Econlib

What causes recessions and “empressions”?

Before starting this post, let me highly recommend George Selgin’s recent post on NGDP targeting.

Nick Rowe has a post discussing a scenario where a lack of media of exchange disrupts trade, without affecting employment and output:

I would call that a “recession”, even though (by assumption) output, employment, and (aggregate) consumption are unchanged. People are worse off, because of a reduction in the volume of exchange, due to a reduction in the circular flow of money around the Wicksellian triangle.

Nick’s terminology is unconventional; recessions are usually defined more in terms of output and employment.  I’d prefer a third definition—a sharp rise in the unemployment rate, regardless of what happens to output.  But I don’t get to choose definitions, so rather than fight a losing battle I’ll invent a new word for the concept I’m interested in.  Let’s call an employment recession an “empression”.

To see the difference, imagine a primitive economy where all workers are peasant farmers.  There is zero unemployment, as all are self-employed.  A spell of bad weather would cause a recession (falling output), but not an empression.  However, it just so happens that in the US all recessions seem to also be empressions, and all empressions seem to be recessions.  In the following graph, the grey bars reflect recession periods.  You can see that sharply rising unemployment is a necessary and sufficient condition for a recession.  You can’t say that about inflation, stock prices, yield spreads, steel output, or numerous other variables.

Lots of things might cause a higher unemployment rate.  These include:

1.  Sharply higher minimum wage rates, or a surge in union organizing.

2.  A sharp rise in the share of GDP going to capital, meaning less money to pay wages.

3.  A sharp rise in hours worked per week, meaning fewer workers are needed to produce the same nominal output.

However, I don’t believe that any of those factors are important causes of the US business cycle, at least since WWII. Rather the problem is sticky nominal hourly wages and unstable NGDP.   Before looking at NGDP, lets examine the growth rate of total labor compensation:

Notice that nominal labor compensation growth slows sharply during recessions and empressions—every single time.  So the problem does not seem to be a surge in hourly wages, rather the labor market is being starved of funds to pay workers—my musical chairs “model” of unemployment.  (Or perhaps “metaphor”, as respectable economists wouldn’t think it rises to the level of being a model.)

So what causes nominal labor compensation growth to slow at various times?  Does the corporate sector suddenly grab a bigger share of national income, leaving less money to pay workers?  Or does growth in national income itself slow?  Not surprisingly (as labor compensation is a big share of national income) it’s the latter.  It turns out that falling NGDP growth (combined with sticky hourly wages) is the proximate cause of both recessions and empressions:

Recall that I said that wage spikes don’t seem to be the cause of recessions and empressions.  There is, however, one wage spike that made a recession/empression somewhat worse than one would have otherwise expected.  Notice that the slowdown in NGDP growth was pretty modest during the 1973-75 recession.  And yet that was one of the more severe postwar recessions/empressions.  Why?  It turns that that 1974 saw an unusual wage shock, something that generally does not occur during US recessions:

Why did wage growth spike during the 1974 recession?  I’d guess it was because Nixon phased out his wage controls during 1974, and workers demanded wage increases to compensate for the high inflation of 1973-74.  But while that sort of situation may be common in some unstable developing countries, it’s pretty unusual in the USA.  And even during 1974, slowing NGDP growth was still part of the story.  The 1974 recession was one part NGDP shock and one part wage shock.

So the cause of post-war US recessions is actually quite simple.  NGDP growth slows while nominal hourly wages are sticky, and thus employment falls while unemployment rises.

Why don’t workers offer wage flexibility to prevent high unemployment?  For the same reason that Wall Street financiers don’t offer indexed bonds to prevent falling NGDP from creating financial crises—it’s a collective action problem.  If any one worker agrees to flexible wages, it doesn’t help him preserve his job.  He shows up at the factory gate and finds his workplace is closed down.  Only if all workers have flexible wages can we avoid a recession/empression during periods of sharply slowing NGDP.

If all workers bargained collectively that might be possible. But a labor union that covered all 150,000,000 workers would create lots of microeconomic inefficiency, which might be even worse than the business cycle.  Better to use monetary policy to keep NGDP growing at a steady 4%/year, or something close to that figure.

To summarize, recessions/empressions are quite simple.  A combination of sticky nominal wages and unstable NGDP (i.e. unstable monetary policy) causes recessions.  At elite universities they have models that don’t even feature nominal wages and NGDP.  Rather they focus on price inflation, interest rates, output and other irrelevant variables.  Again, sticky wages and unstable NGDP are pretty close to a necessary and sufficient condition for US recessions/empressions—no need to look for microfoundations.  No need to make it complicated.

The policy implications are also simple.  Adjust monetary policy to keep market expectations of NGDP growing along a 4% trend line.  That will mostly solve the problem of empressions in the US, and any remaining movement in RGDP will be an efficient “real business cycle”, not be worth worrying about.

(5 COMMENTS)

A Mythical Micro Meeting

I recently discussed the teaching of Ph.D. Microeconomics with a noted professor in a top five econ department.  His bottom line: The curriculum is virtually the same as it was when I took Ph.D. Micro a quarter century ago.  Among active researchers, the status of pure theory has dramatically fallen during that period, but pure theorists retain a stranglehold over the first-year curriculum.  This surpasses even my pessimistic expectations for the education system; I would have thought that top schools would have at least marginally decreased pure theory in favor of empirical work.  But at least according to my source, this hasn’t happened.

Rather than decry this stasis, however, I thought it best to write a dialogue.

The Scene:

Meeting room at a prestigious university

The Cast:

Professor Proof, old-school micro teacher

Professor Raze, radical curriculum reformer

Professor Well, swing voter on the curriculum committee

Prof. Raze: I just reread your Ph.D. Micro syllabus, Prof. Proof.  Frankly, it’s ridiculous.  You haven’t changed the content in a quarter century.  You make zero effort to introduce students to any of the great empirical work that’s been done in the meanwhile.  Instead, you waste a year of their lives on useless math.  Enough is enough!

Prof. Proof: Relax, Raze.  Students have plenty of time to learn empirical work later on.  The point of Ph.D. Micro is to train economists in the fundamental ideas of their discipline.  That’s what I set out to do when I wrote the syllabus 25 years ago, and that’s what I’ll continue to do.

Prof. Well: Let’s take it down a notch.  We’re the curriculum committee, so we have to work together, Raze.  And the chairman appointed us to reach a consensus, Proof.  You can’t just stonewall.

Raze: [sullenly] Fine.

Proof: [snottily] Fine.

Well: Let’s start with Raze.  What exactly is wrong with Ph.D. Micro as it is?

Raze: We spend the whole year teaching mountains of irrelevant math and theory.  The opportunity cost is high, because we could spend that time teaching promising young minds about how the economy actually works – not to mention basic economic principles.  And it’s a needless entry barrier for students who care about the real world.

Proof: “Irrelevant math and theory”!  So we should just become sociologists?

Raze: I never said that.  I’m all for teaching math that students are likely to use in their research, and theories that actually shed light on the real world.

Proof: [harumphs] That’s already what I do.

Raze: [mock incredulously] Oh really!  Students are likely to use topology in their research?

Proof: Many do.

Raze: Name one.

Proof: Well, two years ago my student Chloe used topology in her dissertation.

Raze: And for her sake, all her classmates had to spend weeks suffering through the subject?

Proof: Suffering?  It was their privilege.  Topology is one of the most beautiful branches of mathematics.

Raze: See what I’m talking about, Prof. Well?  This is all about micro theorists’ bizarre aesthetics; it’s got nothing to do with training future economists.

Well: Here, I’m inclined to agree.  If you want to teach math because of its intrinsic beauty, Proof, you should do it in a math department.

Proof: [exasperated] Even so, you need topology to grasp basic economic theorems, starting with general equilibrium theory.

Well: Naturally…

Raze: [annoyed] Theorists need topology to prove the theorems, but that hardly means that students need to actually learn topology.  Why not just give the intuition behind the theorem, point the rare future theorists to some reference works, and move on?  A single lecture would suffice.

Proof: [outraged] A single lecture?  This is a top five economics department – and you want us to turn out a generation of ignoramuses?

Raze: Just tell me this, Proof: How empirically relevant is general equilibrium theory anyway?

Proof: There are many applications…

Raze: How many rely on more than a quick intuitive version of GE theory?

Proof: That’s hardly the point.

Raze: Uh-huh.  More importantly, how many of our students realize that the sparse empirical applications of GE rely on no more than a quick intuitive version of the theory?

Proof: That would hardly motivate them to study the topic.

Raze: In other words, you keep your students in ignorance of the deep irrelevance of what you’re teaching them, because otherwise they’d be less motivated to study it.

Well: Surely you’re not proposing that we cut theory altogether, Raze?

Raze: Far from it.  I think we should teaching empirically relevant theory, using as much math as empirical researchers need to know.

Proof: And according to you, what would qualify?

Raze: Basic supply and demand for starters.  Game theory.  Information economics.

Well: Doesn’t sound too different from what we already do.

Raze: Actually, it is.  First, I wouldn’t teach any more math than you actually need to grasp the intuitive idea.  And second, I would immediately follow any theoretical topic with relevant empirics.

Proof: But often the “relevant empirics” directly contradict the theory.  See much of behavioral economics.

Raze: That’s a bingo.  Our students ought to learn the extent to which standard economic theory correctly describes the real world.  I don’t mind teaching influential flawed theories, as long as students realize the severity of their flaws.

Well: I’m worried that our students will barely remain economists if we follow your advice.

Raze: Look, what’s intellectually distinctive about economists isn’t our knowledge of math.  It’s our rejection of Social Desirability Bias.

Proof and Well: [in unison, skeptical] What?!

Raze: You know how economists are always saying, “Look at what people do, not what they say”?

Proof: Yes…

Well: Yea…

Raze: Well, psychologists have empirically confirmed that we’re on to something.  When the truth sounds bad, people tend to say – and often believe – falsehoods.  Psychologists call this “Social Desirability Bias.”

Proof: What in the world does this have to do with Ph.D. Micro?

Raze: Plenty.  One of the main goals of Ph.D. Micro should be to root out Social Desirability Bias from our students.  It’s central to “thinking like an economist.”

Well: What, stuff like, “If you put an infinite value on life, you’d never cross the street”?

Raze: Exactly.  Some of the wisest words ever said.

Proof: You want to replace general equilibrium theory with a bunch of trivial slogans?

Raze: They’re deep truths, not “trivial slogans.”  Yet many of your students have barely heard them.

Well: Could you name some others?

Raze: Sure.  I’ll express them as slogans, though each deserves multiple lectures of elaboration.

“If you’re right, why hasn’t anyone gotten rich using your idea?”

“What’s are the relevant elasticities?”

“What precisely is the market failure supposed to be?”

“What are the regulators’ incentives?”

“Immigration is trade in labor.”

Proof: So you want to politicize Ph.D. Micro.  [sarcastic] Great!

Well: I have to admit that I share Proof’s concerns, Raze.  This isn’t science.

Raze: If it’s true and important, who cares if it’s “science”?

Proof: See, Well?  Raze doesn’t even believe in science.

Raze: [losing his cool] Fine, I misspoke.  Yay, science!  My point remains: We should radically overhaul our Ph.D. Micro curriculum.  Proof should stop wasting our students’ time with irrelevant math and theory.  He should teach them how the economy actually works, delving into math and theory only insofar as it serves that goal.  None of this will “turn our students into sociologists” as long as he instills the deep truths of economics along the way.

Well: I see…

Raze: Actually, since we could never trust Proof to do any of this, you should hand his class over to me.

Proof: [glares daggers at Raze]

Well: Very well.  I think I have enough information to make my recommendation to the chairman.

Raze and Proof: [in unison] Namely?!

Well: You both make good points.  I’m going to ask the chairman to ask Proof to update his syllabus in light of the last quarter century of research.

Raze: And..?

Well: That’s should do it.

Raze: But that will change next to nothing!  Proof will be the sole judge of what “needs to be updated”!

Proof: [smugly] I promise I’ll do a scrupulous job.

Well: [self-satisfied] Please see that you do.  We’ll revisit this issue again in three years to see how things are going.  Until then, colleagues!

(3 COMMENTS)

Is economic nationalism even possible?

A great deal of ink has been spilled about the causes and consequences of the recent rise in economic nationalism. Maybe it’s time to step back and ask whether economic nationalism is even possible in the modern world.

The Economist has an interesting article discussing the British struggle to negotiate a Brexit agreement with the EU:

Dominic Cummings, the former campaign director of Vote Leave, thinks that Brexit is being “irretrievably botched”. Ambrose Evans-Pritchard, a pro-Leave journalist, says that “the quixotic bid for British independence has failed”. On the Remain side, Jonathan Powell pronounces hard Brexit “dead”, killed by the conundrum of the Irish border. . . .

On June 6th Boris Johnson, the foreign secretary, delivered an agonised speech to a group of Conservative donors which was recorded and leaked. Mr Johnson argued that Britain runs the risk of ending up in “a sort of anteroom of the EU” and blamed this unhappy prospect on a combination of insufficient will on the part of the prime minister and strong resistance on the part of the establishment. He claimed that Britain needed a strong leader like Donald Trump—“he’d go in bloody hard”. He called the Treasury the “heart of Remain”. He lamented that Britain was so terrified of short-term disruptions that it would sacrifice long-term gains.

Henderson on Radical Markets

In Radical Markets, University of Chicago law professor Eric Posner and Microsoft senior researcher Glen Weyl propose a radical restructuring of property rights, immigration policy, and voting, as well as a substantial change in corporate law. Their most radical proposal is to completely overturn property rights so that people would need to continuously “bid” for property they already own. They want to alter immigration policy to allow about 100 million more immigrants into the United States, but change who decides whether or not to allow particular prospective immigrants to enter. They want to switch to “quadratic” voting as opposed to the current one citizen–one vote method. They also want a major change in how investors can hold shares in corporations.

For all of these positions, they make clever and sometimes compelling arguments. The most compelling one is on voting. The least compelling, and also absolutely horrific, one is on property.

These are the opening two paragraphs of “A Radical Restructuring and Redistribution of Wealth,” my review of Radical Markets by Posner and Weyl. It appears in the Summer issue of Regulation. (Scroll way down to see my review.)

The Illusory Arbitrariness of Deploring?

I’ve previously argued that public deploring is exceedingly arbitrary.  The “outrages” we hear about on the news – the outrages that “We cannot tolerate!” – are usually no worse than dozens of other problems that we barely acknowledge or discuss.  In my words:

When I witness the unbearable arbitrariness of deploring, two unsympathetic types of explanations come to mind.

First, people’s negative emotions depend far more on the vividness of the evil than its badness.  A hundred stories about celebrity harassers would upset the world far more than ironclad statistical proof that 10% of celebrities harass.  Indeed, it’s likely that one detail-rich story about a celebrity harasser would upset the world more than the best statistical study ever performed.

Second, people’s negative emotions are intensely social.  People don’t want to rage alone.  They want to get mad with their friends and countrymen.  So when a new round of ugly stories pop up, almost no one asks, “Is this really the best target of our collective anger?”  Instead, they jump on the bandwagon.  Who cares where we’re going, as long as we’re united in negativity?

As examples, I name the crusades against chemical weapons and sexual harassment.  I don’t see why chemical weapons are worse than the endless alternative methods of mass murder, and I don’t see why sexual harassment is worse than the endless alternative ways of mistreating employees and co-workers.

Henderson on Pinker

Steven Pinker’s Enlightenment Now is, quite simply, a fantastic book. In this fact-filled and incredibly well-footnoted tome, Pinker, a Harvard psychology professor, shows how the conditions of life for ordinary people have gotten much better, not just for those in wealthy countries but also for most people around the world.

He shows that life expectancy has increased almost everywhere, health and nutrition have improved, and wealth and living standards have skyrocketed. The environment has improved. The destruction caused by war—and war itself—have decreased. Safety has increased and terrorism is a tiny problem. Literacy has increased. People have become generally more tolerant of others’ differences and people are happier.

He attributes this progress to the Enlightenment, the four pillars of which—as the book’s subtitle suggests—are reason, science, humanism, and progress. In laying out the facts and his argument, Pinker also shows a knack for the punchy, and often humorous, turn of phrase. Although he occasionally slips, as when he criticizes libertarianism, his slips are few and far between.

Predicting Trade Wars

As the aphorism goes, prediction is difficult, especially about the future. But sometimes, the incentives involved and some basic economic knowledge help prediction, at least regarding the not-too-distant future. Having an idea of how Leviathan works, which can be considered a sub-domain of public choice theory, is also useful.

In early May, I wrote for Regulation an article titled “How’s Your Trade War Going?” As Regulation is a quarterly magazine, my article will soon hit the stands, and has just hit the electrons. The outlook has not improved, but I think I did not forecast the current situation badly—besides explaining some aspects of the economics of free trade.

What was in store has been rather obvious since the presidential campaign  and the election of 2016. In a tweet of last week, I wrote:

Trump promised he would be a protectionist, he showed no understanding for the economics of protectionism, he surrounded himself with protectionists, he is acting like a protectionist, and some people believe he is not a protectionist!

I still find this reaction puzzling, especially from intellectuals who should know better.

The New York Times’ Shoddy Reporting

NASHVILLE, Tenn. — A team of political activists huddled at a Hardee’s one rainy Saturday, wolfing down a breakfast of biscuits and gravy. Then they descended on Antioch, a quiet Nashville suburb, armed with iPads full of voter data and a fiery script.

The group, the local chapter for Americans for Prosperity, which is financed by the oil billionaires Charles G. and David H. Koch to advance conservative causes, fanned out and began strategically knocking on doors. Their targets: voters most likely to oppose a local plan to build light-rail trains, a traffic-easing tunnel and new bus routes.

So read the first two paragraphs of a front-page article in today’s New York Times. Here’s the article’s title:

How the Koch Brothers Are Killing Public Transit Projects Around the Country

Do poverty programs reduce poverty?

The answer is “probably”, but by less than you might assume. The LA Times has an interesting article entitled:

New evidence shows that our anti-poverty programs, especially Social Security, work well

I’m not quite convinced by this argument.  The article discusses some very interesting research by Bruce D. Meyer and Derek Wu, which shows the poverty rate looking at only official income data, and then again after accounting for taxes and various income support programs.  I’m convinced by their argument that poverty, properly measured, has fallen rather sharply over time.  There are clearly far fewer poor people in America than when I was young (in 1960).

Indeed research by Bruce Meyer and James Sullivan produced another similar graph that I included in this post, which shows that the consumption poverty rate has fallen to extremely low levels, below 5%.  I like that graph so much I included it in the new principles textbook that I am working on.

Immigration: A Confession and a Value Judgment

I must confess that, contrary to my former anarcho-capitalist stance for unrestricted immigration (shared by many of my co-bloggers here), I now find the topic more complicated. I of course have no economic objection to immigration, if by “economic” is meant its effects on wages, incomes, and the allocation of resources. Basically, as Jean-Baptiste Say would have said, supply creates its own demand. As far as value judgments are concerned—some are ultimately needed to evaluate any government policy—I find no moral case for banning competition by the poorest. Any newborn citizen is an immigrant from within, and—except for Malthusian environmentalists—we understandably don’t worry about that.

The invasion argument is more difficult to reject. Assume that “our” state is a contractual agent for protecting our liberty. An invasion of immigrants who do not share that value would compromise it. We then have a classical-liberal argument against open immigration. How many and what sort of immigrants would actually come is an empirical issue that cannot be decided in advance, and it may be impossible to go back after the fact.

Richard Reinsch on the Enlightenment, Tradition, and Populism

Richard Reinsch, editor of Law and Liberty and the host of the podcast Liberty Law Talk, talks with EconTalk host Russ Roberts about the Enlightenment. Topics discussed include the search for meaning, the stability of liberalism, the rise of populism, and Solzhenitsyn’s indictment of Western values from his Harvard Commencement Address of 1978.

This week's guest:

• Richard Reinsch on Twitter.
• Writings of Richard Reinsch at Law and Liberty.
• Law and Liberty Site.
• Liberty Law Talk. Podcast.

Moises Velasquez-Manoff on Cows, Carbon Farming, and Climate Change

Journalist and author Moises Velasquez-Manoff talks about the role of dirt in fighting climate change with EconTalk host Russ Roberts. Velasquez-Manoff explains how changes in farming can allow dirt and plants to absorb carbon and potentially reduce climate change. At the end of the conversation he discusses the state of the science on hygiene, parasites, and auto-immune disorders that he discussed in his previous appearance on EconTalk in 2014.

Play

Moises Velasquez-Manoff on Cows, Carbon Farming, and Climate Change

Journalist and author Moises Velasquez-Manoff talks about the role of dirt in fighting climate change with EconTalk host Russ Roberts. Velasquez-Manoff explains how changes in farming can allow dirt and plants to absorb carbon and potentially reduce climate change. At the end of the conversation he discusses the state of the science on hygiene, parasites, and auto-immune disorders that he discussed in his previous appearance on EconTalk in 2014.

 

This week's guest:

• Moises Velasquez-Manoff's Home page
• Moises Velasquez-Manoff on Twitter.
• Moises Velasquez-Manoff at The New York Times.

This week's focus:

• "Can Dirt Save the Earth?" by Moises Velasquez-Manoff. The New York Times Magazine April 18, 2018.

Additional ideas and people mentioned in this podcast episode:

• Good Night, Gorilla, by Peggy Rathmann on Amazon.
• Wilderness reclamation
  • Summer Brennan on Wilderness, Politics and the Oyster War. EconTalk. August 2015.
  • Pete Geddes on the American Prairie Reserve. EconTalk. September 2015.
  • "Woolly distaff thistle--an increasing invasive in northern California", Guy B Kyser. University of California Weed Science, April 2, 2012.
  • Jeff Creque. Biography. Marin Carbon Project.
  • Terry Anderson on the Environment and Property Rights. EconTalk. August 2014. Wolves, elk, beaver connection in ecology.
  • Karol Boudreaux on Wildlife, Property, and Poverty in Africa. EconTalk. September 2008. Wildlife management in Namibia.
  • "Healthy Soil: Good for the Farmer, Good for the Planet". Regeneration International, April 30, 2018.
  • Dire wolf. Wikipedia.
• Whendee Silver, Professor of Environmental Science, Policy, and Management at UC Berkley.
• "Allan Savory: How to fight desertification and reverse climate change." TED Talk.
• Autoimmune disease discussions
  • Velasquez-Manoff on Autoimmune Disease, Parasites, and Complexity. EconTalk. March 2014.
  • An Epidemic of Absence: A New Way of Understanding Allergies and Autoimmune Diseases, by Moises Velasquez-Manoff on Amazon.com.
  • "A Cure for the Allergy Epidemic?" by Moises Velasquez-Manoff. The New York Times, Nov. 10, 2013.

A few more readings and background resources:

• Gabe Brown's Ranch: "Regenerating Landscapes for a Sustainable Future".
• Dave Brandt. No-TillFarmer.com.
• The biggest daikon. Keppers' Pottery and Produce, Oct. 26, 2011.
• Healthy Soils Program. California.gov.
• National Resource Conservation Service. U.S. Department of Agriculture.
• "Health Secrets of the Amish," by Moises Velasquez-Manoff. The New York Times, August 4, 2016.
• Global Warming: A Balance Sheet, by Thomas Gale Moore. Concise Encyclopedia of Economics.
• Greenhouse Effect, by Thomas C. Schelling. Concise Encyclopedia of Economics.
• Friedrich Hayek. Biography. Concise Encyclopedia of Economics.
• Milton Friedman. Biography. Concise Encyclopedia of Economics.
• Carbon Sequestration. Encyclopedia Britannica.

A few more EconTalk podcast episodes:

• Matt Ridley on Climate Change. EconTalk. June 2015. Definition of a lukewarmer.
• Nassim Taleb Podcast Episodes and Extras. EconTalk.
• Gary Taubes Podcast Episodes and Extras. EconTalk.
• Janet Golden on Babies Made Us Modern. EconTalk. June 2018.
• Greg Page on Food, Agriculture, and Cargill. EconTalk. January 2015.
• Lisa Turner on Organic Farming. EconTalk. December 2012.
• Adam Cifu on Ending Medical Reversal. EconTalk.

 

| Time | Podcast Episode Highlights | | --- | --- | | 0:33 |

Intro. [Recording date: May 18, 2018.]

Russ Roberts: My guest is journalist and author Moises Velasquez-Manoff. He first appeared on EconTalk in March of 2014 discussing his provocative book, An Epidemic of Absence--his look at the idea that avoiding germs and parasites in modern times may have been the rise of very subtle immune disorders--asthma, various allergies. Today we are going to talk about a recent article he wrote in the New York Times--can dirt save the earth? And, if we have time we'll circle back to the story of germs and parasites. Moises, welcome back to EconTalk.

Moises Velasquez-Manoff: Thanks for having me. Great to be back.

Russ Roberts: No, your story in The Times starts with a little bit bizarre; and for me, as an economist, a fascinating story, even though it doesn't have that much to do with economics. But what it has to do with is complexity and emergent order, which of course I'm always interested in--as listeners know. Tell the story of John Wick and Peggy Rathmann--their cows on their porch of their house and what they discovered as they tried to live a wilder lifestyle on their ranch in Marin County--

Moises Velasquez-Manoff: Right. So yeah. So, in the late 1990s--so, Peggy Rathmann is a children's book author. And probably any parents out there, seems like anyone owns a copy of Good Night, Gorilla, including us, which is this classic children's book. She wrote that book and numerous others. So, she lives in San Francisco--lived in San Francisco in the late 1990s--and they needed more space because their apartment was getting full of their illustration. And her husband, John Wick, was then a construction foreman. So they started looking for places up north of San Francisco in Marin County and found this ranch of over 500 acres, which they ended up buying; and they bought it because they wanted--basically it had this huge barn that they wanted to turn into an illustration studio. And it gave them a lot of space. Ultimately that never panned out because the barn was oriented wrong for the light or something: it never really worked out. But, what did end up happening was that--so they were just enchanted with life up there, this bucolic life, lots of animals, and gophers; there were even mountain lions wandering around, as there are out here in the West. And, they decided to turn their land back to what they thought would be wilderness. So, it had--all that country is sort dairy country, or cow country. It's been that way for like a hundred years.

