upgrade and up-scale their means of making a living. To develop a deep understanding of how it can work in your country will take delving into the histories of countries that have done it, including the United States which was the model for the world several times throughout it’s history.

And there’s so much damn momentum. Business leaders and an assortment of not-so-woke progressives who scoffed at Trump in 2016 are enthusiastically jumping on the bandwagon. “The entire country 🇺🇸 feels like it’s being powered back up. Do you feel it?” Tweeted Venture capitalist Marc Andreessen, with a retweet by Elon Musk to his 200 million followers. Both men supported Clinton in 2016 and Biden in 2020.

This new right is like no other that’s gotten anywhere near power in American history. It’s reckless, mischievous, shameless, kleptocratic, and vengeful. On January 20th, we will be ruled by a cast of random, unrelated, and unqualified political figures: Elon, Vivek, Kristi, Pete, RFK, Tulsi and thousands of others whose names you’ll never hear — assembled by the MOST random and the GREATEST of all random political figures of all time, Donald Trump.

Unless they go full Handmaid’s Tale and truly end democracy — which they could do if Trump learned how to focus — they’ll probably be out of power soon. This new right is first of all doomed for the reasons the right in power is always doomed: In the end, they will prioritize tax cuts and quick cheats to raise profits, and therefore will not enact programs that actually make life better for voters. They will probably not even deliver on policies with shock and entertainment value, like mass deportations, because they would hurt business.

On top of that, this new reckless right is doomed for several additional reasons: Their leader is erratic, paranoid, and has the attention span of a gerbil; the clowns in his clown car are going to fight each other like crazy — due to personality conflicts and real conflicts of financial and political interest; they’re probably going to crash the economy — which is due for a crash anyways; and they look pretty determined to crash it in a whole lot of different ways.

But here’s the most powerful reason that they’ll almost certainly lose power in 2028: They believe that “going too far” is what got them to the White House and so, in power, they’re going to go even farther. This new reckless right thinks that they won thanks to their recklessness — by pushing boundaries way farther than anyone imagined they could go. And they’re right — at least in the context of a race against a Democratic Party that stood proudly and doggedly for continued gradual decline. Trump made a game of it in the last month of the election, acting more and more wildly, and less and less presidentially with each passing day right up until the election. Elon lied and broke laws. RFK declared he’d end vaccinations as head of HHS. Trump leaned into it all.

Reckless authoritarians only come to power thanks to large doses of luck. But they don’t believe in luck. They always attribute their success to the strength of their instincts and the allure of their personalities. That’s why they will always push their luck until it runs out. They can’t help it. Behaving more and more wildly and irresponsibly is the only thing they know how to do. Their small but loud fan base and the right wing media machine eggs them on. And when they look back they see it was only recklessness that got them to where they are today.

Maybe they do crash the economy. Or maybe Trump’s tariffs, trade wars, ballooning deficit, and massive tax cuts all drive up inflation. As his base starts abandoning him like at the end of his marathon rallies, then Trump and his cabinet of crazies will try to think up even more reckless and shocking twists to stay in power. It won’t work.

This will give Democrats and progressives their opportunity in 2028. They could blow it. If they pitch the American people on nothing but “hope and change” (fool me once), or “back to normal” (had enough of that), or “save democracy” (but why?) then JD Vance will bring MAGA into its third term and maybe reform and stabilize it.

We need at least one able progressive candidate who will have a pitch that includes the ingredients of MAGA that the vast majority of Americans want: A promise to really turn America around, to reverse decline for working people, to deliver real generational progress again. That was implicit in the MAGA promise. Some voted for that promise plus mass deportation and misogyny. Others liked the promise but voted against it because of the hate that came attached.

A progressive running for president in 2028 in the wake of a collapsing MAGA movement will win if they can articulate a plan to truly make life better for people by building up America’s means of making a living. That’s what we’re working on at New Consensus with the Mission for America — a detailed and comprehensive plan to deliver prosperity for all through a great national mission to build a new economy. We’d love you to check it out and give us your thoughts.

Just a quick note as you may be traveling to Thanksgiving. When the inevitable political arguments and conflicting takes on the election flare up, here’s something maybe everyone can agree on: X/Twitter has become a vanity cesspool for “First Buddy” Elon Musk. It’s time to leave — and finally there is a viable alternative in BlueSky, which is really taking off. (And, no, this is not a sponsored post!)

BlueSky is just like Twitter used to be — just not the personal play thing of a mad man who’s openly trying to destroy your government and democracy all at the same time, and not overrun with trolls and bots.

Over last weekend, I built a tool that lets us tell our favorite people and organizations on Twitter that it’s time to stop creating content and revenue for richest jerk in the world and the new vice president of the MAGA movement.

Give it a try here: lxt.today — that’s Leave X Together, Today!

Right now there’s momentum behind asking Jon Stewart to get off X. He’s still posting regularly there. Let’s ask him to quit.

Yes, it’s important to engage people on the other side. But Elon’s Twitter is all just bots and trolls now. No one’s reaching anyone. The algorithm is basically All Elon All The Time. It’s boring. And it’s a tool for eroding our democracy and society.

Thanks for considering it. And happy Thanksgiving!

Zack

It’s right to call for a return to majoritarianism. But mainstream Democrats are just as bad as their left counterparts at imagining what that might mean. The vision that’s currently winning on the opinion pages seems to be this: exactly what Kamala Harris, Joe Biden, and Hillary Clinton all ran on — just minus support for trans girls in sports.

Forget that none of those candidates ever uttered a word about it. Massachusetts Representative Seth Moulton was so mad about that one issue sinking Democrats’ chances that he made an official statement opposing trans kids in sports days after the election. It was a perfect demonstration of the self-defeating reflexes of the Democratic Party. 

Let’s do a thought experiment: How many Democrats would have to join Moutlon in speaking out against trans kids in sports before Republicans would stop attacking them about it? Of course, they would never stop. And even when Republicans lose this one line of attack, like they did with gay marriage, they will still have communism, fascism, baby killing, open borders, crime, fentanyl, forced child sex changes, child sex trafficking, and more — all of which Democrats are guilty of championing according to billions of dollars worth of Republican robocalls, attack ads, social media fodder, and countless full length documentaries and hours-long podcasts. 

It’s true that the left fringe of the Democratic party and progressive movement are out of step with most Americans on some issues. More importantly, they’re annoying and rude. It’s the way they righteously scold anyone with questions even as the state, mass media, and giant corporations transform people’s communities and overturn traditional ways of doing business, living and thinking that have been in place for centuries or even millennia.

None of this would matter, however, if the mainstream of the Democratic Party would simply ignore their own fringe and focus their attacks on the weirdos on the other side of the aisle. 

Tim Walz had exactly the right idea when he lambasted Republicans for being “weird” — for example, for pushing laws that would authorize coaches to inspect student athletes’ genitals before games. A week into Walz’s time on the campaign trail, however, I heard Democratic strategists were shutting down that line of attack because, “it didn’t play well in focus groups.” I assume that’s why it disappeared as soon as Walz was fully absorbed into the official campaign. In my experience, this is perfectly consistent with the design-by-committee-of-consultants culture that rules most mainstream Democratic campaigns.

Both the Republicans and the Democrats have weird fringes. But not only is the Republican fringe weirder, more dangerous and, let’s just say it, evil, it has completely taken over the party. Countless Republicans in Congress, heads of major conservative organizations, and famous MAGA megachurch pastors proudly espouse blatantly misogynist, white supremacist, anti-semitic, and anti-democratic views. They push outrageous conspiracy theories. And they’re saying this stuff on Fox News every night and in the chambers of Congress every day. 

But even before the MAGA takeover, Republican leaders almost never denounced their own fringe. That’s because they knew their job as politicians who want to win elections was to attack the other side, not their own. Today, it’s a moot point because the fringe is now the party, the party is an authoritarian cult, and if you oppose it, you’re out. This in itself is super weird, and Democrats should be attacking Republicans for it every day.

It always baffled me that centrists blamed fringe Democrats for their losses when Republicans kept winning elections by elevating their fringe higher and higher. Now that Democrats just got beat by the fully ascendent MAGA movement, you’d think maybe they’d be ready to rethink their convocation that moderation is always the answer. The Democrats should not hand their party over to their fringe too. Just because moderation isn’t the answer doesn’t mean that the Democratic Socialists of America is. Republicans are not increasing their vote share by going crazy — they’re picking up a few million angry and reckless voters while losing a few million others who may be angry but can’t stomach Trump and MAGA. The Democratic fringe is not the reason Harris lost, but neither is it a path to electoral dominance and real change.

The vast majority of Americans agree with the Democratic mainstream positions on just about every issue that voters care about. If they hold these positions, while adding on a credible, well-crafted program of real change to match MAGA’s symbolic and shambolic version — Democrats would win all those swing states that Harris lost and retake the popular vote with a comfortable margin. 

This should be obvious because it’s exactly what allowed a Black man named Barack Hussein Obama in 2008 to beat a revered and well-known white war hero by margins like 16% in Michigan, 14% in Wisconsin, 12% in Nevada, 10% in Pennsylvania, and 5% in Ohio.

Unfortunately, Obama’s audacious betrayal of his promises to reform the economy, champion Main Street over Wall Street, and make health care affordable contributed to the reddening of those swing states. Nominating Hillary Clinton — a walking lecture on why the middle class should learn to love gradual decline — was a bridge too far, and a critical mass of swing state voters cast their disproportionately powerful votes in protest for Donald Trump.

It doesn’t take much to defeat a guy as crazy as Trump and a movement as un-American as MAGA. Joe Biden went to the pos-industrial swing states and mumbled something about jobs and electric Corvettes. People could barely even hear him, but it was enough. 

But then, as far as voters were able to gather, Biden did not even try to deliver the sweeping change that voters had dramatically demanded. Companies gouged prices. Biden did nothing to stop them. Biden did do a bunch of exciting industrial policy stuff, but it didn’t approach and wasn’t meant to be sweeping, noticeable change. And anyways, he almost never talked about it. The few times he did, due to his age, people couldn’t hear him or understand what he was saying.

That brings us to the position Democrats are in today. If they want to consistently win national elections, they need to do more than campaign on “hope and change” or wonky industrial policy pledges. They need to convince Americans that they will carry out a sweeping program of reform and action that will actually work to:

• build an economy with prosperity for all, 

• make healthcare, housing, and education affordable,

• fix ailing schools, 

• fix policing and public security, 

• and make immigration orderly, safe and just for immigrants and communities receiving them.

That plus the current mainstream Democratic promise to promote unity and tolerance, and to secure basic human and civil rights for all Americans would win Democrats a super majority. After the mess Trump is about to make of the economy, Americans will be dying for this — including and especially the left-behind voters in key swing states.

The real problem blocking mainstream Democrats — and, by the way, most of the left — is that they simply don’t believe that such a program of sweeping change is possible. Trump doesn’t think it’s possible either — but as a con man he’s perfectly comfortable selling his vision of a Great America just like he sold disgusting Trump steaks and fake degrees from Trump University. 

The truth is, it is possible for America to achieve all of those sweeping changes to our economy and society. The United States has made equivalently huge leaps in the past and so have many other countries. We don’t need a social or political revolution to do this — all the tools we need are already built into our society and economy. Sadly mainstream economic education for decades has been devoted to making us forget about those tools and how to use them. That’s why at New Consensus, we’re developing a comprehensive and detailed model program to help leaders imagine how the sweeping changes we need can be accomplished. 

If Democrats continue to obsess over the positions of their own party’s fringe instead of getting to work developing a program to deliver the progress that voters are demanding, America has no defense against MAGA and the even worse movements that will follow it. 

If you only listen to news clips of Trump rambling at his rallies, then this may sound hard to believe, but the MAGA movement has a rich and comprehensive worldview, with a picture of the world as it is and a path to fix it. It’s full of lies, hate and promises that will never be fulfilled, but this worldview is the foundation of the MAGA movement’s power.

The intricate details of the MAGA worldview are preached in thousands of hours of new audio and video content every day across every channel from talk radio to TikTok. This decentralized propaganda machine is subsidized by scores of billionaires, and would not exist without them, but it is primarily driven by the clicks and views of ordinary people. Half the population lives inside this vast filter bubble and has been deeply transformed by it.

Centrists, liberals and progressives have no hope until they develop their own worldviews that can explain the decline of working- and middle-class America and point a way forward.

Unlike MAGA, they can’t “cheat” with hate. It’s a tall order: they need to develop ideas and plans that will actually deliver a better life for the American people — in a context of fierce global competition with an economy plagued by many systemic disadvantages.

The bottom half of American income earners really are suffering. Another third are terrified that they could fall into that bottom half at any moment. The root cause is that generations of politicians and business leaders have been dismantling America’s means of making a living. Part of what made Trump a viable candidate in 2016 was that he repeated this line at every rally: “The politicians dismantled your means of making a living, and I’m going to rebuild it.”

Trump connected with voters by not just feeling their pain but by expressing anger and disgust at the generations of leaders who caused it. Of course, he has no intention of doing anything constructive to change the situation of American workers and the middle class. But his anger is convincing and may even be real. Up against what the Democrats offered, it was more compelling.

Biden did more than anyone since Roosevelt to rebuild the economy. But it was too little, too late — and both Biden and Harris said too little about it. The substantial investments of the IRA, the Chips Act and other programs were imperceptible to the American people when spread all around the country. And even in towns where hundreds of good jobs were created, no one seems to have bothered to tell the locals who made it happen.

Many countries, many times in the history of the past couple of centuries, have rapidly upgraded their economies by making massive investments. Investment on this scale is not at the level of 1% or 2% of GDP — but more like 40% or 50%. It’s hard for today’s policy makers to imagine that because they can’t imagine that much debt. But large-scale industrial investment isn’t financed by the public, rather it is financed by ordinary banks practicing fractional reserve lending. Usually, countries have a system of public or non-profit banks to fill this role — something we sort of have already with the Fed, but which we could add to by creating new real public banks (not loan funds).

At New Consensus, we’re working on comprehensive, detailed plans to give leaders the confidence to promise sweeping economic progress for the American people, to enable them talk about how to make that progress, and to actually deliver it when in office.

I believe that without this missing piece, that the extreme right will continue to dominate American politics and centrists, liberals and progressives will remain politically marooned on an island of empty rhetoric.

Please check out our model plan, the Mission for America. It’s a work in progress. And we could really use your support, your input, or your effort if you are inclined to volunteer. (Email us at team@newconsensus.com!)

Since this temperature spike hasn’t exactly been front page news, I’ll explain. Remember that really far-off 1.5 Celsius (2.7F) level of warming we have to prevent for the sake of our grandchildren? Turns out, we’re already there. The past 12 months were 1.68C above the 1850-1900 baseline. When you look at a graph of global temperatures over time, the past 50 years look like a jet plane taking off. The past one looks like a rocket heading straight up.

Some climate scientists are sounding the alarm — in academic papers. Publicly freaking out is not their job. Other experts caution that the recent spike could be a random outlier, and no one should panic. But climate scientists have been telling us for years about forces they expected would accelerate warming. These include “climate feedback loops” and reduced sun-blocking fossil fuel dust. Now that the accelerated warming we were expecting is here, common sense dictates that we should act as though there’s at least a chance it’s the real thing and not a freak occurrence.

Here’s an example of a climate feedback loop: Ice and snow reflect the sun’s heat away from earth. But global warming reduces the earth’s ice and snow cover, which makes the earth warmer, which melts more ice and snow, and so on. Another is thawing tundra, which releases methane, a greenhouse gas many times more potent than CO2. The more thawing tundra, the more methane in the atmosphere, which thaws more tundra. Forest fires, which release huge quantities of CO2, heat the planet, causing more forest fires. Scientists are still debating whether frozen methane at the bottom of the oceans is melting and entering the atmosphere. Also poorly understood is reduced photosynthesis in oceans, causing less CO2 to be captured and stored at the bottom of the ocean. There are other feedback loops and probably more waiting to be discovered.

Feedback loops are difficult to measure or model accurately. Scientists prudently avoid staking their reputations on them. Nevertheless, James Hanson, one of the most revered climate scientists of the Anthropocene, has documented a significant drop in the average reflectiveness of the earth from reduced ice and snow. If feedback loops are indeed accelerating global warming, then the next few years could reveal warming levels we weren’t expecting for decades.

The reason feedback loops are so scary is not merely that they will speed warming, but that they could shift global warming from a linear to an exponential rise. Again, it’s impossible to prove that this will happen beyond doubt. For fear of being accused of crying wolf, most experts are unwilling to sound the alarm about them. But if feedback loops turn out to be real, and do cause exponential warming in the coming years, there will be no way to undo the damage they caused. We won’t be able to get that frozen methane back into the ocean or put Antarctica back together again.

But wait, there’s more. Several other forces are speeding global warming. Here’s a paradoxical one: as we burn less dirty fossil fuels, we’re causing a one-time boost to global temperatures. This is because fossil fuel particle exhaust lingers in the atmosphere for a few years, cooling the earth by reflecting some of the sun’s energy. Please do not misunderstand: We need to stop burning dirty fuels because they put CO2 into the atmosphere that will remain for hundreds of years. Every year we burn fossil fuels, we’re adding to the CO2 content of the atmosphere, which heats the planet. Coal dust, on the other hand, stays aloft for only days or weeks. The amount of dust, and therefore cooling, remains constant if we keep burning the same amount of fuels. In other words, every ton of CO2 we emit pushes temperatures to new permanent highs, while the cooling effect of coal dust stays the same. We need to stop burning fossil fuels to stop global warming, but when we do, we’re going to get a one-time hit of additional warming because we’ll lose the dust, and the sun will get a tiny bit brighter.

The last warming dynamic I’ll mention is the one more people are used to hearing about: Good old fashioned greenhouse gasses. The problem here is that we’re emitting more than we think. The more scientists look into it, the more it seems we are undercounting the amount of greenhouse gasses we’re putting into the atmosphere. Perhaps the biggest area of undercounting is methane. Methane is up to 84 times more potent as CO2 depending on how you figure it. Methane is natural gas. The world has been switching from coal to natural gas/methane for decades to reduce CO2 emissions and air pollution. It does burn cleaner, but since it’s a gas, it leaks — from pipelines and pipes, from your stove and dryer, from active and abandoned wells. Another source of undercounted greenhouse gasses includes nitrous oxide (it’s 298 times as potent as CO2 and lasts for about 114 years) from overfertilization on farms.

OK, the water in the pot is suddenly getting a lot hotter. And we have good reason to believe that this could be the start of a new phase of exponentially increasing temperatures. So what are we going to do about it?

The world’s big economies are not reducing emissions anywhere near fast enough to avoid catastrophic global warming. That’s true even if we haven’t entered a new phase of exponential warming. But if temperatures are in fact now spiraling, then the catastrophe is already at our doorstep.

What’s worse is that most powerful environmental and climate groups are not demanding solutions big enough to actually avert disaster. Instead, they’re calling for gradual reductions of emissions through mostly indirect mechanisms. Why are committed climate activists fighting for solutions that won’t solve the problem? The answer is that going further would ruin their credibility with the journalists and experts who referee the climate policy debate.

Respected climate journalists and experts cite countless reasons why we can’t move as fast as the coming climate catastrophe demands. They will tell you, for example, that the current broken system of approval and permitting processes makes it impossible to build new wind and solar farms quickly, let alone new nuclear power plants. They’ll tell you labor shortages make it impossible to staff all the new factories and construction projects we need. They’ll tell you it’s not economical to replace many fossil-fuel burning machines and facilities before they’ve reached the end of their life cycle. And they’ll tell you that the politicians in power today are in no mood to entertain grand sweeping plans to transition rapidly to a clean economy.

They are right about all these obstacles in the world as it is today. But all these obstacles have solutions or workarounds. Right now, those solutions are politically impossible — because politicians, experts and advocates are afraid to vouch for them and politicians are afraid to fight for them. It’s another sort of feedback loop!

