Yglesias on the Great Stagnation

Matt Yglesias didn’t use the term “great stagnation”. Nor did he draw any parallels between the following four tweets. But it’s hard not to notice when within 60 minutes a well known progressive points to four areas of stagnation, at least three of which can be blamed on progressives:

The “status quo” bias that Yglesias cites in the third tweet reminds me of how cities won’t allow developers to tear down buildings that provide housing to the homeless, but also won’t allow developers to build (SRO) buildings that provide housing for the homeless.

No matter how cynical I get, I can’t keep up with the real world.

When will America get its “infrastructure? I vote for “never”. It’s over. We are done with the material world. Our future is living in isolation from each other, connected by iPhones and iGlasses, being closely surveilled by governments and corporations. Comfortably numb.

PS. Progressives aren’t just stopping solar. They are closing down California’s last carbon free nuclear power plant. They are tearing down carbon free hydroelectric dams in California. They are opposing wind power. It’s an all out war on carbon free energy.


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39 Responses to “Yglesias on the Great Stagnation”

  1. Gravatar of Spencer Hall Spencer Hall
    25. July 2021 at 12:44

    Lacy Hunt: “Fisher’s view that debt is an increase in current spending in exchange for a decline in future spending unless the debt generates an income stream to repay principal and interest”

    What’s missing is the definition of an “income stream”. But that question is answered in my 1964 Money and Banking book:

    “Savings dissipated in financial investment, or impounded in idle savings, or as leakages in transfer payments, are stoppages in the flow of funds derived from the main income stream, and have a direct and immediate dampening impact on the economy.”

    There you have it. Lacy Hunt is correct. It’s Irving Fishers’ “THE DEBT-DEFLATION THEORY OF GREAT DEPRESSIONS”

  2. Gravatar of rinat rinat
    25. July 2021 at 13:18

    Does anyone else remember when Sumner told us how reliable the PCR-Test was? Or how about the time he told us Chile’s Judge, and how the inventor of PCR, were all “conspiracy theorists”?

    He wouldn’t listen to the inventor: but thankfully, the CDC did. PCR is now being revoked.

    But he wants us all to get the experimental vaccine despite 12,000 deaths reported to VAERS (as of July 19th), and despite the fact that thousands of scientists don’t agree with the CDC’s call to vaccinate everyone. Any skepticism at all, from anyone, and Sumner and his social science cohorts scream “conspiracy”. A few months later the skeptics are usually proved right.

    In fact, can anyone point to a time when Sumner’s predictions have actually been accurate?

  3. Gravatar of Orkun Baysal Orkun Baysal
    25. July 2021 at 13:23

    Secular Stagnation is permanent. This is capitalism’s natural path. Zero lower bound interest rates are here to stay. Inflation will not be back since the velocity of money falling continuously.
    There will be too much discussion and argument among different schools of economics for government spending.
    A revolution in economics needs to be made to reverse the cycle. Otherwise, this deflationary economy will cause so many unintended consequences.

  4. Gravatar of Dan Dan
    25. July 2021 at 13:47

    Took a trip to Santa Barbara…everything is very ‘nice’ but the central coast has barely changed in the 15 years since we last lived there. Stagnation indeed.

  5. Gravatar of henry henry
    25. July 2021 at 14:07

    Rinat, Scott just regurgitates what he hears on CNN. You cannot really take his political & medical blog posts so seriously; CNN and Scott also told us ANTIFA did not exist and BLM wasn’t Marxist:

    https://twitter.com/MrAndyNgo/status/1419410502170644485

    Of course, we all know that’s laughable.

    Just ignore his political posts, and focus more on the economic posts which is his field of expertise. Otherwise, you’ll lose your mind.

  6. Gravatar of Bob Bob
    25. July 2021 at 15:19

    At a time where attendance to churches is very low, we have moved the quest for purity to policy, making compromise, and therefore actual progress, almost impossible.

    Conservative pundits defend their people’s freedoms by giving them deadly advice. Leftists care a lot about intent, but not about outcomes. Other than the decisions that are pure corruption, it’s amazing how many policies achieve the opposite of what was attempted.

    Just like novice chess players never consider their opponent’s next move, novices at policy will not consider how the market players will react… and the people deciding which policies are popular are novices. Even our smartest players tend to be just a single move ahead.

    Having no policies is obviously ridiculous, but the world is too complicated for weak institutions to make good policy, and oh are our institutions weak.

  7. Gravatar of ssumner ssumner
    25. July 2021 at 16:07

    Dan and Bob, Good comments.

    The rest of you? ? ?