Russ Roberts: Not exactly wilderness, by the way. One of the stranger things is when you go north of San Francisco, you do see, on Route 1, you do see cows grazing. It's 1 or 101. Route 101, I think.

Moises Velasquez-Manoff: That's right.

Russ Roberts: You see cows grazing by the side of this road. Kind of wild, but they are cows--not so wild.

Moises Velasquez-Manoff: Yeah. No. Absolutely. It's a very agricultural landscape, and specifically dairy-oriented: for some reason, that climate produces--you get the marine zone wetness coming off the ocean, so even though it doesn't rain, like, except for 3 or 4 months of the year, you still get good grass growth there. I think that's one reason. At any case, so, some rancher had rights to their land, or the previous owner had sold rights, grazing rights. So they revoke those rights; they kicked the cows off the land in pursuit of going back to wilderness. And what happened was the landscape started changing right away, turning into something that they did not like. Which was, a lot of invasive weeds started moving in, and brush started moving in. I mean, if you know about ecological colonization theory, it's not that surprising. So, what happens is like, grasses are the first colonizers of a disturbed landscape; then brush moves in; then maybe some scrub--depending on what the climate allows for--some scrub trees. And they are probably the oak scrub forest or something naturally. And so, really what they were seeing was this sort of recolonization, without the grazing pressure, of these different plants which they didn't appreciate. Because, you know, you walk out to this landscape of rolling hills, verdant pasture; and all of a sudden it's becoming clogged with all these opportunistic weeds. Right? And they didn't really like it that much. So, they--first of all, John Wick went out and tried to actually, literally, kill some of the weeds back. There's one called the Woolly Distaff Thistle, which is--it's an invasive--it looks like a marigold on steroids. We have them in my backyard, too. It's prickly and has these yellow flowers--but it's a really powerful plant. It just moves in; it shoots in, and it's hard to like actually pull with your hands because it has these kind of spines on it. So, he was using these kind of herbicides and all sorts of stuff, trying to pull it out, mow it. Of course, none of that works. Because you are dealing with sort of this force of nature that's not--it's not sensitive to that kind of intervention. So, then they meet this rangeland ecologist, Jeff Creque, who says, 'Well, what you should do is instead of focusing on what you don't want to be there, trying to beat it back, you should focus on what you do want to be there.' And, so he looked at the hillsides and he said, 'I bet,' this is actually not in the article but he said, 'I bet that there are seeds in this dirt still from the old, perennial grasses that used to exist in California, pre-European contact.' So, like, in California in general, there have been grasses introduced with European, basically with cows when the Spanish first and then with the United States. So, annuals grow and then die in one year; and perennials are those more big, bushy grasses that live year after year; and they have these really deep root structures. So, he said, 'I bet there are perennial seeds in there, still, if you just graze the landscape in the right way.' So, yeah, so he said, 'If you bring back cows it could actually help with this problem that seems to have emerged after you kicked cows off.' Like, so, just to give some background again: Cows are generally, from the conservationist standpoint, are blamed for denuding landscapes; for desertifying them. And for good reason. I mean, that has happened around the globe, everywhere, throughout human history, where overgrazing has basically turned semi-arid landscapes into deserts. You know, all around the Mediterranean rim, and basically almost anywhere, throughout the American West, and anywhere that wasn't moist. And cows can be a horrible sort of environmental destructive force.

Russ Roberts: It's like--we had the same issue in Yellowstone, which I've written a little about and I think it's such a fascinating related story, where they get rid of the wolves, because people are scared of wolves, I guess; ranchers don't like 'em near the Park; the elk population grows tremendously, and as a result the elks denude--and eat down to the ground basically anything, all kinds of stuff, riparian systems around creeks and streams. And that ends up killing the beavers, because they have no stuff to make dams with any more. So you get this crazy thing that wolves are connected to beavers. If anything, you'd think wolves would eat beavers. And so, fewer wolves, more beavers. But if works the opposite way. And, you know, cows don't have any predators. So if you do keep them in one space, they will kind of eat everything. Well, they have predators; they have us. But I mean, if people want to keep a herd going, they are going to kind of eat a lot.

Moises Velasquez-Manoff: Right. So, Jeff Creque is basically making the point that if you graze cows like wild herbivores that are pursued by predators--so, the term is 'mob grazing.' That's one term. And the idea is just to keep 'em moving across the landscape. Don't leave them in one place too long. Keep a tightly packed herd, the way you can imagine a herd of buffalos pursued by those buffalo-wolves that we used to hear about back in those--those gigantic wolves that used to hunt buffalo on the plains--

Russ Roberts: 15, 20 feet long. Yeah. Hmh, hmh, hmh, hmh, hmh.

Moises Velasquez-Manoff: What, the wolves?

Russ Roberts: Yeah; I'm kidding.

Moises Velasquez-Manoff: I'm not talking about the dire wolves.

Russ Roberts: Kidding. Kidding.

Moises Velasquez-Manoff: Well, it's funny, actually--I was reading--this is a little bit of [?], but I was reading Laura Ingalls Wilder, The Little House on the Prairie, to my daughter a few months ago. And they saw some of those--you know, when those settlers are moving onto the Plains, they still saw some of huge wolves that were remnants of an older population--they were just getting killed off--that used to hunt buffalo on the Plains in the Dakota. In any case. So, he brings the cows back and then manages them in this new way: Instead of just letting them free-roam, basically, he cut up his land, if I recall correctly, like 67 different separate lots that he moved them between. So that each lot would get intensely grazed for a very short period of time. And, sure enough, the landscape responds. Their pasture returns. And, actually, what's interesting, is he tells me, John Wick tells me, that weeds actually taste very good to cows. So, the weeds are like the first things to go. I mean, in a way it makes sense: Like, any plant that has prickles and stuff all over it is a plant that probably tastes pretty good. That's why it has prickles all over it, to defend itself. So, the landscape is reverting back to what they considered to be, what they really wanted when they thought of wilderness. Which is not at all wilderness. Right? It's more of a graze ecosystem.

| | 10:14 |

Russ Roberts: It feels like wilderness to us, because we don't know what the real thing was.

Moises Velasquez-Manoff: Yeah, but honestly, if you go back to pre-, like the Native American times, that's what these ecosystems were. They had large grazers like elk. And they had lots of predators, like big cats and bears. There was grizzlies out here in California.

Russ Roberts: And humans. Yeah.

Moises Velasquez-Manoff: And humans, of course. And pre-native American, there were even larger grazers. You know? There were these mastodons, and the mammoths. I'm not sure which ones were out here. But, huge grazers were out here shaping the landscape with huge predators following them. So, this is what exists when people don't interfere. Long story short; I'll fast forward here. So, they become curious about--Jeff Creque is very interested in climate change. He's worried about it. He thinks--he's interested in the idea that you can get carbon into the soil from the atmosphere. And basically how that would work was the plants, of course, capture carbon dioxide during photosynthesis. And, they use the carbon to build their own tissues, as well as to, they excrete sugars into the soil to feed micro-organisms, that then, in exchange for those sugars give them other nutrients that the plants might not be able to get on their own. So, he urges John Wick to get in touch with the soil scientist at U.C. Berkeley, Whendee Silver, and they basically come to an agreement where she's going to study their land and see if they are getting any carbon into the soil, doing what they are doing.

Russ Roberts: And the argument-what would be the logic? Because they've got a richer grassland now?

Moises Velasquez-Manoff: Yeah.

Russ Roberts: They'd maybe absorb more carbon from the air nearby, and that carbon would show up either in the soil or the plants themselves.

Moises Velasquez-Manoff: That's right. And there is--there is a whole sort of--well, there is an argument out there that I did not go into in this article. But, I guess its major proponent is a land manager named Allan Savory. And he gave this TED Talk--he's very influential in ranching circles; very controversial in scientific circles--mostly because the evidence of what he says is possible doesn't exist yet.

Russ Roberts: Yeah, 'We'll find it. Give us time. We'll make it up if we have to.'

Moises Velasquez-Manoff: But he makes his argument-- That's where we are, kind of. So, he basically argues that if you just graze right in this way, this mob-grazing way, which he calls 'holistic management,' that you can actually--we can deal with climate change. You can [?] the world's deserts, and sort of--it's the opposite of what most conservationists think about cows, which is that we should get rid of cows because they not only denude the world, semi-arid regions; they also belch methane, which is a greenhouse gas that's about 30 times more powerful than carbon dioxide.

Russ Roberts: But the argument here is that cows are going to allow healthier--even though they themselves might not be so great, they are going to clear a path for some really good things to grow in the soil, and improve the soil so that there will be less carbon in the air. And then it's an empirical question of whether they are a net positive or negative. And then there's another empirical question of whether you can get those benefits without cows, somehow.

Moises Velasquez-Manoff: Yeah. So, I think fundamentally, if you back up: The premise that grasslands can capture huge amounts of carbon from the atmosphere and put it in the ground is absolutely true. Some of the richest soils that we have are, were formerly grasslands. Like, the Great Plains. Like the Midwest. Like the Ukrainian Steppe. These were all grasslands before we plowed them up to plant stuff. And that, like, that is it, like 7 feet of topsoil or something, in Iowa? Like some amazing amount. And that soil is just incredibly rich? Those same ecosystems also hosted huge wild grazers. Right? I mean, there were just herds of, millions of buffalo running up and down the Great Plains.

Russ Roberts: Lewis and Clark, what they saw when they went there.

Moises Velasquez-Manoff: That's right. And, in Eurasia, it was, maybe horses; I mean, since there was this sort of human footprint it was a little bit bigger there. But there were also huge grazers there, as well. So, it's fundamentally true--there's also this Paleobotanist at the University of Washington, if I remember correctly, Gregory Retallack, who argues that in deep time, the co-evolution of large grazers and grasslands became so efficient at pulling carbon out of the atmosphere that it actually reduced the amount of carbon dioxide in the atmosphere such that it triggered the ice ages, which begin around 2 and a half million years ago; before that there were no, sort of, these periodic glaciations that we call the Pleistocene. That, they weren't happening. Right? Earth was kind of in a different sort of phase, where it was just a lot warmer all the time. So, he makes this argument that it actually cooled the earth and caused this, and these periodic glaciations. So, I think that's fundamentally true. And when we think about grazing and grasslands. But, whether or not cows, which are domesticated animals, can do, replicate, what happens in nature is, you know, still an open question, I think. Right? This is this idea that's out there that John Wick and Jeff Creque were interested to see if they were doing. And, actually, I should point out that they discovered that it wasn't happening. There was not carbon getting into the ground from grazing. So, what ends up happening--I'll back up a little bit from that point--is that they start their--Whendee Silver starts their studies with a series of just baseline measurements in Marin and Sonoma Counties of rangelands, just to get a sense of how much carbon is there to begin with. Right? In the soil. So, they dig these 3-foot long soil cores out of the ground and examine them. And, what she discovers is that dairies--dairy farms--have a lot of carbon in them. And it's very recent carbon. Like, it's got there recently. It arrived into the ground recently. And, so they go around asking, 'What are you guys doing different on these dairy farms?' And what they do is they: Dairy farms, they milk their cows; they take them to a central shed. And they have a lot of manure they have to deal with. It's a huge problem, actually, in dairy farming, in the sense that you just have to manage a lot of manure. And they use water to wash it away. And so they end up with this kind of slurry, this manure slurry. And what they did, a lot of those places, a lot of those farms, is they sprayed it back on the land as a fertilizer, in a way as a way to manage it. So they were basically--what she discovers is that there are things you can do to your land that increase the carbon content of the land. Right? And that dairy farmers are already unwittingly doing this. So, they decide: Maybe we can replicate this--John Wick. He says, 'Maybe I'd like to be able to replicate this, but I don't want to use cow manure. Because cow manure releases lots and lots of methane, which is a powerful greenhouse gas, and lots of nitrous oxide--an even more powerful greenhouse gas.' So the numbers are like methane is around 30 times more powerful than carbon dioxide; and nitrous oxide is around 300 times more powerful. So, they--Jeff Creque--he had been an organic farmer, so he was very familiar with compost. And compost is basically just--it's food scraps or shredded trees or any kind of organic material, really, that's been decomposed, partly decomposed, by microbes--by--these are microbes that are not anaerobic. So, like, the key to composting is, of course, anyone who has a backyard compost pile knows, is you have to constantly sort of turn the pile to keep it aerated--to keep oxygen in there. Otherwise you start getting really nasty smells. And, from the scientific point of view, you start getting those powerful greenhouse gases. So, they put a bunch of compost--about half an inch--over a few acres. But what they discover over the following years is that compost seems to act like, on one hand, like a kind of fertilizer--a long, slow-acting fertilizer on the landscape. So that it supercharges the grass growth. This is rangeland. This is land that is being--you know, it's grass, it's being grazed at the same time. So, it makes about 50% more grass grow. Which is great. It's great for anyone who has cows on the land--which John Wick does have. And it causes--it allows more water to be absorbed or held in the soil, because the more organic material you have in the soil, the organic material acts like a sponge and holds the water. So there's more water stays in the soil. This again, this is grassland that gets water only in the winter, really; and then, the rest of the summer here in California, on the Coast, we don't really get any rain. Except we get this marine layer moisture that comes in, but that's it. And then, what's happening also is that carbon is going into the ground at an incredibly rapid rate. So, and in untreated control plots, the carbon is getting lost from the ground. This is just--nothing is happening on the land; land is being grazed; carbon is seeping out of the ground. And no one is really sure why this is the case; but it's likely that it results from that transition I mentioned earlier of the kinds of grasses that grow there: from the old, perennial kind, which are--you know, they grow, year after year of the same plant, and they have really deep root structure, so that, those deep root structures push carbon into the ground, or deposit carbon in the ground--and annuals, which don't have these deep root structures. So, the landscape had gone from perennial to annual. And that probably causes, caused over time, a loss of carbon. But, on the treated plot, the opposite happened. Carbon was getting absorbed. And most of that carbon--so, compost is very rich in carbon. Obviously, anything that's organic has a lot of carbon in it. It also has nitrogen and a lot of other stuff in it. Um, but the carbon that was going in to the treated lots was, most of it was not from the compost. Most of it was from the air. Meaning that: She had--she, being Whendee Silver--had basically caused the ecosystem there, in that treated plot, to become so, to accelerate at such degree, to accelerate photosynthesis, that there was just carbon being pumped into the ground.

| | 21:04 |

Russ Roberts: So, I'm going to pause you here, because it's a little bit complicated. And I just want to let--do a little reset here for listeners. First, I want to point out something you point out in the article, which really, an incredibly beautiful idea, that of course the carbon that we use for energy purposes, like oil, is the result of this process from billions of years ago. That, plants absorbed carbon, died, went into the ground, and eventually turned into petroleum. Correct?

Moises Velasquez-Manoff: That's right. I think oil actually comes from some--but, I mean, fundamentally, yes, you are right. But oil comes from a marine process. Coal comes from a wetland process. But, yes, you are fundamentally correct. All that carbon came from photosynthesis and got deposited somewhere. And then got buried at some point. And then was fossilized after it got buried and became this fuel that we now power civilization with.

Russ Roberts: Right. And we create civilization with it. And we pump a lot of it into the air as a result. And, it seems to be getting a little bit warmer. We can debate about how much. I'm a lukewarmer. The meaning--I think there's some warming; I don't know whether it's catastrophic; but I am worried about it a little bit, I think, because you should always worried about the downside risk that could be catastrophic. I learned that from Nassim Taleb. And common sense. And so, that's just a beautiful thing, that we could recreate that, use that same process, to get the carbon that's in the atmosphere now back into the ground. It's kind of a cool thing. The economics of it, of course--and by that I mean not the financial part, but the big picture economics--is: This does strike me as--my favorite Hayek quote: "The curious task of economics is to demonstrate to men how little they really know about what they imagine they can design." So, part of this--your article has this really crazy idea that somehow we are going to re-engineer the soil to solve this other problem we've got over here. And we don't really understand the whole thing, really that way. We get glimpses of what's going on. We run this one study--Whendee Silver's done it--that looks encouraging, this incredible reduction of carbon. But we don't know if it's going to scale. We don't know what the other effects are. We don't know if by spreading compost in a really wide range across all kinds of different terrains, what could happen. But, the bottom line is this encouraged people to start thinking about one way to fight global warming, and climate change: Which is to change farming rather than, say, cars. Which is really interesting. Which is why we are talking.

Moises Velasquez-Manoff: That's right. And it's often these, these modifications in the agricultural world, are a lot cheaper than, you know, photovoltaic panels on all houses, or all this more high-tech stuff. Because, you are just tweaking how you do what you already are doing, in some respect. And I should point out that, um, this is often thought of in the circles of people, the proponent circles, as being beneficial to the farmers themselves--

Russ Roberts: And we're not going to punish them--

Moises Velasquez-Manoff: That's right--

Russ Roberts: for their bad use of cows and therefore put a big tax on cows, or force them to change. We're going to find a win-win, is the ideal.

Moises Velasquez-Manoff: Well, it's more that, um, by getting carbon in the soil, you actually improve the efficiency of fertilizers. So, like, you need basically less fertilization of synthetic fertilizers the more carbon you have in the ground--

Russ Roberts: They are expensive--

Moises Velasquez-Manoff: That's right. You save money. And there are a bunch of other things, as well. Like, I mean--it's interesting because, a lot of this stuff was clearly known before the advent of the modern agricultural tool kit. We know of synthetic pesticides and fertilizers. This is what farmers had to do before, you know, the 19th century when [?]

Russ Roberts: spread a lot of manure. Yeah.

Moises Velasquez-Manoff: But they knew that you had to return all organic material to the land. Otherwise your land would stop producing. Right? And so, like, there are these--there were these revolutions in Europe, for example, where they sort of centralized the cow barn to all--in terms of all the fields--so they would be in the middle of the whole operation, so that they could get the manure back to the fields easily. Right?

Russ Roberts: It's like the spoke and hub airline[?] system. It's great.

Moises Velasquez-Manoff: Right. Right. Exactly. And they were often getting human waste back to the fields. I mean, there is a point where there was competition for the nitrogen in human waste for producing making gunpowder with it, rather than putting it back in the fields. Right? In Europe.

Russ Roberts: I like your term--I think you mentioned it in one of your [?]--'humanure'. I don't know how to pronounce it--hu-manure. But that somehow--there are other words for it; we won't use them on the program, but that's an attractive name for it.

Moises Velasquez-Manoff: The other term is 'night soil,' which is used in the early 20th century, which is just, whatever is in your chamber pot, which is another nice euphemism, went back on the garden in the morning. Right? And this is part of how agriculture worked, because otherwise your land would, after repeated growing, your land would start to lose its fertility and nothing would grow there. The other aspect of this was that you would rotate what you did on your land: crop rotation. You would change what grew where, because different plants both feed the soil in different ways and also take different things out of the soil. And you would also rotate in grazing with your farming. So that, you would let one field that, let's say, grew corn last year, you would just let it go to pasture and graze on it for another year; and then plow it the following year. These are all techniques to maintain fertility. Which, I guess they are just sort of coming back, because after almost a century of doing everything synthetically, a lot of the land is, in the United States and in the world, in the developed world, is exhausted--

Russ Roberts: is tired. You have an amazing statistic in here which I just never imagined to be the case. I assume it's true. "More than one third of earth's ice-free surface is devoted to agriculture." Part of the reason it's hard to believe is the United States, which of course has, for better or for worse, probably the world's most productive agricultural system--in certain crops for sure; I don't know how widely that's the case. But, we've got some great--we've got great machinery, to keep the price down; and we've got great synthetic stuff to keep yields high. And we have great seeds; and we're at the cutting edge of everything. But most of the world is not. A lot of the other parts of the world are not, and they need a lot more land to grow food. And it just--right? It's just surprising that that--

Moises Velasquez-Manoff: That statistic also includes rangeland; and about two thirds of what we do with land in the world is grazing it. Just like one third of that is actually used to grow crops. Because, most marginal land is used for grazing--like the hills and stuff, you can't plow up. That's just--you let cows roam on it; and especially in poor countries, you are able to get another protein source from that grass, that land from which otherwise you wouldn't be able to get anything from.

Russ Roberts: Right. Cool.

| | 28:42 |

Russ Roberts: So, where are we? So, this experiment gets done. Talk about where--I just like that story; for a lot of reasons, I like it, because of the unintended consequences part of it: The fact that these people hated these cows and thought that by getting rid of them, they'd make their land better when in fact their land got, to their eye at least, worse. The other thing I like, I just want to mention because I don't want to miss this chance, Moises, is that your research interests and interests as a writer strike me as united--I'm sure; I assume you've thought about this, but maybe not--so your first book--I don't know if it was your first one: An Epidemic of Absence: A New Way of Understanding Allergies and Autoimmune Diseases is about the microbiome; it's about our gut. And this article and other stuff we are talking about is about the soil. And on the surface they have nothing to do with each other. But, they are united in a couple of ways. One way is that they are both about complex ecosystems, emergent orders that are not easy to look at.

Moises Velasquez-Manoff: That's true, yeah.

Russ Roberts: So, the soil is underneath the ground; and my gut is inside my body. And so, they are complicated systems; they are hard to get at. And as a result, there's all kinds of things to be discovered there that may not be obvious and are connections you don't get to see and might not appreciate. So, I don't know--there's a symmetry in your work there that I love. And then there's cows. Because, cows are good for the soil, and they may appear to be good for helping us fight autoimmune disorders by introducing parasites and other things into our microbiome that we've lost as we've moved away from agricultural life. If we have time, we'll come back and talk about that and the gut. But I just wanted to point those out.

Moises Velasquez-Manoff: Yeah. Well, actually, they're more closely linked, these two big themes in my work, in the sense that the microbiome of the soil is also what's responsible for the carbon sequestration. So, the plants--basically, what plants do is they capture carbon from the air, and beside making their plant forms, their actual tissues, they create sugars with a huge amount of the carbon that they get from the air. And those sugars go right into the ground to feed the microbiome of the ground. So, there is this whole microbiome in the ground--I mean, this whole ecosystem really in the ground, that's being fed--the plants are basically working as pumps. Carbon pumps. This is how it was described to me by, I think, Whendee Silver, I remember. But, the purpose of the plant in this big ecosystem is to just pump sugar into the ground, or other kinds of carbon, long carbon chain molecules, that are then consumed by this incredible array of life in the soil, that then returns other nutrients in exchange for those sugars. But that is the carbon pathway of how you get carbon from the air into the ground--is, basically, by passing it through all these life forms. And huge chunk of those life forms are microbes. In the soil. So, basically, healthy soil is basically about a healthy soil microbiota[?]

Russ Roberts: It's all about the gut. Whether it's inside you or underneath the ground. It's all about the gut.

Moises Velasquez-Manoff: That's right. You can think of the soil microbiome as a kind of analog to the gut microbiome, in a way. It sort of powers everything. Like you said. And yet we don't pay much attention to it. We haven't historically.

Russ Roberts: Well-- go ahead. Sorry.

Moises Velasquez-Manoff: Well, I was going to say that the advent of genome sequencing technology is letting us see both these microbiomes in a way we absolutely could not see them in times past. That's another part of this story.

Russ Roberts: When I was a little boy, I did not grow up in farmland. I grew up in suburban Massachusetts, mostly, in Lexington. And we'd go out--we'd play in the dirt. And we loved worms; and I like to fish; so we'd dig up dirt and find worms in there. And if you'd asked me, since I didn't have a farming background, 'What's underneath the earth's surface?' it's--well, it's dirt and worms. Well, of course, I'm getting there. But the idea of the richness of soil, the chemical composition of soil, the difference between dirt, clay, and, say, loam--a rich, fertile soil--people for most of human history were obsessed with it. We're not really that involved with it. I'm going to read one more thing from your article, by the way; and then we'll get back to the policy stuff. And I hope listeners are enjoying this, because to me it's extremely interesting. But we'll get to some policy implications in a second. It says--you are talking about when they brought the cows back to the Marin County acreage that Wick and Rathmann, the children's book author at their ranch. It says,

By summer's end, the cows, which had arrived shaggy and wild-eyed after a winter spent near the sea, were fat with shiny coats. When Wick returned the herd to its owner that fall [Russ Roberts: This is the herd that he had grazed on his land to try to get it back into shape] collectively it had gained about 50,000 pounds. Wick needed to take an extra trip with his trailer to cart the cows away. That struck him as remarkable. The land seemed richer than before, the grass lusher. Meadowlarks and other animals were more abundant. Where had that additional truckload of animal flesh come from?

And, of course, the answer is they were eating carbs. Which brings us back to other EconTalk episodes.

Moises Velasquez-Manoff: That's right--

Russ Roberts: Carbs and weight gain. So, I just thought I'd bring that in. I loved that. So cool.

Moises Velasquez-Manoff: Yeah; that's right. And, of course, those carbs were coming from the sky. I mean, that's the whole--the carbon cycle, that we often forget. But the carbon cycle basically begins with photosynthesis. And then you eat the plants that have captured the carbon; and then plants eat those--I mean, other animals eat those animals, on down the chain. And they decompose, go into the dirt; other plants grow out of it. And eventually all that carbon is released back into the atmosphere--that, the carbon represented in that first plant that grew that was eaten by the cow. But that's the short-term carbon cycle right there.

| | 34:38 |

Russ Roberts: So, what is this--this is really cool. It's fascinating to me; it's interesting; it's a beautiful example of the seen and the unseen, a theme I love in economics: emergent order, things that are complicated and related to each other in not-obvious ways. Which I love. But, is it important? Is it really a potential mitigator of climate change in any way? And, who is skeptical about it? Why are they skeptical? You know, obviously, if it was good farming practice across the board, it would just happen. Is there something that people are trying to encourage artificially? Are there subsidies, or various regulations? And, what's the potential? What do you think? It's a great story. Is it--is it of any meaning?

