Category: Economics

Biden’s Tax and Regulation Plans Shift “Demonized” Silicon Valley Toward Trump

(p. B1) In 2021, David Sacks, a prominent venture capital investor and podcast host, said former President Donald J. Trump’s behavior around the Jan. 6 [2021] riot at the U.S. Capitol had disqualified him from being a future political candidate.

At a tech conference last week, Mr. Sacks said his view had changed.

“I have bigger disagreements with Biden than with Trump,” the investor said. Mr. Sacks said he and his podcast co-hosts were working on hosting a fund-raiser for Mr. Trump, which could include an interview for their “All In” show.  . . .

Such public support for Mr. Trump used to be taboo in Silicon Valley, which has long been seen as a liberal bastion. But frustration with Mr. Biden, Democrats and the state of the world has increasingly driven some of tech’s most prominent venture capitalists to the right.

. . .

(p. B5) Delian Asparouhov, an investor at Founders Fund, the investment firm founded by Mr. Thiel, recently marveled at how much the political winds had shifted. This month, Mr. Trump made a virtual appearance at a venture capital conference in Washington. There, he thanked attendees for “keeping your chin up” and said he looked forward to meeting them.

“Four years ago you had to issue an apology if you voted for him,” Mr. Asparouhov wrote on X.

Mr. Sacks, Mr. Palihapitiya and Founders Fund did not respond to a request for comment. Sequoia Capital declined to comment.

The comments and activity by the group of tech investors are particularly noticeable given Silicon Valley’s blue background.

. . .

The . . . “techlash” against Facebook and others caused some industry leaders to reassess their political views, a trend that continued through the social and political turmoil of the pandemic.

During that time, Democrats moved further to the left and demonized successful people who made a lot of money, further alienating some tech leaders, said Bradley Tusk, a venture capital investor and political strategist who supports Mr. Biden.

“If you keep telling someone over and over that they’re evil, they’re eventually not going to like that,” he said. “I see that in venture capital.”

That feeling has hardened under President Biden. Some investors said they were frustrated that his pick for chair of the Federal Trade Commission, Lina Khan, has aggressively moved to block acquisitions, one of the main ways venture capitalists make money. They said they were also unhappy that Mr. Biden’s pick for head of the Securities and Exchange Commission, Gary Gensler, had been hostile to cryptocurrency companies.

The start-up industry has also been in a downturn since 2022, with higher interest rates sending capital fleeing from risky bets and a dismal market for initial public offerings crimping opportunities for investors to cash in on their valuable investments.

Some also said they disliked Mr. Biden’s proposal in March [2024] to raise taxes, including a 25 percent “billionaire tax” on certain holdings that could include start-up stock, as well as a higher tax rate on profits from successful investments.

Mr. Sacks said at the tech conference last week that he thought such taxes could kill the start-up industry’s system of offering stock options to founders and employees. “It’s a good reason for Silicon Valley to think really hard about who it wants to vote for,” he said.

. . .

Mr. Andreessen, a founder of Andreessen Horowitz, a prominent Silicon Valley venture firm, said in a recent podcast that “there are real issues with the Biden administration.” Under Mr. Trump, he said, the S.E.C. and F.T.C. would be headed by “very different kinds of people.” But a Trump presidency would not necessarily be a “clean win” either, he added.

Last month, Mr. Sacks, Mr. Thiel, Elon Musk and other prominent investors attended an “anti-Biden” dinner in Hollywood, where attendees discussed fund-raising and ways to oppose Democrats, a person familiar with the situation said. The dinner was earlier reported by Puck.

For the full story see:

Erin Griffith. “Silicon Valley Notables Are Shifting to the Right.” The New York Times (Friday, May 24, 2024): B1 & B5.

(Note: ellipses, and bracketed years, added.)

(Note: the online version of the story has the date May 22, 2024, and has the title “Some of Silicon Valley’s Most Prominent Investors Are Turning Against Biden.”)

Species Shifting Their Range Due to Climate Change May Have Enabled the “Playing Around With Resources” That Invented Farming

(p. D6) In the 1990s, archaeologists largely concluded that farming in the Fertile Crescent began in Jordan and Israel, a region known as the southern Levant. “The model was that everything started there, and then everything spread out from there, including maybe the people,” said Melinda A. Zeder, a senior research scientist at the Smithsonian National Museum of Natural History.