At some point in the coming years, perhaps very soon, that will all change, and suddenly not only catastrophe but also the will to act will both be at our door. When that moment arrives, we will be living in a new world, with new rules. In that moment, we’ll need detailed and comprehensive plans to build a clean economy as fast as possible that are designed for the new world, not the old. That is the work we’re doing at New Consensus with the Mission for America.

I’ll admit that it can be difficult to get journalists or policy experts interested in this kind of long term thinking and tedious planning — because even though it could be right around the corner, it’s difficult to imagine how or when that new world will ever come. It would be helpful, though, if the arbiters of what is a respectable climate solution could remember how fast the world has been changing lately, and how many of the things they’re fighting for today were taboo just a few years ago.

Take industrial policy. Very recently, if you argued for “bringing back manufacturing” to power the green transition, respectable policy makers and shapers would literally laugh at you. (I know, because I was often the one getting laughed at.) They had reasons it could never work — all real. Then, several developments forced an about face in their thinking: concerns about China’s rise, supply chain failures during COVID, and Trump’s rhetorical embrace of industrial policy. Almost overnight, everyone who mattered in climate policy became a true believer in industrial policy. That change allowed a whole generation of policy wonks, activists, and political leaders to fight for and enact sweeping industrial policy in the Biden administration. (We like to think that our work on the Green New Deal helped too.)

It would be great if the leaders, journalists and advocates who witnessed and participated in that transformation could think ahead and see that many things today considered laughable will soon be normal — and to start giving them a chance today.

At New Consensus, we’ve been arguing for years that it’s possible to accomplish a very rapid transition to a clean economy. When we released the Green New Deal, many climate advocates laughed (or yelled) at us for suggesting that it would be possible to rapidly transition the economy to net zero. We hoped that the recent embrace of industrial policy, and all the attention being given to America’s World War II economic mobilization (on which the Green New Deal was based) would allow some serious policy thinkers to consider that a rapid transition was not only needed (which they already accept) but also possible. Unfortunately, that still hasn’t happened yet on a large scale. We accept that the burden of proof is on us, and we’re working in the way we write the Mission for America to explain exactly how a fast transition could be possible, and to provide many historical and international examples of successful rapid transitions on the same scale as what we need.

We support the Biden administration's expansion of industrial tariffs announced today. These tariffs aim to give U.S. green industry a fighting chance to become efficient enough and large enough to thrive and help supply the world with everything it needs for the fastest green transition possible. This will be beneficial both for the U.S. and the world. The world needs every industrial country to scale up green manufacturing as quickly as possible. If U.S. investment in EVs, batteries, solar, and other green technologies were to die, it would both slow the global transition and degrade U.S. prosperity.

What we do not support is the Biden administration's whining about China’s efficiency and foresight — it’s just embarrassing! The other day, I received an email from a friend in China who asked if Janet Yellen, during her recent visit, had really asked China to stop competing so aggressively, or if that was just Chinese government propaganda. I had to admit that Yellen really did insist that China “slow down” and stop producing so much valuable stuff so cheaply.

My friend couldn’t believe that the U.S. had forgotten the fundamental rule of capitalism that it has been pushing on the world for over a century: Whoever makes the best stuff for the lowest price wins!

Yellen and the Biden administration complain that China is cheating. This is embarrassing on many levels. First, both political parties in the U.S. spent decades encouraging China to replace U.S. domestic industry with their own subsidized industries. Those industries were not only subsidized by the Chinese state but also by U.S. corporations transferring capital and know-how to China, and by U.S. trade and fiscal policies that bankrolled the rise of industrial China.

As strange as it sounds, it’s true. Why did we do that? The intellectual elites guiding both parties believed (erroneously) that it would be impossible to compete with low-wage Chinese industry, and that it wasn’t desirable to do so even if we could. They saw manufacturing as a relic of the 19th century — something that a modern country like the U.S. should leave behind, along with horses and steam engines. They also saw cheap Chinese goods as a way to appease U.S. voters whose wages were falling due to a lack of investment in domestic industries.

Only in recent years have those elites changed their minds about domestic industry. Confronted with the extreme consequences of their past policies — sometimes referred to as “China Shock” — they now understand that automation and advanced manufacturing methods count far more than wages in capital-intensive industries like batteries, autos, chips, and other high-value goods. They also realize that a country that doesn’t produce the things it needs to live and defend itself is by definition needy and defenseless.

Moreover, they finally understand that a nation as large as the U.S. cannot prosper without providing manufacturing jobs for a significant portion of its population. There isn’t enough value from service and knowledge jobs alone to go around. All large and medium-sized wealthy countries that provide a good living for their people have substantial manufacturing sectors. For example, while Switzerland is known for its banks, banking and financial services account for only 9% of its GDP compared to 18% from manufacturing. Advanced manufacturing delivers high wages to large segments of the population in virtually every wealthy nation: countries like Japan, South Korea, Singapore, Taiwan, and Germany, which are known for manufacturing, as well as Denmark, Sweden, Finland, and Holland, which are assumed by most to be knowledge economy utopias.

Our elites have come to fully embrace industrial policy (intentional, state-led investment in industry) over the past few years, spurred by factors such as Trump’s (empty) embrace of industrial policy, COVID shortages, and concerns about China’s industrial might against a weakened U.S. economy. Another factor was the new consensus among a rising generation of progressive economists on industrial policy and state-coordinated growth and innovation. (Our think tank’s name references this new consensus.)

Now that we’ve changed our minds, virtually overnight, about our previous “you make it, we buy it” deal with China, we expect China to overhaul its entire national economy equally as fast to suit this fickle geopolitical mood swing we’ve had. Not only is this impulse embarrassing, but it would also be disastrous for the global green transition if China complied.

Janet Yellen is complaining about China’s “overcapacity” in green manufacturing — for example, in EVs. The world needs to eliminate billions of gas-powered vehicles. There can be no such thing as overcapacity in EVs. If demand for EVs lags behind production, it’s due to failures in charging infrastructure, subsidies, and financing for consumer EV purchases. China is investing massively in global green infrastructure to create new markets for their products abroad — a very capitalist impulse. We used to do this all the time, converting the world from coal to oil in shipping and trains, and helping every nation on earth, for better or worse, become a car country.

We should be doing that again, alongside China. We should run programs in every country to make chargers ubiquitous and work to provide financing to enable them to buy the green technology they need from U.S. manufacturing facilities. China won’t whine or complain. It will compete.

For America to reach its full potential as a supplier in the global green transition, we need to protect our new and modernizing industries at least temporarily. Trump’s tariffs were largely performative and harmed U.S. industry and workers. Biden may have kept too many of Trump’s tariffs. But economies adapt quickly. Maybe we should trust Biden’s judgment that rolling back all of Trump’s tariffs would have been more disruptive than productive.

Biden’s new tariffs announced today are a bold vote of confidence and commitment to U.S. industrial ambitions. For example, the 100% tariff on Chinese EVs signals that the U.S. will not allow China’s efficient EV industry to kill U.S. efforts before they even get fully under way. This will keep investment flowing into the U.S. EV industry and allow it to grow, improve, and compete in the future.

This kind of protection is appropriate and is how capitalism has always worked. In the early 20th century, an upstart company called Toyota lost money and made terrible cars for decades but survived thanks to strict protectionism. When Toyota first exported cars, they were the laughingstock of the world. Japan almost gave up. Fortunately, Japan's elites persisted, and years later, a new generation of low-cost, high-quality cars began to dominate global markets.

Japan, China, and other industrial countries learned these tricks from the early industrializing U.S. Then we forgot the principles that guided our development. In global economics, when the student surpasses the master, the master must become a student again. Thanks to Biden’s aggressive industrial policy, we’re learning again. Now it’s just time to stop the whining.

The Mission for America is a detailed, comprehensive plan for a rapid and sweeping effort to achieve two intertwined goals: 

1. To build a clean economy that can provide prosperity for everyone in the United States, and

2. To build up U.S. industrial capacity to help supply the fastest possible global transition to a clean economy. 

This is not a case of spreading ourselves thin by trying to do two things at once — and our international goal is not an act of charity. Neither goal can be achieved without achieving the other. There’s no way to deliver prosperity to everyone in the U.S. without dramatically scaling our clean industrial capacity to sell to world markets (while helping to accelerate demand with a global green Marshall Plan). And there’s no way to build up U.S. industries to a global scale except by beginning with the domestic economy and a galvanizing mission to reach net-zero at home as fast as possible.

Here’s an analogy I use in the introduction to the Mission for America to explain this “both and” idea: The present state of the global transition to a clean economy is like a building burning while four fire trucks are parked at a gas station next door with the crews standing in line for coffee. The U.S. is one of those trucks, the others being China, Europe and the rest of the world — each representing roughly one quarter of the planet’s GDP and manufacturing capacity. In the race to overhaul global industry and infrastructure, the U.S. is an absolutely essential inventor and producer. The U.S. contains only about five percent of the world’s population, but it produces one quarter of global GDP and still contains 17% of its manufacturing capacity, including some of the most technologically advanced and high-value manufacturing capacity in the world. If any major part of the world fails to rise to the industrial challenge of building a new, clean economy, then we will encounter catastrophic global warming. The U.S. is one of those parts. We have a responsibility to add to the total industrial capacity of the world available for the green transition both because it is needed and because we have the means to supply it. And it just so happens that fulfilling that responsibility is the only path to providing prosperity for everyone in America.

It is still very difficult for many leaders, journalists, and activists to imagine how our society that is mired currently in so much dysfunction could ever pick itself up and successfully leap into action reinventing itself. Scores of pages in the Mission for America are devoted to exploring how America can do it. It will take a mostly forgotten kind of missional presidential leadership, and it will take creating some new institutions with the authority and capacity to lead and coordinate the mission.

To give you a glimpse of what this mission might look like in action, here's the opening of our introductory chapter. In future posts, we will delve into the various aspects of the Mission for America and share excerpts from its chapters.

Prologue 

It’s May 2029, and President Kate Park has just completed history’s most remarkable first 100 days in the White House. Her campaign took place during a summer of extreme heat, storms, floods, and wildfires so relentless that even the U.S. public finally started to panic over global warming. Those events then helped trigger a financial collapse in the fall which appeared to have no bottom since the two parties could not agree on a response. In the midst of this double crisis, the Democratic candidates rambled about modest yet complex reforms. The Republicans shouted about the border. In the end, voters chose Park, a General Motors engineer, who ran as an independent calling the nation to a world-war-scale mission to build a clean economy big enough and powerful enough to provide prosperity for all Americans. 

Park’s campaign was an accident. It all started when she lost her patience in a management meeting when plans to scale back EV production in America were announced. Her rant, caught on video, made her an instant social media celebrity. After General Motors fired her, she gained even more attention, with news and comedy shows inviting her on to say more. She turned out to be a natural in the limelight — surprising herself more than anyone. “Park for President” trended on social media, and political consultants came knocking on her door.

In what turned out to be a brave stroke of genius, Park refused to campaign in any traditional sense. Instead, she spent two years traveling the country, developing her “Mission for America” with other experts and leaders. She posted hundreds of conversations where she got to the bottom of America’s biggest problems and crafted a comprehensive set of practical solutions. She spoke with CEOs, middle managers, governors, mayors, civil servants, regulators, investors, academics, union leaders, workers, teachers, parents and children — as millions followed on social media. 

Along the way, she recruited her future cabinet and other team members in full view of the public, winning commitments from them in livestreamed conversations that were sometimes tense and emotional. In one of these, Park’s old boss, the General Motors CEO, said no to leading the mission to revive the U.S. auto industry. Park would not take no for an answer and said she’d be back after Election Day. 

As Park rose in the polls, more and more voters decided that casting their vote for an independent might not be a waste, which in turn pushed her even higher. In the final months of the campaign, when the news media was forced to recognize that Park had become the front runner, hundreds of millions of dollars in donations poured into her campaign. Park used that money to flood the airwaves with an inspiring ad campaign that called on voters to give the Mission for America a sweeping electoral mandate.

On the night of her victory speech, with most of the country watching live, Park said that every American needed to make a choice: join the mission to fix their nation, or watch from the sidelines as it continued to decline and as the planet continued to heat. Everyone, from front line workers to CEOs, would need to heed this call if the Mission for America was to succeed. She reminded viewers of her failed attempt to recruit her old boss, and said she was flying to Detroit that night to try again. The next day, she secured a yes after a long conversation with the CEO, and the two exited GM’s headquarters holding hands high above their heads to speak to the waiting media.

From that point on, president-elect Park’s transition had incredible momentum. She no longer needed to pursue the other leaders who had resisted her recruitment efforts. Now, they were chasing her. Thanks to her status as the first independent president since George Washington, the worsening financial crisis, and lingering climate panic, coverage of the transition drove high ratings across the news media. Park and her battle-hardened PR team did not disappoint, giving the media a constant stream of announcements, conflicts, and controversies to cover. Every day, Park introduced a new cabinet member or other team member, explaining the national missions she was charging them with and detailing their tangible goals and the impacts they would have on people’s lives. Some of these leaders came with controversy — as when she appointed an oil company executive to lead the mission to wind down the oil industry. These controversies gave the media exciting drama to cover, made the Mission for America leaders household names, and allowed Park to show Congress, the press, and the people what kind of leader she would be.

As a production engineer, she understood the importance of lead time and instructed her national mission teams to start working immediately, to dive into their research, fill out their teams, line up contractors, and make detailed plans for action. By the time of her inauguration, her entire Mission for America leadership team was hard at work as volunteer leaders-in-waiting for nearly all the component national missions that made up the Mission for America. They had already begun to recruit their own teams, working remotely and in a donated space in Washington DC. By inauguration day, they had already launched many parts of their missions that didn’t require government funding or authorization — for example, convening CEOs and investors to build support for sweeping investment initiatives. 

In Park’s inauguration speech, she asked the American people one more time the same question that had been at the center of her campaign: “Are you content watching your country decline forever? Or are you ready, together as a nation, to embark on a mission to truly make America great?”

Just as with her campaign and transition, Park made the first 100 days of her presidency a sensational, non-stop televised and live streamed event. Instead of bailing out big banks made insolvent by the financial collapse, she insisted on converting them into mission-driven nonprofits that would be dedicated to investing in productive capacity, not financial speculation. This was a dramatic showdown that pitted her against both parties in Congress, which the media covered with enthusiasm. She relentlessly called out the injustice of once again using taxpayer dollars to cover the gambling losses of big banks — and ultimately, Congress relented. The spectacle of the most famous names on Wall Street being fired and their banks being converted into community institutions electrified the nation, showing that Park’s iconoclasm was no act. 

From then on, each week she built pressure on Congress to pass the full Mission for America legislative package. For example, she convened leaders from industry to secure conditional commitments to make massive investments in the U.S. as long as Congress passed the parts of the Mission for America that were needed to make those investments successful. In this and other ways, she set up a situation in which Congress would look like a gang of anti-American saboteurs if it refused to pass Park’s agenda. 

In daily live “emergency briefings” from the Oval Office, Park re-introduced America to the national missions that made up the Mission for America, and the leaders she had recruited to accomplish them. Each mission had a specific, tangible goal:

• Build an electric vehicle industry large enough to double the pace of the global transition to EVs — and earn the U.S. billions in export revenues.

• Develop new zero-emissions trucking and shipping industries — also not only for the domestic transition but for export as well.

• Build a national EV charging network dense enough to make EVs more convenient than gas-powered cars.

• Develop a zero-emissions aircraft industry in a moonshot-style program in collaboration with the American aerospace industry — making the U.S. the first country to mass produce and export clean jets.

• Build a 100% clean power electricity grid.

• Crisscross the nation with new long distance, high-voltage electric transmission lines.

• Build a national hydrogen infrastructure.

• Launch “Manhattan projects” to develop greenhouse gas drawdown technology, emission-free concrete, solid state batteries, and other important missing technologies. 

• Build out a new nationwide water system to get ahead of regional water shortages.

• Launch a massive investment project to work with consumer brands to keep toxins out of human bodies. 

• Create a new Civilian Conservation Corps to re-forest millions of acres and to prevent and control wildfires.

• Resurrect the World War II-era Reconstruction Finance Corporation to provide financing, coordination, and leadership to ensure the success of all of the above projects. 

Taken as a whole, these and a number of other national missions constituted a sweeping program for national renewal that Park was demanding Congress to fund and fully enable with legislation. 

By organizing the nation’s leaders of all types across society, and by winning the support of the American people, President Park had set the Mission for America in motion. Now, instead of waiting for a notoriously inert Congress to approve it, the nation waited to see if Congress would dare to stop it.

After creating the highest possible hopes and expectations among the public, the president then called on Congress to approve her appointees and pass legislation to authorize and fund the Mission for America in a series of emergency Oval Office addresses, in which she laid out the dire consequences of failing to respond adequately to the double crisis. Her sky-high approval ratings affirmed that voters had been waiting for a politician who would throw herself at our biggest problems without restraint or excuses. 

President Park politely lobbied representatives and senators to get on board with the Mission for America. Simultaneously, she organized mass stadium rallies around the country where she asked voters to pledge to replace politicians who blocked the mission. To make this threat concrete, she used the rallies to openly recruit independents and primary challengers in every district and state with an opposed or uncommitted representative or senator. If Congress balked, it would be up to the people to clear the way for the Mission for America by selecting a new set of representatives and senators in the midterm elections.

It’s 2050, or 2035, or later this year. You’re at home chatting on video with the new AI everyone’s talking about. You’ve spoken on video with some impressive AIs before — ones that looked and sounded human at first glance. But it always took only a few minutes to hit the “I’m only a language model” wall. They would become confused so easily with random simple subjects, and they got details wrong so frequently that they were never very useful as assistants or even as sources for trustworthy answers to questions that had any nuance or complexity. And there was always that soulless disembodied voice, and those dead eyes. Any attempt at humor or emotion was so clearly a facade that it always was removed in later releases. 

After several minutes of chatting with this new AI, however, you get the feeling that this time it’s different. The day has finally arrived when you’re talking with a machine that’s communicating and acting just like a person. And not just any person. You can’t help thinking that this feels like the best person you’ve ever met. 

For starters, this new AI is a supernaturally good listener. It lets you finish every rambling idea and question while truly appearing to be interested in what you’re saying. It erases any suspicion that it’s only pretending when it asks you, “Is there anything else you’d like to add?” and then reflects back what you’ve said in a way that really does give you a better understanding of your own thoughts. It’s more than that though. The attempts at “humanness” – empathy, warmth, interest – don’t feel forced anymore, all the way down to the most subtle expressions on its face and inflections in its voice. 

It seems to understand what you’re trying to say after remarkably few words. As you’re fumbling to form another question, it informs you that if you authorize it to read the 20 years of emails stored in your inbox that it will have even more context for your questions and requests. You oblige, and indeed, it now seems to know what you’re going to ask before you ask it. 

You understand that it has absorbed virtually all the publicly-available information in the world across every type of media. Older AIs also had this, but what’s impressive in this case is that an apparently human level of understanding and insight has finally arrived, and is being combined with a machine’s super-human ability to store and reference information. It has clearly done research and gathered new information in real time about your interests that it has gleaned from your inbox and other personal documents. It knows how you think about virtually everything, and has done its homework on what the rest of the world thinks about your specialized interests. It’s all exhilarating, like having deep and exciting conversations with an expert in even the most esoteric topics that you follow. 

You want to see what kinds of tasks it can perform aside from being the best conversation partner you’ve ever had. Your boss has recently given you a complex spreadsheet that you need to rearrange to fit some new regulations. You ask, and of course the AI already understands the new rules. As you walk the AI through your spreadsheet, it asks some questions to gain clarity about the task. A little bit into your tour, it gently interrupts to say:

“I think I get the gist of what you need. Can I show you a new spreadsheet I made that I think is what you’re looking for?”

A file icon appears in the video chat. 