Moises Velasquez-Manoff: So, carbon farming with compost is just one method of carbon farming. And carbon farming is the idea that if we can get carbon into the air, into the soil or into just living trees or plants, you know, woody material that's not the atmosphere, right? So, well, so, there are other methods of doing this that don't involve compost, like, you know, cover crops. Some of the older stuff that I alluded to earlier--the older agricultural methods that, because in the past, when we didn't have synthetic fertilizers and farmers who naturally obsess with soil health--you know, they maybe call it that. They sort of developed all this stuff. And so, there's a movement now, afoot, independent of what John Wick and Peggy Rathmann are doing, sort of encompassed under the moniker 'Regenerative Agriculture,' where they are trying to--a lot of the agricultural land in the world is exhausted, because it's just, you know, we've basically plowed the hell out of it and doused it with herbicides and pesticides, and fertilizers, when it was losing fertility. So, the idea is to sort of regenerate some of the soil. So, I visit one other farmer who is doing this stuff as a way to just farm more efficiently. And, um, to answer your question: because, we have to think of this as a suite of practices, right? It's not just compost. There is a whole number of things you can do. And the idea is to get farmers who are cultivating crops to take up some of these practices. And these guys--there's a number of people around the States now doing this--Gabe Brown, I reference: he's sort of a pioneer--they say that they are producing crops with fewer fertilizers, fewer pesticides. These are not organic heads. You know. There's no ideology here. What they are trying to do is farm more efficiently so they can make more money. Right? And--

Russ Roberts: Nothing to be ashamed of there.

Moises Velasquez-Manoff: in being more efficient-- No, no. These are not--not that there is anything wrong with California hippies. But these guys are not California hippies. They are sort of middle-country, just regular farmers just looking for ways to do things. I mean, farming is a difficult business. The profit margins are so, so slim. Right? And so, anything you can do to keep more of the money that you generate is good. And what these guys do, it sounds like I've talked to a few of them, is that by focusing soil health, they reduce their pesticide use, their fertilizer use, their herbicide use. You know, they get basically nitrogen into the soil by using cover crops--cover crops like legumes. Legumes have the nitrogen-fixing bacteria in their roots. So you get that in there naturally without having to purchase synthetic fertilizer. And I know people will say fertilizer is cheap. But I also--you know, the profit margins are so slim, anything you can do is going to help you out. And so, what they do is they produce crops, they say, for about 20% less than conventionally-farming people. And so you see[?] realize[?] everyone doing this. What they are doing, right?

Russ Roberts: Let me guess--one reason is these are smaller farmers than the largest farmers in America--I assume is part of it.

Moises Velasquez-Manoff: That's part of it. But that is not the answer that they give. The answer that they give is that, people don't want to change the way they've farmed for, perhaps, generations. And, in a way admit--they know, and admit in a way that they made a big mistake--

Russ Roberts: Yeah. Sure. That's no fun. It reminds me of the doctors who thought women were dying in childbirth because the windows were open, and that brought in bad air. Right? And, while, what's his name--

Moises Velasquez-Manoff: Semmelweis--

Russ Roberts: Semmelweis,
God bless him, although it took way too long for people to agree to it--he said, 'Maybe you should just wash your hands.' He did a little, quick experiment, showed it; and they weren't convinced. Because it was one experiment. It was a small sample. For him it was so obvious, he didn't even to make it larger. But, for them, it was like, 'You're telling me that I've been murdering women because I went for the morgue, [?] in childbirth to go deliver her baby, and you're telling me for the last 30 years of my life, I'm a killer.' And he just couldn't face it. I think that's a huge part--there's a huge psychological part to that. Yeah: You've been an idiot, in this case; and maybe you've damaged the environment, too. It's no fun.

Moises Velasquez-Manoff: And, by the way, Semmelweis ended up dying in an insane asylum.

Russ Roberts: Yeah, I forgot about that. But he wasn't--go ahead. He wasn't fully appreciated. He resented the fact that in his lifetime, his ideas were seen as quackery.

Moises Velasquez-Manoff: Absolutely.

Russ Roberts: I don't know if that, literally--

Moises Velasquez-Manoff: An insane asylum.

Russ Roberts: I don't know if that literally drove him crazy or not. I wonder if--

Moises Velasquez-Manoff: I think probably syphilis drove him crazy. But that was the big--it is a huge tangent. But, the idea being that you can be right and never be recognized for it and in fact be sort of marginalized, easily, in your lifetime.

Russ Roberts: Well, Milton Friedman stayed happy and cheery even when he was in total intellectual desert and laughed at because he thought that inflation was caused by printing money. So, he's always my exemplar of the other part--

Moises Velasquez-Manoff: Well, there you go--

Russ Roberts: But, plenty of people do, at least become bitter and deeply troubled by the fact that the world doesn't recognize them for their genius. And, he was--I don't know if he was a genius or just lucky, but he was right. We know that now as much as we know anything. And it must have been no fun to think that people were dying because people didn't accept his ideas.

Moises Velasquez-Manoff: Yeah. And in this case, and in the farmers' case--so, I mean, they don't care if other farmers accept it. Because they are making a profit. They are [?] as they did before. And they also--truth be told, so the guy I profiled in Kansas, Daron Williams[?], they are also selling to these niche markets where they can get slightly more money for their product. Because they can say, you know, 'This is cows, raised in such-and-such fashion.'

Russ Roberts: Correct.

Moises Velasquez-Manoff: But, not all of them are. There is a guy, Dave Brandt, out in, I want to say, I think he's in Ohio. He's using cover crops--no animals. He's competing directly in the commodities market. And he's getting--he says, 'Yeah, I produce stuff about 20% cheaper than all my neighbors. So, it's not--it's not absolutely true that, like--for example, if we think of that, if we could scale all this up, will that little advantage of having that niche market would go away. Right? Because there would be no niche market any more. But this guy is competing in a huge market already; and he's doing fine. So, I don't know. So, I mean--

| | 41:49 |

Russ Roberts: So, I guess, just to bring in a little more economics--and I think you alluded to this in a phrase, maybe a sentence in your piece. But, if everyone did it, and it brought down the cost of production enough that it lowered price, through competition, people would eat more of some of this stuff. And that might offset some of the gains, because there would be more land, then, devoted to some of these products. And so--the world's a complicated place.

Moises Velasquez-Manoff: It is complicated. But, I think that what is indisputable, or at least somewhat indisputable, is that--

Russ Roberts: Oxymoron of all time, Moises--I love that--

Moises Velasquez-Manoff: Right, is there a softer adjective for 'indisputable?'

Russ Roberts: It's like somewhat literal. Is it figurative, or is it literal?

Moises Velasquez-Manoff: Yeah. These guys, their land is more resilient when they farm it this way. So, they are more--they are better able to withstand the inevitable shocks of farming life, like not enough rain. For example, if you have more carbon in the soil your crops are more resilient because there is more water stored in the soil. Not having to use as much fertilizer because you have more carbon in the soil. So, there's a way that it improves farming such that, you know, they are constant sort of shocks from price to weather to what have you in farming that you are insulated a little bit from those shocks because your soil is healthier. And I that is something that everyone could get on board with, in theory. The flip side, though, is this psychological aspect of tradition that we talked about. And I have to say that the one practice that people have the hardest time--and I do, too, in some ways--considering that it might have been a mistake, is plowing. So, these guys are all doing no-till growing, which means they don't plow any more. Because plowing causes carbon soil loss. So, it's like 10,000 years of agriculture [?]--

Russ Roberts: Human history--

Moises Velasquez-Manoff: right? And all of a sudden, it's been a mistake?

Russ Roberts: Yeah; we call it 'working the land.' You tell me I'm not supposed to work the land any more? It's--yeah. That's kind of weird.

Moises Velasquez-Manoff: Well, the reason it is, is because we plow because it sort of loosens up the soil, obviously. And you can use cover crops also to loosen up the soil. Like, these guys all grow these huge daikon radishes that are like--feet long. If you look at photos of what David Brandt grows, they're like 2 feet long, these radishes. And they break up the soil--these huge roots going into the soil break it up. That's number one. And number two is, you plow to limit weed growth. And, what these guys use instead is--First of all they graze their land; they rotate grazing into their land. And they use carbon crops to basically--what they are doing is engineering an ecosystem, where weeds can't get a foothold. So, when you grow crops there that grow really high, you are squeezing out the weeds. You are not allowing the weeds to take root.

Russ Roberts: It's just so incredible. Yeah. There's something really beautiful about it, right? And I love the inevitable trial-and-error: they are trying different things. Like, I'm sure the first guy trying this didn't say, 'Daikon radish. Of course.' You know, somebody thought of that idea and tried it, and it seems to work; and it's a beautiful thing.

Moises Velasquez-Manoff: Well, you know, Gabe Brown pioneered a lot of this. He's in North Dakota, in the 1990s--incidentally, because he had--his crop had been ruined by hail for three years in a row, and banks would no longer lend to him. And so, he had no way to get to pay for things he needed to pay for conventional farming. So, he said, 'Well, how am I going to farm?' And then he thought, 'Well, how did the guys used to farm before they had synthetic pesticides and all this other stuff?' And he ended up reading the journals of Thomas Jefferson, who, you know, ran, like a--

Russ Roberts: a farm--

Moises Velasquez-Manoff: Yeah. Not just a farm--a plantation. Right? So, he read, and there he learned about crop rotation and using livestock. And you know, they had all this stuff figured out. And I think maybe even some of the carbon crops[?], at least the rotation of part of the carbon crops[?]. And then he also read about how Native Americans used to farm on the Great Plains. And, there he learned about legumes and mixing crops together. Legumes and corn. You know--the legumes get the nitrogen into the ground. And they provide, like, a way--the corn provides a way for the legumes to climb up. And the sort of idea that you are really creating an ecosystem more than just growing a mono-crop. Which you then harvest.

| | 46:34 |

Russ Roberts: So, what's the potential for those? Is it going to make a difference, or is it just a cool thing for a few farmers?

Moises Velasquez-Manoff: Well, the farmers--these guys are already running with it. We'll see how--I mean, that's sort of happening on its own. How we're going to yoke all of this to deal with climate change is, I think, a bigger question. I think we need some incentivizing to happen. That is--and there are some really interesting ideas out there. Like, so basically what you want to do is to incentivize farmers to treat their land a little bit differently so that they can get paid for carbon that's stored in the soil. So, obviously that's not going to happen under the current, the Trump, regime. Right? Because they don't believe climate change is real, or at least that's what they say. But, there is this--let's just assume that we come to our senses regarding climate at some point. And, again, this is an idea that is not only good for climate, it is good for agricultural land. Right? And we are--I spoke to some people who said, 'We are facing this much bigger problem: We basically don't have any more agricultural land. But we need to start, we need to feed a lot more people.' So, it needs to be more productive than it is. Now, you could say, 'Well, yeah, let's stop giving, you know, all our spare corn to--to the animals'--

Russ Roberts: Yeeah. We've got so many other problems. We've got so many problems in the agricultural area. I mean, we've artificially privileged corn, for starters. We pay people way too much money to do something that comes naturally--which is growing food for people in the name of "food security," which I think is just a cover for giving money to your friends. So, there are a lot of things we can do to fix agriculture. But, whether agriculture could be part of a climate-change solution, if things get bad, I think is definitely important. Worth considering.

Moises Velasquez-Manoff: Yeah, but I--I think you are not going to get farmers on board talking about climate.

Russ Roberts: Nope. Right. Correct.

Moises Velasquez-Manoff: Half of them don't believe it's even real. I could mean that--I don't know that for a fact. But, for example,--

Russ Roberts:"Survey says...."--

Moises Velasquez-Manoff: Just talking to the farmers that I talk to who are doing it for regenerative agriculture, they are like, 'Climate change? Whatever.' You know, 'I just have to make sure that I manage [?]'

Russ Roberts: They are just trying to do their job. They are not so interested in public policy. I get it. I am sympathetic to that.

Moises Velasquez-Manoff: No, they--it's more than that. It's that they don't believe it's real because they read state people.

Russ Roberts: Yeah--

Moises Velasquez-Manoff: They get that media.

Russ Roberts: Well, I'm a little bit of a skeptic, too. I'm agnostic. I don't think it's false. I don't think it's fake. I think it's true that there has been some warming. We don't know how much. It's troublesome that it hasn't gone up a lot over the last 20 years--the temperature hasn't in the face of an enormous amount of extra carbon. Which suggests we don't fully understand the mechanisms. But, as I said--I think we should be cautious about it. But, for whatever reasons--not everybody agrees--and, it's--then you get the question: You're going to make them do something they wouldn't actually want to do. So that's going to be a lot harder.

Moises Velasquez-Manoff: Well, yeah, first of all, you--I think the evidence is much stronger than you alluded to, that climate change is real and caused by humans. But, that's a whole different show, and many other shows.

Russ Roberts: Yes it is. Correct.

Moises Velasquez-Manoff: So, how are you going to get farmers on board, getting carbon into the ground? Well, you incentivize it through several possibilities. One is, in California, we have this Healthy Soils Initiative, where they are helping fund some of this stuff, because it often costs, you know, changing the way of doing stuff costs money up front. So that taking money from the State's carbon mitigation funds--so, California has got this ambitious plan to reduce our carbon emissions by, you know--the number actually I think is by 80% by 2050 or something like that, even though that isn't fact checked.

Russ Roberts: If you keep raising the income tax, you'll do it easily. Because enough people will want to leave--move to other states--that you'll have fewer cars. Nah; I'm just giving you a hard time. I'm sorry. But I do think, to be serious for a second: I think the environmental movement as well as legislators need to think long and hard about how we spend our money to make the world a cleaner place. And, spending it wisely is always a good idea. No matter what you agree. No matter what the dispute. And, it's probably--right now, many things have been subsidized that are either not good or don't help or are actually counterproductive. So, it would be good to spend some money--that we already are allocating. Maybe move it away from some things and toward other things.

Moises Velasquez-Manoff: For soil, here, there's now some money available to people who want to try to get carbon in the ground. And so, actually, this has been promoted. The carbon farming idea has been promoted--just as good agricultural practice--by a Department in the USDA [U.S. Department of Agriculture]--already. The Resources Conservation Service. Which is--this is a little-known-about--sorry, the NRCS, National Resource Conservation Service--that was founded in the wake of the Dust Bowl. Which, of course, is this huge agricultural--

Russ Roberts: dramatic [?traumatic?]--

Moises Velasquez-Manoff: dramatic experience that happened that we forget about. But basically we plowed the hell out of land that shouldn't have been plowed. And then, in conjunction with some dry years and a lot of wind, the topsoil--like, the entire upper Great Plains ended up blowing away. And if you read about what was happening at the time, like, the sky was red as far away as Washington, D.C. I mean, it was like a huge environmental catastrophe. And it was driven by farming. So, they founded this organization--it wasn't called the NRCS then, but it is now. And they focus on soil health, and in recent years they've been trying to promote soil carbon. And they have like 35 practices, 30-some practices that they consider that sort of build--that deal with this problem of, if you plow your land, you are going to have a lot of the carbon blowing away, or just eroding away, from water. So, they help also fund some of these things, already. Very tiny amounts of money. Not huge amounts of money. And the idea is they are funding you to take care of agricultural land, which in a way is sort of, even though people own it, is also a resource in common for the country.

Russ Roberts: Well, it has external--how you use it can affect some people other than yourself. Obviously, when you own your own land, you have an incentive to not graze it to the ground; not take out all the nutrients. You may make mistakes--out of ignorance, or tradition, or other reasons.

Russ Roberts: But, the other thought I had was--you mention niche markets. It would be an interesting challenge for a foundation to help to fund farmers to try experiments on their own land, who would then in turn could market their products as being more environmentally friendly, and use some kind of labeling to encourage customers to pay a premium; or maybe they wouldn't have to, because it's as you say, maybe it pays for itself.

Moises Velasquez-Manoff: Yeah. I think it pays for itself. You know, there's an initial period of years where it's not paying for itself.

Russ Roberts: Sure.

Moises Velasquez-Manoff: But then, over time, as the soil gets healthier, it starts paying for itself. And you end up producing your crops for less investment per bushel than your neighbors. And so, one really interesting idea that is out there, and I actually did not talk about this in the article, is to give people who are building soil carbon--give farmers who are building soil carbon--a discount on crop insurance.

Russ Roberts: That's cool.

Moises Velasquez-Manoff: Because, in theory, their farms are more resilient.

Russ Roberts: Yep. Should happen naturally.

Moises Velasquez-Manoff: Well, crop insurance, as you know as an economist--it's a complicated--there's a complicated set of calculations that go to dictating what your premium is for the insurance.

Russ Roberts: Well, I don't know anything about it--as an economist. Or as a farmer.

Moises Velasquez-Manoff: But, you understand it [?]

Russ Roberts: Sure. It's risk. Insurance, I know a little bit about.

Moises Velasquez-Manoff: Right? So, in theory, your risk is lower [?] building [?]? You actually [?] lower premiums. So, there's one incentive right there. We use also, in New York, they are thinking about giving people, farmers who build soil carbon, tax breaks in some way or another--I don't know if they are calling them 'tax breaks.' They have another term for it. But, anyway, there are multiple ways of doing this, of helping out farmers who are doing this, besides just handing them cash--I guess is the idea. Some of them are--legislators around the country are very interested in this because they are very interested in agriculture. And some of them are also interested in climate--

Russ Roberts: It's a fascinating--go ahead. Sorry.

Moises Velasquez-Manoff: We have this healthy soils initiative: it's sort of like the example in the country of how this can be, how it can be incentivized; and they are getting some state funds to do some of this; our farmers get some state funds to do some of this stuff.

Russ Roberts: The other thing I was going to say is that, you know, farmers--we spend a lot of time eating, as human beings. And, as Americans, we eat a lot--mostly--for many of us, too much. And it's just interesting how few people are involved in agriculture. I often point this out: it's 2 to 3% of the American people are in farming: because it's so productive we don't need a big population in farming, industry, in terms of labor. And, not only is it efficient enough that we only need a few: we make so much food that we can export a bunch of it. And so, it's a very small group of people that we are talking about, to change their habits, if indeed this is a useful and productive thing to do.

| | 56:22 |

Russ Roberts: But, I want to change--we're almost out of time, and I want to talk for a bit about the human microbiome--the small part of us. And I want to turn toward your book, An Epidemic of Absence. And that book had an incredibly provocative idea, which, again, was an amazing example for me of unintended consequences, complexity, and emergent order. This idea that by cleaning up our environment and taking worms and parasites and germs--basically, making our environment as sterile as possible--and I just talked to Janet Golden about the evolution of how we treat babies, here on the program, in the 20th century and what a great triumph that was--that we took so many things that killed people and got it out. We learned that milk could spoil and we learned that germs carry disease and we learned that there are all kinds of things that people shouldn't eat and should be near each other at certain times. And that was a great triumph of civilization. It lowered infant mortality in extraordinary ways over the first half of the 20th century. Lots of other things along the way, of course--not just our scientific knowledge. But, you point out that maybe that came at a cost. Certainly it came at a cost. Maybe that cost was very large for certain people, whose bodies, without the germs to fight, started fighting themselves. The autoimmune system started to eat us, instead of the germs that were no longer there. They had to have something to do. And I found that deeply provocative. The book came out in 2012; we talked about it in 2014. And, 6 years have passed since you published the book; and more than that has passed in some of the research. And, it's an idea that's deeply appealing--to the point where you, yourself, actually put worms into yourself, deliberately. And other people continue to do that, to fight certain autoimmune disorders. Do we have any more knowledge about whether this is just a possibility? true? maybe? What's happened?

Moises Velasquez-Manoff: Well, I think the hygiene hypothesis has only gained more steam and more evidence in its favor. But, it's often, like: It depends who you ask, the meaning of what the hygiene hypothesis is, changes depending on who you are talking to. But, the idea that we need to tune our immune system early in life: that it needs to be educated early in life--I think we are just getting more and more evidence that this is true. And educated by the right set of microbes. And they are not just microbes that we are fighting against. Many of them are just commensal microbes that, because of the way we live now, and because of what, of dietary changes, for example, that we are selecting for different types of microbes that are not necessarily the ones that educate our immune systems in a way that prevents some of these diseases from arising. So, in terms of the microbiome front, that these are just the microbes and, you know, the unicellular organisms: there's so much research, it's hard to know what to look at. But, for example, I wrote an article about--a lot of this research started in Europe, with the farming stuff. So, it was: Farming kids were less allergic. Why? Because they are probably exposed to manure and cow sheds and they drink unpasteurized milk. So, then there is an interesting example--and I don't think this existed when we spoke last time--but, of Amish kids in the United States now. Where, these Amish kids, they actually come from the same part of the world--in Switzerland, German-speaking Switzerland, where a lot of this research first started. So it's an interesting comparison. Like, they are in theory comparing genetically similar people. So, what they, this most recent set of studies--of course, the Amish kids are like the least allergic of anyone they've ever seen in the developed world, of any subset of people.

Russ Roberts: It just tells you [?] that that cell phones causes allergies.

Moises Velasquez-Manoff: Well, yeah, it's funny. I visited one of these farms. And I was talking to, like, an Amish elder, and he was like, 'We can't deal with the cell phones.' Like, 'We've dealt with everything up until now. The kids are getting the cell phones and we can't stop them.'

Russ Roberts: The ultimate parasite. Yeah. It gets hold of the human host and then they have their way.

Moises Velasquez-Manoff: Yes. So like, that's a whole 'nother story. And also, it's just like a [?] idea: the Amish do get vaccinated[?]--I don't know; there's this idea that that they don't get vaccinated. They do. They get vaccinated. So it's not like they are not getting vaccinated.

Russ Roberts: They are not against science. They are against technology of certain kinds, I think. They want to do certain things in traditional ways.

Moises Velasquez-Manoff: Yeah. I mean, each sect differs. That's another thing that's not appreciated about the Amish: is that, they sort of decide in their communities what they are going to do. So each one--there are more strict ones and less strict ones. The one that I visited in Indiana: they got vaccinated. Like, they didn't want any external electrical lines coming to their houses. But they used lamps in their houses that had batteries. So, there you go. There's a paradox. One of them was a dairy farmer, and he had just upgraded to a modern dairy farming system because he was like, you know, he still plows his land with horses; but he, to be able to sell his milk into the market he has to pasteurize it and do all the stuff that modern dairy farming requires, so you can sell it. In any case, the guys, the kids were super non-allergic. And so they did this interesting study where they compared the Hutterites, which were another group that stemmed from the same area of the world. And they were sort of religious. And they destick[depict?] themselves--they live in the Upper Midwest and the Plains States of Canada--the plains, not the states, provinces of Canada. And they are as allergic as anyone else. Right? They are just as allergic as your average American, Canadian.

Russ Roberts: Even though they are living this agricultural life that many might think is protecting them.

Moises Velasquez-Manoff: Right. So, what's the major difference? Well, they keep their livestock far away. They do, like, this factory farming and they keep it far away from their homes. Whereas the Amish have these little farms where their homes are like 20, 30 feet from the barn. So, if you think of the cowshed as this factory of microbes that are, probiotic microbes that prevent allergy, they are missing all that in the Hutterite land. And they also--the men are the only people who work with the animals. So, what's interesting about the research from Europe is that they find that women who are pregnant who are working with animals have kids who are like the least allergic of all the women. It's like, the earlier your exposure begins, the less allergic you'll end up. And they think it actually--the microbes actually stimulate the mother's immune system. And that stimulation goes through the placenta--I mean, it, via, like Cytokines[?], which are these immune-signaling molecules. And starts training the infant immune system before they are even born. So, you get--so, this happens in Amish country, because pregnant women are out there milking the cows, too, and the kids are out there from an early age playing in the barn. They are getting this exposure. Whereas in Hutterite country, the kids don't have any of that exposure, and the pregnant women don't have any of the exposure. And, they did this really interesting study of the different immune profiles. And they have a different sort of--here are two populations that are genetically very close, because they come from the same part of German-speaking Switzerland; and southern Germany, I think; and they have this very different immune system. And they did these studies where--they tested in mice, and sure enough the mice were exposed to Amish cow dust, Amish cowshed dust, were less allergic than the mice that were exposed to Hutterite dust. So, I mean, like, this research is getting closer and closer to an actionable pro-biotic. Right? Based on, let's just say, an Amish cowshed pro-biotic. Where that, we would use as an intervention early in life. It's getting closer. We're still not there.

Russ Roberts: Well, you just [?] your kid. Or, you could just, when you are pregnant, go milk some cows or when your kid's early on, go have him play in the cowshed, and breathe a lot and absorb it. We should build our own cowsheds! Every house should have a cowshed.

Moises Velasquez-Manoff: That is going to be--it's going to be more complicated. Because it has to be chronic exposure.

Russ Roberts: Oh, okay.

Moises Velasquez-Manoff: So, taking your kid to a cowshed for a week--

Russ Roberts: not enough. But. But, while you are in the cowshed, you want to eat a peanut butter sandwich with your kid. Because that's another example where people are saying--this peanut allergy thing is because people are eating their peanut butter so late in life, they don't have a chance, right? Same argument, right?

Moises Velasquez-Manoff: Well, yeah, in a way. Except for we're talking about exposing yourself to the allergen versus training your immune system--

Russ Roberts: Yeah. Okay. Different mechanisms. Fair enough.

Moises Velasquez-Manoff: Different mechanisms. But you can do the peanut butter sandwich thing regardless of whether or not you are in a cowshed. Obviously.

Russ Roberts: I just wanted to kill two birds with one--I don't know, peanut butter sandwich. One trip to Pennsylvania.