  8. Gravatar of Michael Sandifer Michael Sandifer
    25. July 2021 at 17:22

    Bob,

    I think the left cares about outcomes, but they aren’t good at discerning them. Many goals of the left are laudable, but many of their policy ideas are stupid.

    I still think intentions matter, as it isn’t the left, for example, that’s trying to end democracy in much of the world, unlike at times in the past, when there was a leftest branch that favored communism, for example.

  9. Gravatar of Sky Price Warrior Sky Price Warrior
    25. July 2021 at 18:34

    So fun story, I just moved to Lowell, Massachusetts, for work. The work is in another city, but this apartment was cheaper.

    Anyway, the museum there made a claim that the city was the centerpiece of the US industrial revolution. The reason was because the Merrimack river was perfect for textile factories, and Lowell is named after Samuel Lowell, who stole the British industrial designs.

    And this claim was true! Lowell was the center of American innovation.

    Nowadays, despite some revival when the city took in Cambodians after the genocide, the city is largely in decline, there are certain areas you shouldn’t go, there isn’t an industry there anymore, and the history sustains it … somewhat. The Merrimack is a wonderful kayaking spot but that is it.

    To bring it back to the post, America was the center of innovation in the world for 200 years. At some point I dont know if the forces forcing decline can be overcome for any developed nation. And I’ve largely made my peace with that. One can fight it, one should fight it, but that doesn’t mean we can’t acknowledge it and not let it get in the way of trying to live our lives.

    As for Yglesias, I do hope he does formally break with the progressive movement at some point, he seems fairly bright and independent minded, but seeing as I still having given up my republican registration despite the clusterf*** that was the past 4 years, I shouldn’t pass judgement.

  10. Gravatar of Sky Price Warrior Sky Price Warrior
    25. July 2021 at 18:35

    So fun story, I just moved to Lowell, Massachusetts, for work. The work is in another city, but this apartment was cheaper.

    Anyway, the museum there made a claim that the city was the centerpiece of the US industrial revolution. The reason was because the Merrimack river was perfect for textile factories, and Lowell is named after Samuel Lowell, who stole the British industrial designs

  11. Gravatar of Lizard Man Lizard Man
    25. July 2021 at 18:35

    “When will America get its “infrastructure? I vote for “never”. It’s over. We are done with the material world. Our future is living in isolation from each other, connected by iPhones and iGlasses, being closely surveilled by governments and corporations.”

    Will any countries build infrastructure? Would the Communist Party of China give everyone living in its cities McMansions in tower blocks if it had the means? South Korea?

  12. Gravatar of John John
    25. July 2021 at 19:15

    The problem is people refuse to mentally confront that you need to make some people worse off in order to make society as a whole better off. Construction always enriches some, displaces others, and changes property values. Community activists always say that “the community” must be consulted and agree before changes are made, but too many vetos leads to complete inaction and favoritism of the status quo. I can’t tell you how many people I know who live in a gentrified neighborhood, yet strongly oppose further gentrification because it might harm people who live there right now.

  13. Gravatar of David S David S
    26. July 2021 at 01:28

    Scott’s euphoria over the Buck’s win didn’t last long–maybe he made the mistake of watching the U.S. men’s team play France. Talk about failing institutions.

    I’m trying to be optimistic today so I’ll push back against some of this “headline stagnation” pessimism by pointing out some bright spots in this country:

    -We have a stable monetary system. People yammering about a temporary bout of 5% inflation should really try spending a few months in Turkey.

    -We still invent and build things—or when appropriate–design things that are built all over the world. Check out those nifty vaccines, for instance.

    -People still want to come here, and I think we should be encouraging that if we want to rebuild cities like Lowell. In fact, it’s probably smarter to move there than California.

    My pessimism will return after the midterm elections.

  14. Gravatar of mbka mbka
    26. July 2021 at 03:01

    Scott,

    “Progressives aren’t just stopping solar. They are closing down California’s last carbon free nuclear power plant. They are tearing down carbon free hydroelectric dams in California. They are opposing wind power. It’s an all out war on carbon free energy.”

    While being all gung ho on electric cars of course. Because they’re, like, cleaner. Which is why I’m not an “environmentalist”.

  15. Gravatar of J.V. Dubois J.V. Dubois
    26. July 2021 at 06:07

    One thing I really resent about current politics is that everything is viewed from the moral ground. In the past there always were toxic topics like abortions or guns or some number of cultural issues. But these were considered somewhat isolated.

    Now the moral language seeps into everything. Let’s say a city wants to open new bus line. Does the new line serve marginalized communities? Will the new bus have low carbon footprint? Should we add new employees to a bus company that had some bad meetoo scandal?