But in recent years, Dr. Zeder and other archaeologists have overturned that consensus. Their research suggests that people were inventing farming at several sites in the Fertile Crescent at roughly the same time. In the Zagros Mountains of Iran, for example, Dr. Zeder and her colleagues have found evidence of the gradual domestication of wild goats over many centuries around 10,000 years ago.

People may have been cultivating plants earlier than believed, too.

In the 1980s, Dani Nadel, then at Hebrew University, and his colleagues excavated a 23,000-year-old site on the shores of the Sea of Galilee known as Ohalo II. It consisted of half a dozen brush huts. Last year, Dr. Nadel co-authored a study showing that one of the huts contained 150,000 charred seeds and fruits, including many types, such as almonds, grapes and olives, that would later become crops. A stone blade found at Ohalo II seemed to have been used as a sickle to harvest cereals. A stone slab was used to grind the seeds. It seems clear the inhabitants were cultivating wild plants long before farming was thought to have begun.

“We got fixated on the very few things we just happened to see preserved in the archaeological record, and we got this false impression that this was an abrupt change,” Dr. Zeder said. “Now we really understand there was this long period where they’re playing around with resources.”

Many scientists have suggested that humans turned to agriculture under duress. Perhaps the climate of the Near East grew harsh, or perhaps the hunter-gatherer population outstripped the supply of wild foods.

But “playing around with resources” is not the sort of thing people do in times of desperation. Instead, Dr. Zeder argues, agriculture came about as climatic changes shifted the ranges of some wild species of plants and animals into the Near East.

Many different groups began experimenting with ways of producing extra food, which eventually enabled them to start a new way of life: settling down in more stable social groups.

For the full story see:

Carl Zimmer. “The First Farmers.” The New York Times (Tuesday, October 18, 2016 [sic]): D1 & D6.

(Note: the online version of the story has the date Oct. 17, 2016 [sic], and has the title “How the First Farmers Changed History.”)

The 2015 study co-authored by Dani Nadel and mentioned above is:

Snir, Ainit, Dani Nadel, Iris Groman-Yaroslavski, Yoel Melamed, Marcelo Sternberg, Ofer Bar-Yosef, and Ehud Weiss. “The Origin of Cultivation and Proto-Weeds, Long before Neolithic Farming.” PLOS ONE 10, no. 7 (July 22, 2015): e0131422.

Economical Parrots Decline an Immediate Smaller Treat to Be Able to Trade a Token for a Bigger Treat

(p. D3) Chalk up another achievement for parrots, . . . .

Anastasia Krasheninnikova and colleagues at the Max Planck Institute for Ornithology in Germany tested four species of parrots in an experiment that required trading tokens for food and recently reported their findings in the journal Scientific Reports.

. . .

A metal hoop could be traded for a piece of dry corn, the lowest value food, a metal bracket for a medium value sunflower seed and a plastic ring for the highest value food, a piece of shelled walnut.

The birds were then offered various choices, like a piece of corn or the ring. They all reliably chose to forgo the corn and take the ring. Then they were able to trade the ring for a piece of walnut.

They also did well choosing a bracket instead of the corn, and in other situations where the token was of higher value than the food.

For the full story see:

James Gorman. “Parrots Think They’re Pretty Smart.” The New York Times (Tuesday, Sept. 11, 2018 [sic]): D3.

(Note: ellipses added.)

(Note: the online version of the story has the same date as the print version, and has the title “Parrots Think They’re So Smart. Now They’re Bartering Tokens for Food.” Where there is a small difference in wording between the versions, the passages quoted above follow the online version.)

The paper published in Scientific Reports and mentioned above is:

Krasheninnikova, Anastasia, Friederike Höner, Laurie O’Neill, Elisabetta Penna, and Auguste M. P. von Bayern. “Economic Decision-Making in Parrots.” Scientific Reports 8, no. 1 (2018): 12537.

Nobelist Phelps Opposes a Universal Basic Income, Since Recipients Might Miss the Fulfilment That Comes from Meaningful Work

UBI below stands for Universal Basic Income.