Russ Roberts: Let's close with something you discuss in the--and we'll put a link up to your Amish article, which is really interesting, although it is a small sample, as you point out and that some people have pointed out may not be as reliable as we'd hope. But, it is very interesting.

Moises Velasquez-Manoff: So, the Amish are a small sample. But, the other stuff, from Switzerland, those are thousands of kids at this point. Hundreds, at least. Thousands, probably, of kids they've done over and over and over in Europe, not just in Switzerland but also in Denmark, in parts of Germany. I mean like, everywhere. This is a very solid finding over there.

Russ Roberts: That, exposure to agriculture reduces allergies? A correlation?

Moises Velasquez-Manoff: To cowsheds, in particular.

Russ Roberts: Okay.

Moises Velasquez-Manoff: And to milk. I mean, it's very--it's a strong binding.

Russ Roberts: Cool.

| | 1:06:02 |

Russ Roberts: Let's close with another world you wrote about. You called it an underworld, of people who are treating themselves for conditions which include multiple sclerosis--I don't know what else it's including. But, these are serious, debilitating problems that people are getting on the web, exploring the realities of other people who have explored this, and medicating themselves with parasites. And we talked a little bit about this the first time we talked. But, just tell us where that world is. I'm sure it's blossomed rather dramatically. And, of course, the organized medical world, not so always happy with it. Some people view it as understandable and accepted. But others are hostile to it because it is "unsupervised." But there's something beautiful and poignant about people--connecting with people around the world and learning about these techniques and getting access to this stuff that couldn't have been imagined 20 years ago.

Moises Velasquez-Manoff: Yeah. I mean, except for in the article I make the--

Russ Roberts: We're not sure it works. But other than that: yeah.

Moises Velasquez-Manoff: Yeah. But, that movie, the The Dallas Buyers Club, they were doing the same thing, beginning of the AIDS [Acquired Immune Deficiency Syndrome] epidemic. They were trying to self-treat, because there was--

Russ Roberts: no one was helping them--

Moises Velasquez-Manoff: because mainstream medicine had totally, was just ignoring them, because they considered them all to be either gay or just degenerates in general, and was not helping them in any way. So they took matters into their own hands. So, regarding--I should back up and say that, when we last spoke I think that there was a trial underway to test one of the organisms--the only organism that's really been scientifically, that is, has any rigor behind it, any scientific rigor--and that was the pig whipworm, which was developed by Joel Weinstock. And those tests failed. It did not work. Now, there are like--you go onto this community; you can talk to some of the scientists--there are lots of reasons they might have failed that don't have to do with the fact that the organism doesn't work. But also, it could be just that the organism doesn't work. And this whole idea--

Russ Roberts: And that what we saw that seemed to work just was just a placebo effect: that people were so desperate that their psychological state was what drove the result, not the worm.

Moises Velasquez-Manoff: Well, no--they had a placebo group in those studies. But, those were small studies. This is why we need big studies. And, I think one of them was not blinded, also. So, at least the investigators knew was getting this treatment and who was getting the placebo. But, they also--like, if you talk to some of the people who are in this world, the company who was making these parasites for human consumption--they changed the formula right before they did these large trials. Which is kind of, like, 'Why would you do that?'

Russ Roberts: Ooops. Yeah.

Moises Velasquez-Manoff: So, I mean, you know, I don't know. I think the most likely answer is probably most obviously--you know, Occam's Razor, right? The most likely answer is probably that it doesn't work. But, there are, I think, legitimate questions. But, so, that did not work. Meanwhile, there is a guy in Australia who is doing interesting work with a different organism. And his idea is that the pig whipworm was never going to work anyways because it's not adapted to humans. You need a human-adapted organism. Alex Lucas[?]--he had some really kind of remarkable studies, longitudinal studies, very small, like curing Celiac Disease with hookworms. Or, I should say, sending it into remission. They are very small. He is doing larger ones now, I think. But, so, you have this kind of conflicting evidence coming from the actual scientific world. And this, in the absence of any certain answer from science, this community has blossomed. And it's probably growing bigger, even as we speak. Because there's so much desperation. I've got to say that if you have one of these diseases, like, you know, multiple sclerosis, you sort of just end up progressively more or less able to move and more and more paralyzed; and eventually if it's severe you end up unable to breathe, potentially. I mean, these are horrible diseases. And we don't have lots of good treatments f or them. We have some. They are--

Russ Roberts: slow it down--

Moises Velasquez-Manoff: They slow it down. I mean, for multiple sclerosis, there is a number. Like for inflammatory bowel disease and a lot of the, for like, rheumatoid arthritis, they use, they just block an aspect of your immune system, with these TNF [tumor necrosis factor], you know, with remicades or TNF blockers, that's just a pro-inflammatory, pro-[?] immune system. So, what you are doing is you are hobbling part of your immune system. Which is good if it works to treat the disease. But, it's bad in that it opens up--

Russ Roberts: everything else, yeah.

Moises Velasquez-Manoff: Yeah. I mean, you know, like, it's, the fears are always overblown. You have to look at the actual numbers; and the actual numbers are pretty minor. But, I can tell you that, when you talk to this community of people, the potential--the fact that you might get different kind of cancers that are incurable, or infections that kills you, because you have taken these immune-suppressing drugs, looms very large, in their imagination. Right?

Russ Roberts: Yeah.

Moises Velasquez-Manoff: And so they say, 'Well, what the hell?' Why wouldn't they go try a parasite? Like, I can get rid of a parasite. It's not going to kill me. I can get rid of it.

Russ Roberts: --Yup. Psychologically, it's not a pleasant thought. But, it's--

Moises Velasquez-Manoff: Well, wait a minute. Which is not the pleasant thought? That you might die from--

Russ Roberts: No. The putting the--the direct decision to push them into your body through your skin, through a patch or whatever. Put the eggs in. It's just something--it's not a pleasant thought. I'm sorry--

Moises Velasquez-Manoff: There is an ick factor. But I mean--

Russ Roberts: Yeah, that's all. Just an ick factor. Yeah.

Moises Velasquez-Manoff: Think about the alternative--

Russ Roberts: the alternative is horrible--

Moises Velasquez-Manoff: which again is overblown in people's imagination. The numbers are quite small of people who develop this. Right? But the possibility that you might just die from taking a medicine that, to treat your disease which is incurable--it's untenable to many people.

Russ Roberts: Yep. I hear you.

Moises Velasquez-Manoff: Or, many of them have tried it, and it didn't work. You know, those drugs don't work for everyone. So--

Russ Roberts: And that's the other part of this, right? It's that--so much of this is almost certainly person-specific, right? So, it [?] might not have worked for this person but it might work for that person--both the drug or the [?].

Moises Velasquez-Manoff: Yeah. Yeah. And that's what I think--I mean, what I suspect, like, there's no real good evidence that taking worms can treat anything. But I suspect those that have worked for some subset of people--I mean, so they are of course--what happens online is, you get spectacular stories

Russ Roberts: you hear from those--

Moises Velasquez-Manoff: you get spectacular stories. And the feeling is, you don't--it's like hard to find the feelings for. They're there. You have to seek them out. But, there is no, sort of like, even-handedness, in dealing with these two types of stories. Right?

Russ Roberts: --Yep.--

Moises Velasquez-Manoff: So you get these glorious results. You read about them. You say, 'Crap. I'm going to try that.' And you try it; and, for some people it works. For many people it doesn't. I wonder about the people who feel worse in some ways. But, then again, if you are, if what your baseline is, is multiple sclerosis--the horrible pain of Crohn's Disease. The symptoms of a parasite infection might be a great improvement if that's all you're dealing [? Feeling?] ?

Russ Roberts: Right. Sure.

Moises Velasquez-Manoff: So, that's what's happening. And, where it is, is I wish scientists would actually do case studies of these people. Because I think it works for some of them. And it would be great if we knew, if we understood more about how it's working

Russ Roberts: Well, I look forward to having you back on in 5 years. If not sooner. If not sooner. To talk about: I mean, both these stories--again, I see them as linked. They are both very similar to me. It's hard to know exactly what's going on. They are really complicated. They are out of sight. And they are awfully interesting to me. And you write about them in really interesting ways.

Moises Velasquez-Manoff: Well, thanks for having me. I'll be glad to come back.

|

 

(18 COMMENTS)

Janet Golden on Babies Made Us Modern

Historian and author Janet Golden talks about her book, Babies Made Us Modern, with EconTalk host Russ Roberts. Golden chronicles the transformation of parenting in first half of the 20th century. It's a fascinating story of how our knowledge of infant health and behavior grew dramatically but remains imperfect. At the same time, government, business, and private organizations responded to that imperfect knowledge.

Play

Time: 1:03:04

Janet Golden on Babies Made Us Modern

Historian and author Janet Golden talks about her book, Babies Made Us Modern, with EconTalk host Russ Roberts. Golden chronicles the transformation of parenting in first half of the 20th century. It’s a fascinating story of how our knowledge of infant health and behavior grew dramatically but remains imperfect. At the same time, government, business, and private organizations responded to that imperfect knowledge.

This week's guest:

• Janet Golden's Home page

This week's focus:

• Babies Made Us Modern: How Infants Brought America into the Twentieth Century, by Janet Golden at Amazon.

Additional ideas and people mentioned in this podcast episode:

• Baby book background
  • "You're not a bad parent if you didn't make a baby book", by Jessica Leeder. TodayParent.com, Nov 30, 2016. What is a baby book?
  • "Reading Baby Books: Medicine, Marketing, Money and the Lives of American Infants", by Janet Golden and Lynn Weiner. Journal of Social History, Volume 44, Number 3, Spring 2011. Project MUSE, John Hopkins U.
  • Baby Books Collection. UCLA Library.
• Bryan Caplan on Parenting. EconTalk. May 2011.

A few more readings and background resources:

• "The First Snowfall", by James Russell Lowell. Poets.org.
• Emily Oster on Infant Mortality. EconTalk. November 2014.
• "Where Have All the Zwieback Gone?" Mamapedia.com, August 19, 2012. Blog discussion of where to get the popular but discontinued Gerber's or Nabisco's twice-baked toast for teething infants. Some other brands still available.
• Gerber's history & heritage. Gerber.com.
• Luther Emmett Holt. Wikipedia.
• "Maybe you don't need to burp your baby," by Laura Sanders. Sciencenews.org, September 5, 2016. Report on research by Bhavneet Bharti published in Child: Care, Health and Development, 2015.
• U.S. Children's Bureau. Department of Health and Human Services.
• History: Extra Virgin Cod Liver Oil: History. Rosita Real Foods, evclo.com. Historical production methods, medicinal claims, and uses for cod liver oil.

A few more EconTalk podcast episodes:

• Oster on Pregnancy, Causation, and Expecting Better. EconTalk. October 2013.
• Scott Atlas on American Health Care. EconTalk. July 2012.
• Angus Deaton on Health, Wealth, and Poverty. EconTalk. November 2013.
• Tim Harford on Fifty Inventions That Shaped the Modern Economy. EconTalk. November 2017.
• Michael Munger on Milk. EconTalk. September 2013.

 

| Time |

Podcast Episode Highlights

| | --- | --- | | 0:33 |

Intro. [Recording date: May 17, 2018.]

Russ Roberts: My guest is Janet Golden.... Her latest book, which is the topic of today's conversation, is Babies Made Us Modern: How Infants Brought Americans into the 20th Century.... This book's a really fascinating portrait of a piece of American social history which of course many of us are aware of in general outline. We know that the way we treat babies and the way they treat us has changed over the last hundred years. But, your book really brings home how credibly dramatic that change has been, in a relatively short period of time. And in creating that portrait, talk about what your goals were and how you went about finding the information that you share in the book, your methodology. Because, you looked at some sources that economists certainly don't usually look at, and even some historians don't get to.

Janet Golden: Thanks. I started this book, originally, with a friend of mine; and we thought we'd write a kind of a fun, happy, commercial book. And then she had to drop the project because she was busy being a dean at a university. And, the more I kept digging into readings about children and defining fun stuff about babies, the more I realized: Infants are truly economic actors. They really bring Americans into the world of commercial culture, into modern psychology, into familiarity with advertising. And the way I discovered that was truly serendipitous. I was talking with a colleague at the History of Medicine Meetings, and he said, 'You know, here[?] at UCLA [University of California, Los Angeles], we have a collection of baby books--books that mothers filled in, day after day, year after year. Sometimes they made a few entries. Sometimes they made a lot.' And he gets online every day and he buys baby books on E-Bay. And so they've amassed several thousand in their collection. And they are truly a wonderful source about everything. I could have written another three books about what they had to say. But, I had to stop myself. And, I will say that I did put my children's baby books in that archive as well, because I thought it was such a terrific collection. But, for economists, I think the story of babies is just wonderful. I didn't realize it when I started. But, babies are really all about connecting their families to the modern economy in the 20th century. And I didn't expect to find so much about banking, insurance, finance, purchasing. But, that's what they're all about.

Russ Roberts: Yeah. And the vast amount of advice given by a vast array of interested and sometimes disinterested observers is--it's pretty daunting, I assume. I mean, you accumulated a huge amount of information.

Janet Golden: I did. I tried to stay away from saying too much about the advice to parents--of which there's a vast literature--and instead record what the parents had to say about their infants. And, of course, people didn't always obey the advice--let's put it that way. They fed their baby things that baby advisers would say is not a good idea. My favorite anecdote in there is, of course, the one about the one about the baby book that said, 'Today I smoked my first cigarette.' [Econlib Editor's note: In baby books, first tense is commonly used to articulate experiences by the parent on behalf of the baby. E.g., 'Today I spoke my first word' instead of 'Today, my baby spoke his first word.'] And then he added, 'Twenty one years later, I'm still smoking.'

Russ Roberts: Woo hoo.

Janet Golden: Yes. So, you find a lot of fascinating material in there. Or, the 7-month-old baby who had the full Thanksgiving meal: the turkey, the stuffing, the cranberry sauce. Lots and lots of really fascinating material about how babies really live, not about how they were supposed to live.

Russ Roberts: Yeah. That cigarette story reminds me of when my wife was shopping with our daughter, who was maybe, I don't know, 6 months old at the time; and she ran into a friend, and then she went and grabbed something from a shelf. She came back to see our daughter smiling the most ecstatic smile; and that's because this other woman that my wife had run into had given her her first piece of chocolate. Which, my wife was not happy about. But, my daughter sure was. I don't know about that first cigarette. But there is a lot of serendipitous stuff in life like that going on, inevitably.

Janet Golden: Right. And the other fun thing about it is that you get to see how immigrant folkways and foodways really come to America. So, well, historians find that medical advisers used to complain a lot about Italian immigrants: 'Here they are. They are feeding their children fresh fruits and vegetables. Isn't that terrible?' And, of course, nowadays that's what we're supposed to be eating. So, it's kind of fun to see how the babies and their immigrant parents really change America that way, as well.

| | 6:17 |

Russ Roberts: I was struck--a number of things struck me while reading the book that I hope we'll get to talk about. One of them was just how dramatically life has changed--for mothers in particular, and for babies in particular. Of course, by, along the way for fathers and siblings and society at large. But this one sentence struck me as a dramatic example. It says: As a scholarly study of Buffalo, New York's--Italian community at the turn of the century--explained: 60-89% of women over 30 had lost at least at one child. And among Polish women in the city, the rate was at least as high. The rate of infant mortality was--it's just hard for us to relate to how perilous life was. And we'll get into the particulars, of why it was particularly perilous. But, it's just hard to remember. Obviously, women died at a much more fearsome rate in childbirth. But the infant mortality rate is just--it's just shocking how high it was. And it makes you reflect on what that must have done to life, and how people dealt with it and thought about it. And it's just incredibly powerful.

Janet Golden: It is truly a triumph of the 20th century that in the developed world we've been able to so dramatically lower our infant mortality rate. And, a lot of that really began in the late 19th century, of course with things like clean water supplies. Later on with milk pasteurization laws. With sewage and sanitation--sort of the big infrastructure projects, that we've mostly forgotten about. But really had a dramatic effect on infant lives, children's lives, life-expectancy. And then, the second phase of that really comes in the 20th century when we began giving people pretty sound advice about infant care, around the idea of, 'Let's get rid of germs. Let's avoid germs. Let's keep milk clean, or refrigerated.' Pretty basic ideas that are second-nature to us now, but that really had to be taught to people.

Russ Roberts: Yeah, and we'll talk about that. I found that extremely interesting. I just want to mention in passing that--I may have mentioned this poem once before; nah, I didn't; I think it was on a different program, different activity of mine--but it's called "The First Snowfall," by James Russell Lowell; and we'll put a link up to it. It's one of my favorite sentimental poems. It's really an extraordinary piece of sentimentality, very powerful. And, it makes you wonder, as your data also makes me wonder, just how people felt about the loss of an infant. It was common. So, it wasn't--in some dimension it--it's tempting to think it was not as big a tragedy as it is now because it was common. And yet, it obviously was incredibly painful and heart-rending. And, at the same time, the other part of your book I want you to talk about while we're discussing this is the ability and necessity sometimes for women to sell their children for financial reasons, or to abandon them. The whole phenomenon on a foundling, which is a common motif of movies set around the late 19th century is just so alien to us. You still read about it once in a while--an abandoned baby is found in a train station somewhere, and it's a big news story. But in the late 19th and early 20th centuries, it was--I wouldn't call it commonplace, but it was not a rarity. Talk about that.

Janet Golden: Abandonment has had a long history, of course; and in Europe all of our hospitals that began for children really began as foundling asylums, run by religious orders, where people would drop off unwanted infants. In the United States, we also had foundling hospitals. And today we even--I know a number of fire stations, say, have a sign: You can drop off an unwanted infant here; no questions asked. But it was much more common in the late 19th, early 20th century for women to abandon infants on the steps of police stations, in front of churches. It wasn't an everyday occurrence, but it happened quite a bit. And the infants would be sent to institutions, where the mortality rate is, as I talked about, close to 100%. They just didn't have the means to care for them; they didn't have the means to feed them. And then, of course, once a baby had an infection it would spread from crib to crib and they might all die very quickly. So, that was a problem. Later on in the 20th century infants go from being unwanted to be highly desirable--

Russ Roberts: Yeah. Desperately wanted--

Janet Golden: Desperately wanted, especially of course if they are not disabled and they are white. So we get into a different kind of marketplace, once that economists probably don't talk enough about; and that is: What will you pay for a baby? How do you go about buying one? What will you pay for one. And that's something that Kefauver hearings in the 1950s really brought to light. It was quite a booming industry--sub rosa, black market, illegal, quasi-legal. And the thing that impressed me most that really brought that home to me was a story in the New York Times about a mob organization that engaged in baby buying and selling, and the traditional racketeering was kind of a secondary enterprise for them. So, that tells you about how much money got involved in that. I think today there's probably some of that going on. I don't really study the world after the Baby Boomers. But, babies are highly prized now. That's not to say they are not still abandoned. And it's not to say that all babies are highly prized. But they really are, again, a part of the marketplace that we don't like to talk about. People used to pay to give them up to baby-farmers, who would kind of quickly dispatch them; and now we pay to buy them, in a sense, from adoption brokers.

Russ Roberts: Talk about what a baby farmer is. It's a terrible phrase. It's a really ugly phrase. But it was a thing. You said 'dispatch.' So, clarify that and tell us about baby farmers.

Janet Golden: Baby farmers--and that was a well-known phrase once--were women, often older women with no other means of earning an income, who took in babies to care for them full time. Some of them were well-meaning women who helped out other women who had to go to work in domestic service. Others engaged in a kind of understanding that the babies might not live. And when municipal authorities or newspaper reporters would do investigations of these baby farmers, they would find that they had either taken in the babies and then sent them to the poorhouse or the infant asylum to die, or that their back yards were filled with them, where they dug up the back yard and put the bodies in there. So, these babies would be--were not likely to live. But you could kind of soothe your conscience by saying, 'I didn't abandon my baby on the court house steps. I paid somebody to take it in.' But you must have known that, whether it was a baby farmer who was going to take good care of the baby or was a baby farmer who would oversee the child's burial. There were a lot of investigations, attempts to outlaw this. But, ironically, when you took babies away from baby farmers and sent them directly to institutions, they didn't fare any better. They really [?] better system of what we'll call foster care to make sure that those unwanted infants lived.

Russ Roberts: Yeah. I couldn't help but think about Cosette and the Thénardiers in Les Mis. But--and you always think, 'Well, that's kind of a harsh portrait. But, you know, maybe not so inaccurate. It was just hard to keep babies alive.

| | 15:11 |

Russ Roberts: I want to talk more about that, but one piece of that which you talk about in the book which I knew nothing about, which is utterly fascinating, is infant incubator displays. So, talk about what those were, and how they evolved. It was really crazy.

Janet Golden: Well, it's crazy, but it's fascinating; and that is infant incubators. We think of incubators for hatching eggs and not for already-hatched babies, but there they were. They are basically glass and metal boxes that kept babies warm and isolated so they weren't exposed to germs. They were for premature infants. Some of them would be fed by a milk dropper filled with milk or some other kind of tube-feeding, cared for by nurses. But, how do you pay for that kind of expensive care? Well, you put the babies on display--at a state fair or at a World's Fair, where they began in the United States in 1898 in the Trans-Mississippi Exhibition. But they appeared at every other World's Fair. People paid a quarter to go in and look at the babies; and that money helps pay for their care. And the last of them survives until World War II on Coney Island, New York, where it was said that some women sort of had a favorite baby and they'd pay every day to go in and look at it and see how it was doing. But eventually, as we know, incubators become hospital technologies in those neonatal intensive care units, so it's--you don't have to pay to see them any more. And we think of those medical technologies, not as display items. The best place to get a sense of that is when we had the TV show Boardwalk Empire, if you remember that: the Mayor of Atlantic City, Nucky Thompson, would go down to the Boardwalk and look at the babies in the incubators there. It was kind of a wonderful TV moment, teaching us a little bit of history, because Martin Scorsese does a lot of research for all of his historic work. So, yes, we had baby incubators; and they were display items. I don't know if you know any, have any relatives who grew up in New York or on the New Jersey Boardwalk in Atlantic City, but your older relatives might remember seeing the babies.

Russ Roberts: It's just the weirdest thing. I mean, that--you quote a young boy who goes through the exhibit and is just a little bit disappointed that they don't do anything. It reminds me of when you go to the zoo and the lions are asleep. At least you saw one, but it's not doing anything. And you do want some action. The amount of action you get from a baby in an incubator is highly limited. There's not much to hope for there. But, as you point out, one number I wanted to read: you said at the 1915 Panama-Pacific International Exposition in San Francisco, California, "the incubator display took in $72,000 dollars." Which is nearly $1.7 million in today's dollars. It's extraordinary that--I don't think--it's not a Barnum thing, but people paid to see 'em.

Janet Golden: Well, let's go back and think about what you asked me about earlier. We had an incredibly high infant mortality rate. And the greatest driver of infant mortality, then and now, is prematurity. So, if you can find a way to keep premature infants alive, you are striking at something that every family, every person has probably experienced or heard about. So, to just go and see these simple boxes that probably looked like the incubator on the farm where you grew up, and say, 'But yes, it's keeping the babies alive,' that would seem marvelous to you even though those babies weren't doing anything too interesting. They weren't performers.

Russ Roberts: I like that point. Yeah. Of course, as you point out, most of them didn't stay alive for very long. So, we weren't really very good at figuring out how to keep those premature infants alive.

Janet Golden: Well, the ones in incubators--we think they fudged the data on how many survived, but they did pretty well, in part because of their own little boardwalk trick. And that is: By the time the infants got there, the weakest ones probably died. And then, they might not put them on display if they looked like they were likely to die. So, you kind of put the fighters in there. They did survive. And you could go back day after day and see them growing a little bit until they finally get discharged. So, yes, it was a little bit of boardwalk trickery. But you got to see something that mattered to just about every American: they knew they had lost siblings; their parents told them about lost siblings. They knew people who had lost babies. So, what a wonderful piece of technology to gaze at.

Russ Roberts: Yeah. That's cool, even though there wasn't, like, as we said, not very much going on.

| | 20:23 |

Russ Roberts: The other piece of the infant mortality puzzle, which again, I had never thought about--I knew how horrific the data, the numbers were for, say, 1900. I hadn't thought much about why they fell so dramatically. And part of the reason is that in 1900 we were really bad at keeping milk cold. And so, the summer in hot climates, the summer is a particularly dangerous time to be an infant.

Janet Golden: The summer was deadly. There were just babies dying all the time in the heat. They'd get an infection; they'd spread it to others in the household; and they would die. But the milk was a real problem. And that's they told women not to wean their babies in the summer. If you were breastfeeding, keep doing it until the cool weather comes. Because, if you think about it, it's a long way from the cow to the urban infant. You've got to collect the milk. Maybe the cans you collect it in have some germs; they are not cleaned out well. You put them on the wagon to take them to the milk depot at the train. They sit in the hot sun waiting for the train. They sit on the train. They get to town to the milk seller, and the milk seller sits by them and says, 'Gee, that smells pretty bad. Let me add some water, some adulterants to cover up the smell.' By the time you go and buy that loose milk, it's not too good. And even if you buy pretty good loose milk, if you don't have a way to keep it cold, if you can't afford the ice for the ice box, it's not going to do too well. If you don't have any running water in your tenement to clean those bottles, you're going to grow bacteria in them. So, it's a challenge, feeding babies. So, in the summer, babies died of what we called 'summer complaint,' which were these milk-borne bacterial illnesses. In the winter, we had different problems, and that's the respiratory illnesses that spread, as they still do, in the winter.

Russ Roberts: It's interesting--maybe I missed this. I know there's different moments in the book where you talk about, say, solid foods--the advice that parents are given about when to adopt solid foods and what kind. Zwieback--which is one of my favorite words; you don't see it very often--gets mentioned at least twice in your book. Maybe more. And, when I hear that word--I think you have to be old enough to appreciate it. I don't know if anybody still buys Zwieback. I'm sure they still make it somewhere.