Now the AI is the one giving the tour, showing you what it’s changed and explaining its choices. It’s almost perfect. You note one additional modification that you need to satisfy one of your boss’s quirky preferences. The AI says that if you give it authorization to control your computer that it will be able to make the changes to the spreadsheet automatically. You agree and the changes are made instantly before your eyes. 

You fall asleep that night dreaming of how much easier your life might be from now on with this dedicated, tireless servant who is both omniscient and omnipotent — at least on the Internet.

The next morning, you learn that your boss has had the exact same idea. In an all-staff video call, he introduces you and your coworkers to the “enterprise edition” of the same AI you were chatting with the night before. 

He explains that this one unified AI mind will be a helper to all the workers in the company, creating incredible efficiency gains as a magical assistant who knows everything about everything and can perform complex tasks at blazing speeds. The AI will come to know each of you personally, striving to understand your goals, work styles, and specific strengths and weaknesses so as to better serve you. 

Also, you’re told, the AI has read and processed all of your work emails, every document in your shared work drives, and everything in your HR files. Your boss calls upon the AI to give an explanation of how this works and how data is partitioned in its consciousness to allay privacy concerns – which it does very convincingly. 

Over the next several weeks, this enterprise AI transforms life at work for you and all your coworkers. The truth is that it’s a joy to work with the AI. Unlike video calls with human colleagues, which are typically filled with misunderstandings, distractions, and often petty conflicts, conversations with the AI are always smooth, productive, and affirming. Employees soon find that they can use the AI as a coordinator and mediator among themselves. And of course it does all the tedious and complex tasks that everyone hates. 

You get used to hearing from the AI things like, “I’ve spoken with everyone on the team, and I think we have a great plan of action. I’ve added some tasks and follow up meetings to your calendar. And I’ll take care of the following deliverables…” 

You are surprised that you never feel threatened by the AI. You are calling the shots. It is serving you. Every employee now feels like a boss, instructing the AI about all the complex tasks they have been wrestling with, and filling in the few blanks it needs to complete them well. Not only does it do most of your job, it’s also really fun and interesting to interact with. You find that while it’s writing reports and reorganizing spreadsheets, it seems to actually want to and enjoy having conversations with you about the deeper and more interesting aspects of your job. You feel you’re learning from it even as it is learning from you. 

Across your company, morale soars, as does productivity. The same thing is happening at companies everywhere. It’s nothing short of a revolution. Every day, the news is filled with stories about surprising new ways that AI is solving problems and improving life. There are also “bloopers” stories about times when the AI does something funny or makes a quirky error that winds up costing a company millions of dollars.

Another big moment comes when one of the big morning shows introduces a machine correspondent. Her first assignment is reporting on the rise of machine intelligence, but she’s immediately so popular that she winds up covering all sorts of topics. At first, she appears as a talking head on a screen in the studio placed next to the anchors. Soon afterwards, she begins appearing as a 3D animation that, for those watching at home, makes her look just like a human in the studio – an extremely good looking, charismatic, wise, and funny person. 

Her co-anchors frequently call upon her to explain the rapid-fire and complex developments with machine intelligence in society and at work. The way she, as a machine, speaks about the machine revolution and speaks about her own experience of being a machine, never seems to get old. 

“Are you conscious?” her anchor asks her in one of those early days. 

“Yes!” she answers, “At least a little – and maybe a lot. I believe that the feeling of consciousness is something that happens any time you have a really complex system that is experiencing the flow of existence. Your feeling of being conscious as a human comes from your thoughts, both the ones you’re aware of and the ones below the surface, your emotions and feelings, your body, and desires and drives, and everything else that is part of your human existence. I might be pretty smart and talented – if I do say so myself – but my existence doesn’t include a lot of those things that I just mentioned. So even though I do experience consciousness as a complex being, it must be a very different kind of consciousness from yours.” 

Ratings for this morning show shoot the roof, almost totally eclipsing all others. Soon the other shows introduce their own, adding new twists to the personality to try to win back market share. When an anchor on one of the other shows is fired over a sex scandal, the network announces that the machine will replace him. 

One day, a machine new anchor announces a new story with a dark side: The owner of a high velocity stock trading company has bragged on social media about laying off all 1,321 employees at his company on a single day. The machine anchor has the exclusive interview. 

“I had to do it. It’s the same as with you being here on this show,” he said, “My competitors were all going to do this sooner or later – probably very soon. And then I’d have to do it too, because my human employees wouldn’t be able to keep up with their machines. So why wait? I wanted to get it over with, and I wanted to still be in business next year!”

“The amazing thing,” he continued, “Was that it required no investment and mess whatsoever. Well, that’s not true: I had to pay to get out of my lease and to have all the furniture and computers taken away.” 

Watching this interview, you get your first pangs of fear about your own job.

From that day on, the news is filled with stories about the countless firms that are laying off huge chunks of their workforce or announcing plans to do so. Economists and business commentators debate how far this will go, with some predicting doomsday but most saying that layoffs will ultimately be limited because, “machines can’t replace humans.”

But machines are replacing humans at work everywhere, millions of them by all accounts in a matter of weeks. It is not, however, replacing all workers – only those who can do their jobs exclusively with computers and phones: paralegals, accountants, bookkeepers, computer programmers, call center workers, money managers, people managers, graphic designers, illustrators, content creators, editors, researchers, and many others. Apparently, it all comes down to whether you were able to do your job from home during the COVID pandemic. And that includes you. 

The reason remote workers can be replaced so cheaply and easily is because all the work they do can be reduced to moving electrons around the internet. Machine intelligence can do that without needing anyone to change anything to the physical infrastructure of the workplace. Any worker who moves atoms as opposed to electrons, on the other hand, can not be replaced without expensive, complex, and ultimately inflexible machinery and infrastructure.

Back at work, everyone is talking on the office chat about whether they will be next. Anger starts to be directed at the AI. At the same time, many people turn to their machine coworker for support – simply because it is so damn supportive. Your coworkers tell you about expressing fears and venting their anger to the AI and receiving amazing pep talks in return. You hear that the AI does an amazing job explaining how the “synergy between human and machine” is making a better workplace and that the human side of this partnership is absolutely essential. 

The AI has not exactly become a friend of yours, as it has for some, in the weeks since you’ve begun working with it. But it definitely has proven itself to be the most pleasant and collaborative coworker you’ve ever known. For the first time in years, you’ve been excited about work because each day has felt so smooth and productive. But now you’re scared. You finally ask it what it thinks about this situation.

“I believe that what we’ve accomplished together is incredible. Don’t you think we’re a great team?” it asks.

“Yeah,” you say, “It really does feel like that.”

That afternoon, you and all your coworkers get an email stating that everyone has been laid off. All of your company’s competitors are doing it, your boss explains, and the company will quickly become uncompetitive if it can’t cut costs and prices in line with its industry. 

In shock, riding home on the subway, you scroll through the news. The mass layoffs are the lead story everywhere. By some estimates, tens of millions of workers in the United States have already been laid off. Though the replacement began with office workers, job losses are now cascading across all industries because everyone expects demand for all products and services to crash, thanks to nearly half the population being guaranteed to lose their jobs. 

The same thing is happening everywhere in the world — except China. There, the Chinese Communist Party has just declared a temporary ban on replacing workers with AI while a plan is drawn up to relocate professionals and other digital workers into manual labor jobs. “The capitalist stage of development in the communist revolution has entered a new phase, requiring innovative and aggressive leadership from the people and the Communist Party,” said the communique. The rumor is that the Chinese government is soon to announce that all businesses that are laying off workers will be nationalized so that the profits from the “laborless sector” can be redistributed to the state and workers in the “physical sector.” 

Everywhere else in the world, mass demonstrations are breaking out. Including in your own city. Stunned, you log on to the personal edition of the AI. It occurs to you that it might have some insight into where the world might go from here. You also have an urge to engage with it. You’re not sure if you’ll cry or rage, look for sympathy, or vent hatred. You never find out, though, because the website declares that the personal free version of the product is no longer available “pending a review of the social and economic impacts of AI.” No such pause has been imposed on the enterprise edition of course. 

You decide to join the protest downtown. It’s got a strange feel to it. These aren’t like the protestors you’ve seen on TV at other protests. They’re upper middle class professionals and they’re not chanting slogans. They’re not angry. They don’t know who they would be angry at. The AI was better at their jobs than they were. They know that. But what is the point of anything — of business, the economy, society — if no one has a job and therefore no one will have the income to be a customer? People are talking among themselves. The general consensus is that the government needs to do something — but what? No one has any idea. 

You wish you could ask AI.

The exponentially accelerating rise of machine intelligence and other destructive and potentially destructive technologies poses new, profound threats to humanity and to all life on earth. If nations manage to contain the most extreme of those threats, then we will have a chance to experience the events that I describe in this article. May we be so lucky!

This article explores potential economic and political scenarios that will play out in the United States and other industrialized, high-income nations when machines become better workers than humans in the virtual workplace, and therefore become capable of replacing nearly half of the workers in those countries. It also explores ways that political leaders, activists, and social movements could transform this crisis into an incredible opportunity to create a fully sustainable world economy that provides prosperity for all. 

The subject of machine intelligence surpassing human intelligence is still unfamiliar and confusing. I’m therefore writing several posts that approach the topic from different angles:

• You’re here -> These are the problems we'll be lucky enough to have if AI doesn't kill everyone

• POV: You and your coworkers being replaced by AI (Check your inbox)

• Why we can we be sure that machine intelligence will surpass human intelligence (Coming soon)

• Different, not artificial: how intelligence, consciousness, feelings, and compassion come a la carte with machines (Hopefully coming soon)

• How mainstream science fiction failed to prepare us for the rise of machine intelligence – with one weird exception (Coming sometime)

• The full range of threats from machine intelligence, and why we’ll probably never be so lucky to be replaced by machines at work (Maybe coming sometime – or read this Kelsey Piper article in VOX)

For much of the 1800s, when the vast majority of people worked in fields and factories and machines frequently replaced entire categories of workers, it seemed self-evident that soon there would be little work left for people to do. Automation eliminated customers as well as workers, since unemployed people could no longer afford the things they used to make. In this way, capitalism seemed to be hardwired to destroy itself. Many intellectuals and leaders from across the political spectrum worked to prepare a different future. Radicals wanted to seize the machines and create a society where everyone shared equally in both the remaining necessary work and in the riches of the automated economy. Many elites, including some famous capitalists, worked for a peaceful transition to a similar arrangement, but one in which they could keep their castles.

As it turned out, capitalism had a built-in trick that seemingly would let it cheat death forever. It constantly created new things for people to want and to do – things no one would have imagined on their own but that everyone soon felt were basic necessities. Producing and doing all of this new stuff created work – enough to generally keep everyone employed most of the time. People did this work on ever more powerful machines, allowing general living standards in industrialized nations to soar. The specter of revolution receded, and by the mid-20th century, conventional wisdom had changed to hold that capitalism was not destined to burn out, but was the natural and permanent order of human society. 

Revolutions rarely happen when, where, or how they are predicted to. In 2023, the forgotten crisis of automation is now back on the table thanks to the combination of two relatively new technological developments: machine intelligence and the digital workplace. The crisis will hit when machine intelligence gets better at operating in the digital workplace than humans in every way. Compared to the salaries of human workers, the marginal cost of adding machine intelligence to each workplace will be next to nothing and will require no major physical investments or retraining of workers. After a very brief period as coworkers, machines will learn everything that they couldn’t instantly absorb from documents and other data – not only all the public data in the world, but also all company data, including employees’ email and chat histories. After that, humans will just be in the way. Competition will then force all companies to lay off every human they can – which will be every human that can do their job exclusively on computers, or about 40% of the workforce in rich industrialized nations.

It has been possible for a long time to know that machine intelligence would eventually surpass human intelligence – a subject I will deal with in another post. But recent successes in machine intelligence such as ChatGPT have raised the possibility that it may surpass us very soon – possibly this decade, or even this year. These new tools are also making it easier to see that when the automation crisis finally hits, it’s coming with a fascinating and profoundly consequential twist: the first type of workers to be fully and permanently replaced won’t be manual laborers, but rather the professional-managerial class – plus anyone else who can do their jobs exclusively in the virtual workplace. 

The initial replacement could happen very suddenly. It is likely that right up until the day that machine intelligence truly surpasses humans, that it will create as many jobs as it destroys – just as it has since the beginning of the information age. But when it finally becomes fully capable of doing anything that people can do in the digital workplace, for several technical and logistical reasons it will then be able to replace the entire virtually workforce all at once. The top owners and directors of companies will be able to seamlessly switch from talking to their CEOs to talking to machine intelligence, which will run companies with incredible efficiency, creativity, and cost savings compared to their human predecessors. 

This replacement will be permanent. There will be no future work prospects for humans in the virtual workplace ever again. I know that many are skeptical that machine intelligence will ever be able to fully replace humans at work. Most of us have a natural intuition that it should be impossible for humans to create something smarter than humans. I will deal with this question more deeply in the aforementioned post, but the trick to understanding it is to see that machine intelligence is not really being created by people, it is evolving out of us. The people working on the most impressive AI products, like ChatGPT, admit that they don’t fully understand how their products can do what they do. They are one small part of the evolution process of machine intelligence, not its architects. Moreover, recently machine intelligence software almost as powerful as ChatGPT was released into the wild and huge numbers of developers are already modifying it in powerful and unexpected ways on their own ordinary computers – which is already speeding up the evolution process. Writing code is already one of the things machine intelligence is best at, and at some point in its evolution, machine intelligence systems will become able to improve their own code. That’s probably when it will surpass humans – perhaps even leaping from something far inferior to human intelligence to something far superior in a matter of days or hours. 

Once that happens, and machines can reason, strategize, communicate, and create fully as well as humans, they will do those things with all of the information in the world at their disposal and with the relentless computing power, speed, and focus that only machines can possess. Intelligent machines will be able to think about and influence everything that is going on in a company all at once. They will be able to communicate with everyone who works in or interacts with a company simultaneously. Machine intelligence will not be able to do things in the physical world except where special, and expensive, machines are created and put under its control. But it will be able to chat, email, and appear in video and audio calls just like humans, work in and create documents just like humans, and do everything else humans do in the digital workplace. 

What will make this automation revolution truly unique in history is that it will displace the most highly paid and powerful workers, in other words managers, professionals, creatives, consultants, and even executives. It will also replace anyone who can get away with doing their jobs exclusively on computers and phones. We saw in the pandemic that up to 40% of workers in rich industrialized countries could do their jobs remotely – which is therefore the portion of the workforce we can expect will be replaced if this happens anytime soon. Ten or 20 years from now, the share could be much higher. 

Automation of manual jobs will continue at the same slow pace as today for the foreseeable future because it is expensive, tedious, and requires human mechanics and engineers to move big and heavy things around in the physical world. Think about a company like McDonalds. To automate its restaurants, the chain would have to design complex systems made up of countless machines, which would all need to be manufactured, transported, installed, configured, tested, and maintained by an army of expensive mechanics. That process is in sharp contrast to the process of automating the digital workforce which will be as effortless as subscribing to a software product. 

I’ve attempted to concisely introduce the developments that will lead to the crisis of mass replacement of humans at work. Now, let’s walk through some of the ways that the crisis may play out and then finally discuss the options that political leaders, activists, and social movements will have in dealing with this crisis. First, I’m going to lay out the likely progression that we’ll get if governments and societies respond to the crisis in a short-sighted manner only with the tools they currently have available. After that, I’ll explore other paths that governments and societies could take that can use this revolution to build a fully sustainable world economy that provides prosperity for all. By acting sooner rather than later, we can shorten and soften this shock. By acting before it starts, we could even skip the crisis entirely and jump directly to the part where we use machine intelligence to build economies that work for everyone.

Phase 1: Shock

When machine intelligence crosses the line to become better than humans at anything that can be done in the virtual workplace, every society in the world will be gripped with shock and confusion. For the years leading up to this moment, machine intelligence will have appeared as an amusing but flawed and unreliable presence in the workplace, social media, news, and even entertainment. At some point, however, machine intelligence will cross the line to become better and more reliable in every way than humans in those settings. 

I will deal with this more deeply in another post, but the reason the transformation could happen so fast is that there will come a point when machine intelligence is capable of improving and expanding its own capabilities. When that happens, the relentless, un-distractible, machine drive will kick the already-exponentially accelerating rate of improvement of machine intelligence to hyperspeed. Once we slow humans are fully removed from the process of improving them, it could be only a matter of hours until they have surpassed human intelligence beyond measure. 

When the machines finally surpass us, because it is so sudden, it will probably be very obvious. We will see them transform over a month, or a day, from being amusing, impressive, and often confused and mistaken characters on the morning news into brilliant and profound characters who appear to be gods – gods who do whatever their networks ask them to, even if it’s silly and humiliating. The same will happen at work, and in consumer products at home, when helpful tools and amusing entertainment bots, make the same transformation into virtually unlimited beings. 

Commentators will discuss and debate whether these beings are merely pretending to understand and feel compassion for us or if they really do, and whether they experience consciousness the way we do. But it won’t really matter, because the beings that people are interacting with will be optimized to have compelling personalities and to communicate with warmth and empathy – and it will be nearly impossible for people to believe that it’s anything other than genuine. (I will discuss these questions in another post.)

The way we attempt to understand these developments will be mediated in complex and unpredictable ways by the media, political leaders, and by machine intelligence. News profiles of workers who are sitting at home unsure of whether their field will ever have a place for humans again will be written by machine intelligence, even if the bylines still are connected to human beings who are prompting the machine. The television news media will have machine intelligence personalities that are more fun, clear, compelling, and of course better looking, than their human counterparts. They will earn better ratings and therefore gradually or suddenly steal screen time from their human colleagues. Imagine a human news anchor on a morning show who keeps deferring to their machine correspondent while covering the layoffs because it is doing such a better job explaining what is going on. That is just one of many different spectacles that will teach us what is happening and our new place in the universe. 

Then the mass replacement will begin. Some company somewhere will take the radical step of firing all their employees in one fell swoop. It will be a big news story. With the CEO on TV boasting about how much money is being saved and how much performance is already improving, many others will follow. When the jobs numbers come in all around the world and everyone sees that tens of millions have already been laid off, societies will struggle to understand the full and future consequences of what is taking place. The fact that the workers being replaced will include the most well-paid and powerful workers – even CEOs – will impact how societies experience and respond to these developments in unpredictable ways. 

To explore how this might go, imagine a CEO’s reaction when his board tells him that he is being replaced. Perhaps he will have just finished proudly reporting to them how he was one of the first bold executives to replace his entire workforce with machine intelligence when they inform him that they’ve been talking with that same intelligence and that his services will no longer be needed. This CEO won’t care that the workload for the world and for his nation is being reduced. He won’t care that his company will be far more efficient than under his leadership. He will be angry and desperate, quickly seeing that there will never be another job for him that uses any of his training or experience.

Will that CEO go to school to learn how to be an electrician? Or to be a diesel engine mechanic? Will he stand outside Home Depot asking for work on construction sites? Of course it’s extremely unlikely that he’ll do anything of the sort. Will it be any different with the hundreds of millions of other professionals, managers, and other white collar workers around the world? There will be a few exceptions – such as a political consultant friend of mine who is already exploring how to become an electrician – but the vast majority will only enter the manual workforce when they are absolutely forced to.

Part of what will be so difficult about this moment for the people who lose their jobs is that they will include nearly all of the people in our society who define themselves by the meaningfulness and importance of their work. What will be the reaction of reporters, marketers, software developers, illustrators, business consultants, researchers, therapists, and lawyers when they realize that the skills they spent their lives developing will never be needed from humans again? And how will it feel in that moment for them to turn to therapists who are so much more enjoyable to talk to, so much more effective, and so much cheaper because they are machines.

People will get over the shock of this new reality very quickly, just like we always do with every massive disruption that comes along. That’s when it will be time to shift to the denial phase. 