(p. C9) And yet Mr. Phelps, the winner of the 2006 Nobel Prize in economics and emeritus professor of political economy at Columbia University, is among the most lucid, passionate and original defenders of capitalism. (He is also the founding director of Columbia’s Center on Capitalism and Society.) He disparages European-style corporatist economies as being unsuited to dynamism or innovation. Progressives who’d claim him as their own would do well to remember that he takes a hostile view of the idea of a universal basic income.

In “My Journeys in Economic Theory,” Mr. Phelps declares that it is “disappointing that UBI”—embraced by such modish politicians as Andrew Yang and Alexandria Ocasio-Cortez—“has not received widespread opposition.” The idea, if implemented, “would entice people and their children away from meaningful work and thus from a sense of involvement in the economy—society’s central project.”

It is this last, humane observation that distinguishes Mr. Phelps from the economists’ tribe, reflecting his belief that the nobility of capitalism lies in the chance it offers for prosperity and self-discovery on a national scale. He calls this phenomenon “mass flourishing,” words that make up the title of his late-in-life magnum opus, published in 2013 when he was 80.

. . .

It is apparent in his memoirs that Mr. Phelps wishes to be remembered most for his theories of the past two decades, which focus on the workplace and creativity. He believes that economists are mistaken in their supposition that the reward for work is pay alone. As he writes in “Dynamism” (2020), in America “it is very clear that work is central to a meaningful life.” People at all rungs of the economy “possess imagination and creativity,” and the modern economy is “a vast imaginarium” in which growth comes from “creativity within the workforce.”

Mr. Phelps underscores a connection between economic growth and job satisfaction. He urges economists “not to stop at the standard theory” but to explore an “uncharted realm” of human desires and fulfillments. There’s more to life than capital, mere employment and national income. And certainly more to economics.

For the full review, see:

Tunku Varadarajan. “On the Way to the Nobel, and After.” The Wall Street Journal (Saturday, May 13, 2023): C9.

(Note: the online version of the review has the date May 12, 2023, and has the title “‘My Journeys in Economic Theory’ Review: A Creative Nobelist.”)

The book under review is:

Phelps, Edmund S. My Journeys in Economic Theory. New York: Columbia University Press, 2023.

Phelps’s magnum opus, mentioned above, is:

Phelps, Edmund S. Mass Flourishing: How Grassroots Innovation Created Jobs, Challenge, and Change. Princeton, New Jersey: Princeton University Press, 2013.

University of Chicago Press Undermines Its Own New Edition of Milton Friedman’s Capitalism and Freedom

(p. C9) I had never read “Capitalism and Freedom” and was renewed in my admiration for midcentury American reading audiences. The book, full of tightly reasoned arguments about the principles of economic freedom in various spheres of life, sold 400,000 copies in its first 18 years. The University of Chicago Press, which first published the book six decades ago, evidently would rather it stop selling. The new edition’s foreword is written by Binyamin Appelbaum, a member of the New York Times editorial board, who treats Friedman’s classic text as mildly interesting artifact. “Friedman’s claim that ‘widespread use of the market reduces the strain on the social fabric,’ ” Mr. Appelbaum assures us, “misapprehended the nature of society, which is more like a muscle than a fabric.” I await Chicago’s edition of J.K. Galbraith’s “The Affluent Society,” with a foreword by Larry Kudlow.

For the full review, see:

Barton Swaim. “Of Markets and Morals.” The Wall Street Journal (Saturday, Jan. 30, 2021 [sic]): C9.

(Note: the online version of the review has the date January 29, 2021 [sic], and has the title “Politics: Of Markets and Morals.”)

The book under review is:

Friedman, Milton. Capitalism and Freedom. Chicago: The University of Chicago Press, 2020 [1st ed. 1962].

Shark Tank Shows Capitalism as a “Bootstrap Meritocracy”

(p. 24) . . . my favorite TV show is “Shark Tank.”  . . .  The premise of the tank is that small-business owners get an audience with investors — the “sharks,” a crew of millionaires and billionaires that includes Mark Cuban, Daymond John and Lori Greiner, the “queen of QVC” — in the hope of provoking a bidding war for a stake in the company. Sometimes the sharks dismiss the ideas outright, and they often do so cruelly, but in a satisfying, detailed way. You start to feel as if you could write your own business plan after watching a few episodes.