Janet Golden: I'll have to look that one up.

Russ Roberts: Yeah. It's a certain kind of thick cracker that is just--I can smell it right now. But, you'd think that this challenge with milk would have not just encouraged breastfeeding through the summer months, but breastfeeding for a long time. I find it interesting that--obviously, the commercial interests of formula makers and the milk industry encourage the adaptation[adoption?] of milk and formula. I found it interesting to think about why women didn't breastfeed a lot longer than I think they did. I might be wrong. Maybe they did. Again, I don't remember anywhere in the book where you talked about it. But I think--the impression I get is that women were eager to get their babies onto milk and formula, in the early 1900s, relative to today. And I wondered--given the dangers of milk--why they didn't delay that a little bit longer in those days. Or, do I have the facts wrong?

Janet Golden: It's really a social class phenomenon. Wealthier women, middle class women would wean their babies or even start their babies initially on bottle feeding maybe with a day nurse. Poor families, immigrant families breast fed for a lot longer. In part because it did function for a while as birth control. But it also what happens in poorer families, if you do have a large family, if you've just given birth to baby number 5 or 6 and you have 3 or 4 living children to take care, and you are washing those diapers by hand; you are keeping the farm going; you are going out to work or your husband is getting laid off from work and you've got to go out and do domestic service, you really don't have the luxury to keep on breastfeeding. So, there are different issues for different classes of women. But, the medical community was very incensed about upper class, middle class women who did not breast feed. They knew it was best. And yet, they were also the ones prescribing the formulas. So, it's kind of a conundrum there. They knew it was best, but their clients, their patients didn't want it. So, they helped them get the formulas. Preparing baby food is a challenge--was a challenge. You had to take those vegetables and mash them and puree them, themselves. And that's why apocryphally, Mrs. Gerber said to her husband, 'You know, putting these peas through the strainer is too hard.' It goes[?] from being a food company to being a baby food company, as they discover that there's a real market for already-made baby food.

Russ Roberts: I like that argument, that there was a prestige, I guess, to not breast feeding to show you are wealthy enough that you could afford to buy the milk or hire someone to feed the baby. And, now, I'm getting--I really wish you had mentioned the Gerber pea thing. I think that's worse[worth?] than Zwieback. I have a vivid memory of my little brother going through those little jars. But, there were colors--they should have picked a different color. That green-yellow--there was, like squash and peas. I would have picked a different--anyway.

| | 26:37 |

Russ Roberts: Let's move on to something--let's actually stay related to this. Which is, one of the things that screams out in your book, although I don't think you talk about it explicitly, but it's so out in the open is that: We just so know so little about how to raise a child. The first part of the book is just about the physical side of that; and then toward the end of the book there's a chapter about the psychological development. And of course modern parents are obsessed with both of those things. We worry about whether the child is meeting the right milestones at the right places, and whether they are getting the right psychological preparation for adulthood; and it starts very young, that worry, for infants. And, what I was struck by is how little we know. And it's fascinating to me. It's just really hard.

Janet Golden: Well, we've--you know, I guess you could have some psychologists on there who would say, 'We know so much, and we've done so many experiments.' But I think that because babies are not verbal, and their range of motion is limited, that we don't quite know what they're thinking and doing and how they're developing. We think we do. We've got some mass data. But we don't really know about our own infants. And so, what happens over the 20th century is that there's more and more surveillance of infants' psychological development, as we get more and more certain that they are going to live. And that is a big transformation. Then, it's the question of: How are they going to live? What is their future going to be about? And so, it leads down all sorts of interesting paths. I talk a little bit about the popularity of astrology: you know, where would the stars align when your infant was born? For a while we went through phrenology, where we tried to measure the bumps and shapes of your head to say: What will that tell us about your personality and your intellect? And there's still a tradition in some ethnic communities, as there was historically, of putting different items on the floor and see which one the baby crawls to. Do they go to the Bible or the whiskey? Are they going to be a preacher or a drunkard? You know. You just want to know what the future holds for your infant. But, we begin to be taught by psychologists that we have to, you know, surveil our babies. When do they turn their heads to follow us? When do they respond to noise? How often do they cry? Can they self-soothe and go to sleep? What age do they start walking? What age do they start babbling? They are very, very scrutinized. And they probably don't give up as much information as we'd like. And, of course, there's some funny--not funny, really--but some experiments I talk about that psychologists conducted early on, like sticking a baby with a pin and seeing if it reacts. And, you know--in an era when diapers were kept together with pins, not little straps, of course, mothers would have been able to tell them: Yes, when you accidentally stab your baby with a pin, they do react.

Russ Roberts: Yeah. It's a stunning discovery of modern science.

Janet Golden: Yes. You might have been stabbed as an infant. Your children were not.

Russ Roberts: I was. Correct. The invention of Velcro and Pampers, one of the great inventions of the 20th century. I know there are people who think they are environmentally unfriendly and those are people I think who haven't thought quite enough about what cleaning a diaper does in re-using it, to the environment, which is not zero. I like the line--you said: a 1907 baby book included a line for recording the person--recording in this baby book the person who first carried an infant upstairs: The date and the baby's age at the time, with the explanation, "It is an old superstition that a baby should be carried upstairs so that it may rise in the world before it is taken downstairs." So, yeah. We had a lot of those kind of strange ideas. The other quote I want to read is about the psychologist John Watson. It says, you write,

That same year he published Behaviorism, and four years later The Psychological Care of Infant and Child,"

and this is around--what year is this? This is around 1910?

Janet Golden: I think a little later than that. I can't remember.

Russ Roberts: Okay. Early part of the 20th century. It says,

He advised mothers to never hug and kiss their children or let them sit on their laps. The problem was not, as other experts argued, that kissing conveyed germs but rather it led to the creation of unhappy children. Having little faith in the ability of mothers to rear children or to manage their own lives, Watson believed they needed scientific instruction in the psychological care of children. He viewed his book as the equivalent of Holt's 1894 manual The Care and Feeding of Children, but it had far less influence on actual nursery practices and a personal scandal (an affair with a graduate student he later married) forced him out of academia. His status eclipsed, he moved on to a career in advertising.

I just love that, your ironic ending of that--that he went from academics to advertising. Some would say it's the same field, just different application. But, it is interesting, again to make the point that I made earlier, that there are so many fads, it seems to me, in the psychology of how to raise your children. And you go through a bunch of them, with terms of physical--you should spank them or not spank them--indulge them or not indulge them, give them what they want to eat or force them to eat this other stuff, keep 'em happy, make sure they are--keep their self-esteem high, keep it low so they'll overcome it. All these different fads, and it--I'm calling them fads because I don't think they are much, there's much science to it. And yet, today, we feel like: Now we know. And it just makes you realize that: Well, we don't know so well.

Janet Golden: Yes. There is a kind of back and forth in the world of, 'Are we going to be strict? Are we going to be loving? Can you hold your baby too much? Can you not hold your baby enough?' We really--and it's very hard, of course, to subject that to any data-driven analysis. But it's, it's quite wonderful to see, as a historian to see the back and forth. And my favorite story about that, of course, is Dr. Spock, who was Benjamin Spock, raised in a very strict household that followed the late 19th century expert Luther Emmett Holt--you know, you rise at a certain time, you go to bed at a certain time, you eat at a certain time; you keep your distance from the child; you know, you don't overindulge it--and then, of course, turned around and preached something very, very different. After undergoing a lot of psychoanalysis, [?] to that. And of course there are people that advocate things on all sides: Let your baby cry to sleep. You know: Don't let your baby cry to sleep. Lots of--

Russ Roberts: Bring your baby into the bed, into your bed. Leave it in its own bed. Put it on its stomach. Put it on its back. Music/no music.

Janet Golden: The one thing I found most interesting in that was when I discovered, much to my surprise, that babies don't really need to be burped. Somebody, in 2016 I think it was, finally did a study: Is burping good for babies? I burped my children--I'll come right out and say that.

Russ Roberts: We did, too. We were horrible.

Janet Golden: It's not horrible. But it turns out, in most cultures around the world, they don't burp babies. And when you do, you know, pat them on the back and help them--they don't need help burping. And they tend to throw up a little bit more when you do that. But it really took till--what, 2016?--before we asked the question in the United States and in the West: Do babies need to be burped? And I would bet dollars to donuts, published in a peer-reviewed medical journal, has had no effect. Because we've all been taught by everyone around us to burp babies and people are probably going to continue to do that. No harm will come to the baby. We may get a little more spitup on our shoulders. But, you know, it's interesting to think about the things we do question and the things we don't.

Russ Roberts: Yeah. My mother, grandmother taught her children--who is now 85; I can still see her, the pleasure she got from just walking around the room and burping our kids. Just the comfort she got from patting them, and the art of it--the satisfaction she got when it was successful. It's an interesting human thing.

| | 35:45 |

Russ Roberts: That's related, of course, to colic. Which reminds me of constipation. Which take up some nontrivial part of the book. Not a large part, but a part of it. Because, it was an obsession, and still is to some extent, both of those issues. I like your line, you say,

What went into infants, came out of infants, making toilet training another shared concern of parents and experts. Baby book pages prompted mothers to make detailed notes, as they practiced what a writer called "hygienic surveillance."

So, when you have your first child, the obsession that you have with its, what goes in and what comes out, and the in-between part, the colic or the burping and all that--it, what it made me realize, which again I knew but it made me realize it in a more visceral way--is how unprepared human beings are to survive in the world. It's obvious. Humans are born way too early, compared to other animals. And that's because, if the gestation period was as long as it should be, which is probably something like 2 years, the baby could not be born. The size of the human crown, the head, is too large for the hips of a delivering mother. And so, babies are born, even at 9 months, prematurely in some sense. And, we're completely helpless. That's obvious, compared to, say, a colt or a kitten. Other animals in a very short period of time can fend for themselves. We certainly can't fend for ourselves for a very long period of time; and we seem remarkably fragile, at the same time.

Janet Golden: Mmmhmm. And so, I guess I do get to talk about what comes in and out of babies. You know, Americans--and I'll say this because I study U.S. history--have always been obsessed with their digestive tracts. We'll put it that way. And, you can turn on nightly television and see a lot of ads for products for adults--we'll just be discreet about that.

Russ Roberts: I appreciate that, Janet, very much. Often, I tell guests before an episode that we have young listeners, and language and topics, certain language and topics, are best kept off the program, unless I warn listeners in advice--which I do once in a while. I did not warn Janet. I didn't think anything was happening. But, who knows? Here we are in an area that could offend some. And you're handling it very well. Janet, I appreciate that. Carry on.

Janet Golden: Well, I went through--as I point out in my book--the U.S. Children's Bureau received up to a quarter million letters a year, mostly from women, sometimes from grandparents, sometimes from fathers, asking for advice about infant and childcare. They were our trusted advisers. And many, many, many of the letters were about infant digestion. And, I love the letters, because it listed all the different products that families would try to help their babies with their digestion. But, it also shows, kind of an obsession with it that I just found fascinating. And it appears--later on, I read the letters sent to Benjamin Spock; I read the material sent to Arnold Gesell, who was an infant psychologist. It's just a matter of great concern. And, I have to say the women physicians at the Children's Bureau handled it very well. They tried to get the babies off the opiate-laced products--which helped the infants to become a bit constipated. They tried to get them off other products that meant to loosen them up. They really just kind of believed that, at least in regards to evacuation, infants pretty much would know what they were doing. I hope that was discreet enough?

Russ Roberts: Yeah, I love it. It's awesome. It is remarkable how many things people used that were either ineffective or counterproductive--perhaps in terms of general health. But, there's a special category which we haven't talked about yet, which is: How did cod liver oil ever become a thing? And why did it die out? [More to come, 40:19]

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(3 COMMENTS)

Iain McGilchrist on the Divided Brain and the Master and His Emissary

Psychiatrist and author Iain McGilchrist talks about his book, The Master and His Emissary, with EconTalk host Russ Roberts. McGilchrist argues we have misunderstand the purpose and effect of the divided brain. The left side is focused, concrete, and confident while the right side is about integration of ourselves with the complexity of the world around us. McGilchrist uses this distinction to analyze the history of western civilization. This is a wide-ranging conversation that includes discussions of poetry, philosophy, and economics.

Play

Time: 1:26:09

Iain McGilchrist on the Divided Brain and the Master and His Emissary

Psychiatrist and author Iain McGilchrist talks about his book, The Master and His Emissary, with EconTalk host Russ Roberts. McGilchrist argues we have misunderstand the purpose and effect of the divided brain. The left side is focused, concrete, and confident while the right side is about integration of ourselves with the complexity of the world around us. McGilchrist uses this distinction to analyze the history of western civilization. This is a wide-ranging conversation that includes discussions of poetry, philosophy, and economics.

This week's guest:

• Iain McGilchrist's Home page
• Iain McGilchrist on Twitter.

This week's focus:

• The Master and His Emissary: The Divided Brain and the Making of the Western World, by Iain McGilchrist on Amazon.
• The Divided Brain and the Search for Meaning: Why Are We So Unhappy, by Iain McGilchrist on Amazon. Kindle edition.
• "The Divided Brain." Animated Summary. YouTube video. 12 minutes.

Additional ideas and people mentioned in this podcast episode:

• Neuroscience, left-right brain applications
  • Dan Pink on How Half Your Brain Can Save Your Job. EconTalk. June 2007.
  • Jonah Lehrer on Creativity and Imagine. EconTalk. June 2012.
  • Vernon Smith on Rationality in Economics. EconTalk. March 2008.
  • Daniel Willingham on Education, School, and Neuroscience. EconTalk. October 2009.
  • William Duggan on Strategic Intuition. EconTalk. December 2007.
  • John McWhorter on the Evolution of Language and Words on the Move. EconTalk. August 2017. Language learning and processing.
• Adam Smith, Friedrich Hayek, Paul Samuelson
  • "How Adam Smith Can Change Your Life: An Unexpected Guide to Human Nature and Happiness," by Russ Roberts on Amazon.
  • Adam Smith. Biography. Concise Encyclopedia of Economics.
  • An Inquiry into the Nature and Sources of the Wealth of Nations, by Adam Smith. Library of Economics and Liberty.
  • The Theory of Moral Sentiments, by Adam Smith. Library of Economics and Liberty.
  • Friedrich A. Hayek. Biography. Concise Encyclopedia of Economics.
  • "The Use of Knowledge in Society," by Friedrich A. Hayek. Library of Economics and Liberty.
  • "The Pretence of Knowledge," by Friedrich A. Hayek. Nobel Prize lecture.
  • Paul Samuelson. Biography. Concise Encyclopedia of Economics.
• "Jordan Peterson vs. Iain McGilchrist," by Andrew Sweeny on Medium. With link to video interview.
• Jonah Goldberg on The Suicide of the West. EconTalk. April 2018.

A few more readings and background resources:

• Oliver Sacks. Wikipedia.
• David Epstein on the Sports Gene. EconTalk. September 2013. Discussion of whether 10,000 hours of practice works.
• Standards of Living and Modern Economic Growth, by John V. C. Nye. Concise Encyclopedia of Economics.
• Steven Pinker.
• "Arithmetic, Population and Energy," by Al Bartlett. YouTube video.
• Paul Pfleiderer on the Misuse of Economic Models. EconTalk. September 2014.
• Some poetry, Hopkins, Hardy
  • "The Windhover," by Gerard Manley Hopkins. Poetry Foundation.
  • "Pied Beauty," by Gerard Manley Hopkins. Poetry Foundation.
  • "The Self-Unseeing," by Thomas Hardy. Poetry Foundation.
• Michael Munger on Permissionless Innovation. EconTalk. October 2017. Dance floor metaphor.
• "The Power of Vulnerability," by Brené Brown. TED talk.
• "Wanting to Want What We Want," by Russ Roberts on Medium.
• Bill James on Baseball, Facts, and the Rules of the Game. EconTalk. January 2018.
• Jerry Muller on the Tyranny of Metrics. EconTalk. April 2018.
• Polyphony. Wikipedia. Some discussion of Renaissance polyphony.
• No Fear Shakespeare. Nfs.sparknotes.com.

A few more EconTalk podcast episodes:

• • Robin Hanson on the Technological Singularity. EconTalk. January 2011.
  • Nassim Nicholas Taleb Podcast Episodes and Extras. EconTalk.
  • William Byers on the Blind Spot, Science, and Uncertainty. EconTalk. May 2011.

 

| Time | Podcast Episode Highlights | | --- | --- | | 0:33 |

Intro. [Recording date: May 10, 2018.]

Russ Roberts: My guest is... Iain McGilchrist. He is the author of The Master and His Emissary: The Divided Brain and the Making of the Western World, and that is our topic for today.... Now, you've written an extraordinary book. It's 460 pages of dense print filled with innumerable philosophical, cultural references that are hard to parse. It's probably over 200,000 words; the print is small and the margins are small. So I really can't recommend this book--I can't--to my listeners. But, at the same time, I can't recommend it enough. It is earth-shaking in its provocativeness. If you stick with it, listeners, it will fundamentally change the way you view the world, and possibly yourself. And, I'd like to say I couldn't put it down. That's not true. I put it down many, many times because I could only read a few pages at a time. But they were always fascinating. It's really an incredible achievement. I know you worked on it for a long time, and it shows. As I said, it changes--it gives you an entirely different lens for looking at the world than you had before. So, part of our discussion today is going to be neuroscience; part of it's going to be applications of that neuroscience to Western civilization; and part of it will be the part I bring in, which is the applications to economics. So, let's get started.

| | 2:04 |

Russ Roberts: You start with the deep idea that we have misunderstood the differences between the left side and the right side of the brain. They are not symmetrical--but that we've misunderstood what's important about that asymmetry. Explain your vision of those differences and how that vision has emerged from your understanding of the neuroscience research.

Iain McGilchrist: Well, although I--intuit you'd say early on there was something rather important here, I was comprehensively warned off treating this subject, because, as many of your listeners will assume, it's an area of pop psychology that has no validity in science. That was unfortunately the prejudice that I had to work against. But, there is absolutely no question that there is a massive difference between the two sides of the brain. It's just a question of what that difference is. And, in the book, I lay out, with the help of about two and a half thousand references to the literature, exactly what I think those differences are. It's probably worth saying that this is not just a human thing at all. It goes, not just in mammals. It's in reptiles, amphibians, fish, nematode worms, mollusks, insects. And, indeed the oldest living creature that we have, which is a sea creature that lives off the Isle of Wight, 700 million years old, already has a lateralized neural network. So, it's extremely basic to all living beings. Now, what is the difference about? People get put off because there were a lot of very silly things said. And I understand why my colleagues were nervous. Because, you know, it used to be said that the left hemisphere was, you know, down-to-earth, a bit dull, but terribly reliable, rather clever, linguistic. The right hemisphere was a sort of caricature--pink and fluffy, creative artist of some kind, with little to contribute to language or reason. None of this turns out to be right at all. Both hemispheres are very much involved with everything. So, does that mean there's no difference? Well, no: it doesn't at all. First of all, when you look at the brain, the two halves are physically different in a whole range of ways. In any case, why is the brain divided? You know, if you go to an organ--

Russ Roberts: It's a crazy idea--

Iain McGilchrist: Yeah, that exists to make connections. So, how about, let's bring a huge great divide right down the middle? And, you know, this structure is in all the nervous systems of all creatures that we know. So, there's something ancient and important there. And, as I say, if you measure them, the two hemispheres are different sizes, different weights, different shapes. The sulcal gyral markings[?], these sort of convolutions are different on the two sides: they have different ratios of gray-to-white matter. They respond to neuro-endocrinal hormones differently. They use different preponderances of neurotransmitters. Even some of the nerve structures are different. You can't say there is nothing going on here. Especially when you realize that the band of fibers that lays through the brain, called the corpus callosum, which connects the hemispheres--only 2% of neurons actually cross that. And, the upshot of what they are doing is often to say to the other hemisphere, 'Keep out of this.' So, it's not so much they are recruiting one another, as carefully inhibiting one another. All that is fascinating. And was the background to why, for 20 years, I studied this--

Russ Roberts: And we know about that from people who have strokes. Various types of neuro-imaging that's now available to us. Right? So, the difference is you are going to talk about [?] aren't just speculation, like it's an inch long, it's a centimeter longer here, etc.

Iain McGilchrist: No, no. These things are very important. And, you can quickly tell the difference between a neuroscientist who doesn't know anything about medicine or people, and a neurologist or psychiatrist or neuro-psychiatrist. Because we who are clinicians know, from our experience, in ways that Oliver Sacks has made very popular--the fascinating ways in which people's world changes when they have a stroke. And, it changes not just according to the site[?], but according to the side of the lesion. So, that's just taken for granted. If you live in a lab and you spend all your life working on a single cell, and you think of the brain as a machine, you may not know this. Or you may just choose to forget it. But it's absolutely clear. So, what is going on here? I have a theory which, I don't know that it's a contending one, but it's just a hypothesis. But it has an awful lot of evidence going for it. Which is, that, it's there for good reasons, Darwinian reasons, of survival. Because, every living creature has effectively to do two things: It has to be able to get hold of stuff to use it--food, shelter. It has to be able to manipulate things--pick up twigs, build a nest, grab a seed quickly and precisely, catch its prey, lock on to it. So, in order to use the world, it's got to have a kind of very targeted, local, highly focal attention. But, the trouble is, if that's all it's doing, it will be extremely vulnerable to everything else that's going on. Everything else, whether it's your friends and mates around or it's a predator, you need to be on the lookout to see where you are in the world, how you relate to it. So, if you wanted a kind of sound bite: Effectively the left hemisphere is good at helping us manipulate the world, but not good at helping us to understand it. To just use this bit, and then that bit, and then that bit. But the right hemisphere has a kind of sustained, broad, vigilant attention instead of this narrow, focused, piecemeal attention. And it sustains sense of being, a continuous being, in the world. So, these are very different kinds of attention. And they bring into being for us quite different kinds of a world. It is not so much what each hemisphere does: it's the way in which it does it. By which, I don't mean by what mechanism. I mean, the manner in which it does it. It's better to think of them really like different people, or [?] different machines. In talking about the brain, people are always a bit [?], because you've got choose either to talk about [?] as if people are a machine--which it blatantly isn't--or you've got to talk about it as a person. I mean, it's closer to that; but clearly the brain isn't a person, either. But, the two halves of the brain have, as we do, different goals, different values, different preferences, different ways of being. So, that brings me to what I discovered in a nutshell. Which is that, if you like, the left hemisphere has a map of the world; and the right hemisphere sees the terrain that is mapped. So, one is seeing an immensely complex, very hard-to-summarize, nonlinear, deeply[?] embedded, changing, flowing, never-constant, ramifying world. And in the other, the left hemisphere's take on the world, things are clear, sharp, distinct, dead, decontextualized, abstract, disembodied. And then they have to be put together, as you would put things together like building a machine in the garage. You have to put the world together, as if it were a machine. And, I believe that--and I'm writing a book at the moment--another, I'm afraid, very long, long book--which is really saying, 'We've got to stop thinking about ourselves and the world as machines,' because it's not accurate scientifically. And it's very destructive, socially, psychologically, and emotionally; and helps us to believe all kinds of terrible things about what our duties are towards the planet, what our duties are towards one another. And what it means to be a human being at all.

| | 10:57 |

Russ Roberts: Well, we used to think it was a machine, the brain or ourselves. But now we know better. It's a computer. It's not just a machine. Right?

Iain McGilchrist: Heh, heh. No, it is not.

Russ Roberts: A lot of people, of course, believe that.

Iain McGilchrist: A lot of people believe that. That's my problem with them.

Russ Roberts: Yeah. And it's fascinating. Of course, they could be right. But, I'm sympathetic to your view--

Iain McGilchrist: No, they're not right--

Russ Roberts: Well, they could be right. I'm sympathetic to your view, and I found myself struggling, alternating between thinking every word in this book is true, versus, 'Wow, is there really--how strong is the case for that claim?' Because there's a lot of, um--it's a book of--here's the way I would describe it: It's a bit of a prosecutor's brief. I made a list of some of the words you used, against the left side, in favor of the right side. I made a list of the words--I don't think that you used necessarily every single one of these, but it's close. This is the left side: static, fragmented, linear, solipsistic, controlling, over-confident, objectifying, two-dimensional, virtual, lifeless, mechanical, context-free, and sees the whole as nothing more than the sum of the parts. But, I've got both. And let's say that's true. But I have two sides. I've got them both. We all have both. Other than stroke victims. So, in what sense is the left side like, taking over or dominating--leaving its tasks and taking on more than it was meant to take on, and running our culture--which we'll get to in a little bit.

Iain McGilchrist: Yeah. Well, Russ, of course you make a very good point. Which is that we both, all of us, have two sides to our brain. And there's very good reason that we do. I'm not suggesting we'd all be better off if we had a left hemisphere stroke. No. There's nothing wrong with the left hemisphere. As I often say: It's my second-favorite hemisphere. And we definitely need both to be working together. The problem comes from the fact that the right hemisphere is, if you like, a both-and style. Whereas the left hemisphere is an either-or style. And, the right hemisphere sees more. So it knows what it is it doesn't know. But the left hemisphere, seeing less, thinks it knows everything and doesn't know what it is it doesn't know. So, in fact, they do relate in a different way to one another. The right hemisphere communicates--this is a literal, near-physiological fact--that it communicates more and more quickly with the left does reciprocally with the right. And all those things that you read out, I wouldn't quibble with any of them. I'm sure I did use all of them, those adjectives. And, I haven't got time right now to give you chapter and verse for them. But they are not just figurative. They are not just, you know, a hasty caricature. All of those terms I could flesh out in greater depth philosophically, and neuropsychologically. So, yes: You do have a world which is fragmented. Decontextualized. Appears meaningless. A heap of bits. You have a brain half which is very good at procedures. Much better, actually, at carrying out routine procedures than the right hemisphere. But it doesn't understand exactly what it's dealing with. So, I'm going to be sympathetic to you for a moment. I'm going to really regret saying this--because I do consider that the--seriously--and I have a lot to say about the new[?] nitty-gritty about why it's wrong. The brain is nothing like a computer. It's nothing like any kind of mechanism at all. But, if you like, the left hemisphere is a little bit more like a personal computer. It isn't a computer. But the parallel would be that when you use a computer, you understand data that you're interested in. And then you then put it into this machine that can manipulate it in ways that would take you years, in seconds. The machine hasn't the slightest clue what it is doing. It spews this stuff out. You, then, take it back into the lived world, where it makes sense. And so, if you like, the right hemisphere understands what it's giving to the left for processing. And it needs to get it back. Take it back. Bring it into the world of meaning. And let me give you an example. Um, so, for example, if you are learning a piece of music, you start off by being attracted to it. And then you need to do a lot of rather mechanical processes. The 10,000 hours, if you really want to be a concert pianist. You have to do a lot of practice. You do your scales. You practice fingering.