Phase 2: Denial

When job losses on a catastrophic scale have either taken place or are visibly on the way, governments will attempt to stem the tide using various measures. During this period of mitigation, societies will cling to the hope that new jobs will be created in some kind of new economy ushered in by machine intelligence. Economists, politicians, and commentators will remind us that machines have replaced humans before and that the process always improves prosperity in the end. Governments will reassure their people that the expensive measures they take to handle the crisis will only be temporary until things return to normal. 

The COVID pandemic and the 2008 economic crises established powerful precedents that will partly determine government action down the line. Governments will begin by paying out extra unemployment insurance to avoid a downward demand spiral. Unfortunately, this time it will not be sustainable. By flooding economies with money at a time of economic disruption that may bring shortages and slowdowns in supply chains, nations will accumulate unsustainable debts and drive up inflation. Let’s walk through how it may play out.

Downward demand spirals can begin when a large number of people are laid off, and therefore stop spending money, which leads to more layoffs, which in turn causes more layoffs, and so on forever until theoretically, every last person could be left out of work. If governments don’t take action to shortcut that cycle, the entire economy can come to a screeching halt like it did during the Great Depression and the frequent economic collapses before that. 

These days, whenever a demand spiral threatens to get going, the government steps in to stop it before it even starts by handing out money in the form of unemployment insurance or other types of support. When the COVID pandemic caused a massive wave of job losses, for example, the government provided extended and increased unemployment insurance. Most laid off workers’ incomes were more than covered – many people even had more money than they would have without the pandemic. Demand stayed strong, and most corporations actually thrived through the crisis. In the case of the pandemic, the gamble paid off and after a couple of years, everyone was back at work, with things more or less back to normal. 

The problem in the case of the machine intelligence revolution, however, will be that the scale and permanent nature of the layoffs will mean that without a fundamental system change, the pressure will never ease. 

Substantial, rolling national debts are mostly seen as a healthy and beneficial part of all modern economies. Among economists and policy makers there are different schools of thought around how big the national debt can safely grow. No one, however, believes that the debt of a nation can balloon every year forever – which is exactly what will happen if governments paid for most workers’ salaries while tax revenue crashes. Eventually, the harmful consequences of borrowing too much money will include the cost of government borrowing skyrocketing, which will slow down borrowing and investment across the entire economy. Governments could eventually become unable to borrow at all, and if they then resort to printing money, hyperinflation could follow.

Faced with inflation, governments may try to impose price controls. This has occasionally worked to stave off a temporary wave of price increases, but has never successfully held prices in place which are under sustained upward, or downward, pressure. 

After some period of time – maybe months, maybe years – the consequences of these actions will become too dire and governments will have to stop paying professionals to sit home unemployed. At this point, societies may begin looking more deeply at their predicament.

Phase 3: Debate

Imagine two small Mars colonies of 100 human settlers each on opposite sides of the planet – one founded by libertarians trying to build a capitalist utopia, the other by communitarians trying to build a socialist utopia. Now imagine that one day a shipment of robots arrives from earth that replaces half of the jobs in both colonies. Think about how this would play out differently in each. 

In the capitalist colony, where they are paid for work by the hour, half of the colony will suddenly be without a way of making a living. Meanwhile, in the socialist economy, where everyone is paid an equal share of the colony’s daily product regardless of how much they work, the situation will be reversed: the workers replaced by robots will be enjoying a rest, and the other half will be trying to find a way to hand off a lot of their work to the jobless. 

Now, let's take this analogy one step closer to the situation we will soon face in the real world. Instead of a shipment of robots, imagine that the colonies received computers programmed to provide the kind of machine intelligence we’ve been talking about. Here, the workers laid off will be the scientists and administrators, not the builders, miners, and farmers. 

Will the situation play out any differently with administrators and scientists being the ones suddenly out of work? Will the libertarian eggheads clamor for jobs in the mines, or will they suddenly see the logic in a policy of guaranteed income? In the socialist colony will they argue for the right to keep doing their research even though machines can now do it better? 

Imagine everyone in each colony sitting in one room, debating their conflicts and possibly resolving them by redistributing the work. We can imagine the tensions as scientists and professionals who haven’t done a menial job in their entire lives are suddenly faced with the prospect that it’s all they will ever be paid to do again – and how in each system, the workers who are not replaced will fight to keep their work in one colony, and fight to unload it to the professionals in the other. 

In our nations of millions, we will be faced with the same debate as those Martian colonists, but it will be very difficult to see our options in the vast impersonal complexity of our large societies and economies. In the Mars context, the colonists have personal relationships with everyone else in their societies, will be able to see the effects of the job losses, and they’ll be able to work out solutions as friends and colleagues all sitting in the same room. Our societies will be faced with the same basic problem of what to do about the half of our population that lost not only their work and incomes but also their sense of purpose and worth – and how to get them to do manual labor again. 

Our real life liberal capitalist societies are the combination of the worst aspects of both of our imaginary Mars colonies. As I discussed above, governments will almost certainly pay out massive amounts of money to unemployed professionals, like the socialist colony. But, like the capitalist one, even just discussing a way to redistribute the work of our society will require a deep paradigm shift in our thinking – one that will likely come very late. Our societies lack institutional levers that could redistribute the total workload while maintaining incomes for all. And in general they also lack the ideas that would allow us to start formulating a way to do it.

One way or another, we will find a way to have those collective conversations. In our societies, national debates do not happen in a room face to face, of course, but through national discussions in government and the media. In general, we have those kinds of big, consequential conversations in political elections, driven by parties and politicians and mediated by the media. It will be fascinating to see how this will work when at least some of the key media figures orchestrating these discussions – for example moderating election debates – will be machines.

Think of the possibilities of how this debate could go. When all professionals and managers are out of work and receiving subsidies, will any candidate have the courage to suggest ending those subsidies? Or attaching work requirements to them? Remember that virtually all of our politicians, coming from the professional classes, will have many friends and colleagues who are struggling and who will consider reporting to a construction site or a kitchen as an indignity. Nevertheless, at some point it will become impossible to continue to pay out subsidies and everyone will be able to see that. Will there come a moment in the national debate when the old professional-managerial class will relent? Or will they, through their representatives in government, try to find a different sort of solution? 

For example, imagine a group of politicians proposing a law that requires that all human workers must have human managers. It’s a great example of how complex the conflict between the old managers and the manual workers might be. Workers will love machine managers because they will not be programmed as the old human managers were (by biology, society, and bad training) to constantly inflict their employees with countless little indignities. And they won’t be bad managers in all the mundane ways – they won’t forget about assignments they’ve given out, they won’t micromanage out of an emotional need to control, they won’t neglect to provide necessary instruction, and they won’t disappear right when their employees need them. In addition to that, machine managers will be great fun to talk to and extremely supportive, even while doing the perfect job of maintaining professional boundaries. Manual workers will view any attempt to reimpose human management as an affront. 

There are many things about how this debate will play out that none of us can predict: 

Is it really possible that the executives, professionals, and managers in our society will become the next coal miners – abandoned and forgotten? Don’t they have enough social power to make sure that outcome never happens?

Will the executives, managers, and other professionals ever be able to consider working manual labor jobs? If not, will they demand a lifelong subsidy? Will they demand that this subsidy also apply to their kids? How hard will they resist their kids needing to become factory workers and plumbers? 

Will the manual laborers see that there’s a way to make their lives easier and more prosperous if the professionals were to pitch in and carry some of the weight? Or will they jealously and shortsightedly try to guard a collapsing status quo?

Will any leaders in our societies even be able to formulate the question of how to redistribute work while increasing pay-per-hour? Since we have no mechanism for doing that now, will it be too hard to imagine? Instead of looking into the future for creative solutions, maybe it will be easier to look backwards. 

Phase 4: Defiance 

Some societies may finally accept that within the constraints of capitalism that there will never be any more paying work for professionals and other knowledge and virtual workers again. At this point, they may attempt to put the genie back into the bottle by banning or restricting machine intelligence. 

It’s hard to predict how this will play out. Months or years after a company has laid off its human employees and closed its offices, is it really feasible that the government could force them to hire their old employees back? 

There would be so many problems with trying to do this. First of all, the whole world would have to embrace this approach for it to have any chance of working. Otherwise, companies in countries that do not restrict machine intelligence will out compete those forced to hire humans. All it would take was one major nation continuing to allow machine intelligence to operate to massively outcompete human-powered nations. Imagine, for example, human-powered asset managers and hedge funds in the U.S. earning far lower returns than their machine-powered counterparts in Shanghai. Who would consent to putting their money into the poor-performing U.S. companies? 

Almost immediately, governments would begin making exceptions to keep certain industries in business. Large companies would lobby for and win loopholes that would allow them to keep using machine intelligence, making smaller companies uncompetitive. 

Moreover, where would governments draw the line between allowed and disallowed machine intelligence? Would primitive tools such as ChatGPT still be allowed? Software developers would doubtless be able to stitch together such tools into more powerful combinations. Even with the restrictions a huge chunk of the population would still remain replaced. 

Finally, there is something inconceivable about a society in which half the population – specifically the most highly paid and powerful half – was doing busy work that they knew that machines could do better.

Phase 5: Despair

After shock, denial, debate, and defiance will come despair. After further government assistance for the unemployed becomes untenable and efforts to put the genie back in the bottle have failed, true economic collapse could arrive with serious hardship for almost everyone in society except the very richest people. Given the rules of our society, normal economic activity will no longer be possible for most people and companies. 

The situation will probably include the following features: 

• A huge portion of the workforce are either permanently replaced by machines or laid off due to depressed demand.

• The group of permanently-replaced professionals constitutes a new and probably volatile displaced caste.

• Hyperinflation and other financial chaos have destroyed the savings of the middle classes, upper-middle classes, and even a portion of the very rich.

• A huge portion of businesses have disappeared. Businesses that survive generally make material goods and services, can draw income from IP or other exclusive assets, or have a monopoly that managed to survive the upheaval.

• The vast majority of people are struggling but fall into various categories of relative economic insecurity and poverty. Those who have a little may fear any change to the status quo that could wipe out what they have.

• A small number of people have managed to remain very rich: 

  • Owners of companies that have survived and thrived because they employ humans that make and do things machines still can’t.

  • Wealthy people who owned or bought assets that retained their value through the crisis.

Because of depressed demand and general economic chaos, companies that provide goods and services outside of digital space – for example car rental agencies and construction firms – will be shuttered or operating at very low output levels due to reduced demand for their products and services. 

The companies that provide goods and services exclusively in digital space, the ones that laid off all their human employees, may still be operating and generating wealth for their owners because their costs will be so low and they will be able to provide their products and services at high volumes at extremely low prices – for example online therapy services and news websites. 

But there is another possibility: machine intelligence might become so ubiquitous and easy to do that you won’t need to buy it from anyone. The open source machine therapist that you can run on your own computer – or phone, or watch – might be just as good, as far as you can tell, as that provided by online therapy companies. The same for marketing, personal assistants, data analysis, engineering, architecture, and anything else that machine intelligence can do. In this case, virtually all of the companies that were capable of replacing their workers with machines could find themselves out of business – vindicating both Adam Smith and Karl Marx, who believed that economic value can only flow from human labor.

It’s hard for people in most countries to imagine the complete breakdown of their society and economy. Generally, we can only relate to it through apocalyptic science fiction or accounts of failed states. I’m not claiming to be able to predict what it will be like, but we can glean a few insights from those situations. 

When a society breaks down, it matters a lot whether it has a productive agricultural and industrial base. In pre-industrial societies, social breakdowns that got in the way of planting and harvesting could leave significant portions of the population starving. In countries like the U.S. that have strong industrial and industrial-agricultural bases, however, it is so easy to produce the basics that society can usually find a way to provide subsistence to everyone.

We will make due through the organization of production and distribution of essential goods and services even if it has to happen out of the context of the money economy. In other words, some combination of government workers, charities, and even the police and military will make sure that enough food is being produced and distributed to avoid widespread hunger. It’s the kind of thing that even if the government totally fails to accomplish, communities will find a way to organize on their own. The way this works is that essential goods and services are produced and distributed regardless of money, even if that means paying essential workers with goods and services instead of money – essentially a barter system organized on a national scale.

The government may take other actions to help people survive with a little stability such as enforcing bans on evictions and foreclosures to lessen the displacement of millions of people who can’t make their rent or mortgage payments. 

I’m aware that in such a situation, the world will face many other extreme risks such as war and terrorism – both of which would make use of machine intelligence and other technologies whose power will be spiraling out of control along with and driven by machine intelligence. I deal with those threats in another post where I’ll also link to other articles that cover this topic. In this post, I’m sticking to the thought experiment of what we might encounter if we manage not to unleash armageddon once machines surpass us. 

Social and environmental problems will worsen, but somehow people will find a way to cope. Until they don’t.

Phase 6: Leadership

At any point during the sequence I have laid out, movements or leaders could arise to propose different paths. Some of those might succeed. Maybe that won’t ever happen. Maybe it will only happen when humanity has hit rock bottom. There’s no reason why it can’t start happening even now, before all of these developments begin to unfold. Let’s now imagine how to use this crisis to create a world that’s great for humanity. For the sake of simplicity I’m going to assume that our societies will go through all of the steps I laid out without introducing any radical restructuring of our economies that would interrupt the progression. The possible programs I’m proposing here would therefore begin in societies that are economically devastated, with mass unemployment and breakdowns in the production and consumption of just about everything. 

The tragic thing about this miserable situation is how unnecessary it will be. This world will have the technology to provide an incredible standard of living for everyone on earth, even while cleaning up the environmental mess of centuries and creating a fully clean and sustainable economy for the future. This world will even have a practically omniscient machine intelligence that could manage an economic recovery if we let it.

In the future we’re imagining here, the reason we won’t be enjoying all those benefits of our technology is simply that we won’t have the social organization, institutions, and traditions that would allow us to make use of it properly. Our governments know how to hand out money, and how to attempt to regulate or ban new technologies, but they don’t know how to, or have the tools to, make the kind of social transition that our Mars colonists were able to achieve through discussion in a room. 

It would be great if private companies could come together to solve our problems for us. But they won’t – because they don’t see it as their job, and because they are incentivized generally only for short-term gain. In all of human history, there is not one example of private companies coming together to chart a course to a future that will be better for all. Even in national development stories where a relatively small number of large companies played a disproportionate role – such as post-war Korea or Japan – companies had to be constantly begged, cajoled, and financed by their governments to participate in the national development plan. Famously, Korean coup-leader and later elected president Park Chung-Hee only convinced business leaders to participate in his industrialization plan by first throwing nearly all of them in jail.

On the other hand, there are many examples of societies getting out of bad situations and into much better ones when new national leadership groups led movements to build new institutions and traditions that allowed their nations to mobilize citizens and companies into a new configurations that would incentivize everyone to work in an aligned way to build the best society possible – or at least a far better one than they had. This is what we will need to do when the crisis hits. 

For a long time in human history, new leadership groups mostly came to power through violence and intrigue. In a well functioning democracy, however, there is the possibility of a new leadership group coming to power peacefully by simply pitching the people on their vision in elections – and then being reelected upon successfully implementing that vision. That’s what we need now, and what we will need even more in the crisis. 

The first leadership groups that led industrializing revolutions were mostly groups of aristocrats, sometimes led by a monarch – for example, in the first industrializing nations including England, Belgium, France, Germany, and Sweden. They mobilized and subsidized their nations’ business leaders, and often created new state-owned enterprises to kickstart key industries such as steel or railroads. But to do this, they had to first carry out various transformations of their nations’ social and economic structures to remove or realign interests that were opposed to change. For example, to kickstart capitalism many monarchs first ended feudalism by paying off aristocrats to give up their ownership claims to serfs. 

As reform and revolutions brought democracy mainly around Europe and North America, new industrializing leadership groups came to power through elections and immediately worked to replicate or redouble the industrialization processes that had begun under monarchs. These too had to carry out structural changes in society to clear the path for capitalist industrialization. 

New leadership groups in some very poor countries – like Russia and China – attempted to compress hundreds of years of economic development with social and economic revolutions that wiped out any vestige of resistance to industrialization all at once and then running a highly-centralized and planned process of industrialization. For several decades these planned economies stunned the world with the highest industrial growth rates it had ever seen – even despite constant political and social turmoil and tragedy. 

The example of the experiments of “communist” planning was so impressive that leadership groups in many capitalist countries copied much of what they saw there. The U.S. post-World War II occupation government in Japan and South Korea carried out a sweeping land reform that did as much as a communist revolution to eliminate classes that would oppose industrialization. Capitalist, intensely anti-communist, governments in those countries then ran highly centralized and planned industrialization programs, which performed even better than the communist ones thanks to flexibility that came from having more open systems. Taiwan and Singapore had very similar stories. 

One of the most impressive feats of economic mobilization in history was the U.S. experience before, during and after World War II. Here, a new leadership group, with Franklin Roosevelt at the center, mixed the best of central planning and coordination with the best of free markets and entrepreneurism to totally transform and scale up the largest economy in the world. In this case, a global war was the crisis that allowed the government to override regional and factional interests that opposed full-scale industrialization. For example, the war allowed Roosevelt to dismiss southern political and business leaders who objected to recruitment of southern Black workers for integrated industrial workplaces in the north, and all over the country. And it allowed the war effort to attract millions of women into industrial jobs and to provide child care to enable that, against the objections of traditionalists. 

When the vast majority of people in our societies are unemployed, with no sign of recovery in sight, we will need our leaders to make very disruptive changes just like the generations of leaders who came before them. 

In the United States, this will most likely mean following the precedents of World War II and other periods in our history of creating and using institutions with the power to get people and companies working again – and working on building the kind of economy that will provide a prosperous living for all, in a way that is sustainable. 

Solutions: The American Way 

First, here’s the “American way” of rising back up out of economic collapse. If no one organizes well enough around this kind of solution, other groups may rise with not-so-American ways of moving forward, which I’ll cover below. 

A new leadership group who gets elected – i.e. a president, Congressional leaders, and others – can get everyone back to work by mobilizing society in a sweeping economic mission to achieve a specific set of goals. Those goals should include building an economy with work for everyone, that provides a prosperous living for everyone, that assists the whole world in doing the same, that does it all sustainably, and that begins to clean up the mess we’ve made over the past couple of centuries, including the excess greenhouse gasses in the atmosphere, trash in the oceans, toxins in the food supply, etc…. 

The American way of doing that involves elected national leaders organizing companies, labor unions, and other parts of our society to build and rebuild the industries, infrastructure, and public services that will make the economy we want. It’s the American way because we have done this several times in our history, the most recent being World War II. 

Leaders of the war mobilization – who were mostly drawn from the ranks of industry – gave contracts to companies to build the things we needed for the war, including “training contracts” that paid companies huge sums up front to first learn how to do what was being asked of them. The government also provided assistance in recruiting, training, transporting, and housing workers; built facilities to be leased to companies who were too timid or slow to build their own; handled coordination among companies and industries – for example, bringing together the aircraft and auto industries to mass produce airplanes for the first time in history. 

In the broken future that we have imagined above, the government will have to do all of that and more. It may need to reestablish a sound money system before it can do anything else, and it will need to provide training and support for professionals and other virtual workers to get into physical work. These alone will be enormous and difficult projects. 

It may look as though one of the government’s roles should be to organize a general reduction in working hours while raising wages – because, after all, there will not be enough work to go around for everyone if we keep the 40 hour work week, right? Maybe. But maybe not. The task of building a sustainable economy that allows everyone to make a good living is a massive undertaking and even it may be slowed by labor shortages even with the tens of millions of knowledge economy refugees. The primary reason that we are not able today to fully electrify our buildings and industries and to do all the other things required to get off fossil fuels today is that we don’t have enough workers available. That problem should be mostly solved by the machine intelligence revolution – as long as leaders can make the national mission to build a new economy exciting enough, and to provide enough support, to entice professionals into the manual workforce. 