    Every single thing in the life has to submit to new pieties until the thing that we wanted to achieve gets buried so deep it is no longer important. And the scope gets ever expanding from having to chew on wet mangled paper straw while drinking soda from plastic cup through to policies of international importance.

  16. Gravatar of Michael Rulle Michael Rulle
    26. July 2021 at 06:31

    “no matter how cynical I get, I can’t keep up with real world”

    Finally—-just pure full-throated anger and mockery from Scott about our current world. California, while far from the only bizarre place in America, seems to have special skills.

  17. Gravatar of ssumner ssumner
    26. July 2021 at 08:10

    Sky Prince, Good post. I think about our history of industrial theft every time I read complaints about the Chinese.

    David, You said:

    “maybe he made the mistake of watching the U.S. men’s team play France.”

    Watching the Olympics is one mistake I did not make. (But I’ve made so many others . . .)

    mbka, Yes, there’s a difference between being an environmentalist (or feminist) and being in favor of a clean environment (or equal rights.)

    JV. In fairness, Matt Yglesias often pushes against that approach to public policies.

    Michael, Finally? I’ve been here for 12 years.

  18. Gravatar of Jackson McKenzie Jackson McKenzie
    26. July 2021 at 09:02

    Reading this just left me depressed and wrecked my morning productivity. A different, more positive attitude might be more constructive. Constantly lamenting how horrible everything is and how we’re inevitably on a downward trajectory to hell is extremely demotivating.

  19. Gravatar of msgkings msgkings
    26. July 2021 at 09:39

    @John and JVDubois: good posts

    @Jackson McK: you’ve probably noticed that pessimism is the almost universal pose of all pundits and intellectuals, for a couple of reasons.

    One, pessimism sells. Gotta convince your audience that everything is terrible so they will keep reading/watching for solutions or support.

    Two, pessimism sounds smart. Optimists are derided as naive or foolish. Big thinkers from Socrates on have decried the decline of civilization.

    My antidotes have been reading Matt Ridley (“The Rational Optimist”) and Hans Rosling (“Factfulness”)

    Also any broad scope historian is good to help us remember these problems we face are no bigger or smaller than the problems faced in every era. It’s always hard and yet we always muddle through.

    I’m in the middle of Will & Ariel Durant’s 10 volume “History of Civilization” and they are excellent writers for historians, and it really puts all the nonsense of the headlines in perspective.

  20. Gravatar of sean sean
    26. July 2021 at 09:58

    I always get a laugh when you are so hateful of Trump whose certainly flawed.

    But then you will post things like this. Or suggest Freedom of Speech won’t exists in 20-30 years.

    You prescribe a dystopian future. And then wander why some of us have thrown in our towel with Trump as the least bad option. For the younger ones just giving up and watching Netflix doesn’t sound that good.

  21. Gravatar of steve steve
    26. July 2021 at 10:24

    From where I sit stuff like the affordable housing problem doesnt seem like something progressives in general want but rather that a small group of people have been able to corruptly make a lot of money doing stuff that people in general do not agree with. Also with the first tweet. Small, very active, committed groups seem to be able to thwart stuff everyone else wants to do. This is special interest politics.

    Steve

  22. Gravatar of Tom Brown Tom Brown
    26. July 2021 at 10:33

    Dan, I live in Goleta right next door to Santa Barbara. I’ve lived either here or in Santa Barbara since 1984. I disagree with your assessment: a lot has changed. I’ve seen the whole downtown area near the freeway redone. There are lots of projects here in Goleta. There’s 173 apartments going in right next door to where I work. Every time I go downtown to SB I see construction going on and I try to remember what was in the spot that’s now a construction site. I went to UCSB and it’s a short distance from my house and my work. Every time I go there I get lost because of all the new buildings and construction, which they’ve been doing continuously since I attended.

  23. Gravatar of David S David S
    26. July 2021 at 10:58

    I tried to offer some optimistic comments, but I guess I didn’t read the room. Incidentally, Yglesias is cruising around Texas right now in a Camaro convertible. Maybe his perspective will change after a few weeks in the Real America.

  24. Gravatar of msgkings msgkings
    26. July 2021 at 12:15

    @sean:

    Voting for Trump doesn’t fix any of these issues and makes some of them worse.

  25. Gravatar of Gene Frenkle Gene Frenkle
    26. July 2021 at 12:38

    South Carolina spent $9 billion on a half built nuclear power plant…so fracking makes nuclear power uneconomical as long as one is willing to burn natural gas.