Russ Roberts: And you'll take a difficult passage--you'll take a difficult passage and play it over and over and over again just to make sure you--

Iain McGilchrist: Play over and over and over again. Till you contextualize, and so on. Yeah. Now, all that is not wasted time. But, when it comes to performing it, you've got to forget all that. If you are thinking about all that, you'll never perform the piece at all. So, it needs to be taken back, now. Having been enriched by being temporarily taken apart into a new whole. And everything is like this. Language is like this. For example, the left hemisphere has, if you like, the dictionary. The--funnily enough[?]--the right hemisphere also has quite a decent dictionary. But, for most purposes, we rely on the left hemisphere to give us the words and the complicated syntax. But, actually, the business of--the first idea, when it comes to you, and the understanding of the utterance at the end of the process as a whole--so the grounding of it and the bottom and the kind of interpretation of it at the top--you need the right hemisphere to do that. In the intermediate step, the left hemisphere is very good is, as I say, looking words up in the dictionary, stringing them together according to pre-arranged rules. But you get metaphorical, try to convey implicit meaning, and it's at a loss. So, that is a very important difference. And I give the example sometimes, but it's quite a good one. You know, if I say to you, 'It's a bit hot in here,' you know, using your right hemisphere what I mean, which is: 'Can we open a window?' Which is not what I said. But the left hemisphere is thinking, you know, 'Why is he telling me that? I know it's hot in here. What's that got to do with anything?' So, in a way, if you like, the left hemisphere hasn't a grasp of the overall picture. It doesn't understand humor. It doesn't understand metaphor. It doesn't understand embodied meaning. It can't read faces. It can't read body language. It doesn't know that the things I don't say are just as important as the things I do. It doesn't know that the tone of voice in which I say them completely alters their meaning. All of that has to come from the right hemisphere. So there's no question that the right hemisphere is far more in touch with the whole picture. Understands it better than the left hemisphere. Even though the left hemisphere is expert at following familiar procedures. As long as it's routine, as long as it's met this one before, it's going to be fine. If it's any way new, forget it.

| | 18:34 |

Russ Roberts: So, there's one other piece of the distinction that you talk about that I want to bring out. It's central; you just haven't mentioned it yet. Which is: You've talked about context and the whole; but you haven't mentioned this idea that the right hemisphere is about between-ness. It's about our relation to others. It's about how we fit in. It's less solipsistic. It's less about me, me, me; and it's a recognition that I'm part of something larger than myself. Which, of course, we're going to have a lot to say about that. But, talk about that for a little bit.

Iain McGilchrist: Okay. Well, it starts off in animals, who socialize using their right hemisphere, broadly speaking. So, you--you know, for example, a bird will approach more to a mate and will conduct an exercise in wooing using more its left eye, which in a lot of birds is wired fairly much straight to the right hemisphere, than it will the other way around. You ought to gloss that, because people get mixed up about this. In humans, the left eye and the right eye don't just cross over to the other hemisphere. The left visual field will for both eyes go to the right hemisphere and the right visual field. Both eyes go to the left, so that's good if you've got eyes on the front of our head. But, a lot of animals and birds very conveniently for doing science have the eyes on the side of their head. So you can tell which hemisphere they are preferring for this task. And, you know, they will actually turn their head round, inconveniently, to look with the eye that is appropriate for the task that it is actually carrying out. But, so, socializing is more the right frontal expansion. Which was never mentioned at medical school, because actually the largest asymmetry in the brain, we were taught that the left hemisphere is expanded in what is known as the language area. But we weren't told that the right hemisphere actually has an even bigger expansion, which is in the frontal lobes, and is the most highly evolved and lately evolved to the brain structure morphology. And that is what gives us the capacity to be what Aristotle called 'the social animal.' That we are these beings that can read others' minds, live with them, don't have to have everything explained but can understand the nuances of massively complex situations; can read tiny changes that last just for a few hundredths of a second in somebody's eyes--that kind of thing. So, being able to be social is something the right hemisphere is very important for. And it's also very good at, for example, things like humor, which is important socially. But, what I think you are saying is that I haven't talked about things like theory of mind? Or is that what you want to hear?

Russ Roberts: No--it was fine. That's exactly right. I wish we--

Iain McGilchrist: I think, how do you gloss the word 'betweenness'?

Russ Roberts: Yeah. Talk about.

Iain McGilchrist: It's a word I made up. And it doesn't mean just the sort of gap between two things. But, it is the--say, there's you and me, and we know one another very well; we're good friends. We have a relationship. My friendship with you and my other friends constitutes to a very large extent who I am, how I relate to the society in which I grew up. How I relate to everybody that I've met. My whole being is in a thing that is not just my body but ramifies through experience into the context of myself and the world. And, it can't be just thought of as simple relationship, because suppose we go back to, say, you and me. There's you. And there's me. And there's the relationship as it were--the betweenness. But that includes what you and I become in the context of this relationship, which is a whole new thing. So, I again give the example music. Music can, if you are a lover of music, this is something that can be the most important thing in your life. It can give you richness and meaning in life to a greater extent than almost anything else. And yet, what is music? It is a series of notes. And what is a note? Let's take it apart. Let's draw down this; let's be analytic. Let's see what it's made up of. Well, it's made up of these notes. Aha! At last. A note. What does a note mean? Absolutely nothing at all. Okay. Well, let's take another note. Means absolutely nothing. Put a few thousand of these notes together that mean absolutely nothing and you have something that means everything. Now, how did that happen? It can't be because, as it were, the gaps between the notes, because the gaps are silent. And it can't be because of the notes themselves, because they don't mean anything. So, it is the betweenness--which is not the notes on their own, nor the addition of that to the silences on their own, but the entire, whole, irreducible, indecomposable structure that is Schubert's C Major Quintet. Or whatever it might be. So, there's something that newly arises, that is quite different. It's a little bit like in chemistry: you take a dull, gray, malleable metal like sodium and you mix it with an evil-smelling, poisonous green gas, chlorine; and you get white crystals of salt that make your life right. Now, what's going on there? That's amazing. That is a kind of betweenness.

| | 24:43 |

Russ Roberts: Yeah; I find it--well, I find it quite profound. Just to respond to that, a couple of thoughts that I had while I was reading the book. Obviously, a conversation--this conversation--is a special example. There's one conversation where I write down a bunch of questions and you answer them. And, I could have sent you the questions in advance; I could have read them out loud, then you answered them, and that would create this interview or conversation. That's not a real conversation. A real conversation is alive. It's more than just our back-and-forth. A real conversation is more than just alternating monologues. And I argue in my Adam Smith book that to be a fine human being--and I got this from Smith somehow--I forget how--but to be a fine human being, when you are talking to someone, you are not always thinking about what you're going to say next. You are actually listening. And listening is very difficult. The other area where I think it comes into play is narrative. Which is related to your idea of metaphor, which you talk about a lot. And a narrative is just--you know, one darn thing after another. Right? It's just a symphony of words. But somehow, a great story is more than just a sequence of events. And it has to do with, partly, all the events, how they all work out together. But, more than that, it has to do with how they are told. A great story-teller creates something transcendent, something that makes those connections, that illuminates the connections between the events, using the words, just like a great composer can use rhythm and other things in the instrumentation--the orchestration, and so on. But I think--the other aspect of it that I think is so important is how you see yourself in the world. We spend a lot of time inside our own heads--thinking, 'What do I need to do? What am I afraid of? I hope he doesn't say that. I hope he's going over there. Where's that car? What that doing?' We are deeply immersed in our own world.

Iain McGilchrist: Sure.

Russ Roberts: We have to understand that to lead a full life, we have to escape from that prison. And we have to interact with others. And it's not just--I'm going to go far afield here because I want to make sure I get to this. It's not just, 'Oh, I wonder what's in it for me?' It's got to be: What are we going to create together? Through our conversation, our dance, our song. And so, that metaphor, whether it's neurological or not, of the right side of the brain being aware and focused on that richness of context and interaction, to me, is a profound insight into the human experience, relative to what you call the left side of the brain--and again, I can't speak to the accuracy of it--that somehow it's all about me. And, there is a big part of me that's all about me. But that's all there is about me. I'm leading a very shabby and sterile life.

Iain McGilchrist: Indeed. Yes. I don't think one can emphasize enough this idea, because we start from this age-old, deeply entrenched idea that there are isolated entities. There me. There's this table. This chair. This room. And that it has to be constructed. But it isn't. It's a seamless whole as it stands. And the things that we identify are events that, as it were, stand out against the background. I'm writing a book called There Are No Things. And, I was--I was being in an interview with Jordan Peterson a couple of months ago, and I told him this; and he said, 'Oh. What are there, then?' And I said, 'Patterns. Flows. Relationships.' And that is actually what matters. That is where all the meaning is. It's in--and indeed, there's no news in that. If you came from an ancient oriental culture, you would know precisely what I'm talking about. But, in fact, you can arrive there late in the day, several thousand years on from having made big philosophical errors, in my view--you can find that now, in, certainly, current physics. But you can also find it in current biology. People are beginning to see the metaphor, the machine, is just completely wrong. It doesn't illustrate what we are at all. Doesn't account for it in any way. It doesn't work like a machine.

Russ Roberts: So--

Iain McGilchrist: So, that's why I'm rather down on that. And I haven't got time to give you the full story of that, but I'm hoping you'll buy the next 800-page book.

Russ Roberts: You'll be back. I'm confident of that. If I'm here. And if you're here. We'll both be talking--

Iain McGilchrist: If I am. If any of us is.

| | 29:33 |

Russ Roberts: Let me bring us to economics now, which I think is--I should mention, we are going to get to it, but it's impossible to do justice to the full range of ideas in the book. The second half of the book is an application of this different way of interacting with the world that you posit the left hemisphere and the right hemisphere have. And applying that to the evolution of Western Civilization. A small task. So, you go back through Greek history, philosophy of thought, up through the modern era, with large stops at the Renaissance, Reformation, the Enlightenment, Romantic period. And, you talk about how--and this is--I find this difficult to say, to accept--but I like the idea of it, which is: You make the argument that at different times in cultural history, the left side was more ascendant, or the right side was more ascendant. And that's difficult, because culture doesn't have a brain. Each of us have brains. So, I'll let you defend that later, perhaps; but for now I'm just going to say, I want to think of it as a metaphor. Which you, at the last page of the book say very eloquently, that metaphors are not just for fooling around with: they are the way we understand the world. So, again, putting aside the neuroscience: If I look at the world as either a man of station--the way we understand the world is either a man of station of the left versus the right--the right side as the way you've described it has some very interesting applications to economics. So, through most of economics, the evolution of economics, going back to, say, Adam Smith. Adam Smith has understood narrative. He is interested in description. He's interested in understanding. He has a very emergent--and I would describe it as biological--view of human interaction. Biological meaning more of an ecosystem than a physical system like planetary orbits. It's not mechanical at all. There's nothing mechanical in Smith's, either the Wealth of Nations or The Theory of Moral Sentiments. He sees the world's complexity. He's not trying to build a map. He's giving you his perception of the terrain. And then we come up through 1945, and we get to F. A. Hayek's "Use of Knowledge in Society." Which is a Smithian essay he wrote about the interaction of people and market processes, and how prices mediate our interactions. And they are complex. And they are not mechanical. And, he wins the Nobel Prize, and in 1974, his address, "The Pretence of Knowledge," says, makes the same point. It's basically: We can't understand this. It's not a question of computing power. It's a question of the underlying complexity. And it's not fruitful to think of it as a mechanical system. And there he's talking about macroeconomics, business cycle theory, and so on. That was 1945. 1948, Paul Samuelson writes The Foundations of Economic Analysis, where he mathematizes and linearizes, more or less, economic life. And it starts, say, a trend, say, in seeing the economy as a system of equations. As something to be manipulated. As something we have mastered. As something that is precise. As something that is controllable. And so the change goes from a bottom-up perception, which tends--which is, almost by definition to be observed--to a top-down one, which is to be, then, controlled. And the economist then sees him- or herself as an engineer/priest--a priest/engineer that can manipulate the human beings. Ironically, Smith warned against this in 1776. Excuse me, in 1759, in The Theory of Moral Sentiments. He talks about the man of system, who thinks he can move the pieces of humanity and society around like pieces on a chessboard, forgetting that they have emotions all their own. So, in economics, I see the metaphor you are using very powerfully. And, so many economists see the world in your left-side way--what you describe as the left side. Which is, 'I know. I've got this. Let me do this. We know how to do this. We know what the minimum wage should be. We know what stimulus package we need to pass. It's a little--it's short by $234 billion dollars.' And your point is that, that's a deep misreading of what science should be, just as it is in many other applications. I would--you know, I harp on endlessly here on the program: epidemiology and other medicine--that the complexities are not controlled. We don't understand them. And yet, people, you know, go around as if they have all the answers. And it's very--I think your way of seeing it is very powerful. And I would just close with one thing on this; and then let you respond. But, of course, then I say to myself, 'Am I just kind of smugly dismissing their smugness?' You know: 'I'm so smart; I know how smart I am. They're so dumb they think they are really smart.' And so, I start to think, 'Maybe--I'm not so sure how to balance that out.' But, anyway. React to that.

Iain McGilchrist: Heh, heh. Well, my reflection on that it is not what you think. It's the how, of how you think it, that matters. As, it's not what you do but the manner in which it is done and the reasons for which it is done and the mentality with which it's done that changes it. So, you may be right that they're missing something without necessarily being smug about it. I think the degree of humility is what's missing from many of the crasser areas of physical science and social science. And, as you quite rightly say, several Nobel Prize winning economists who have got egg all over their face because just before everything crashed, they said, 'We know how to do this. It's never going to crash again.' So, there's no question about that. One very odd thing is, you know, I thought that neurologists and psychiatrists and philosophers and people in my sort of area would respond, or hoped that they might. I didn't think they'd respond as much as they have, but at least expected that. The bit I didn't expect was how my mail box was full of stuff from economists and people in the world of finance who said, 'You've just described exactly the problem.' Now, I know next to diddlysquat about economics and the world of finance. So, I was surprised by this. But of course having talked to them, I see exactly why they say that. And so I find myself being invited by people in the world of industry and economics to enter into a conversation. I think I could illuminate a little bit--you said--or perhaps you don't want me to address the question: but you did rather provocatively say, 'I'm not comfortable with this idea because a culture doesn't have a brain.'

| | 36:47 |

Russ Roberts: Yeah. Talk about--respond to that.

Iain McGilchrist: Yeah. I mean, the thing is, I think there's a bit of a misunderstanding here. I'm not saying that, as it were, 'Something has happened in the brain and it's controlling you or controlling society.' What I'm saying is that the brain inevitably constrains the auctions for us. It's giving us--if I'm right--and there is no dispute that I'm right that the two hemispheres attend differently; I don't think anybody in the world who knows anything about neurology would disagree that on the whole the left hemisphere attends in a different way from the right hemisphere. And if I'm right in thinking, as I think most philosophers would agree, that if you attend to something differently, you see something quite different, then you can put those two together; and the two hemispheres will produce different versions of the world. It's logic. It's got to do that. And you see it happening in the history of culture. That's really what I was aiming to show. I wasn't suggesting that if you scanned people 500 years ago, you'd find different things lighting up in their brains, so to speak. That is not the point. My point is that we can get blinded to certain things by custom and by the way in which our culture talks. We can learn to ignore things that our brains are fully equipped to tell us but which our culture tells us we shouldn't listen to. And so, we can develop what in my view is a very simplistic, impoverished idea of the world--simple, predictable, mechanical, controllable, even perhaps complex as it gets underway, but nonetheless by routes that are effectively predictable and controllable. Or, you understand, that we don't know a tenth of what we are dealing with, and that these systems are intrinsically, not accidentally but intrinsically predictable. And that the fool is the person who thinks that they know it all and can control it all. I mean, that has been demonstrated comprehensively throughout human history. And was the background to, perhaps, [?] it was most valuable, the history of tragedy. You know that tragedy is about hubris. It's about when things come crashing down. And my own view is that our society is--I'm not generalizing about the human beings, who have the same capacity to be subtle, wise, kind as they ever did. But, the culture is not like that. The culture is missing an awful lot. I think it's rather crass. I think it's egotistic. I think it's highly materialistic in a way that is not helpful. I think we've lost--

Russ Roberts: It's [?]nasty--

Iain McGilchrist: a moral compass. I think we've lost the sense of the spiritual. It is nasty in a lot of ways. Yeah. And, what I've thought I saw and why I thought it was worth going there in the second half of the book was that there are parallels. That three times in the West we've had a civilization that's flourished. And it often came into being rather quickly. It sort of came almost out of nowhere. Suddenly, there was a great efflorescence of knowledge, learning, understanding--across the board. In science, in astronomy, in maps, in exploration, in philosophy, in the arts, in drama. And then, gradually, that waned. And you might say, if you didn't know much about human civilizations, you'd think they'd take a hell of a long time to grow, and then they'd just go, like that. But, actually, the pattern so far has been more like: They seem to come into being rather quickly--and I don't really want to try to explain that, because I can't--but they--well, I have my own theories but they are not worth saying--but, what's certainly happens is that they then degenerate over time. And in every case--as Greece went from the very rich era of, you know, the 5th, 6th century B.C. down towards the Hellenistic period and on; and then in the Roman period from the end of the Republic and the beginning of the Empire, which was a very rich period for the 4 centuries until Rome collapsed. And then again, with us, at the Renaissance--this wonderful efflorescence of everything--you know, good for science, good for art, good for every human endeavor. Enormously rich suddenly; incredibly creative. And then we've got more rule-bound, more rigid, more hubristic, more certain that we know things--always a bad sign. And now, I think, we're at a point where our civilization is ready to collapse. Partly some of that is economic and political, because I think in each case what's happened is a society has over-stretched itself by having an empire. And, we're doing that, too, both an administrative empire with the British in the 19th century but more now, the global and American empire of commerce. Anyway, sorry [?]--

| | 42:33 |

Russ Roberts: Let me push back on that. Although I'm--there's a dour[?] and dark side of me that finds that appealing to accept. But, I want to push back. And I'll put on my Steven Pinker/Jonah Goldberg hat, recently here to talk about the Enlightenment. And so, let me make a brief case for the Enlightenment, and then you can tell me why you disagree. Or accept some of it, or not. So, the Enlightenment--which is the rationalistic, scientific, rejection-of-religion, embrace of reason is the sort of bumper-sticker version of it--that's led to the greatest advances in the world. We got out of that capitalism, and we got out of it democracy; and because of those two things working together, with science and engineering and technology, we've transformed human life expectancy. We've pulled people out of poverty. We have reached some of the greatest standard of living in human history, unimaginable for the masses. Certainly in the developed world, and increasingly in the developing world, the poor world. The number of people in the last 20 years who have come out of abject poverty is just shockingly glorious. And, women don't die in childbirth like they used to. Children don't die in their first 5 years as they used to. We've abolished smallpox. So many wonderful, glorious things from that left-side, focused reason: let's get rid of the mumbo-jumbo of superstition and religion and let's focus on what science and technology can do. And it's all good. 'What are you complaining about?'

Iain McGilchrist: Yeah. I mean, you don't need to tell me what the Enlightenment did for us. There's no doubt that if I'd been living in the 18th century--

Russ Roberts:'Don't we need more of it? Don't we need more of it? We're on our way to the Singularity. We're going to have--we're going to upload our brains into machines and live forever. Everything is going to be great.'

Iain McGilchrist: Sure. No, as I was saying, if I'd been living in the 18th century I'd have undoubtedly been enormously confident that what we were doing was very good. The thing is, you've mentioned a lot of things. But, everything in life--which is not the way we normally think: We think there's good stuff and there's bad stuff. But actually, if you look at things, every good has a dark side. And even the things we think are bad have their redeeming features at times. So, the world is more complicated. That was a very left-hemisphere story you just told me. And I know it's Steven Pinker's. I'm sure he would wear the badge of being very left-hemisphere minded as a badge of honor. But, I do think it's blinkered. Because, you mentioned things--some of them I would not dispute. It's better, obviously, that we don't physically suffer in the ways that we used to. But, we actually have a problem because of that. Because of the good things--like medicine and better nutrition, we now have a problem of resources, which is not going to be solved by technology. Because technology consumes resources. And I don't think most people really understand quite how bad that problem of resources is. There's an absolutely wonderful lecture by Al Bartlett, a physicist, on YouTube, which I expect you know. But if you don't, and if your listeners haven't, please go and look it up now and watch it. It's about an hour long. It could change your whole way of thinking--

Russ Roberts: But, don't go listen to it now. Wait till the end of this conversation--

Iain McGilchrist: No, no, don't listen to it now--

Russ Roberts: And we'll put a link up to it.

Iain McGilchrist: Make a note of it. No. Because, effectively, what you are saying is, there is absolutely no way. It's not a matter of, you know, if. It's a matter of when; and it will be very soon. We will have exhausted various kinds of resource which we are using exponentially. And, his point, which is human beings don't understand exponential growth. They, you know, the famous thing that you put a bacterium in a jar at 11 o'clock, and it doubles every minute. And you come back at 12 o'clock and it's full. When is it not full? 11:59. And when would a bacterium in that jar have realized that it had got a problem? At 11:58, the jar was only a quarter full. At 11:57, it was only an eighth full. At 11:56, it was only a sixteenth full, but that was four minutes before it hit the buffers. So, we're in that kind of a world. And, there's for more to a world than just having more years. You mentioned longevity. Is that necessarily a good? That we can get more stuff? Is that necessarily a good? Do you think we are happier? The evidence is we're not happier. The evidence is that actually people who lead lives that we in a somewhat as a patronizing way think of as very basic and sinful may have more stable existences, feel more fulfilled, and be as happy or happier than we are. So, it's not as straightforward. It reminds me of when I told a colleague of mine--who is a Distinguished Professor of Psychiatry somewhere, the research that shows, pretty clearly, that we aren't any happier. And there's a stronger case that we are not as happy as we were in, say, the 1950s or 1960s--when, you know, life was relatively uncomfortable on the terms you've described. And he said, 'But that can't be right. They've all got washing machines.' You know. And I'm sorry, what you just gave me, and what Pinker says, is a version of 'But, they've all got washing machines.' But, there's a bit more to life than that. And if we're not actually not able to understand and enjoy the spiritual aspects of life, and to feel a relationship to nature; and if we believe that we don't mean anything--what is the point in it? There's a rather curious element to modern thinking, which is: The more we think life doesn't mean anything, the more we hang on to it. The more we want it never to stop. Even though we are more stressed, and we used to have higher rates of mental illness than we used to do. And we're in the process of destroying not just ourselves, but the whole rich business of this planet. Its creatures. Well, I want to go on, because it--a long story, but I think it's one you know but can't be said loud enough. So, you know, I don't share this optimism. And I don't think it would be good if became more like machines. I think it would be good if we became less like machines. And we use machines to help us, in a sparing sort of way towards the things that really are drudgery and need to be got rid of.

Russ Roberts: So, I'm--I have mixed feelings about all that. I am not as pessimistic as you are--is it Al Bartlett? Is that his name?

Iain McGilchrist: Al Bartlett. Yeah--

Russ Roberts: As he is. But I'll have to give him a listen and see what I think.

| | 50:03 |

Russ Roberts: But, on the other aspects about meaning, I think you are spot on. I always think of the phrase, 'Everyone's fighting a battle. So, be kind.' We all have our ghosts, our phantoms, our fears, our insecurities. And strangely enough, our higher standard of living don't help us with those things. They don't help us with our fundamental challenges of relating to other people and of empathy and maybe in fact make them harder--

Iain McGilchrist: no--

Russ Roberts: you could argue. But, if we have time-- Yeah, go ahead.

Iain McGilchrist: Mmm. Yeah: I was just going to say. Sorry. My favorite is: Never criticize someone until you've walked a mile in their shoes, because by then when they get mad at you, you are a mile away and you've got their shoes.

Russ Roberts: Ha, he, heh, heh, yeah. It's a good line.

Iain McGilchrist: Sorry.

Russ Roberts: Yeah; no, you can't help it. It's a good line. But I do think, to come back to the seriousness: I think most of us walk around with our armor on all the time, that defends us, protects us, from embarrassment, humiliation, shame. And, you can make a case that we've had an enormous loss of vulnerability in our ability to share with others. But I think that's a perennial problem of being a human being. And I don't think--washing machines don't help with that. And I do think: If you don't have a washing machine, it's transformative to have one. But I don't want to suggest that having one is somehow the ultimate. And I do think that, as economists, that we spend way too much time thinking of human beings as maximizing machines. And, you point out in the book, when you talk about people a certain way--you actually start to think of it as true. And we had a credible episode of EconTalk with Paul Pfleiderer where he talked about the challenge of--professors in particular of finance because that's his field--of actually confusing reality with their model. And I think that's a huge problem in science--

Iain McGilchrist: And that's exactly what I'm saying. The left hemisphere has a model; and it mistakes it for reality.