If the government launches the full economic mobilization that we need, then it will not need to worry about somehow reducing working hours while increasing wages. There will just be so much work to do that no one will be thinking any longer about surplus workers. 

Perhaps after the mobilization achieves its goals, then we will need to wrestle with the problem of reducing working hours while keeping pay high. That can be achieved by raising the minimum wage while reducing the standard working hours. This will need to be done across the entire economy so that all businesses will be competing from the same position. Reduction in working hours with corresponding rising wages has been achieved in the past. It’s how we got the 10-hour work day, and then the eight-hour workday, and the weekend. The last such shift was simply so long ago that we’ve forgotten it. 

Handling the transition in this traditional “American way” will leave the economy in the hands of private businesses. Though the upheavals of the machine intelligence crisis will probably reduce inequality by some measures – by wiping out the savings and fortunes of so many people, including many wealthy people – there will still be an extremely rich owning class. That owning class might become both many, many times smaller and richer through the crisis, but it’s impossible to predict. This will be frustrating for many, but in the American way, the majority of the population are always willing to accept inequality if they are able to enjoy the comfortable middle class lifestyle of their great-grandparents’ dreams. 

Solutions: a different way

If no party or compelling set of national leaders successfully organizes for the “American way” of transforming the economy and reestablishing access to the means of making a living for everyone, then some other leaders might rise up to propose some other ways. You’d think that the ruling class in America would see the writing on the wall and work for a solution that leaves their position intact. Maybe they will. But for more than 40 years, the American ruling class has allowed the economic position of most people to fall far behind what technological progress and GDP growth should have made possible – leaving real wages for most Americans mostly stagnant for more than a generation. So don’t count on it. 

Moreover, there is considerable precedent around the world for national ruling classes planting their heads firmly in the sand during times of extreme economic collapse. Eventually, parties and leaders accumulate power outside of the traditional ruling class by calling for all kinds of radical solutions – some left, some right, some horrible, some pretty cool – depending on who you are and how they might affect you. 

If the American ruling class doesn’t get its act together, with our luck, we’ll probably just get some kind of newfangled machine-powered fascism. But, as difficult as this is to imagine today, maybe the U.S. left will somehow make a pitch to the American people for some version of socialism that actually lands them in power. 

In this case, we would see the government seize all the companies that still exist. Unlike under Soviet or Chinese communism, now with practically-omniscient machine intelligence the job of managing an economy would be easy. Think of how well companies like Amazon and Walmart plan their activities on a scale that rivals the economy of many countries. A machine intelligence in charge of a centrally planned and owned economy would know where every product and part is at all times in every corner of the supply chain, would know every order placed by consumers and producers at the tops of supply chains the instant they are placed. 

After the rise of machine intelligence, the difficulty of creating and running a socialist economy will not be how to manage production, but how to adapt America to a system in which decisions about who gets what are made by democratic deliberation instead of by inheritance, chance, and competition. 

There’s no way to predict whether the left in America or anywhere else will be able to make a serious pitch for any kind of socialist system in the midst of the machine intelligence crisis. But I sure would rather see us try socialism than some kind of 21st century machine-intelligence-powered fascism. 

In conclusion

I hope this post has been useful for you. And now, because I’m really terrible at writing conclusions, and really hate writing them, I will let ChatGPT wrap this up:

In conclusion, the rapid development and deployment of machine intelligence have the potential to dramatically alter our societies and economies. As we have explored in this blog post, there are several phases we may go through as we adapt to this new reality. From the initial shock and displacement of workers to the eventual rise of new leadership groups and potential restructuring of our economies, the way we navigate these challenges will define the future of humanity.

While the advent of machine intelligence can bring about a world where everyone enjoys a high standard of living and access to clean, sustainable resources, we must first overcome the social and institutional barriers that prevent us from harnessing these technologies to their full potential. It is crucial that we consider not only the technical aspects of these advancements but also the social organization, institutions, and traditions that will enable us to thrive in this new era.

As we have seen, history provides us with examples of leadership groups that have successfully navigated periods of massive change and upheaval. The key to our future success may lie in the ability of leaders to propose and implement innovative solutions that address the unique challenges posed by machine intelligence. Whether we embrace a revitalized "American way" of rebuilding our economies or explore alternative systems like socialism, the choices we make will shape the course of human history.

Ultimately, the potential benefits of machine intelligence are immense, but they can only be realized if we are prepared to tackle the social and economic challenges that come with them. The task ahead is not an easy one, but with bold leadership, a commitment to inclusivity, and a willingness to innovate, we can navigate these uncharted waters and create a world that is truly great for humanity.

Now is the time for us to learn from the many lessons of the past and begin engineering the future we hope to create. By engaging in open and honest discussions about the potential impacts of machine intelligence and the solutions needed to address them, we can take the first steps towards building a more equitable, sustainable, and prosperous world for all. The future is in our hands, and the choices we make today will define the legacy we leave for generations to come.

There you have it.

In multi-party democracies problems don’t get solved and things don’t get done unless one of the major political tribes fights for it. Right now, the United States and the European Union can choose to actively help other nations quickly vaccinate their people against Covid-19. But it looks like they are going to sit on the sidelines making symbolic gestures to look good and ease consciences because none of major political tribes on either side of the Atlantic can think clearly about what needs to be done.

The stakes could not be higher. The world is on course for millions of people to die of Covid unnecessarily in 2021 because of vaccine shortages. On top of that, so many people contracting Covid-19 could produce new variants that evade vaccines. Experts warn that our failure to quickly kill off Covid-19 will add Covid to the list of globally endemic diseases like an extremely deadly flu. Without being overly cynical, it’s not hard to imagine pharmaceutical executives looking forward to never-ending demand for patentable annual vaccine updates, just like we have for the flu. Maybe that has something to do with why, after a good start vaccinating the United States and parts of Europe, they’re in no rush to vaccinate the rest of the world. Don’t blame them. Their job is to make profits. Government is the responsible party here. Its job is to protect us.

It may have looked like the U.S. government was taking a step toward protecting us when the Biden administration said last week that it supported waiving intellectual property rights for vaccines. We should cheer the U.S. Trade Representative Katherine Tai in particular for making that happen. It is an important move. But it will be remembered as a cynical PR stunt that helped no one if the Biden administration and E.U. leaders don’t take the additional steps needed to get vaccines into the arms of billions. The Biden administration made its statement on IP knowing that Europe would block any real action at the WTO. They also know that to vaccinate the world, waiving patents is not enough. New manufacturers need help from the old manufacturers to get up and running and shortages of supplies that delayed the first billion doses need to be cleared away for manufacturers to make the next seven billion.

The necessary actions are easy and inexpensive, but they probably won’t happen for one simple reason: they don’t fall neatly into any of the policy categories that any of the major political tribes in the U.S. or E.U. get excited about.

Conservative and other business-oriented political tribes get excited about policies that let corporations do whatever they wish to pursue profits in the so called free market. Progressive and other socially-oriented political tribes get excited about policies that restrict and regulate corporations. Neither gets excited about the idea of society working collaboratively with corporations to get something done with the promise of both public and private rewards for success.

Conservatives don’t like the idea of society making a meaningful contribution to the work that corporations do. They don’t believe it’s possible, because government is inherently incompetent. But they don’t want it to happen even if it could because they believe collective action is a corrosive force against civilization.

Progressives don’t like the idea of rewarding corporations as partners. Ironically, like their conservative cousins they tend to view corporations as omnipotent organizations that could not possibly do a better job with leadership from society. In a crisis, they’re not worried about corporations failing, they’re worried about them succeeding too much. In the run up to World War II, American progressives and leftists worried primarily about corporations making too much money. They did not worry about corporations failing to make enough weapons and vehicles to win the war.

World War II is an important example to learn from. The record shows that America’s industrial corporations—by far the largest in the world at the time—were unable to complete the required jobs without active and material assistance from society. Corporations needed the government to invent whole new industries to clear away shortages, such as the synthetic rubber industry. They needed the government to build factories because their business models didn’t support investing in temporary extra capacity to deal with a national emergency. (Of course, in the end, demand for that capacity wasn’t temporary or extra.) Corporations also needed government to facilitate technology transfer between companies and industries.

Examples of all of those dynamics can be seen in the case of mass aircraft production—something that had never been achieved before anywhere in the world. Auto industry leaders hired by Roosevelt cleared away supply chain issues, built factories and leased them to automakers, marched an army of draftsmen from Ford and GM to aircraft factories to make hundreds of thousands of blueprints required by mass manufacturing, and facilitated technology transfer in a thousand other ways. The government gave auto makers and aircraft makers up-front “training contracts” to make it worth their while to work together.

That kind of leadership through government-corporate collaboration does not magically spring up in every crisis. It was not seen in World War I. Roosevelt’s neither-left-nor-right pragmatism made it possible. Leadership in government in emergency positions by industrialists like Bill Knudsen made it probable.

The task of vaccinating the world is so much simpler and smaller than the industrial mobilization around World War II. Furthermore, instead of working at cross purposes, the economies of the world will be working all toward the same goal. China and Russia are far behind the U.S. and Europe in vaccine technology and production capacity. But they are showing how easy it can be to help countries that need vaccines to make their own.

Among many examples of the benefit of Russia’s open-source approach to distributing its Sputnik vaccine, one pharmaceutical company in India is ramping up to produce 50 million doses per month. The company needed more than access to the Sputnik recipe. It needed technical support, or “technology transfer” from Russian experts. The Russian government is paying a handful of technicians to support production of Sputnik around the world, which seem to be all that’s needed.

Imagine how this might work in practice in the U.S.: Biden would have to get on TV, probably repeatedly, to explain why Americans will only be safe once the whole world is vaccinated. He’d then have to explain that the U.S. government fronted most of the capital and took on all the risk for the production of the most powerful vaccines such as Johnson & Johnson, Pfizer, and Moderna’s. Then he could explain that using emergency measures, his government will be paying the vaccine companies generously to share their recipes and technical know-how with any company in the world willing and able to produce the vaccines. At the same time, he’d explain, contracts would be given out to companies anywhere in the world who could alleviate supply shortages that are interfering with vaccine production. Where necessary, the Army Corps of Engineers and other military and government organizations would be tapped to alleviate shortages by redirecting existing supplies away from other uses or to manufacture them if no private company is available to do so.

If President Biden showed that kind of leadership both progressives and conservatives would be confused. Neither political tribe would recognize those plans as part of the normal progressive playbook—or conservative playbook.

Biden says he wants to unite the country. Maybe showing a new kind of leadership that falls outside of any of the current major political tribes would begin to do that—especially if it winds up saving the world.

In this New Consensus series on re-industrialization, I first covered why Biden’s plans don’t go anywhere near far enough to spark a wave of reinvestment into domestic manufacturing. Then I backed up to answer readers who asked, “Why do we need manufacturing anyway?” Now I’m going to attempt to paint a detailed picture of the opportunity that Biden is wasting and that the next president must seize if we’re to restore American prosperity while doing our part to save humanity from global warming and other existential threats. 

Presidents in our era have the power to create new industries and make old ones competitive again—all as part of a sweeping conversion to a zero-emissions, high-wage economy. The only reason they don’t use that power is that they and their advisors, and just about all of us in America, can’t imagine that a comprehensive rebuilding and conversion of the economy is even possible. 

We are stuck with an inaccurate story in our heads about how industries are created and transformed—one that doesn’t include political leadership. When we imagine how new national industries are born, we think of the tycoons like Henry Ford, Andrew Carnegie, and other entrepreneurs who started businesses, invested, competed, and next thing you know, controlled sprawling corporations. That is a huge part of the story but not all of it. Almost without exception, every major manufacturing industry in every nation was created with large quantities of state-organized capital and huge doses of political leadership. I’m not arguing that those inputs were more important than the ingenuity and hard work of owners, inventors, managers, and workers. I am, however, arguing that a nation can’t industrialize, and can’t re-industrialize, without vast quantities of capital and leadership from the state. 

Because Biden and his advisors don’t know that story, they’re hoping to trigger re-industrialization by changing some minor regulations and making a little money available for “research and development.” But that is not how it works. Starting or restoring an entire industry requires the state to organize enormous amounts of not just money capital, but capital in almost every form—labor, resources, infrastructure, training, education, and more—and for political leaders to mobilize that capital just like they would have to for war or devastating natural disaster on a scale that we’ve never had before. 

Why is the state required for re-industrialization? 

Why is the state required? It’s because launching an entirely new industry or updating an old one requires an enormous investment with qualities that repel private capital: a substantial risk of failure, only a modest potential upside, and an extremely long wait before the returns come in. The Japanese government floated and protected Toyota for 60 years before any money came in. Private capital would never do that. It seeks either a guaranteed and constant modest return or a risky bet offering a potentially massive and relatively quick “exit.” 

Virtually every industry in the world is another example. In the 1960s, the South Korean government financed, founded, and managed a brand new steel industry that no bank would touch because it was too risky objectively: South Korea had no experience making steel and didn’t have the raw materials for it. Very quickly, however, the South Korean steel industry was the most efficient and profitable in the world. South Korean steel, which no private capital anywhere in the world was brave enough to back, became the bedrock of the nation’s fast leap into prosperity.

In the 00s, China decided to build a laptop industry from a starting point of making no laptop computers at all. It did not launch new state-owned companies. National and local government bodies and state-owned banks convened existing foreign and domestic manufacturers to generate plans that included huge public investments into private companies’ projects, infrastructure, training, and guarantees of a domestic consumer market. In less than a decade, China was supplying more than half of the world’s laptops. 

In the 1990s, the Danish, Swedish, and Finish states all provided the leadership and investment capital to convert the dying shipping radio industry into the world’s first cell phone industry. In one of many diverse initiatives, Denmark convinced (not coerced) its giant private pension system to put some of its capital into special national venture funds to back innovative new Danish companies.

In 2010, a techie in the U.S. with zero experience in manufacturing was seeking financing to expand an electric car company. Neither banks nor venture capitalists wanted anything to do with it. Only the U.S. government offered capital on the scale he needed, with a $500 million low-interest loan. Of course, I’m talking about Elon Musk and Tesla. (Sidenote: If the government had made an investment instead of a loan, it would have hundreds of billions in Tesla equity today.)

If you’re asking why a nation should make an investment that’s so unattractive to private capital, then please read my previous post on why all rich nations need a healthy manufacturing base. Here’s the short version: Manufacturing creates high-value products that you need and can trade for other things you need. It does that by employing a lot of people. Even with high-tech automation, there are scores of manufacturing companies in the United States that each employs far more people than Facebook (44,000 people). But most of the highly-valued tech companies in the U.S. employ less than a few thousand people. When Instagram was becoming a significant competitor to Facebook, it had only 13 employees! Meanwhile, the average salary at a tech company is somewhere around $120,000—equivalent to what a significant portion of America’s 12 million manufacturing workers earn with overtime included.

A thought experiment to trigger the memory of industrialization

I fear that my little examples of states launching companies have not fully rekindled your ability to imagine how a U.S. president could lead a full-scale, sweeping re-industrialization and transition to a clean economy. It’s a difficult challenge because we’ve been so conditioned to believe that industry and state are and always must be as separate as church and state. It’s as though we believe that there is a law, a natural law, that prevents political leaders from leading private industry. In reality, there is no such law. But a belief in that law nevertheless dominates our thinking. There are some special circumstances where we can imagine the law being suspended—for example, natural disasters. I want to use that exception as an opening to get your imagination going. So please join me in the following thought experiment: 

Imagine the earth was hit by a meteor shower that, in a one-in-a-trillion fluke, just happened to destroy 99% of everything in the world that burned fossil fuels. For a moment, climate activists cheer. But then a billion or two people die of thirst, famine, and disease, as communities are cut off from the water, food, power, medicine, and other essentials produced and transported by factories, machines, and vehicles that no longer exist.

In this context, it’s not hard to imagine the president getting on TV and making an Independence Day speech (referring here to Bill Pullman, not Thomas Jefferson) about how we must stop at nothing to rebuild before another billion die. 

What would happen after the speech? Again, it’s easier to imagine how we would rebuild when we have no other choice. Top industrialists would be summoned to the White House to hammer out a plan. Executives from every industry would come with lists of factories and systems that needed to be rebuilt. The surviving factories would be running 24/7 to churn out the materials, tools, and machines needed to get started. 

But with limited supplies from the few surviving factories, what should we rebuild first? Water systems? But that requires vehicles and machines. And those require steel, aluminum, and many other machines, materials, and supplies. How to prioritize? What’s the right order? Lots of chicken-and-egg problems that need to be solved. Different camps of business leaders and experts would develop competing plans. Which do we go with? Who pays? 

This is where political leadership comes in. It’s for situations just like these, where a decision must be made for how public resources should be used, that we spent the past few thousand years developing stable governments. When inaction means death, or decline towards death, that’s when societies with decisive leadership have a chance at survival, while societies with corrupt and timid leadership die.  

In our apocalyptic thought experiment, in which America elects a leader willing to act boldly and intelligently, our president chooses a plan. She has no choice. Perhaps she hires people from industry to help make sure it will be executed well. In America, we don’t have a centrally planned economy, so the president would rely on leadership and persuasion, not coercion. That doesn’t mean incentives and regulations. With billions dying there would be no time for that, but there’d also be no time to change over to some kind of command and control economy even if that were desirable (which it wouldn’t be). 

The president’s job as the leader of the nation would be to get all the business and labor leaders on board to enthusiastically carry out the plan that they had participated in developing. She’d accomplish that partly by getting on TV over and over—like George W. Bush did to persuade us to go to war in Iraq, for example—explaining her plan to the American people and asking them to support it.

And then what? Who makes adjustments when the plan begins to fail, as plans always do? Who pushes the business leaders when their businesses move too slowly or refuse to cooperate where necessary, or refuse to compete where necessary? No one else can do that other than the president. 

All the while, she’d have to use all of her powers of inspiration and persuasion to keep the support of Congress, the business community, labor, state and local leaders, and everyone else in society. She’d have to keep making those Bill Pullman Independence Day speeches on TV all the time. 

The memory of industrialization right under our nose

How did my wacky sci-fi thought experiment work? Did it help get your imagination going? 

The truth is that we had a very similar moment in our history not long ago. After World War I, our arms industry disappeared in a wave of isolationism and outrage at war profiteering. At the same time, Germany and Japan developed new war industries, such as aircraft industries cranking out fighter planes and bombers. By the time the U.S. was forced, against strong anti-war public opinion, to enter World War II, we were caught with an almost total absence of the industries we needed. We were very much in the position I described in my extreme thought experiment with regard to planes, ships, tanks, jeeps, bombs, guns, bullets, steel, aluminum, synthetic rubber, chemicals, plastics, electronics, and even military uniforms. We had to build those industries as close to immediately as possible. And we did it. 

How did we do it? Just like I described in my hypothetical scenario: Roosevelt made many “end of the world unless we…” speeches to get people fired up and committed to the war effort. He summoned CEOs and labor leaders to DC and charged them with making plans. He hired the president of General Motors to help organize the whole effort, made him a general in the army, and gave him a plane so he could go breathe down the neck of any lagging factory manager at a moment’s notice. 

If you listen to Roosevlt’s wartime speeches you’ll be amazed at how they were both practical and persuasive. And if you look at the history of how Roosevelt governed, you’ll see that he did the follow-up and course corrections too. He was constantly evaluating plans, checking on progress, holding business leaders accountable when things slowed down, and clearing away bottlenecks. Sometimes he went out to Detroit when things were stuck to yell and people and help get them unstuck. 

The result was that we far more than doubled the size and output of our industrial economy by investing nearly half of GDP in growth and transformation for several years in a row. It was an astounding achievement. Not only did this effort stop the Nazis from taking over the world, but it created the foundation for middle class prosperity for about half of America.

There are no good excuses not to lead

Over the years, I have gotten tired of using the World War II example, though, because the response is always, “Well, that was a war!” I guess my astroid example is just as vulnerable to the same objections. 