    As someone who spent a lot of time in the Caribbean we should bail South Carolina out and complete the reactors and then make Cuba an offer they can’t refuse—we will build a huge power cable from the Turkey Point nuclear reactor along with a natural gas pipeline to serve the entire Caribbean that goes through Cuba…as long as Cuba holds democratic elections and returns real property and IP to the exiles. (and the federal government can throw money at the EU companies with investments in Cuba to shut them up). I’m sure progressives will throw a tantrum but Biden needs to stand up to them at some point because progressives have been saying a lot of dumb things lately. I’m not sure why we just don’t throw money at the Cuba problem when we flushed trillions down a toilet in the Middle East?? Throwing $20 billion at Cuba is nothing when China has made such big inroads into the Caribbean…so throwing money at Cuba has a big national security component.

  26. Gravatar of ssumner ssumner
    26. July 2021 at 13:36

    Jackson, Sorry. Oddly, spouting off makes me less depressed.

    I have done some optimistic posts in the past. Vaccine research is one area where it makes sense to be optimistic.

    Sean, You said:

    “You prescribe a dystopian future. And then wander why some of us have thrown in our towel with Trump as the least bad option.”

    So Trump is supposed to make us more optimistic about the future? He’s part of the problem. He’s the biggest NIMBY in America.

  27. Gravatar of Sean Sean
    26. July 2021 at 16:12

    He worst is better than the worst on the left.

    I get your point he has a lot of nymbism with America first. But that only meant wasting a few billion building a wall and tariffs on $300 billion of trade which represents like 1.5% of the economy. The rest of governing was McConnell.

    Hopefully Trump realizes Desantis is better for his legacy. Florida GOP are winners and the state is relatively well governed. He’s smart enough to be an insider but knows how to get Trumps base excited.

  28. Gravatar of nick nick
    26. July 2021 at 18:01

    Sumner wants the CCP to control America, and imprison Christians. He has property and interests in China.

    This is what they do to the Fulan Gong
    https://www.minghui.org/

    Don’t let him debase the currency and destroy liberty. Stand up for your rights.

    Everything he says is designed to make America weaker.

  29. Gravatar of Lizard Man Lizard Man
    26. July 2021 at 20:50

    The Argentina of the 21st century in action.

  30. Gravatar of ssumner ssumner
    27. July 2021 at 08:41

    Sean, You said:

    “I get your point he has a lot of nymbism with America first.”

    No you didn’t get my point. He’s our biggest NIMBY on housing construction, which is our number one economic problem.

    Nick, You said:

    “This is what they do to the Fulan Gong”

    This is actually a good point. The same people who complain about the treatment of the Uyghurs tended to totally ignore the treatment of the Falun Gong. What does that tell us about their agenda?

  31. Gravatar of Michael Rulle Michael Rulle
    27. July 2021 at 09:06

    Yes, finally—–a recognition that so much sucks—–and you did not even have to mention Trump. That is what I call “pure” and “full throated” anger and mockery.

  32. Gravatar of Mark Z Mark Z
    27. July 2021 at 12:44

    California, not altogether surprising, but depressingly, even France is now beginning to turn against nuclear power, with the government committing to reduce reliance on it to 50% by 2035. The tide really seems to have turned on that issue. But anti-nuclear sentiment is if nothing else a useful way to identify people who are only pretending to care at all about global warming.

  33. Gravatar of Sean Sean
    27. July 2021 at 17:19

    The POTUS has little control over local regulations. He did one thing that had a big anti-nimby effect which was eliminating the SALT deductions leading to a lot if people leaving coastal cities.

  34. Gravatar of ssumner ssumner
    28. July 2021 at 07:52

    Michael, You said:

    “Yes, finally—”

    LOL, I’ve done a 100 similar posts over the past 12 years. Where have you been?

    Sean, The president has little control over anything. The point is that the control he does have is being used to make things worse. He also doesn’t have much control over whether America is a democracy, but the control he does have was used to try to turn us into an authoritarian state.

  35. Gravatar of dtoh dtoh
    28. July 2021 at 15:48

    @msgkings If you like Ridley, you should read “The Origins of Virtue.” It’s one of his earlier works and very insightful.

  36. Gravatar of dtoh dtoh
    28. July 2021 at 15:52

    @scott

    “Watching the Olympics is one mistake I did not make.”

    You didn’t make the mistake of watching it? …. OR

    Watching it wasn’t a mistake?

  37. Gravatar of msgkings msgkings
    29. July 2021 at 16:49

    @dtoh:

    Thanks for the tip, I’ll check it out!

  38. Gravatar of ssumner ssumner
    30. July 2021 at 12:37

    dtoh, I did not watch it. In recent decades, the America media started treating it as a soap opera, not a sporting event. (And I’m not even interested in the sporting events.)

  39. Gravatar of dtoh dtoh
    31. July 2021 at 15:47

    Scott,
    Totally agree. Plus a lot of the athletes have become total prima donnas.

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