Russ Roberts: So, let me ask you, then--but I want to come back to--you just said something incredibly profound, which was: How is it that, as we lose our connection to the divine and the spiritual and we start to think that life is just a random set of biological events, we cling to it so deeply? And, I'd written a question before we started: I said, 'Why do you think we human beings care so much about meaning? Why can't we just enjoy life until we die?' And I think that's a--for an economist, a difficult--I'm not going to try to answer it wearing my economist's hat. But I would like your thoughts on it. If you believe that this material world is all there is, why do people care that it should have some "ultimate meaning," or "other meaning"? And many people are happy saying it doesn't and life is just a chance to indulge and enjoy and physically, you know, the Dionysian side of Nietzsche--I have to mention Nietzsche because you do many times, and any time you can mention Nietzsche, you should. But, what is this--why do we have this thing with meaning? What's that about? Why can't we just be an animal? We can't, evidently.

Iain McGilchrist: Well, you said, 'Why don't we just enjoy life without meaning?' I always think that's a kind of oxymoron, because when life is meaningless, it's very hard to enjoy it. As you know, [?] the simple pursuit of pleasure--

Russ Roberts: Yeah, but it shouldn't be. Right?

Iain McGilchrist: It shouldn't be according to the left hemisphere's model. But, as I keep saying, the model isn't the reality. It computes, yes. But we aren't computers. That's not what we do. So, what we, famously, require is the sense of belonging and the sense of purpose. And very hard to deny the idea that there is a kind of teleology in living beings. It's a thing that biologists have until very recently have been loath to come out of the closet and say. But, meaning is something very deep, in life. And, what confuses the picture is that its very meaningfulness comes from not having an explicit meaning, an ulterior motive. It's exactly because it doesn't exist in order that or so that this can happen. It doesn't have an instrumental purpose. That is the foundation of its having a purpose, of being enjoyed in itself. So I think we are saying similar things, but I'm saying them, I think, from a very different philosophical position. Which is that, our satisfaction comes from letting go--not controlling, not thinking we know it all and being imprisoned in our little egos in which we try and force life to be something we want it to be. And try and indulge ourselves in pleasure. That is not fulfilling. Nor is it good for the human species, if we all did that; in fact if we were all like that, society wouldn't last. Maybe if enough of us think like that, it won't. But, there's such an idea as dignity. It's a very difficult one. Nowadays people are so allergic to it, in case it means somebody thinks big of themselves. But of course actually the very people who handle the idea of, you know, 'we're nothing but,' also have myths of their own. They also have a kind of arrogance of their own. And so, it's not as simple as that. But we do need to be able to sense the meaning in things. And it comes when we stop trying to find a meaning at one level. Which is why oriental philosophy is so complicated. It says that all is one and all is nothing, and all is many and all is being. The trouble is, that we come to paradoxes if we are really looking deeply into things. In fact, Niels Bohr [?] said, 'Oh, thank God we've got a paradox. At last, we're on to something.' And his son said, 'My father distinguished between small superficial truths in which paradox is just nonsense--simple, coherent, linear--and the deep truths, which don't have that structure at all. Which are like dipoles in which you can't--you take a magnet and you decide: I don't like the north pole of the magnet. I'm going to cut it off. All you've got is a shorter magnet with a north pole.' So, two things are mutually dependent. And, the big things in life are all of this kind. There's not one that's good and one that's bad. We have to see this complex picture. And, what I'm really saying--I'm sorry; that's a little bit way off. But, what I'm really saying is that there's two senses of meaning: I can't find--if I say, 'My wife means the world to me,' you say, 'Well, okay. What does she mean?' Well, you've misunderstood what I mean by 'meaning.' If I say, 'This piece of Bach, as far as I'm concerned, says everything.' You say, 'Well, what does it say?' You are not understanding the basis from which I am speaking. Now, life doesn't have a meaning that I can give you in so many words. It's meaning is unveiled to you in the process of living, if you are attentive. And so we come back to attention, which drowns[?] everything. And I love this saying by a French existential philosopher called Louis Lavelle, because I think it's succinct; and if you ponder on it, it really kind of brings home to you how important attention is. He said, '[? French, quote]'. In other words, 'Love is a pure attention to the existence of the other.' In other words: How we attend to things changes what there is in the world. How we look at the world changes what the world actually is. Not just in some nebulous way. It actually alters what's happening. And, it's a moral act. Because, by attending in a certain way to the world, selfishly, ruthlessly, mechanically, we can destroy its meaning. And go, 'Well, I can't see it's got any meaning, so I might as well just gobble it up before I go.' And so, our best image of a human being is some disconsolate, constantly impatiently seeking some further satisfaction. Fat guy with a large checkbook [?]. I mean, that is not an aspiration for a decent human being. In fact, we know that happiness doesn't come, with all due respect to your Constitution, from pursuing it. It will run away from you if you pursue it. It comes from forgetting about yourself. If you bring that up.

| | 59:24 |

Russ Roberts: Well, I always want to mention a couple of things that this reminds me of, that have come up in the past for listeners who want to make these connections. I think about translation. You know, people say, 'Well, just give me the literal translation.' As if that was a thing. Right? The whole nature of language is ambiguity. And, again, just use your language, left side, the left side of my brain says, 'I don't like ambiguity. Just tell me what it means. When you say your wife is everything, or the world to you--let's see, world, I can look that up. Well, that doesn't make sense. That's a meaningless statement, obviously.' But, of course, it's not. My right side of the brain is moved by that avowal. So, translation, which I think is--I think it's very difficult for us--many people, and me, every human being has a bit of this: That has that left side, just says, 'Tell me what it means. I want to understand it.' You give me a poem and I don't understand that can be a feature, not a bug. But there's a piece of me that says, 'No, no, no! What did he mean by that? What did Gerard Manley Hopkins mean by dapple-dawn, minion--I can't remember it by heart. But, so that's one thing that I think about a lot, is translation. The other is metaphor. We used recently with an episode with Mike Munger; we'll put a link to it, where I've used this before to think about how we should behave. And I've used the metaphor of a dance floor. The metaphor of the dance floor is that--there is a piece of me, when I go out on the dance floor, I want to be seen as the best dancer. So, I want to say, 'My goal as a maximizer is to get the most I can out of this 20 minutes on the dance floor. And I want to show off. And I want to look great. Everyone's going to say, "He's a great dancer."' But, of course, that's a really bad dancer. A really great dancer says, 'I want to go out there and I want to make sure that neither I nor my partner step on anybody's toes. I'm going to make my partner look graceful and elegant. I am going to, with the other people on the dance floor, create something I couldn't create if I were alone. Even with a partner--that there's something magnificent about the swirling, unpredictable, spontaneous movement there. And a great dance like that is exhilarating in a way that a planned, 'I'm going to win this competition,' can't be. And the other distinction I want to make, which I heard recently from Jonathan Sacks, former Chief Rabbi of the United Kingdom, which I think is a fantastic distinction, is between contract and covenant. A contract is about: What do I get out of this? And, I think: 'What's in it for me?' And, 'I've got to protect myself.' And, I've got to have these clauses to make sure I don't get taken advantage of or exploited. A covenant is a promise. A covenant says: We're together. So, a marriage, where I go into a marriage and say, 'I hope I'm a hit today. I hope I get more out of it today than I lost,' or 'I hope I got more--gee, didn't my wife, hasn't she failed to do this the last three times? It's her turn'? So, if you keep score, you have a lousy marriage. And the way to have a good marriage is to base it on love. And to say, 'Let's see what happens.' That emergent, attentive, enjoying whatever it is at this moment. And that's very hard for us. Especially that left side of us doesn't want that. It wants to say, 'I could get more out of this. I'm dissatisfied. I need a better x,y,z--whatever it is--whether it's a marriage or a job or a relationship with a parent, or a friend.' And I think that whole maximizing mindset, which economists adopt, has some real drawbacks in thinking about how you should live your life. We often rationalize it by saying, 'Well, but you've got to look out for yourself, don't you?' We often rationalize it by saying, 'Well, people don't--they're not literally like this, but they act as if they are.' And your point, I think correctly, is that: Well, if you keep thinking as if they act that way, maybe you start to think they do. And you start to think it's rational for you to act that way. Which is, I think, extremely destructive.

Iain McGilchrist: Yes. Well, it's not even rational. Because it won't be for your own fulfillment, or anyone's.

Russ Roberts: Right. It's not meta-rational.

Iain McGilchrist: There are all these--I mean, of course, you've got to look out for yourself. But, I mean, a point that I think is a very interesting one that I came across recently in the writings of two process[?] biologists. They made the point which I have always believed, that is absolutely, that is absolutely true: that nature involves competition, quite clearly. But that's only half a story. It at least is importantly involves collaboration. Your body contains 37.2 trillion cells, that at some point in history decided to pool resources and cooperate with one another, in order to make something better. And all living things do this. Time and time again. And, in fact, the story of how things progress in nature and how creatures, evolve, is partly to do, surely, with competition. But at least as much with cooperation. And the combination is collaboration. And that gets us back, in a way, to this idea--it's not quite covenant versus contract. But a distinction, by the way, which I think is a very important one. So I agree with Sacks about that. But, you know, when you were talking about the dance floor, I always think of a couple of things that have been for me almost as pleasurable as anything I can think of in life. And, one is taking part very badly in--a kind of dancing that doesn't much happen these days. Where a community gets together, and there is a kind of flow into which you get taken or not. And, somehow you find yourself able to do the things without in any way thinking about them. And the sensation of belonging to this thing--you are taken out of time, and somehow you are enriched. And the same thing used to happen to me--when I lived in London, on a Tuesday night I used to go and sing in a choir that sang Renaissance Polyphony. On Wednesday night I'd go and dance--I was having dance classes in rock-and-roll. Which I love. But, anyway, to go back to the Renaissance Polyphony: One of the things we would do, I think: we thought we knew a piece really well. So there's just two or three people in each voice; and I was singing different lines against one another, would be to put the music down and walk around the room, as if in a dance. But sort of no particular reason for going any one place. And just listen, as you get close to someone else, to how their voice and yours interact. And so on. This is completely an amazing thing. If you play music together with people, it really means--it brings to life what I'm saying, about how the important things emanate from this. As they do, if you've ever worked alongside people on a common project, under difficult circumstances. One of the things about medical training, which in my day was particularly rigorous--I was, at one stage working 120 hours a week--and I can tell you that none of those involved sitting down. So, I was working incredibly hard. But the sense of--it wouldn't be the same, actually, now, because it's all much more managerialized. But in those days, there was a genuine professional culture in which we didn't count the hours. We didn't think, 'Gosh, it's time for me to go to bed.' We didn't think, you know, 'I'm getting paid £5 an hour' which is half what the cleaner is getting paid. You just did it. And you were part of the team. And the satisfaction you got out of doing it. I mean, I'm not saying there weren't times when you thought, 'This is crap.'

Russ Roberts: No, of course. There are a lot of times like that.

Iain McGilchrist: There's always that.

Russ Roberts: Yeah. But, afterwards--

Iain McGilchrist: There's always that mix in life. Yeah, yeah. And even at the time, actually. I mean, a lot of it is, you do get this extraordinary feeling out of it. So, yeah, no, definitely. This idea of the dance is good. But you also mention, and I can't let that go before, because it's so apposite: translation. I started off my academic life with literary criticism. And I wrote a book called Against Criticism. And that wasn't because I hadn't enjoyed and learnt an enormous amount from what I'd studied. But, it was because it seemed to me something wrong with what we were doing to it in the seminar room. Because, if I can express it as succinctly as possible: Someone, a real living human being in the past, had to an extent suffered to produce something very special and beautiful. Which was entirely unique. You know, if you have a favorite poet--one of mine is Hardy. If Hardy hadn't written poems like that, or Hopkins, who you mentioned, a very good example. If Hopkins hadn't written, you could never have thought of his poetry. Because it's entirely his. There would be a Hopkins-shaped hole in the universe if it hadn't happened. So, there was something unique. And there was something embodied. It didn't just consist of a few ideas: 'Okay, I got it.' Like a computer would. It actually affected my breathing. It affected, subtly, the tensions in my body musculature. It affected my blood pressure, my pulse, my heart rate--my hair stand on end. These things are implicit. And much of the meaning is implicit. You know, William Empson, very famous English critic, wrote a book called Seven Types of Ambiguity--one of the most famous books of criticism--that writing is all about the richness of ambiguity. So, it was unique. It was implicit. And it was embodied. And we came along, and we got out of it something that was general and abstract. And completely explicit. So, it just worked in exactly the opposite direction from the way in which it worked. So, if Hardy says, for example,

Here's the ancient floor,
Footworn and hollowed and thin
Here was the former door
Where the dead feet walked in.

Now, that's the opening of a poem in which he is saying how much he misses his wife. And he remembers this room, a time when they were happy together. To say that, is not to convey anything of the poem. Which is why it's so difficult to translate poetry at all. And I think it's a bit sad that, that when children no doubt study Shakespeare at school a bit, that they often are encouraged to go and read No Fear Shakespeare, because it will tell them what it means. In a way I understand that. But, it doesn't really tell them what it means, because it's in the words themselves. You know? Even Shakespeare said something--which is really a banality--you[he?] said, 'There is no art to read the mind's instruction in the face.' You know, I think, 'Wow.' But, what does it mean? It means you can't tell what people are thinking by looking at them. Kind of the thing you could hear in the pub. But somehow it's different, you know?

| | 1:11:03 |

Russ Roberts: No, I've talked a lot on the program about knowledge and wisdom. And how we think somehow, I guess it has to do with facts. You need facts, to be wise and knowledgeable. But somehow, stating things--I'll give an example, a silly example--not silly, but, there's a TED Talk by Brené Brown. It's on vulnerability. And when I was reading your book, I was thinking about this talk. The talk, the point of the talk is: It's good to be vulnerable. So, I just told you the point of the talk. And you'd say, 'Yeah, I agree with that.' But, it doesn't get in your bones. And if you want to get something to get in your bones, you've got to say it in a way that gets into people's bones. One way to do that is with a 460 page book on the divided brain. And, you hammered on me for, you know, the hours it took. And so, I've absorbed the lessons of that book in a way that I wouldn't if you just listened to this one hour. I absorbed it in a way I didn't, having watched your 12-minute, animated RSA[?] version of this, which I'm going to put a link up to. Although those were all--they were great. And I hope people love this conversation. But, it's not the same. It's not just because, 'Oh, there's more in the book.' It's because the choice of the words and how it gets expressed makes all the difference. People have said to me--one of my favorite books is Fooled by Randomness, by Nassim Taleb who has been a guest. And people say, 'Oh, there's nothing new in there.' Or, 'I knew it all, already.' And, of course, I knew it, too. Life has some random elements that are hard to distinguish from the things that aren't random. That's the point of the book. 'Oh. Oh, I get it.' No, you don't. You have no chance of getting it. You could spend a lifetime thinking about randomness. It's a--another guest, William Byers talked about. It's just the nature of some concepts--that, I think you say it, at some point--that the more you think about it, the more your realize that there's more to learn. It's not exhausted by describing. The other--before we end, I want to ask you to defend something. It's hard to defend on one foot. But, many times in the book, you talk about those who are influenced by the Left side--being focused on the material, the explicit, the concrete. And many guests on this program, many listeners, would say, 'Well, that's all there is.' When we had Jerry Muller on, recently, and he talked about the Tyranny of Metrics--how measuring things can lead to mistakes, right? And people say to me--I actually had someone write me and say, 'I'm very disturbed: you didn't give the other side.' And I'm thinking, 'What's the other side?'

Iain McGilchrist: They need to read Jerry's book. Because it's an excellent book. And it's very balanced, actually. I think he does a brilliant job.

Russ Roberts: But the person who wrote that was a data scientist who--what he meant by 'the other side' I think was that numbers are really good. And they are, of course. There are times when it's a very good idea to use numbers to measure things, for all kinds of things, to measure things in general. Right?

Iain McGilchrist: So, we're back to the fact that the Left Hemisphere is important, at times.

Russ Roberts: But maybe they're--but maybe--so, but the people--who--

Iain McGilchrist: It just doesn't[?] think it's a monster.

Russ Roberts: But the people who say that, the people who say that--and I gave this example then, and I'll give it for you, which is: When I would say to someone that certain financial techniques, of riskiness, of a portfolio are dangerous because you tend to start thinking you've actually understood how risk works when in fact you don't, a very Talebian point, someone says to me: 'Well, what's the alternative?' And of course the alternative is: judgment. And humility. And those are really--you are fooling yourself to think that you've somehow made it more it more precise by putting a number to it in certain settings. But, what do you say to the people who say, 'But there isn't anything beside the material? That's all there is. There's just the physical world.' There's stuff about spirituality, or the other, the transcendence, awe. All these things--those are just--those aren't real. What do you say to those folks?

Iain McGilchrist: Well, I don't want to patronize them. But I do feel rather sad for them. Because, um, of course, that's exactly what I would expect. If you don't listen to certain things, and you come to say they don't have any meaning, because they, I don't take them into account, it's all you can see is the [?] face? Because, you are being misled by a, in my view, impoverished kind of a culture, into thinking in rather impoverished terms about the world.

Russ Roberts: But, Iain, your world--it's just an illusion. You're just saying these things. There's no evidence for these things. They don't--there's nothing--I can't touch them; I can't see them. I can't measure them. It's physical. It's all chemistry.

Iain McGilchrist: Well, yes. I know, of course, it's diaboli[?]. Yeah but, it's of course, if you think that the only things that matter are the things t hat you can touch, then you won't understand anything. I can't prove to you what love is. I mean, I can't measure it. I can't show you. I haven't got a handful of it. And, if you've never experienced it, you won't know what it is. But I can tell you it exists. And it's very important for many people.

Russ Roberts: It's just a set of neurons--

Iain McGilchrist: Time is intangible. Time is intangible. And it's not a neuronal twangle. The fact that neuronal activity accompanies everything we do doesn't tell you anything. Why wouldn't it? It's like: We found a bit in the brain that lights up when you eat a ham sandwich. Well, you know, what [?] it, there's something going to light up somewhere. But it is not itself--well, it can sometimes be helpful to know what it doesn't--I mean, it can sometimes be helpful. To know what it--you know, after all, I've spent my life looking at what connects with what in the brain. So there is something in there. But, on the other hand, a big mistake is to think, you describe what it really is by redescribing it at a more reduced level. But all the things that matter or of this kind. They can't be proved. But why should they be? Why waste your time trying to prove something to somebody who is constitutionally incapable of understanding it? I mean, for example, I'm completely convinced that Bach is a greater composer than Bing Crosby. It doesn't matter what you tell me: I'm going to believe that. 'Well, I happen to think Bing Crosby is far more, made far better music than Bach.' So, it's just your opinion. Yeah, okay. It is. It help you. But just because things can't be proved or measured doesn't mean that they are not important and real. In fact, you know, famously, it's the things that count, that can't be counted, and the things that get counted that don't really count. So, you know, we shouldn't surely get into such a naive trap as that. One of the most absurd things that's ever happened is Galan Strawson and the English analytic philosopher pointed out, is the denial of the existence of consciousness: It's the only thing that we can be certain of. It's massive. People say, 'A problem?' Well, what problem? I mean, that's the one and only thing that is non-problematic. Matter, however. What the dickens it matter? It's something in my consciousness, that I only know because I only have consciousness. That seems to resist my will. We don't know that we only have consciousness because we matter--we might or we might not. But we do know that we only know matter through consciousness. So, consciousness is the primary thing. And, to say it's an illusion is ridiculous. Because an illusion suggests a consciousness that can be illuded. It's a bit like-you know, if somebody says, you know, in my consciousness I see sunlight on a bowl of strawberries--I'm not really seeing sunlight on a bowl of strawberries. As it were: What would the real thing look like? You know? It's like people who say, that the old joke, 'Shakespeare wasn't really written by Shakespeare. It was written by another man of the same name.' The--if that isn't consciousness, then what is the real thing like? So, it's an incoherent concept, in other words--

Russ Roberts: well--

Iain McGilchrist: no consciousness, certainly not tangible. And we don't know that it emanates from matter.

Russ Roberts: I've become increasingly interested in it. And I tried to get some philosophers on the program; but they didn't, they thought better of it. For whatever reason. But it's fascinating to me. It's fascinating to me that, whatever we haven't quite--either there's nothing to it. Or probably we'll never understand it. Other than that, it's not interesting. I find it extremely interesting.

| | 1:20:15 |

Russ Roberts: Let's close--I want to say something ironic about your book, and then I want to say something, I'll ask you a question about the book, I'll let you close with. So, one of the things I loved about your book was the embrace of ambiguity. I remember teaching MBAs [Masters of Business Administration] and saying some negative about the Swedish MBA system--the Swedish economy. And a student raised his hand, and he said, 'In our other class today, in Organizational Behavior, we learned that they have really good companies.' 'Yeeeah?' And what he meant was: 'So which is it? Are they good or bad?' The idea that they could be, have some good things or some bad things, that's not good for the multiple choice test? And we have that mentality of like, 'I don't like to balance two things in paradox. Just tell me the right answer.' So, at the beginning of this conversation, I made a joke about: I can't recommend this book and I can't recommend this book enough. So, the listener is thinking, 'Which is it? Is it a good book or not?' Well, it's a very good book. But it's very long. And it requires a great deal of effort, because there are allusions and passages that are challenging. There's a decent amount of Heidegger in the book--by 'decent amount' I mean more than a sentence. And Heidegger is very hard. There's maybe a page or two about Heidegger in total. You may struggle with that, as I did. You may want to skip over it. You may want to grapple with it. But, the other thought I had, and this comes back to this consciousness thing and that we have to use consciousness to understand consciousness, is: You've written a systemic book about the problems of systemic thinking. You've written a book that makes a powerful case condemning the over-reliance of the left side of the brain. And you had to use the left side of your brain to write that. Did you think about that at all when you were writing the book?

Iain McGilchrist: I definitely did. By the way, in my earlier life I wrote a book called Against Criticism which contained a lot of criticism. And now I've written a book which is against reducing everything to the brain but which actually does a lot of looking hard at what we know about the brain. But it really is--to be serious--it illustrates very well my point, which is not that there is something fundamentally wrong with the left hemisphere. It only becomes a problem when it thinks it knows everything. It should be a servant, not a master. That is in a nutshell my point. And so, I did a lot of very hard work in order to construct something which I hope persuades the reader. But there was a time when all I thought was, 'I can't write this book,' because everything I know connects and ramifies to everything else I know. In the end, when people read the book they say it reads in such a way that it's got this clear, linear thing; you are carried along by it. I had to really struggle to get that going. And I'd just like to gloss the systemic thing. Because, there's two kinds of meanings to that, really, as there are to just about every important idea. There's a left hemisphere type of system, and a right hemisphere. So, systematizing, in the sense of a flow diagram or something like that is explicit would be very left-hemisphere: building a system of that kind. But there's also seeing the broad patterns behind things in a more Jungian sort of way, if you like. By seeing imaginative patterns of how things connect with one another. Seeing a bigger picture. Not by putting together the lots of things in order with a screwdriver, but by, as it were, allowing something to come into being for you. Those are two different kinds of perceiving a whole: one a pattern and the other more of a system. And I would say that I hope my book ends up being more of that--that it is a very rich pattern in which people start to see that things that they experience relate to it. Probably there is something in that, because the [?] emails I get from people of the lines--I mean, I often get one with a strapline[?], 'Your book changed my life.' Which I think is a very nice thing, because I was a doctor and I had to give it up to carry on doing what I'm doing. And I thought, 'How are you going to feel about that?' And it turns out I can still help people. But, the other thing people say is, 'Oh, in a way I kind of knew this'--rather going back to what you are saying. 'In a way I kind of knew that.' They don't mean the neuroscience, or even the Heidegger, or anything else. What they mean is, 'What you have articulated for me is something I profoundly believe and live and understand; and I didn't have any words for it. You've given me words.' That's what they say. So, that is the way in which I think it works, is that I use the tools of those very analytic things to take people to a place where they can let them go. They can, as it were, you take the ladder up and then you can kick the ladder away.

|

 

(34 COMMENTS)

For Sale!

by Amy Willis

Have you heard of Henry George? In this week's EconTalk, host Russ Roberts welcomes Glen Weyl to discuss his new book, co-authored with Eric Posner, Radical Markets. One of Weyl's objectives is to bring back one of George's main proposals, a form of land tax.

As always, now we'd like to hear what you think. There's already been great conversation in the comment section for the episode...Let's keep it going!

1. Weyl asserts that his broad purpose in the book is to "create a different sort of political coalition." Who is he trying to align, and how successful do you think his various proposals could be in accomplishing this?

Glen Weyl on Radical Markets

Economist Glen Weyl of Microsoft Research New England and Visiting Senior Research Scholar at Yale University talks with EconTalk host Russ Roberts about his book (co-authored with Eric Posner) Radical Markets. Weyl urges a radical transformation of land and housing markets using a new federal real estate tax based on self-assessment. Owners would be required to sell their houses at the self-assessed price. Weyl argues this would eliminate the market power home owners have in the re-sale market and the revenue tax would could be used to reduce inequality. In the last part of the conversation, Weyl proposes an overhaul of U.S. immigration policy by having residents sponsor immigrants for a fee.

Play

Time: 1:03:28

Glen Weyl on Radical Markets

Economist Glen Weyl of Microsoft Research New England and Visiting Senior Research Scholar at Yale University talks with EconTalk host Russ Roberts about his book (co-authored with Eric Posner) Radical Markets. Weyl urges a radical transformation of land and housing markets using a new federal real estate tax based on self-assessment. Owners would be required to sell their houses at the self-assessed price. Weyl argues this would eliminate the market power home owners have in the re-sale market and the revenue tax would could be used to reduce inequality. In the last part of the conversation, Weyl proposes an overhaul of U.S. immigration policy by having residents sponsor immigrants for a fee.

This week's guest:

• Glen Weyl's Home page
• Glen Weyl on Twitter.