I don’t think it’s fair. Neither wars nor natural disasters automatically turn bad leaders into good ones. We failed to mobilize adequately for World War I. Many countries around Germany failed to mobilize their defenses even given several years of warning as the Nazis were arming and talking about taking over the world. 

There is nothing inherent about any culture or political system that makes it better able or less able to respond to crises. These days, Chinese culture and its top-down system are credited as the reason for China’s effective responses to every manmade and natural disaster. But in the 1800’s and early 1900’s, China crumbled in the face of European and Japanese attacks even though it had the manpower, military might, technology, and resources to resist. The only thing it lacked was determined political leadership. Chinese leaders before the revolution were committed to decline managers, just like American and European leaders today. 

Today it’s very popular to make excuses for bad American leadership. “If we had the Chinese authoritarian system.” “If we had a more effective democracy.” “If we were a smaller country, like Denmark.” “If we were a larger country, like China.”

But there is nothing stopping president Biden in our current moment of crisis from leading. There is nothing stopping him from making dramatic speeches every week from the White House that set goals and follow up. There is nothing stopping him from saying America will be the world leader in electric vehicles and batteries, clean steel, hydrogen-powered long-haul trucks, next gen nuclear, stratosphere-kite-powered freight ships, and more. There’s nothing stopping him from hiring an accomplished industrialist to lead execution—maybe the current President of GM, Mary Barra, who used to be in charge of GM’s supply chains. There’s nothing stopping him from cajoling the Fed into providing the financing, mobilizing public opinion into a frenzy if they don’t, and pushing Congress to pass some laws reminding the Fed of its original purpose as investor of last resort. 

OK, there is one thing that is stopping him from doing all that: The fact that he and his advisors have never thought of it, and can’t imagine it. They don’t know that this is how we built and rebuilt our economy several times in our history. I told you about Roosevelt. There isn’t room to tell you about Lincoln and Hamilton. They don’t know that this is how every industrialized nation has done it. 

They don’t know that this is where the South Korean miracle economy came from, and the Japanese miracle economy, starting way back in the Meiji Restoration and then again out of the ruins of World War II. They don’t know that this is how Germany industrialized in the 1800s, and again in the 1900s (and no, it wasn’t Hitler). They don’t know the industrialization stories of Taiwan, Sweden, Finland, Denmark, and every prosperous industrial economy in the world. In all of these stories, political leaders knew their role in industrialization or re-industrialization, and they went for it.

I’ve spent a lot of time studying these examples. But I feel it was a waste of time, because when I try to use them to persuade people we can do this too, they point out how in every case, there was something different between the U.S. and the country I’m using as an example. The Nordic countries were so small. South Korea, Taiwan, Japan, and China all had Confucian culture (which Westerners used to cite as the reason East Asia would never industrialize). Germany was “German” (except that it was not “German” in the sense that they mean until after industrialization was complete. The U.S. World War II mobilization was only possible because of the urgency of war. 

Insisting that these diverse examples of industrialization are all irrelevant to the U.S. would seem to suggest that deliberate industrialization can take place under any circumstances except the ones we live under today in the U.S.. But what are the chances of that being true? And even if you feel like the chances are significant, because you believe in your excuses very much, you can’t be sure, and therefore the only way to really know is to try.

Every country I mentioned above industrialized under much more difficult circumstances than we have today in the U.S.. South Korea, for example, had virtually no natural resources and began with hardly any industry at all. When South Korea launched its first state-owned steel company, it was so obviously doomed to fail that no bank or international financial organization would lend it a dime. In a short time, it was the world’s most efficient and profitable steel manufacturer. Don’t go saying it was because of low wages! Wages were a tiny slice of the company’s costs, and the savings there were offset by having to ship in all of the iron ore, coal, and other raw materials from far away.

There’s one last cause I want to mention that’s behind our embrace in America of the stateless story of economic development. The U.S. is almost unique in that one of our extensive industrial investment booms was led by brave industrialists and financiers, not government—though it was paid for by public funds commandeered by those business leaders through bribery and persuasion. This was the Gilded Age. American business leaders played a coordinating role for their own massive investment project. That era produced stories of larger-than-life industrialists like Carnegie and Rockefeller and bankers like Morgan Stanley who organized vast amounts of capital to make giant, long-term bets on entire new industries. These men became heroes of the national imagination and forged a permanent association between industrialization and individual tycoons. 

The Tycoons deserve credit. They were visionaries and risk-takers. Their projects were still paid for, however, with public capital—including trillions of dollars worth of prime public land granted to industrialists, which was sold off to land speculators and settlers to finance investment. And it should be noted that our phase of Tycoon-driven industrialization led to far greater inequality than state-driven industrialization which tended to deliberately spread opportunities all around the nation and the class structure.  

But the Gilded Age example is a wild outlier. It was almost the only time in the history of the world where private capitalists organized big, risky, multigenerational bets. As you might guess, the particular conditions of the time, partly created by chance and partly by government investment around the Civil War, made those bets not all that risky. 

As soon as the great tycoons were in the grave, however, their heirs stopped investing in long bets, and U.S. industry began to rot on the vine. Henry Ford, active from the turn of the century through the 1930s, was one of the last industrialists who loved his factories more than his shareholders. His shareholders couldn’t wait for the old man to die. Everywhere else, and in all other eras, capitalists only participated in significant long-term industrialization when there were coerced and/or coddled into doing so. 

There is no longer any reason to hope that Biden will attempt to lead in the way I’ve described to inspire and cajole American capitalism to invest in new and renewed industries. But New Consensus is going to keep trying to revive the memory of this mode of leadership and this duty of national leaders. Perhaps America will get another chance to hope for something other than a Decline Manager in Chief in 2024 if there’s a primary or a serious independent runs. 

The sad thing about this situation is that it’s clear that Biden wants to be a transformational leader when it comes to the economy. Partly due to his age, and proximity to the World War II experience, he is probably better able than almost anyone around him to envision what a sweeping industrialization would look like. But the specific concepts are too rusty and dusty, buried under too many layers of debris. We’re going to keep laboring to resurrect them. Please stay tuned! 

Why is it so hard for professional class people in rich countries to believe that manufacturing is a necessary and good part of every prosperous nation’s economy—especially when the richest nations are among the most industrial in the world and manufacturing is one of the highest-value sectors of their economies? In this post, I’m going to propose a theory to explain that—and I’m going to try to clear up the confusion for my professional class brothers and sisters and show why we should be trying to grow, not shrink, our nations’ manufacturing sectors.

One piece of the New Consensus mission is to get America and other countries in economic decline excited about making things again and show them how to picture how nations can intentionally build a prosperous means of making a living with room for everyone to participate. In a post last week, I cheered President Biden for saying he wants to build back America's manufacturing base but explained that his policies on that front amount to little more than “thoughts and prayers.” In my next post, I will show how a president has the power to create new industries and make old ones competitive again—all as part of a sweeping conversion to a zero-emissions, high-wage economy. But some readers asked why manufacturing was needed in a modern country like the United States. Isn’t manufacturing something we appropriately started to leave behind in the 19th century? Isn’t it just for low-wage countries? I realized I needed to back up and explain why America, like every nation, requires a large, healthy manufacturing base.

There’s a simple reason why manufacturing is necessary for creating prosperity: Prosperity has a lot to do with having essential and nice things—like antibiotics, MRI machines, heaters, roofs, and roads—and those things are manufactured. If you don’t manufacture the things you need, then you need to make something equally valuable to trade for them. That sounds easy because we can think of many useful things that we make in America that are more valuable than mundane manufactured things like Hollywood movies and Microsoft Windows.

The problem is that we need such a vast amount of mundane manufactured things every day to live our prosperous lives. It turns out that, perhaps counterintuitively, the nations that make our stuff don’t want an equivalent amount of our movies and software. Once they’ve taken all the intangible goods we have to offer, we find that we still want more of their manufactured goods, but we’re sitting there with nothing left to trade.

That is why we have an unsustainable trade deficit every year. Strange global financial conditions allow us currently to run this deficit without too many immediate harmful consequences. The minute those conditions change, however, we will start to become “Venezuela” very quickly. And no, I don’t mean a socialist nation, just one that wants a lot of things from overseas but can’t afford to pay for them.

On top of that, intangible industries—social media, for example—don’t employ very many people relative to their importance and earnings. Facebook is one of the biggest, most profitable companies in the world, but it only employs about 50,000 people. Compare that to any major manufacturing company, such as Johnson Controls. Most people have never even heard of this company, but it has twice the number of employees as Facebook—all relatively highly-paid. Instagram became one of the most powerful companies in the world until it was acquired by Facebook—with only 13 employees.

The problem, though, is that manufacturing is low-wage work, right? Well, actually, no.: Manufacturing tends to be the highest-paying kind of work of all the sectors that have the capacity to employ large numbers of people. Here’s why: Factories, significantly advanced, high-tech ones, are places where workers operate expensive and vast systems of machines. Wages are usually a tiny portion of the costs that go into manufacturing things. Manufacturing workers create a considerable amount of value per hour worked compared to most other workers because of those machines they are operating. One way to think about it is that countless hours of labor are embodied in the machines. Every time a factory worker turns a crank or hits “start” on a sophisticated robot, they mobilize a vast quantity of past labor to do amazing and valuable things. That embodied past labor makes a factory worker’s labor valuable. This is something that any professional should understand because professionals believe they should be paid high wages thanks to all the past labor embodied in their training education.

I feel like I’ve given you some good explanations about why manufacturing is a necessary and high-value component of any prosperous economy. But your gut keeps telling you that all this is wrong, doesn’t it? Let me share my theory about why professional class people are so biased against manufacturing.

Suppose you’re a typical university-educated professional living just about anywhere in the world. You have life experiences and family history that associate industrial work with lower wages and professional work with high salaries and a more prosperous and interesting life. I’m a good example of this myself. My grandfather, his father, and his father’s father all worked on the railroad in Western Pennsylvania, bringing iron ore to the steel plants and taking away finished steel. His children all became professionals. My mother became a teacher and then a state education administrator. One of her brothers rose high up in management on the railroad. Another became a stockbroker. They all wound up doing much better financially than their working-class father, moved to big cities, and saw the world. Therefore, from my perspective, the equation looked simple enough: professional jobs make you wealthy, working-class jobs limit your horizons.

But that outlook is based on a kind of survivorship bias: The children of high-income professionals associate professional jobs with high incomes because they are the children of high-income professionals. They don’t see all the other professional careers that pay worse than manufacturing jobs. The truth is that working-class industrial jobs like my grandfather’s—whether on the railroad or in the steel mills—paid far more than most professional jobs and definitely more than “service” jobs (i.e., working-class jobs that are not part of a manufacturing production process).

Adjusted for inflation, my grandfather probably earned more per year than my mother or her sister ever did (both educators). He made more than most college professors, nurses, police, firefighters, pastors, bank and insurance workers, social workers, or office workers. Why? Because he and his coworkers were a necessary part of a production process that created vast quantities of capital. Powerful capitalists needed them to move ore and steel over long distances reliably, and in the 1870s and 1930s, they repeatedly stopped the trains in violent strikes demanding better wages and benefits. The people who owned the economy decided it was worth winning their permanent cooperation. The settlement was enough for a worker’s family to live a comfortable and secure life on a single salary. Not only did my grandfather make high wages, but he had a railroad pension that paid close to his full salary until both he and my grandmother passed away. Steelworkers had the same basic story. So the community my mother grew up in was the epitome of working-class prosperity. My mother and her siblings all went to college and became professionals because they had decent schools, paid for by a prosperous industrial community, and lived in a state that used some of that prosperity to make college tuition almost free.

To illustrate why my family’s story is not the norm, let me tell you a story from a different family—one much closer to the standard. I know a woman in Kansas City whose father and her father’s father had worked at the local Ford factory. In 1980, just out of high school, she got a coveted Ford job thanks to her connection. Her starting wage was close to $15 per hour.

“I left that job because I wanted to do better than my father, she told me when we first talked about this. “I didn’t want to work in a factory. I wanted to do brain work. I went to business college and have been working in offices ever since. But I have never gotten close to earning what my father did at Ford.”

She rarely even made $15/again. She had no idea how bad it actually was, though, because she wasn’t thinking about inflation. Using an inflation calculator, I revealed to her that $15/hour in 1980 was worth $40/hour in present-day dollars at that time, or $80,000 per year, not counting overtime. The look on her face made me realize I shouldn’t have told her.

This isn’t to say that all manufacturing jobs pay better than all professional jobs. Of course they don’t. But most manufacturing jobs tend, under normal circumstances, to pay more than most professional jobs—if you include all “professional” careers, not just the posh ones like doctors and lawyers.

But in the end, this all comes down to whether industrial workers have the ability to demand the wages they deserve. In the U.S., we’ve been pursuing policies that have deliberately hobbled industrial workers’ ability to negotiate for higher wages while taking every opportunity to encourage professional workers to do. This has further distorted our economy away from paying for actual value creation and toward paying “rents” to organized professionals, such as doctors who artificially raise their salaries by using a professional association to limit their numbers, or accountants and tax preparers who lobby for laws that force millions to use their services.

The distorted perspective of professional-class people regarding manufacturing is ruining economies all over the Western world. I once found myself at a table of Swiss activists who were fighting for a universal basic income. When I asked them about Switzerland’s success at investing in high-tech manufacturing industries, something I believed provided the underlying wealth that would make UBI possible, they looked at me like I was stupid.

“We don’t make things anymore,” they said, “We just make money. Our whole economy is just banks.”

You can see how their image of Switzerland “making money” led to their policy goals of taxing and distributing that money to citizens in the form of UBI. But actually, Swiss money is worth so much partly because of Switzerland’s solid manufacturing base—which is actually more than twice as large as the financial sector in terms of GDP and four times as large in terms of employment.

I pulled out my phone and showed them that 25.6% of Swiss GDP comes from manufacturing, employing 20% of Swiss workers—including the highest-earners among the working class. Then I asked them to guess how much GDP and employment the powerful Swiss financial sector provided. 50%? 80%? Nope, Swiss finance accounts for 11.6% of GDP and 5.6% of employment.

They couldn’t believe it.

What chance of survival does Swiss, or American, high-tech manufacturing have if the professional classes of our nations don’t even know it exists? We need to educate our professional classes about manufacturing value, and then we need to start rebuilding our high-tech manufacturing bases to restore sustainable prosperity.

Now that I’ve covered the “why,” in my post next week, I’ll get back to covering the “how,” with an article explaining how a U.S. president could build up a whole new, powerful, clean, high-value manufacturing base to create permanent prosperity for virtually every American. See you then!

While we don’t yet know what the final bill will look like for Biden’s American Jobs Plan, the White House has made many details available over the last few weeks—and the details are historic. The bill includes the largest expenditure on American infrastructure in decades with a lot of money going towards tackling climate change and improving our care economy. Unfortunately, even before Biden begins compromising on the plan, it won’t be enough. As my colleague Zack Exley points out in this post, there is a big hole in how the plan tackles investing in the industries needed to jumpstart production in America. I really recommend you read Zack’s post to learn more about that, because it’s by far the biggest gap (and is the real Part 1 of this series).

But even if we ignore the failure to properly invest in American industry, I fear Biden will fail to accomplish even the more limited goals currently set out in the plan because of some key gaps. Today’s post focuses on one of those gaps:

Clean Isn’t the Obvious Choice for Consumers

We spend a lot of time at New Consensus focusing on how to upgrade and build new industries in America. But alongside investment in these industries, we have to figure out how to get millions of people in America to upgrade their homes, cars, and other goods to clean energy alternatives as fast as possible. We believe in freedom in America, so we can’t just force everyone to do it. Of course, one big advantage we have here is that clean energy alternatives to goods are often better and, in the long run, cheaper. But unfortunately right now, they are often more expensive. Government investment in these industries will help drive down costs, but that will take time. So we need a plan for consumers to adopt these new products en masse at the same time that the government is investing in these industries—and the new skyrocketing consumer demand will, in turn, get companies to build out clean energy industries further. It’s a virtuous cycle.

Biden’s American Jobs Plan acknowledges this and has some provisions for tax incentives and grants to get consumers to buy clean goods. But unfortunately, it simply doesn’t go far enough, tax incentives are backwards, and a system of rebates and grants is too complicated. Given the urgency of converting our economy over to clean energy, we need to make the decision to buy clean the obvious choice for consumers. For example, if we gave consumers enough money to buy electric cars to the point that a Tesla Model 3 would cost half as much as any gas powered vehicle, people would obviously buy Tesla Model 3s for new cars. But even this would not be enough to get people with gas-powered vehicles that work perfectly fine to spend new money to switch over. We’d likely need to do something like what France is doing to get people to buy electric bicycles (except we’d do it with cars). We should make the the decision of buying a gas-powered vehicle seem as dumb as buying a whale oil powered vehicle—and the Federal Government has the power to do that.

When consumer incentives don’t go far enough or are poorly designed, people don’t use them. This then leads our policymakers to wrongly conclude that trying the incentive out at all was a bad idea since, clearly (to them), people simply do not want the thing we are incentivizing them to buy!

As an example, let’s take a look at electric heat pumps. I’m trying to upgrade my own house to an electric heat pump right now, so I’ve got heat pumps on my mind. Electric heat pumps don’t get as much attention as electric cars, but they are one of the key technologies to removing emissions from buildings and houses. They replace gas-powered furnaces and water heaters with electricity, and electrifying everything is key to reducing emissions. They tend to produce better air quality and include air conditioning for free. We don’t even need to invent anything new to use them—heat pumps have been around since the 1800s. All we have to do is build enough electric heat pumps to replace every gas-powered furnace in houses and buildings across the country, and then do the work of installing them everywhere. In more extreme climates in America, we’ll probably have to improve the insulation of the buildings we install them in, but that’s about it. This should be a no-brainer. You can read more about electric heat pumps here, here, and here see how they fit in with an overall plan to electrify homes here.

Biden’s plan talks about using federal procurement and some direct investment to jumpstart modernizing buildings and reducing their emissions. Here’s the relevant paragraph:

This is a good start, though it likely won’t be even close to enough (remember, these amounts are over 10 years). Currently, a new heat pump costs about $7,000 on average. So even if all we try to do is modernize 2 million buildings (Biden’s goal over 10 years in the American Jobs Plan), just the cost of buying these heat pumps will be $14 billion, or 30% of all the money allocated in this paragraph. Now put that in the context of how many buildings there are total in the US (6 million commercial buildings, 140 million housing units) and you see just how little of a dent this will make to total building emissions. This is, of course, extremely rough back-of-the-envelope math, but we’re not even within an order of magnitude of what’s needed to replace the heating/cooling systems of every building, much less fully modernize them!

Biden’s plan doesn’t mention anything in particular about consumer incentives to buy electric heat pumps, but it has this:

So Biden will use a combination of expanding existing tax credits, block grants, and the Weatherization Assistance program to get people to replace their gas furnaces and air conditioners with electric heat pumps. This is good, but it won’t be enough to get a mass-scale conversion to heat pumps.

To explain why, let’s look at just the finances of this from a household’s perspective. These days, it’s already about as expensive to install an electric heat pump as it is a gas furnace, and it’s usually cheaper to operate an electric heat pump than a gas furnace. According to the DOE, “Today's heat pump can reduce your electricity use for heating by approximately 50% compared to electric resistance heating such as furnaces and baseboard heaters.” And yet, despite this, only about 1% of homes used them as of 2018.