. . .

(p. 25) The show dramatizes a romantic vision of our economy, depicting it as a bootstrap meritocracy.

. . .

Part of the show’s appeal is that it’s an equal-opportunity forum — you don’t have to know a Silicon Valley V.C. or even a banker to get your audience with the sharks.

. . .

I was so politically assertive as a kid because I wanted someone to respect my opinion, to value me. I wanted to be taken seriously. I think most kids feel this way, dismissed outright for being small. In the tank, no one is dismissed — the sharks start every segment with furrowed brows, ready to take notes and hear out pitches, no matter how preposterous. They begin the process with a clean slate every time. Somewhere deep down, I want all these deals to work, I want the enthusiasm that sharks feel to be genuine and I want the contestants to walk away with business plans ready to be set into motion. Even if “Shark Tank” is propaganda — the selling and marketing of the American dream — the fantasy feels real.

For the full commentary, see:

Jaime Lowe. “Letter of Recommendation: ‘Shark Tank’.” The New York Times Magazine (Sunday, October 1, 2017 [sic]): 24-25.

(Note: ellipses added.)

(Note: the online version of the commentary has the date Sept. 28, 2017 [sic], and has the same title as the print version.)

SpaceX Embraces Fast Failures as the Best Path to Fast Fixes

(p. B1) SpaceX’s Starship spacecraft pulled off an extended flight through space on its third test mission, marking major progress for a vehicle that could one day transport astronauts to the moon and beyond.

Shortly after launching the nearly 400-foot-tall rocket Thursday [March 14, 2024], SpaceX successfully separated the booster from the spacecraft, which proceeded to fly for around an hour before it was lost while re-entering Earth’s atmosphere, according to a company livestream.

The mission advanced much farther than the company’s previous two Starship test flights. It was a milestone for a vehicle that is a centerpiece of SpaceX’s commercial ambitions, NASA’s space exploration plans, and company founder Elon Musk’s goal of one day sending humans to Mars.

. . .

(p. B4) Current and former SpaceX leaders have said the company embraces failing fast to try to rapidly identify fixes and improve. The company took 63 corrective actions to address issues that emerged during the initial launch, and an additional 17 following the second, according to the FAA.

For the full story, see:

Micah Maidenberg. “SpaceX Starship’s Third Test Mission Marks Major Progress Before Explosion.” The Wall Street Journal (Friday, March 15, 2024): B1 & B4.

(Note: ellipsis, and bracketed date, added.)

(Note: the online version of the story was updated March 14, 2024, and has the title “SpaceX’s Starship Makes Major Progress in Third Flight Test.”)

Federal and State Regulatory Thicket Thwarts “Permitting, Siting, Construction and Operation” of New Energy Infrastructure and Technology

(p. C5) Environmentalists have long argued that tackling climate change will require regulations to discourage fossil-fuel use, such as a carbon tax or a cap-and-trade program. In reality, there is no plausible path to a low-carbon economy without a serious deregulatory program. Today’s thicket of environmental regulation at the federal and state levels thwarts permitting, siting, construction and operation of virtually every class of new infrastructure and technology. There are simply too many veto points and opportunities for obstruction, at too many procedural and jurisdictional levels, to conceivably embark on a rapid mission to remake the nation’s energy economy.

. . .

The U.S. can no longer continue to neglect its compounding infrastructure and clean-energy needs. We aren’t going to regulate our way to a thriving low-carbon economy and a more stable climate. America needs to get back to building again.

For the full commentary, see:

Ted Nordhaus. “For a Clean-Energy Future, We Need Deregulation.” The Wall Street Journal (Saturday, February 19, 2022 [sic]): C5.

(Note: ellipsis added.)

(Note: the online version of the commentary has the date February 17, 2022 [sic], and has the same title as the print version.)

Banning the SAT as Racist Is an Insult “Against Black Intelligence”

The soundness of Prof. McWhorter’s argument is neither increased nor decreased by the fact that he is black. His courage in stating the argument is increased by the fact that he is black.

(p. 4) . . . lately, evidence has mounted, steadily, that the SAT is in fact useful in demonstrating students’ abilities regardless of their economic backgrounds or the quality of their high schools. Some studies show scores correlate with student performance in college more strongly than high-school grades, and that without the standardized test data it is harder to identify Black, Latino and lower-income white kids who would likely thrive in elite universities.