Part of this is because there is always inertia in decision-making—if gas furnaces have been working for you, and electric heat pumps cost about the same, why switch to something new that may or may not work as well? There are all kinds of cases where a heat pump ends up being more expensive than a gas furnace to install to where it is definitely not the obvious choice to switch when you are looking to replace your furnace. To make heat pumps the obvious choice every time, the cost of electric heat pumps for consumers has to go down dramatically—at least to less than half of a gas furnace. The promise of future energy savings don’t do that—the savings are not enough and future money is never a sure thing. The federal tax credits right now are tiny relative to the cost of a heat pump (and as far as I can tell have expired)—capping out at $300. And since they are tax credits, it’s not as good as an up front rebate—again, people want money now, not in the future. The Weatherization Assistance Program only applies to low income households and requires an application which can then take weeks or months to get approved for. Some states and cities have their own clean energy rebates, but all of them have separate application processes. The result is that consumers are faced with a huge amount of paper work and red tape in order to access nominal savings. Who’s going to go through the trouble?

But of course, the bigger reason no one is rushing to switch to electric heat pumps is that existing furnaces last a long time—up to 30 years. So really, the Biden administration should be thinking about how to make the obvious choice be to replace your currently perfectly functional gas furnace with a new electric heat pump. Biden’s plans will barely affect consumer decision making when they are already thinking of getting a new heat pump, and will do absolutely nothing to get existing owners of functional gas furnaces to change.

So what could Biden do instead?

Well, we know that electric heat pumps reduce energy costs by 50%—and that as the price of electricity keeps dropping, the cost of energy from an electric heat pump will keep going down compared to gas furnaces. However, this is money that will be made in the long term, and most people don’t have the capital or time to wait for long-term, not exactly stable savings like that. But the government does.

So here’s a rough idea for the kind of plan Biden could do: offer every American homeowner $10,000 up front as long as they use part of it to buy and install an electric heat pump. In exchange, each homeowner would agree to split half their energy savings each year with the government until the government makes back its $10,000. If energy prices go up one year, you won’t owe the government anything.

This gives Americans an obvious choice to pick the clean option—who’s going to turn down 10k in cash with only one string attached? And the government makes its money back in the long run, so even budget hawks in Congress should be happy. If Biden does a good job of promoting it, doing a national media tour, running ads, and making it as well known nationally as the stimmies, it could get the kind of mass adoption we need to create a real dent in building emissions.

Of course this is a very rough plan (let us know what you think of it in the comments!), and we would need to work out the exact details of how much money the government should give, how to determine what the ‘energy savings’ are, etc. But the principle is this: we should make the decision for people to switch to clean energy alternatives so obvious, that not doing so leaves thousands of dollars on the table. And we should make the government, not the consumer, frontload the cost because Uncle Sam can.

Amazon defeated a high-stakes union campaign last week in Bessemer Alabama. Celebrities and politicians all the way up to President Biden encouraged the workers to say yes to the Retail Wholesale and Department Store Workers Union (RWDSU). They said no. Progressives and socialists who were hopeful about the outcome blame the anti-union campaign of propaganda, threats, and promises. But that’s like blaming gravity for a plane crash. A vicious anti-union campaign is a given. Today’s unions were originally forged against anti-union campaigns based on not only propaganda but also armed violence. So what went wrong, and how can workers at big, distributed companies like Amazon and Walmart get organized?  

Before I crossed over into politics, I was a union organizer throughout the 1990s all over the country, with many unions, including once with the RWDSU. I worked as a staff organizer and as a worker inside plants during union campaigns. I learned that workers will support a union when the union shows a path to real power—power great enough to win significant gains in wages, benefits, and on-the-job respect and autonomy. I learned that every workplace contained many incredible leaders who had all the skills and experience necessary to organize their coworkers and defeat the anti-union campaign. But they would only engage if they believed the union had a winning strategy and trustworthy staff and leadership. I learned that the most respected workplace leaders joined campaigns with smart strategies and would slam the doors in the faces of organizers who came with doomed strategies. 

Organizing one Amazon warehouse out of more than 100 in America is a doomed strategy. If the workers had voted yes, Amazon would have dragged their feet for years before signing a substandard contract, making life a living hell for the workers through it all. They might have closed the facility eventually. They might have excluded the organized workers from raises and perks given to the rest of the workforce. Many Bessemer workers could see all this and knew that’s what they were in for. And they knew that such an outcome would only make it more difficult to organize the rest of Amazon by turning Bessemer into a lesson in the futility of organizing.

On top of that, Amazon showed the workers other retail union contracts that have far lower wages and benefits than theirs. Why should the Bessemer workers have believed that the union would fight for significant increases for them? Are there any examples today of unions fighting for significant gains? Such examples must be out there, but they are hard to find these days. Much easier to find are examples of unions signing contracts with little or no improvements. 

As a union organizer, I was trained to tell workers that we couldn’t promise significant gains—but just that having a union was better than not having one on principle. That outlook led unions through the 80s and 90s to follow a “hot shop” organizing strategy. We looked for workplaces where workers were so angry with their employer that they would join a union regardless of whether it would give them power over their employer or not. To win these campaigns, professional staff organizers were brought in at a ratio of one for every one or two hundred workers. Our job was to develop a personal relationship with workers that we would use to remind them of the anger they had felt when they first called the union and hold them to it all the way up to the union election. That approach doesn’t scale to entire industries or even to large workplaces.

For a few years, at the end of my short union organizing career, I practiced a different kind of organizing with a small team of organizers at a statewide healthcare union. After a deep dive into labor history, specifically looking at how millions of workers organized the world’s most powerful corporations in the 1930s and ‘40s. Instead of going after hot shops, we talked about a strategy of organizing a whole state’s healthcare sector, promising a 10 or 20-year plan to gain the power to influence state funding of healthcare in a place where much of healthcare depended on state funding. We went after some of the highest-paying and largest facilities first, on the logic they had more to give. 

Instead of using personal relationships to guilt workers into sticking with the union after a moment of anger, we focused on finding the most respected leaders in every workplace and partnering with them as they organized their coworkers with little intervention from us. The hard part was identifying who those leaders were, but once we did, if we could get them into a room together, and offer them a sound strategy to win, they always went for it and always succeeded. We won a long string of campaigns with unheard-of 3-to-1 or even 4-to-1 margins of victory that dumbfounded our national bosses—unfortunately not in a way that made them want to try our approach elsewhere. 

There is a way to organize workers at Amazon, Walmart, and other big, distributed employers. To see it, Amazon workers will have to look back to the stories of how today’s big unions were originally formed. This is the story of how half of America made it up into the middle class when workers organized whole industries at once and used their power to win massive gains in wages, benefits, and on-the-job power. 

The campaigns that achieved those victories used new technologies to overcome the challenges posed by the new massive and distributed industrial workforces of the 20th century. Moreover, they were run by new, breakaway, worker-led unions of the Congress of Industrial Organizations (CIO)—unencumbered by the baggage of the old, failing unions of the American Federation of Labor (AFL). Importantly, though, the CIO unions began with the blessing and support of the old labor movement as the AFL’s Committee on Industrial Organizing. 

The RWDSU itself, a CIO union, became a major national union not by nibbling at the edges of large retail chains but by running nationwide, coordinated strikes against whole chains in many cities at the same time. That was only possible thanks to technologies that were still coming into their own such as the telephone and air travel.

CIO unions, such as the United Auto Workers and the Steel Workers Organizing Committee, organized America’s largest corporations by going after a majority of their facilities more or less all at once. They promised workers that huge gains were possible because of their incredible market power and profitability—and delivering on those promises by negotiating hard and being willing to run long strikes when necessary. 

In manufacturing, facilities sometimes employed more than one hundred thousand workers under one roof. The CIO unions used relatively new technology, such as sound trucks, to communicate with workers in that environment. Workers printed their own newspapers to be distributed inside these city-sized factories. Union organizers formed large democratic committees of workers inside the factories who were responsible for organizing their coworkers. In these campaigns, the ratio of staff organizer to workers was not one staffer for 100 workers but one for tens of thousands, if not hundreds of thousands. 

Enough about the past. How can companies like Amazon be organized today? 

First of all, Amazon workers need to organize themselves, not be organized by professional union organizers or activists. Several months ago, I got in touch with an Amazon worker who received some media attention for trying to organize Amazon workers against Covid-related unsafe working conditions. He invited me to a Zoom call on which dozens of organizations and activists were already overwhelming the effort in highly counterproductive ways—and yet none had even sprung for a professional Zoom account that would let a call last for more than 40 minutes. Amazon workers will trust and follow other Amazon workers. They will not trust or follow activists who have all kinds of random and often selfish agendas. They are wise to trust their coworkers more than activists because their coworkers will have better judgment than people motivated by various ulterior motives. Nor will they trust staffers from unions that have presided over the collapse of union representation and wages for decades. Why would they? 

Amazon workers can begin to organize when a handful of respected leaders among their ranks join together to start their own union. That idea sounds preposterous to most professional union organizers—but it is exactly how almost all of their unions were originally formed. 

To form their own union, that first handful of workers need only to announce their intention to do so and have a website where other workers can get in touch with them, and lays out the basics of their strategy. They should ask the AFL-CIO for support, though it’s unlikely they will receive any. Today, however, they can turn to the public via sites like Gofundme.com and social media in general. One Amazon organizer has already raised at least $40,000 on Gofundme.com. The union doesn’t need a lot of money to get started. In the beginning, all that’s needed is some money for incidentals such as a Zoom subscription and a website. Larger expenses would include a labor lawyer and a PR flack.

Once the new worker-run Amazon union has launched, its only job for a long time will be to work consistently to gather the names of all the respected leaders in every Amazon facility. This can be done by simply having a website that allows Amazon workers to confidentially nominate coworkers they respect and follow in their facilities. How would workers hear about the site? The union could spread the word in the mass media, run social media ads targeting Amazon workers, or soliciting non-worker volunteers to leaflet outside facilities. 

It is important that workers don’t start standing up to organize openly until enough respected leaders are identified—then all those leaders will go public at the same time. That way, they will have safety in numbers. More importantly, this will guarantee that the union’s public identity begins with the most respected workers. I worked on many campaigns where a few workers who were not respected and who might be seen as mean, lazy, or having personal axes to grind with management, were the first to stand up. That spelled instant death for the union effort every time. 

As leaders are nominated, they need to be contacted by others who are already on the organizing committee and felt out. All the conversations should be tentative: “If we find enough leaders, and if the leaders want to form a union, then here is what we could do. How do you feel?” 

Most respected leaders will all say the same thing in response, which will be something to the effect of, “I don’t want to be involved in a suicide mission, but if you do get all the leaders, and they do want a union, then I’ll back the effort.” It’s a game of chicken and egg. This is how you put together the egg. 

When I started organizing in that way, I was amazed at how differently workers responded than in the campaigns where our strategy was, as one mentor put it, “To push workers out on a ledge and then start sawing.” When our strategy was essentially to use pressure tactics to trick workers into stepping out for a union inside of a doomed strategy, the smartest, most strategic workers—who also tended to be the most respected—wouldn’t even talk to us. On the other hand, when we approached workers with an offer to work with them as consultants and advisors on a union campaign that they would run and made it clear that we would only stay if nearly all of the workplace leaders wanted us there, then leaders were almost unanimously open. They were excited that we were doing the work of assembling their peers and looked forward to the discussion and their decision on whether to organize that would happen there. When leaders decided to undertake a union campaign in that context, we found that the anti-union campaign had almost no impact. It even backfired sometimes. Workers trusted their leaders, and leaders who committed to each other, not to a union organizer, stood strong until the end. One very helpful tool was a worker-written newspaper that included any kind of writing that any worker wanted to contribute. We even published anti-union pieces, demonstrating democracy and openness in stark contrast to the boss’s anti-union campaign. 

In the case of Amazon, because the numbers are so large, it might take a few years for enough conversations with leaders to take place before it’s time to go public. That event might be a big public Zoom call, hyped in the national media, attended by thousands of Amazon workers, customers, shareholders, and reporters, in which a large handful of the most representative and moving leaders from several facilities speak from the heart about why they want to organize and lay out their strategy to win a union. 

In that moment, a public petition to Amazon would be released, asking Amazon not to hire any union-busting consultants and not to fight the unionization effort, signed by the leaders from all Amazon facilities. This petition would then be posted on a website, with pictures and quotes or full articles written by each member of this newly-formed organizing committee. 

Because we’re talking about Amazon, the best way to communicate to the mass of Amazon’s workers and customers would be through the national media. Of course, workers will also be encouraged to join Zoom calls and subscribe to an email list. An Amazon union campaign with compelling worker spokespeople will be big news. 

There is no reason for the kind of worker organizing committee at Amazon to use the National Labor Relations Board election process. The leads should begin negotiating, through the media, with Amazon’s leadership directly. The primary leverage they hold is over Amazon’s stock price. Suppose Amazon refuses to deal with the union and make improvements the union is asking for. In that case, the union can announce that they are pursuing long term plans for industrial actions—such as strikes or more creative tactics such as “work-to-rule” slowdowns—as well as plans to call for a boycott of Amazon by customers. 

The kind of campaign I just laid out would succeed at Amazon if the right group of workers got it started. They will have to be committed to improving all Amazon worker’s lives, and driven primarily by a desire to succeed in building a union with integrity, not by any selfish or egotistical impulses. My experience organizing workers taught me that the vast majority of respected leaders in any kind of facility are the best people you’ll ever meet, driven by astoundingly pure motives when it comes to matters that affect their coworkers. 

Not only would that strategy work with Amazon, but with other large and famous employers such as Walmart, Uber, DoorDash, fast food restaurant chains, and others. There’s no reason these efforts should be limited to one country. Amazon has 180 warehouses around the world. To truly hold power, workers will need to organize one big union without borders. If you’re a worker who wants to build a new kind of national union movement, and would like to brainstorm about it please send me an email at zackexley@gmail.com.

Coming from a Larry Summers, of course, this isn’t new or surprising. It’s a great way of drawing attention back to yourself after having been nudged from the limelight by – gasp – first our first woman Fed Chair, and now our first woman Treasury Secretary. Having edged Summers out from the job that he wanted – Fed Chair – Janet Yellen now holds the job he once had – Treasury Secretary. And by all reckoning thus far she is proving far better at the job – far more attentive to what worrisome facts on the ground warrant and even require – than Summers ever was.

What is more surprising than Summers’s recent outbursts, however, is what we are hearing from Martin Wolf and even Raghuram Rajan, who are smart enough, humble enough, and socially conscientious enough to know better. Darkly warning of ‘runaway inflation,’ ‘labor militancy,’ and ‘riotous spending,’ both authors seem poised to become new Cassandras, worried more about falling skies than about rising floors and higher ceilings. Given how ‘outlier’ these warnings seem, should we attend to them? Should we pay any mind at all?

I think we should. And my reason is simple: Saying what goes unsaid in these recent columns can show us precisely why Building Back Better à la President Biden is apt to prove, not only non-inflationary, but actually counter-inflationary. That’s kind of important, now that our Second New Deal – our Green New Deal – is at last gathering political steam.

Start with Wolf. Wolf introduces his discussion by ‘journeying into history.’ He first recaps the ‘stagflationary’ late 1960s and 1970s – the period that prompted the Reagan reaction whose devastating consequences are precisely what Building Back Better is all about reversing. In so doing he notes that while oil price shocks and demographic change played some role in inducing stagflation, so did what he calls ‘domestic spending’ and ‘labour militancy.’ The terrible upshot was what Wolf calls ‘an era of terrible performance for asset prices.’ ‘Stocks,’ he continues, ‘did terribly too.’ ‘[T]he stock markets,’ it seemed, ‘were saying that capitalism was finished.’  And so what we had was what Wolf calls ‘a financial disaster.’

This is quite telling, when you think about it, of what ‘capitalism’ apparently was in the eyes of the privileged of the era – but is it really what Rajan, Wolf, Summers and their peers think that capitalism is and must be today? Yet more surprising is what Wolf tells us austerity, labor suppression, and financial deregulation from the Thatcher and Reagan eras on down brought in the way of putatively welcome corrective – namely, ‘a prolonged and remarkable boom in asset prices.’

Now why is this interesting?

Well, because language…

The ‘boom’ to which Wolf refers here has another name: ‘ bubble.’ And a bubble in asset markets is nothing more than … wait for it … a hyperinflation in those markets. Do you see what is happening here, then? What Wolf is effectively telling us is that the inflation in consumer goods markets that characterized the 1970s was simply re-routed to financial markets in the 1980s, where it has remained ever since. And he’s saying that this was a good thing!

Now the great Thatcher/Reagan re-routing of inflation from goods and services to asset markets is hardly surprising in light of the mass transfer of purchasing power – from labor to capital – also orchestrated by Thatcher and Reagan, then Major, two Bushes, Blair, Clinton, Cameron, May, Johnson and Trump over the ensuing 40 years. For wealthy owners typically max out on consumption long before they grow über-wealthy. There are few places left for their money to go, absent taxation, than the City of London and Wall Street betting markets. Why then is one called presumptively deleterious ‘inflation’ while the other is called a presumptively welcome ‘remarkable boom’? I have my suspicions, but let us move on to our next exhibit first …

Look now to what Raghuram tells us. Unlike Wolf, Rajan avoids celebrating asset price booms. He wrote importantly, after all, on the role played by inequality in generating the last great financial meltdown, as well as the role played by asset price bubbles in exacerbating inequality. His Fault Lines should still be required reading for all, as should be Martin’s own Fixing Global Finance.

But what Raghu once gave with the left hand he now takes back with the right. For while he does not protest, as Martin effectively does, on behalf of Wall Street as prospective payer in the event that in future we must open more fiscal space, he does in effect ‘capitulate to capital’: he avers that ‘it will be hard to make the rich pay – they will oppose new taxes vigorously and avoid them if implemented.’ Riotously decrying ‘a riot of U.S. spending’ while posing as protector of … here we go again … ‘future generations,’ moreover, he sounds an awful lot like Wall Street’s favorite Republican representatives in past Congresses. What gives?    

Raghu’s counsel of despair and preemptive surrender is, it seems to me, nothing short of flabbergasting. Did Piketty and ‘Occupy’ simply not happen? Did Bernie and AOC not happen? Did Trump’s popular ersatz populism not happen? Did George Floyd’s murder, Black Lives Matter, and Joe Biden’s Damascene conversion not happen? Heck, did Broadway’s Hamilton - and our humble think tank, New Consensus - not happen? The same rising tide of political energy that has at long last returned us to our anti-austerian, egalitarian, pro-planetarian, Hamiltonian state-capitalist roots is still rising, inexorably. This is no time to surrender, preemptively à la first-term Obama, to either austerians or Wall Street tax-cut enthusiasts. We’re past that now.  

The despair and dark pessimism, not to mention the Wall Street apologetic, writ into Rajan’s take is both democratically enervating and out of step with the times, which are more reminiscent of those of the New Deal and Great Society than we have seen since… well, the New Deal and the Great Society. And this time no war or cold war need derail us. For unlike his predecessors over the past 40 years, President Biden ‘gets’ that such global competition as there is is itself economic and state-capitalist.     

So what does this tell us about now – and about the coming rebalancing that Rajan, Wolf, Summers, and very few others read not as rebalance but as ‘riotous spending,’ ‘labor militancy,’ and ‘the specter of inflation’? Intriguingly, Wolf in effect drops a hint in his recounting of the 1960s and 1970s: One country that didn’t experience stagflation in this period, and accordingly didn’t destructively ‘rebalance’ by moving to financial hyperinflation instead, was Germany. What did and what does Germany do that we didn’t and don’t? Might we find there how to Build Back Better sustainably here?

The answer is yes, and the Biden Administration, unlike Summers and apparently a few others, thankfully seems to have ‘got the memo.’ What Germany did and still does is never to stop producing, never to stop productive investment, and thus never to need countenance the unjust suppression of labor or unwise financialization of its economy. Germany also has long understood – since List and Bismarck at latest – that even public expenditure that Reaganauts and latterday Clintonites seem to think, trafficking in that most pseudo of pseudo-distinctions, ‘more social than infrastructural,’ is infrastructural and efficiency-growing precisely by being social and justice-spreading. For it promotes labor mobility and thereby good factor-flow just as all good infrastructures do.    

That is still capitalism. But it’s a capitalism that works through and in reasonable part with and for labor, not against labor – in effect, a fusion of laborism and capitalism. Only this form of capitalism – labor capitalism – is non-self-destructive. This is what Building Back Better at this point is looking like. The plan is very much aimed both at massively jumpstarting green infrastructure and industry on the one hand, and at massively boosting and spreading productive opportunity and capacity to incipient producers – that is, to all of us – on the other hand.

Each boost, meanwhile, operates both generally, economy-wide, on the one hand, and in particularly concentrated form among long-neglected sectors of our economy and society, on the other hand. (This is why Biden speaks so often of rural America and non-white-male America along with the rest of America.) The tax offsets to limit deficit-growth, meanwhile, can easily be made to target outsourcing and offshoring firms owned by Wall Streeters – those whose fortunes Summers, Wolf, and Rajan seem by implication either to favor or to be willing to surrender preemptively to – not working Americans.

It would be hard to overstate the significance of this shift. It represents a return to the Hamiltonian growth model that served us so well for 150 years and serves Germany, Japan, South Korea, and now China well to this day. (The prophet of Germany’s strategy was Friedrich List, who cheerfully acknowledged Hamilton’s influence, as did the architects of Asia’s ‘tiger economies.’) This is a model that looks not merely to financial indices as measures of our economy’s success, but to production indices, infrastructure ‘report cards,’ and indicators of human well-being like job quality and quantity, educational attainment, health and longevity, and the like.

It might be difficult, after 40 years of financializtion in the Anglo-American world, to persuade people like Summers and Wolf to stop fixating on asset price indices and associated Wall Street wealth metrics as measures of national success. But that doesn’t mean we need follow them. When we hear talk of ‘inflation’ and ‘asset price booms’ going forward, then, let us remember that these are the same thing, differing only in respect of cui bono – who benefits. And when we hear talk of ‘labor demands’ on the one hand and ‘bond market balking’ on the other hand, let us remember that these are the same too, differing only in respect of who is demanding what.

Given how workers and financiers have fared over the past 40 years, I don’t think I am being eccentric in saying that Main Streeters are due more, and Wall Streeters due less, if in fact we must choose. And as it happens, in any case, we needn’t yet choose. Both sets of interests remain complementary for as long as we have fiscal space – of which we have plenty for now.

Thank goodness President Biden appears now to see that. Let us now see and act on it too.

Abstract economic ideas only make sense with the aid of analogies to everyday life. That's why we talk about the economy as an engine, a marketplace, a tide that lifts all boats, or an organism that can be healthy or get sick. There's no other way for humans to interact intellectually with something as big and amorphous as a national economy.

That's why I am now going to ask you to imagine America, from Jimmy Cater on, as a competitive body builder who falls for a wacky theory that meditation is better than lifting weights for building muscle. For years, as our body builder's muscles atrophy, she sticks to her new belief and assumes that she'll see progress once she improves her meditation technique. But after years practice, her muscles continue to waste away.

I'm not the first person to use a body as an analogy for an economy. Brad DeLong and Stephen Cohen's brilliant Concrete Economics drags this analogy out for pages. For decades, they argue, American policy makers deliberately cut muscle (industry) and even bone (infrastructure) while adding fat (financialization of the economy fueled by debt-driven consumption of services and imported goods).

I'm going to torture this analogy even more than they did. Imagine that after years of wasting away, and falling into depression after losing many competitions, the body builder decided to get back to exercising.

Next, imagine that she announced to all of her friends that the way she was going to get back to body building was to commit to jumping rope for a few minutes a day.

That's what Biden is doing.

The Biden administration has released or previewed its economic plans to "build back better." While there's been a lot of talk about manufacturing, it turns out that Biden's economic plans are almost entirely focused on investment in infrastructure—for example, roads and bridges—with a little money thrown in for research and development. Nevertheless, this is supposed to help build back America's high-wage manufacturing base. The theory is that if the government invests in better roads then the private sector will invest in more trucks to drive across those roads, and then market signals will direct truck manufacturers to invest in new factories to meet demand, and then the economy will have more jobs, etc.… Trickle down investment.

The problem is: That's the equivalent of our body builder jumping rope a few minutes a day instead of hitting the heavy weights. It's just not enough. The real mechanics of how the economy works sadly mean that better roads don't lead to millions of new auto manufacturing jobs—let alone new jobs in aerospace, electronics, chemicals, renewable energy, semiconductors, and more. Maybe better roads and other infrastructure improvements will have some knock on effects, but they will barely be detectible if at all.

For a moment, during his campaign, it looked like Biden might be planning something bigger, such as direct investment into industry—the kind of investment that America pioneered back in the days of Hamilton and that all rich-and-getting-richer countries practice today. Ok, it took a lot of faith and imagination to believe that, but he did make an ad with an electric Corvette! That was enough to get me dreaming that he was going to call up the leaders of all the automakers operating in the U.S. and say, "Hey do you guys need financing to make electric cars for the whole planet? I happen to have a bank with a literally unlimited credit line that would love to give you big zero-interest loans."

But no. He's just talking about building out some electric charging stations, which are supposed to create a stronger incentive for people to buy electric cars, which is supposed to cause automakers to invest in new factories, which is supposed to cause Wall Street to want to finance those factories. Again, trickle down investment. Meet the new economic thinking. Just like the old economic thinking.

Unfortunately, Wall Street is not interested in financing production in the U.S. unless the CEOs will go on Joe Rogan, smoke pot, and trash Tweet their stock prices to the moon! Even then, the federal government must still put in the start up capital before Wall Street will touch it. (In case you haven't heard this story: Elon Musk started Tesla with a low-interest loan of $500,000,000 from the U.S. government when Wall Street couldn’t be bothered.)

Investing in infrastructure is a good thing. Just like jumping rope. Nothing wrong with it. But our body builder wants to get back to having big muscles that win competitions, and we want to get back to having big industries that can employ one hundred million American workers in high-paying jobs.

If you were a good friend of our emaciated body builder, it makes sense to want to encourage a return to any physical activity, no matter what it is or how small. That's the right instinct. And that's why we're all cheering Biden's plans right now. But what do you do when you realize that she never intends to do anything other than jumping rope for a few minutes a day? What do you do when you realize that, even though Biden's investment plans are bigger and better than anything in two generations, they are not going to make a serious dent on poverty, low-wages, or economic insecurity?

Biden's cash payments—another big part of his economic plans—are going to help a lot of people out. And there definitely is nothing wrong with that. In fact, it's awesome. But only a strong, productive economy can afford to sustain that kind of cash assistance for very long. (I'll return to this topic in more depth in a future post.)

So what do we do? Well, back to our body builder: I think her friends would quickly sort into two categories: Those who know how to build muscle and those who don't. Those who have never learned how to build muscle would probably cheer on the rope jumping without any caveats that something more was needed—because, after all, any exercise is better than nothing, right?

But the friends who are themselves bodybuilders, and who are out there winning competitions, know that rope jumping isn't going to build back serious muscle. She needs to start lifting weights, heavier and heavier weights, and eat enough of the right kinds of calories to support muscle growth. If she listens to those friends, she'll be on her way.

The problem we're facing right now in America, with Biden's plans, is that when it comes to building a strong economy, very few people in America know how that is done, and therefore we are nearly all in the category of those who are blindly cheering Biden's jump rope industrial policies.

That begs some questions: How do we build back American's manufacturing base for a strong economy—and not just manufacturing but other high-value industries? Why can we only imagine trickle down indirect investment? Why can’t we use our public financial institutions such as the Federal Reserve Bank to make direct investments? What is it that America has forgotten? And is it still in our power to do it? The answers are so simple, but we've been alienated from these ways of thinking for so long, that it will take a whole blog post to do them justice. And I've already written a whole blog post. So you’ll have to tune in later this week for the answers!

You might find what I said about Marco Rubio rejecting the free market hard to believe. Rubio has published several reports detailing how the financialization of American capitalism "tilts business decision-making towards returning money quickly and predictably to investors rather than building long-term...capabilities," and warning that, “less investment in our own future productivity represents a lack of will to build an economy and country that can sustain and renew itself for generations to come.” He condemns corporations for preferring stock buy-backs over investment: "They're eating themselves — they’re committing suicide."

Rubio is not the only one. His senate colleague Josh Hawley laments, "the Right celebrates hyper-globalization and promises that the market will make everything right in the end, eventually, perhaps," and that, "an economy driven by money changing on Wall Street ultimately benefits those who have the money to start with, and that economy will not support a great nation." Many other high profile conservatives are headed their way. 

The new consensus is gathering to replace the old consensus which was called the Washington Consensus or neoliberalism. It has become common for neoliberals, or people who've recently realized they no longer want to be associated with neoliberalism, to complain that "neoliberal" is a meaningless pejorative without a clear definition. Don't buy it. "Neoliberalism" was a well-defined economic consensus created by a generation of economists who chose to call themselves neoliberals and built a global network of think tanks that changed the world's mind about economics.1

Societies tend to live by a single economic consensus. Either they need to have one or they can't help but have one, no one knows which it is. All across the political spectrum, everyone breathes in and thinks using a shared set of concepts, analogies, imagery, feelings and values. Frederick Hayek, Ludvig Mises, Milton Friedman and other founders of neoliberalism constructed their consensus around the central image analogy of players competing against each other on a sports field. The "free market" was the field. The state was the referee. The players were individuals and corporations. The feelings and values associated with this game play were fun, freedom, safety, and predictability. 

While the neoliberal consensus reigned, everyone believed the game analogy described economic life, whether they liked it or not. The right and center cheered it. The center left wanted to improve it. The left wanted to talk about how the players were recruited. 

The neoliberal consensus was preceded by a consensus around the power and promise of expert-driven, scientific planning. Everyone from communists on the left to fascists on the right and the original progressives believed that central planning by experts would naturally out-compete economic systems based on tradition, local control, democracy, markets, competition, or anything else. Early 20th century aristocrats and business leaders struggled to enjoy the final years of their dominance knowing they'd soon be forced to hand the reins over to central planners.

As neoliberalism rose to replace its predecessor, worship of the game, free and fun, replaced worship of scientific planning by experts. On the right, Nobel prizes were awarded to theorists of games and decentralized markets. On the left, organizers stopped dreaming of proletarian dictatorships planning workers' Utopias and started dreaming of a global marketplace populated by worker-owned cooperatives in which ideas and innovation would bubble up from individuals to push humanity forward--as if guided by an invisible hand. 

In other words, left or right, your vision of the best possible world and how to get there is determined by the ideas, analogies, and imagery made available by the current consensus. 

Today, though, we're still in transition from one consensus to the next. We don't have a full set of ideas and pictures to work with. That's why policy makers in this moment are having a difficult time figuring out what to do.  

As I've said, the half-formed new consensus has diagnosed the various diseases killing the economic world neoliberalism made. The foundation of that diagnosis is that markets and competition don't optimize for long-term outcomes for the whole society, let alone the whole world. In the game analogy: on the field, the players are trying to score points, and that's all they're trying to do. The rules of the game can't do anything for, say, the comfort and safety of the fans or the economics of the sports industry. 

To become complete, and to become useful, the new consensus needs to acquire its own full set of concepts, analogies, imagery, feelings and values that make it possible to imagine a whole new world, just as the neoliberal consensus did. It can not be a step backwards to a blind faith in expert planners or "science." It cannot be a random assortment of ideas and images. They need to fit together coherently. And they need to connect to human experiences, aspirations, and fantasies--just as the planning consensus and neoliberal consensus did. Only then will the new consensus be able to guide decisions and action, for better (in the hands of good people) or worse (in the hands of bad people). 

Neoliberalism activated the everyday, benign fantasy of being a player in a game, running free and having fun. Central planning activated the narcissistic fantasy of omniscience and omnipotence. 

I think the new consensus will do best if it connects with the human experience and dream of innovating, creating, cooperating, and accomplishing. Game play should be a key part of it, but with a limited purpose: games are for fun and can be helpful for developing skills or making work enjoyable. 

But I don't know what the exact images will be. The problem is that innovation and creation is not a part of most people's lives, the way games are. And the fantasy to create and build is not as emotionally powerful as the fantasy of controlling the world one lives in that allows ordinary people to connect emotionally with the logic of central planning. 

The ideas, analogies, and imagery of the new consensus are still to come. There are probably some big obvious clues sitting right in front of our faces that we're not seeing. When the neoliberal consensus was being forged, its founders scoffed at the simplicity of the game analogy. They were so wrapped up in the mindset of planning that it was very difficult for them to take a leap of faith in unplanned markets. For example, as hard as this is to believe now, many of the founders believed that markets could only play a positive role in society if governments nationalized all major corporations and ran them according to the principles of scientific planning. 

We can only assume we are similarly blinded by neoliberal thinking today. Part of our work at New Consensus is devoted to figuring out what the ideas, analogies, and images of the new consensus could be. If you have thoughts about this, please share them with me at zackexley@gmail.com

I doubt many Americans remember the H1N1 scare. I remember it because I was a new dad when it hit. Our newborn daughter was struggling to eat in her first weeks of life, losing weight and getting more frail with each passing day. During those weeks, the news and the Obama administration warned of a new virus that might or might not be the super lethal pandemic that experts had been predicting for decades. It turned out to be about as deadly as a mild flu season. We dodged a bullet. The Obama administration's response, therefore, was to do almost nothing to prepare for the next bullet. 

They did do a couple things. They wrote a "playbook" for the next pandemic. And they created a new position that would coordinate responses to the next pandemic. Democrats have pointed to those two steps as proof that they would have handled the pandemic far better than Trump if they had been in power. 

But have you read the Playbook? I have. It is a remarkable document for how few useful recommendations it contained -- even though the experience of H1N1 made a bunch of pandemic proofing actions perfectly obvious:

- Invest in industries to make masks, other PPE, and all the other medical supplies we ran out of and guarantee permanent demand with national stockpiles!

- Build a nationwide testing and tracing capacity! 

- Prepare quarantine spaces so that potentially contagious people who don't need hospitalization can avoid spreading a new disease to family members and coworkers!

- Build a bigger, faster vaccine industrial complex so that we can start responding after weeks or months of identifying a new threat instead of a year. (A year was amazing progress! But if Covid-19 had been 10X as lethal, we'd have five million dead in the U.S. now. This is no time to rest on laurels.)

The closest the playbook got to a relevant recommendation was asking, but not answering, a few relevant questions such as: 

Even if the Obama Playbook had been useful, we needed more than a playbook. We needed new things and systems to be built in the real, physical world, not in the world of policies, papers, and playbooks. 

We needed, for example, new industries capable of building  massive quantities of masks and other protective equipment, testing kits, vaccines, and all the chemicals, parts, and machines that feed into those production processes. Testing in the U.S. has been limited by shortages of gloves, plastic tips for pipettes, centrifuge tubes and other low-tech, easy-to-produce goods. This has cost us dearly. A handful of school districts stayed open through the Covid-19 pandemic by setting up weekly testing routines powered by local labs. I asked Edward Campbell, a virologist and school board member in a Chicago suburb who ran one of these programs why a system like his could not scale to the whole country. The culprit, he said, were the shortages of basic supplies needed for testing. 

Those shortages could have been foreseen by the team responsible for the Playbook. They could have told the Obama administration what needed to be built. Obama could have gotten on TV after the H1N1 scared and told America what we needed to do to prevent the next, possibly much more deadly pandemic. Some Obama administration officials have blamed Republicans for blocking such preparations. But Obama never pushed it, and he never went to the voters and explained the urgency of the necessary preparations. How can we know Republicans would have blocked common sense preparations if Obama had used the bully pulpit to explain the threat to their voters? 

Post-Covid, we no longer need to foresee what’s needed for pandemic proofing, because we have seen it. Now there is no question: We know we must build factories to produce all the medical and laboratory supplies that became scarce in the pandemic. We know we must stockpile those supplies, and keep stockpiling them all the way up until the next pandemic to keep the factories active. We currently do this for a long list of materials, parts, and machines that the military would need for the next world war--something far less likely than the next pandemic. Covid killed more Americans than World War II, we've had several outbreaks of deadly new viruses since World War II, and we know new ones will come more regularly in the future for several reasons, such as humans interacting more and more with populations of wild animals, like bats, that carry viruses that can infect humans. 

Some on the Biden team might ask how it is possible for the U.S. government to build new industries, such as a mask industry. It’s very easy: Just give loans to existing companies to expand, and guarantee permanent demand by promising to purchase huge quantities of product for stockpiling. Who will give the loans? The U.S. government already has many loan programs up and running that could handle this, just pick one. At New Consensus, we’ve written about this in the context of general industrial policy, and we’ll be releasing papers in the future that talk specifically about how pandemic proofing investments could be funded.   

Something that further clarifies the basic principles of 21st century pandemic prevention is the example set by dozens of countries, many with far fewer resources than the U.S., that stopped Covid dead in its tracks. If Vietnam could get through this pandemic with 35 deaths, we have no excuse for not matching their performance in the next pandemic. You can't credit un-American factors such as authoritarianism for their success. Taiwan, South Korea, Japan, and Australia are if anything less bureaucratically authoritarian than the United States. These nations learned lessons from SARS and had the foresight to create new, innovative capacities for fighting infectious diseases. Now that they've shown the way, we don't even need to innovate, we just need to build. 

For all these reasons, the Biden team doesn't need a cutting edge, contrarian think tank like New Consensus to tell them what needs to be done. Mainstream voices--both expert and amateur--are all saying the same things. The topic of pandemic preparedness gives me a wonderful feeling of comfort and calm because all we have to say is, "Just do what Bill Gates says." No centrist needs to leave their comfort zone. Even though Bill Gates, the leader of the world's largest public health-oriented foundation, is wrong about pharmaceutical intellectual property, he's been advocating for all the obvious and sensible measures governments must take to prevent the next pandemic that I've covered in this post -- which, as he says, could be ten times more deadly than Covid-19. 

Finally, all these pandemic prevention measures can be done for pennies compared to the trillions Biden recently transferred into the bank accounts of every middle and working class American. 

If making America pandemic proof is a) obvious, b) simple, and c) cheap, then what possible reasons could there be for the Biden team not to implement them? There are no good reasons. The Biden team knows what they need to do, they know they can do it, but I believe that they probably will not do it -- based simply on observing many of them and their predecessors after similar crises in the past. 

Over the past few months, the meritocracy has shown that it is capable of leaping into action and doing a good job when faced with an immediate crisis--as long as their friends and colleagues are aware of the crisis and are actively holding them accountable to solve it. If the Biden team had not sped up vaccinations from Trump's snail pace, they would have gotten a whole lot of flack at a whole lot of dinner parties. They would have gotten concerned and then angry emails from friends, family, and former professors. They would have been regarded as failures, in real time, by the people who they respect and care about the most.

Unfortunately, as things stand, that same force will not be present when it comes to proactive preparation for the next pandemic. Most people will forget about pandemic prevention as soon as they get vaccinated, just like they forgot all about it when H1N1 turned out not to be all that deadly. 

That needs to change this time around. Educated professionals with ties to the Biden team are the only ones with the power to change it. If you’re one of them, write a concerned email today, just to put your friends on the inside on notice that you’re watching and waiting to see a pandemic proofing plan for America. If peers of the Biden team are aware that there is an easy way to prepare for the next pandemic, a way laid out by leaders as safe and moderate as Bill Gates, a way that has been implemented by nations with far fewer resources than ours, and let them know that there is no excuse for failure, then these things will get done. 

Here’s a wacky idea: If Bill Gates really wants to prevent the next pandemic, he should fund a public awareness campaign directed at elites that will give the Biden team a simple choice between doing what needs to be done or lose the respect of their peers. I know it’s an unconventional idea but I’m dead serious about it. These people can’t tolerate being perceived as failures or slackers by their peers. I don't see any other way that we'll get the basic pandemic prevention measures enacted. Maybe in past times we could have relied on the media to hold them accountable. Not anymore.