. . .

The SAT as racist, objectivity as white privilege, making academic training easier to attract Black majors and graduate students — there is a family relationship between them. Namely, an assumption that it is graceless or unfair to require Black people to grapple with detail, solve puzzles and make sense of the unfamiliar. At least, we are not to be expected to engage in such things nearly as much as, say, white people.

. . .

I’m sorry, but I find this a diminished, not to mention depressing, and downright boring racial self-image. It just doesn’t correspond with so very much that Black people do, and are, and seek and always have.

. . .

No coherent admissions assessment would use the SAT as the sole measure of an applicant’s potential. However, the elimination of such tests from the process is less a favor to than an insult leveled against Black intelligence.

For the full commentary, see:

John McWhorter. “No, the SAT Isn’t Racist.” The New York Times, SundayOpinion Section (Sunday, March 17, 2024): 4.

(Note: ellipses added.)

(Note: the online version of the commentary has the date March 14, 2024, and has the title “The Best Way to Find Out if We Can Cool the Planet.”)

Musk Fights for Right of Individuals in Sweden to Enter into Contracts

(p. A15) Sweden is the West’s most corporatist society. Powerful interest groups, often described as “social partners,” use collective bargaining to set rents for apartments and wages earned in labor markets.

This model is being challenged by Tesla CEO Elon Musk, who is refusing to enter into collective wage agreements with Swedish trade unions. The unions have responded with strikes and blockades on Tesla operations in the country.

. . .

Liberal democracy presupposes fundamental rights and freedoms. Some of these, such as the freedoms of opinion, press and expression, are enshrined in the Swedish constitution. But the right of the individual to enter into contracts isn’t similarly guaranteed.

. . .

Liberal democracy is being threatened globally by growing populist and illiberal movements. The government in Stockholm should counteract this threat by strengthening people’s individual rights and freedoms in the Swedish constitution. If this happens, Mr. Musk will have given Sweden a great gift.

For the full commentary, see:

Lars Jonung. “Musk Fights Sweden’s Unions.” The Wall Street Journal (Wednesday, February 14, 2024): A15.

(Note: ellipses added.)

(Note: the online version of the commentary has the date February 13, 2024, and has the same title as the print version.)

Dissenters from Orthodoxy Can Be Easily Blackballed When They Are Required to Write Diversity Statements

(p. A15) Amidst the explosion of university diversity, equity and inclusion policies, Texas Tech’s biology department adopted its own DEI motion promising to “require and strongly weight a diversity statement from all candidates.”

. . .

The biology department’s motion mandates that every search committee issue a report on its diversity statement evaluations. Through a Freedom of Information Act request, I have acquired the evaluations of more than a dozen job candidates.

To my knowledge, these documents—published in redacted form by the National Association of Scholars—are the first evaluations of prospective faculty DEI contributions to be made publicly available. They confirm what critics of DEI statements have long argued: That they inevitably act as ideological litmus tests.

One Texas Tech search committee penalized a candidate for espousing race-neutrality in teaching. The candidate “mentioned that DEI is not an issue because he respects his students and treats them equally,” the evaluation notes. “This indicates a lack of understanding of equity and inclusion issues.”

. . .

The biology department’s search committees also rewarded fluency in the language of identity politics. An immunology candidate was praised for awareness of the problems of “unconscious bias.” “Inclusivity in lab” was listed as a virology candidate’s strength: “her theme will be diversity, and she will actively work to creating the culture—e.g. enforce code of conduct, prevent microaggressions etc.”   . . .

Many critics rightly point out that diversity statements invite viewpoint discrimination. DEI connotes a set of highly contestable social and political views. Requiring faculty to catalog their commitment to those views necessarily blackballs anybody who dissents from an orthodoxy that has nothing to do with scientific competence.

For the full commentary, see:

John D. Sailer. “How ‘Diversity’ Policing Fails Science.” The Wall Street Journal (Tuesday, Feb. 7, 2023 [sic]): A15.

(Note: ellipses added.)

(Note: the online version of the commentary has the date February 6, 2023 [sic], and has the same title as the print version.)