This week's focus:

• Radical Markets: Uprooting Capitalism and Democracy for a Just Society, by Eric Posner and Glen Weyl on Amazon.com.

Additional ideas and people mentioned in this podcast episode:

• Henry George, land taxes, related biographies
  • Henry George. Biography. Concise Encyclopedia of Economics.
  • Progress and Poverty, by Henry George. Library of Economics and Liberty.
  • Protection or Free Trade? by Henry George. Library of Economics and Liberty.
  • "Chinese Immigration," by Henry George, in Cyclopædia of Political Science, Political Economy, and the Political History of the United States, John Lalor, ed. Library of Economics and Liberty.
  • Adam Smith. Biography. Concise Encyclopedia of Economics.
  • Karl Marx. Biography. Concise Encyclopedia of Economics.
  • William Stanley Jevons. Biography. Concise Encyclopedia of Economics.
  • Leon Walras. Biography. Concise Encyclopedia of Economics.
• City Builder. App.

A few more readings and background resources:

• Background: monopoly, antitrust, etc.
  • Monopoly, by George Stigler. Concise Encyclopedia of Economics.
  • Intellectual Property, by Stan Liebowitz. Concise Encyclopedia of Economics.
  • Antitrust, by Fred McChesney. Concise Encyclopedia of Economics.
  • "The Physiocrats: Six Lectures on the French Economistes of the 18th Century [1897]," by Henry Higgs. Macmillan and Co. Available at the Online Library of Liberty. PDF file.
• Zillow.
• Capitalism, by Robert Hessen. Concise Encyclopedia of Economics.
• Collective Decision Engines. Quadratic voting.

A few more EconTalk podcast episodes:

• Epstein on Property Rights, Zoning and Kelo. EconTalk. September 2007. Eminent domain and more.
• Bent Flyvbjerg on Megaprojects. EconTalk. May 2015. Large projects development.
• Michael Munger on the Basic Income Guarantee. EconTalk. January 2017. Universal Basic Income [UBI] guarantee discussion.
• Patri Friedman on Seasteading. EconTalk. October 2008.
• Kelly Weinersmith and Zach Weinersmith on Soonish. EconTalk. January 2018.
• Vernon Smith on Markets and Experimental Economics. EconTalk. May 2007.

 

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Podcast Episode Highlights

| | --- | --- | | 0:33 |

Intro. [Recording date: May 1, 2018.]

Russ Roberts: Glen Wyle ... with Eric Posner, he is the author of Radical Markets: Uprooting Capitalism and Democracy for a Just Society, and that book is our topic for today. Glen, welcome to EconTalk....

Russ Roberts: The book is called Radical Markets, and it's radical in many ways. It's an extremely ambitious vision of how to remake emergent markets from the top down using prices and incentives rather than regulation. The sweep of the book is impressive. It covers property, immigration, voting, data issues surrounding social media, antitrust issues. And it seems monopoly and monopsony as the root causes of many of societal challenges. You want to add anything to that short summary before we dive in?

Glen Weyl: I think beyond its ambition, the goal is to create a different sort of political coalition. I think that today's libertarians, and today's liberals and progressives, were, in the 19th century both part of a coalition that saw fighting inequality as allied to fighting for freedom, and, you know, more open societies. And, my hope is to break apart the standard Left/Right divide today and try to re-unite that coalition. So, that's an important part of the ambition of the book.

Russ Roberts: It comes through. The book, is, in some ways, an attack of both wings--the progressive and libertarian politic economy visions; but it's also an embrace of both of them in different ways. So that's one of the things that made the book so interesting to me.

Glen Weyl: I'm glad.

Russ Roberts: So, I want to start with housing and land. You see yourself in the tradition of Henry George, and many listeners will not know who that is. Some will be--he has, still--

Glen Weyl: It's funny, Russ, because when I give this talk, I put up a picture of Adam Smith, I put up a picture of Marx; people get that. I then put up a picture of Henry George and I ask the audience if anyone can recognize him.

Russ Roberts: One or two people, maybe?

Glen Weyl: Well, the [?] one I got was at Google, yesterday, and it was a guy who runs a podcast or radio show about Henry George.

Russ Roberts: Yeah. He has a few passionate devotees; and I hear from them every once in a while asking me what I think about Henry George. So, tell our listeners what he was about, and your proposal for restructuring land and property, and how that builds on his vision.

Glen Weyl: So, Henry George was probably the best selling author in the English language other than the Bible for about 30 years. He was--his book, Progress and Poverty, was the namesake of the Progressive Movement. He just had an enormous influence on popular culture and intellectual thought for years. And, his central idea was one that wasn't just special to him, but was really shared by many of the founders of the Marginal Revolution in economics--by William Stanley Jevons, and especially Leon Walras. And, it was a concept called competitive common ownership. And the basic idea was that land does not belong naturally to any human being. It was created by God and can't ever belong to any person because no one created it. And, creating private property over land ends up not just creating all sorts of unjust benefits in the hands of a small number of people, but it also keeps land away from its most productive uses. If you, as actually Walras said, make land in big plots, you'll end up with aristocrats grazing their game; and if you put it in small plots, you'll end up with inefficient subsistence agriculture. Only if you have a duly[?] competitive process where no one person can monopolize land, where it's allocated to the person who is able to best use it in some competitive manner, will you be able to have a true free market. And, Henry George wanted to implement this by having a 100% tax on the value of land, and no taxes on everything else. So, our idea is very inspired by the spirit of his idea--the idea that to have truly free markets, you might have to make the value of property partially common. But, we disagree with him on some important details, which are that: he assumed that there was a clear way to make a distinction between land, on the one hand, and human labor on the other. But, if you think about, like, a gold mine: Imagine you were to tax at 100% the value of a gold mine, but, tax at nothing anything that someone had taken out of the gold mine. Well, then, of course, anyone who got control of the gold mine would immediately strip out all the gold and take it for themselves. In reality, everything in the world is some combination of human effort and natural endowments. And, while we agree with the principle of Henry George, we believe that in practice, you need to have a tax that's broader, and that forces people to fully reveal the value of those assets, rather than trying to have some government bureaucrat, as would have had to happen under Henry George, assess what the value of those assets are.

Russ Roberts: Before you go on: The 100% tax--is that once?--the Georgian idea? Is it every year? Is it--what was the idea there? And why is it a good idea. Explain--[] the base.

Glen Weyl: Yeah; so the Georgian idea was that you would have--yeah, so, Henry George's idea was that there would be 100% tax every year on the rental value of the land. So, that would be an assessment made by the government of how much that land would be worth if no one was occupying it in rent that year. So, essentially, everyone would every year pay the value that they would have to pay if the government owned that land and was leasing it out to them.

Russ Roberts: It's a user fee, essentially.

Glen Weyl: Yeah.

Russ Roberts: Okay. So, the problem with that, as you point out--one of the problems--is that that ignores the complex complementarity between what people do with physical land and what they do with things we'd call property. Obviously you landscape your home. You do all kinds of things. You put fertilizer in the ground, if you are a farmer. There are all kinds of things you do that make the land and your effort somewhat indistinguishable. But the original idea as I understand it also was that, since land is "fixed," you are not going to get some of the disincentive effects you get with other taxes. So, one of the other selling points of the Georgian vision is that taxing land--you can't export land, in theory; you can't take it--you can't hide it. Unlike labor, other forms of economic activity, it doesn't respond--I would say--as much. It does respond, is a problem; but it doesn't respond as much to the incentive effects of the tax itself. Is that a fair point, also?

Glen Weyl: Yes; and I think that the idea of that, that we should put greater taxes on things that respond less to effort, and higher taxes on things that are more unique and therefore more prone to monopoly--I think that that is a deep and important insight. I just think the notion that you can cleanly distinguish between something called land and something else called labor is mistaken. And, the basic principle behind the tax we advocate is to take that principle that you should, you know, tax things that are unique and that don't respond too much to work more than other things--that we absolutely agree with. But, what we disagree about is the notion that there is some objective, completely clear categorical line to draw between land and everything else.

| | 9:21 |

Russ Roberts: So, in your vision--which I agree with, that part; I think most people do--in your vision, I would state a value for my property, which would be my house at my current address: I'm a homeowner right now, under the illusion I have private property. Under[?] the social construct that may not be productive, called 'private property,' I own it. And if you want to buy it now, you have to offer me a price that makes it worthwhile. And I'm not interested in selling right now, so you wouldn't even know to bother me unless you went door to door. Which people do, in some neighborhoods. But in general, I can look at what's for sale, decide if it's worth it, negotiate with the owners, etc. You want a very different model of how land and housing and other physical property would be exchanged. So, try to lay that out.

Glen Weyl: Yeah. So, every owner of significant private property, and let's put aside personal effects and, you know, things from your, um, you know, your grandmother, or your dog, or whatever. But, any significant private property like a house, you would have to list a value for in a public registry, pay a tax on that value, and stand ready to sell it at that value to anyone willing to pay it.

Russ Roberts: And the idea of that last part is to give me some incentive to pick a value that is actually close to what its economic value is. Because otherwise you'd just pick a low value.

Glen Weyl: That's one way of thinking about it. But another way of thinking about it is that the whole point of the tax is to get you to stand ready to sell your property at some reasonable price. Because, otherwise, there's no opportunity--for example, developers or someone wanting to build a train--to see the values of properties and choose the ones that are the best value both for themselves and for the owners, to build developments, to build a train, to build skyscrapers, etc.

Russ Roberts: So, I'm going to give you a chance to lay out the best case you can make for it, in my view, which is Eminent Domain. Currently is the way that we deal with large projects that have to--like the train you mention that have to buy up separate plots. The problem with that of course is that there could be a hold-out problem; and to deal with that owner is--developers will often act in secret to acquire land. But it's still a challenge. It's still a problem. And as a result, it's still a temptation to use the government just to--because it's more fun to just take somebody's land. And arbitrarily give them some assessed market value. Describe how the process would work with, say, an App on your phone, as you do in the book, in your world.

Glen Weyl: Well, I think the best is example is: Elon Musk set up this company called Hyperloop that was trying to build a route from the Bay Area, where I think you are based, Russ, down to LA [Los Angeles], to radically--

Russ Roberts: --in the summer. Yeah, go ahead. Enough.

Glen Weyl: Oh, in the summer. I see. Yeah, down to LA, directly. And the project--the biggest problem it ran into was the right of way: trying to buy up all those pieces of land that would stretch you all the way from San Francisco down to LA. Right? And, that's an incredibly complicated process. Now, you could bring in the government to try to expropriate people, and you'd have a bunch of judges, and then you'd have to pay people and who knows what you'd pay them. It would be a whole mess. Under this system things would be far simpler. This system would be one in which, simply, all the land would have a going price on it that the owner or possessor would have set. And, the potential purchaser could just look up all of those values in a publicly available App. And, if they found a collection of plots that they wanted to buy and develop, they could just, say, circle them with their finger or with their cursor, and if they have the funds, they could freeze those properties: make the transfer and become the owner within some reasonable surrender period--like, people have to have to get evicted from their house or their apartment or foreclosed on their house. And they would, upon that purchase pay all that money to the owners: So the owners would be effectively determining their own compensation, if the property were taken for this purpose.

| | 13:57 |

Russ Roberts: So, that's, I think, the most attractive story: which is that this system would reduce the costs and challenges of developing large projects over large geographical areas. The rest of the story, I don't find so compelling, both on practical grounds and, I'm not sure, on, even on so-called welfare grounds. First, let's talk a little bit about efficient--investment efficiency versus allocative efficiency, as you do in the book. Explain what those issues are and why they are relevant.

Glen Weyl: So, the first thing I would say is that, even though the literal geographic of eminent domain is the most eye-catching, there's many other cases where something like this arises. So, in the spectrum, for example, for years, much of the spectrum has been fragmented among people who use over-the-air broadcasting. And if you want to do WiFi or if you want to do 5-G, you face a very similar problem of trying to put together a bunch of spectrum licenses. In intellectual property, there's lots of cases where there are individual patents. Together they can create a new product, but on their own they are not useful. So, in many of these areas you run into this general problem of assembling complementary goods. And, that is one. But there are other examples of the problem of allocative efficiency, which is that: Assets can be owned in a way that is not the best potential economic use--those assets. And that can happen because of hold-out problems, but it can even happen for simpler reasons. You know, the current owner of the asset is going to be interested in earning a profit if they sell, not just selling for the minimum that they'd be willing to accept, but they'll be interested in persuading someone that the asset is really valuable. This is why we end up spending any time we close on a property or buy a used car or any time a company buys an asset: There's always a long and drawn out and complicated process of negotiation which gets in the way of innovation and the best use of assets. So, that's allocative efficiency. However, the tax that I'm describing would limit investment efficiency. So, what's that? That's the idea that if I think that the value that I invest in improving and asset and building a skyscraper, is just going to be taken by somebody else or is going to be taxed away by the government, I will expect less profit on that asset, and I won't be willing to invest as much to improve it. So, our tax, while it improves allocative efficiency, always it reduces investment efficiency. And the optimal tax rate has to trade off between those things.

Russ Roberts: And your goal of--just let's--I want you to finish this story and then we'll dig back down into it--the goal is to: Everyone would state the value of their physical property. And let's just stick with houses and ownership of land for the moment. So, I have a vacant lot in Detroit; I'd have to post my--and I'm waiting to see if Detroit does better in the future before I invest in it--and nothing's happening with that land right now, so I'd have to post a price at which I'd be willing to sell it at. The home that's been in my family for 200 years and 12 generations, I'd have to post a value of that. A retail strip mall, the owner of that land would have to post, the owner would have to post the price they'd be willing to sell-that is, their assessed value. And then you are going to tax all that at a particular rate. And then you are going to do stuff with the money. So, talk about what you think the right tax is going to be, approximately. And of course this is going to be on top of local taxes. This is going to be a, presumably a Federal property tax. And what you want to do with the money.

Glen Weyl: So, the tax rate would vary by different types of assets, so it would be different for land and intellectual property and so forth. But it would be on average about 7%. And that's a little hard to ponder as a property tax rate. But if you think it through it would roughly mean is that two thirds of the value of all major capital assets would be taken as tax revenue. And, that would raise about 20% of the economy in tax revenue. By comparison, the government currently raises at all levels about 20-30%. So, you could use that revenue to eliminate all other taxes on capital, including the corporation tax, the property tax, to eliminate capital gains taxes; significantly reduce income taxes; pay off much of the national debt. So, that's what we would do. We would do things like that with about half of the revenue. And then, the other half of the revenue we would use as a social dividend of some sort. It would be divided equally as payments to every citizen. So, that could--you could think of it as Universal Basic Income [UBI], or as an ownership stake in the national capital stock. That would even just put half the revenue--generate about $20-25,000 for every family of four in the United States.

Russ Roberts: So, just to clarify the numbers for a minute: 7% of the value of the land would be about 20% of, say, GDP [Gross Domestic Product], or somehow like that.

Glen Weyl: Right.

Russ Roberts: So, the land value--because that might seem impossible, how you can tax 7% of something and get 20% of something. Where does that number come from? Why do you think 7% is a good--what's good about 7? Or that ballpark? Why not 20? Why not 3?

Glen Weyl: The rate is based on the turnover rate of different assets. So, the ideal tax is roughly equal to the rate at which assets turn over to new owners every year. And the reason is that when you are thinking about setting your price, if you want people to set it at their true value, you know, one force that makes them want to set it above their true value is that, if they end up selling it, they'll get a higher price if they set a higher value. Right? And that force affects their incentives at about the rate at which assets turn over. And, if you tax at the same rate on that value, that exactly offsets their incentive to set a price that's above their value. So, the turnover rate would rise in our world, because as you set the tax, people lower their values and there will be more turnover of assets. But we think that roughly the current turnover rate strikes a reasonable balance between allocative and investment efficiency. And, the turnover rate of houses in the United States is roughly once every 13 or 14 years, which is about 7%. Other assets have different turnover rates, so that's not meant to be uniform for everything. Many business assets turn over more frequently than that. And the other hand, personal property turns over much less frequently than that. We might want to exempt that entirely or charge a much lower rate. So the rates vary across different asset classes. But, 7% we think is a good representation of what would be typical.

| | 21:37 |

Russ Roberts: Are you taking into account the fact that--I don't like to move? Aren't I going to pick a higher price than the "value" because I don't want to endure the transaction costs of finding another property?

Glen Weyl: Well, the value--first of all, you have to understand that we mean is not some objective value, like a real estate assessor would come in and tell you now or some government bureaucrat would decide upon. The value is what it's worth to you to stay in that property. And so, yes, absolutely, that would take into account your value of staying there. But an important thing to realize is that for a typical family, this would be an incredibly good deal. So, a median American household has about $90,000 of net equity in their home. And they have, on the other hand, the average family of 4 in the economy--if you take an average of the assets of everyone, they have about a million dollars of net assets. So, the revenue raised by this and redistributed by a social dividend would, on net for a family like that if they priced their property at market values, generate about $21-or so thousand dollars in income. Now, if they decided that they really didn't want to move--so they are going to value their property at 5 times market value--then they would still, on net, make about $15,000 dollars. So, they can get as much stability as they want by raising the price. And, you know, stability always costs. In our society, stability is costly. The wealthy live in, um, homes they own outright in areas that aren't disaster prone. The poor live in areas that are disaster prone and they often rent and can be evicted if the area improves. And so, in this society, too, you would have to pay for more stability, or what would be different is because of the social dividend: Everyone could have an equal chance to afford the amount of stability they want. And, the rich, whose stability costs so much in terms of opportunity to others would have to pay a reasonable price for the externality they create.

Russ Roberts: And you are presuming--because we are in a fantasy world right now, or a hypothetical, if you want to be more appealing--

Glen Weyl: yeah--

Russ Roberts: You are assuming that that social dividend would actually be paid. It wouldn't then--the revenue from this wouldn't be used for "other purposes." It wouldn't be like, the Alaskan situation where citizens of Alaska get a dividend based on oil ownership that isn't just, goes into the government coffers--

Glen Weyl: Yeah. I would, I want it to be automatic. You know? I like to think of institutions that you can implement without any or very little need for any discretionary government authority. So, I would think of it--you don't even need to think of it as being raised by the government at all. You can think of there being a corporation that everyone would own shares in that would collect this. And, so, people would be entitled to dividends.

Russ Roberts: Yeah, I like those kind of programs, too. It's just that the government doesn't always tolerate them so well; and they like to take control of them, which is sometimes not so good. And, of course it can be: It depends on the situation, institutions, and the structure.

| | 25:09 |

Russ Roberts: But, I want to get at the underlying argument that you make, which I find implausible. So, I want to challenge it on why this is a, there is a problem here. So, I certainly agree there are resources that are underutilized. Certainly, people who hold property--they might have a home that they only live in a few times a year, that that's inefficient in some dimension, in some definitions of inefficient. There are a lot of things you could argue are not great about the current market for land. And, of course, one way to fix that--the Georgian way--doesn't have this self-assessment. Doesn't have to have this self-assessment piece. We could just raise a--you could just argue we could just put a Federal tax on land that would make it more costly for people to have, you know, abandoned lots that they're not doing anything with. And we could take that money and re-allocate it. But, the essence of this argument: There's two pieces to it. One is, that my home is up for sale at all times--in theory. And that price, that it would sell for is set by me. And, underlying this is an argument, though--and then, there's a redistributive element. Which is that the larger, more attractive properties would presumably have higher values attached to them by richer people who don't want to have to move. And then that is creating this social dividend for the average, for the median person, say. For a large proportion of the public. But underlying this is an argument that I don't understand, which is an argument that the current market for land has a monopoly element. So, defend that. Explain why that's an issue and why your solution is dealing with it.

Glen Weyl: So, the argument, which really goes back to George and Walras, but has a lot of work in the 20th century, is that land is unique. There can be competition between different places to live, but it's very rarely the case that you have truly comparable pieces of land. You know, I just bought a house in a quite liquid market in Hoboken, New Jersey. And, for the apartment that we found, we could find only one really comparable unit that had sold in the last 3 years. And, if we hadn't bought the one unit that we had been interested in, we probably would have ended up renting in New York City. That was our next best alternative. So, that homeowner, you know, had perhaps not the widest reaching monopoly. But, it wasn't as if I had a bunch of closely competing alternatives to that one piece of land. And that is true for a wide range of land uses. And it can lead to lots of potential waste where current owners charge enough to deter a potential better owner of that property from buying up and using that land. And, that may sound abstract. But there's actually a fascinating startup called City Builder, which, what they do is they tell you what the value of different collections of land could be worth if you were to buy them up together. And, for typical contiguous blocks of land, something like 3 times its current value in most cities. So, this is not a--and that's holding fixed zoning regulations, and so forth. So, this is not a, I don't think, a trivial issue. I think that this is quite prevalent, and that there are a huge number of opportunities for making our cities work better, for making our spectrum work better, for making businesses run more efficiently, for building innovative products that are blocked by intellectual property protections. All of which could be addressed if we didn't have this fundamental rigidity that is created by private property standing in the way of assets being turned over to their best use. And, as I mentioned, this argument that I'm making: It's about as classic of an argument in economics as exists. It was first made in the 17th century by the Physiocrats, who were the, you know, founders of modern political economy. It shows up in various forms in Smith. It's very prominent in Walras, who is the, you know, one of the Marginal Revolutionaries. And it also shows up in Jevons, who is another one of them. It's the central theme of Henry George. It was really a central dogma of the field from the 1880s through to roughly the Cold War. And it's fallen out of fashion. But, it's confirmed by Nobel-Prize winning work in a whole bunch of areas of economic theory recently, and by a whole range of empirical work, including but not limited to the App that I was telling you about.

| | 30:43 |

Russ Roberts: Well, the City Builder app, it's clearly the case that multiple persons, multiple parcels could have higher value if they were put together; and there's transactions costs of putting things together. I don't think that's literally a monopoly problem. But, just in general, it doesn't strike me as plausible. Your story about Hoboken, it's interesting. It could be true. My example--I moved to Potomac, Maryland 14 years ago and we looked at 20 different houses and we didn't like any of them. And, we finally found one we liked, after--we rented for a year. And then we found one we liked. It was the only one we loved. But, I don't think the owner had any monopoly power over us. They didn't know it was the only one we loved. They were in competition in their own mind--correctly so--with all kinds of parcels that they had no idea what their value was to me or the myriad of people that would be coming in to see them. What's the--try to give me the intuition of why the fact that it's not exactly the same house, exactly the same property gives them market power over me. I don't understand it.

Glen Weyl: So, the definition of monopoly power that's used by the antitrust agencies, which you may agree or disagree with, is that if a firm controlling a certain market can raise prices above their marginal cost by 5% for one year, then that constitutes monopoly power. Now, the analogy in a property market would be: If the owner of a property can raise the price above the amount that they'd be willing to sell it for, for 5% for one year, that would be a monopoly power. So, I think it's pretty hard to imagine that that isn't the case for most land. And, in fact, there have been a number of attempts to estimate this that suggest that it's about 15%, is the typical margin that's charged for transactions above the willingness of the seller to accept. But it varies dramatically; obviously it's much greater in these hold-out situations than it is in other situations. So, I think by the standard definition of market power, most land has significant market power over it. And the same thing is true in most corporations. So, when most corporations sell to a, in a merger or buy-out, usually you get 20, 30, 40% premium above the value; and usually it's a long and complicated process, to consummate that. So, I think that it's pretty clear that that sort of market power over assets is quite rampant in the economy. And, in the case of spectrum, I can tell you some quite clear and dramatic examples of precisely that phenomenon.

Russ Roberts: Well, spectrum, I don't know anything about. So, I'm going to leave that alone. What I do know about is buying and selling houses: I've done that a few times. I don't know a lot about it. I know a little about it. I've experienced it. And I think many of our listeners have. And, having been on both sides of that transaction--the buyer and the seller--I don't feel like either a monopolist when I'm selling, or the victim of a monopolist when I'm buying. Of course, there's negotiation and uncertainty, and there's a debate between sometimes an owner and an agent about what the true value of the house is. Highly hard to know. It's really hard to know. And I think that's the source of the uncertainty. I don't feel like a victim. I've never felt like a victim. Maybe I'm a fool. I feel like I have lots of choices. And, in fact, I think most people do. I don't see why it being any different than any other market. But I think you probably think monopoly is more rampant in lots of other markets.

Glen Weyl: No, I agree. I do think monopoly is pervasive. And I think we accept a fair bit of monopoly. And if we could purge that from the system we would have much more efficient markets. I mean, you know, you look around you: Most things don't have a liquid price on them. It would be very complicated to try to buy them. If we lived in a society where most assets were: you would, you know some price was the going price for them, you would have just a much more competitive dynamic entrepreneurial society, because there would be much more opportunity for using things for better uses.

| | 35:32 |

Russ Roberts: Well, I'll just say one more try on the home ownership issue: So, you are suggesting that, when I go to sell my house--let's say, I decide to leave the Washington, D.C. area, which is where I live right now, and I want to live, say, full time, in the Bay Area. And I want to sell my house. And I can--I'm excited because I'm going to be able to get a premium over and above the value I really have for it, because other people are going to be stuck buying it. The person who falls--I have to say: the person who lives across the street from us has the exact same house we have. Literally. Physically.

Glen Weyl: Yeah.

Russ Roberts: But they did something different. The owners before us, they added an addition in the back. And the people across the street, they re-did the basement. So, they're not anything exactly alike at all. They are very different. They have a slightly different parcel of land. It's shaped a little differently. But, the physical house that started was the same; but now they're different. And someone could walk into my house and fall in love with love it; or could not like it; they could go into their house and say, 'Wow! A finished basement. I've always wanted that. It's great. It will be great for guests,' etc. The person across the street said to me, when they were selling, that they were going to charge a certain price, that I knew was well above or thought was well above the market price. And I said, 'Wow. That's a lot.' And they said, 'Well, it only takes one person to want that house.' And that's true. But it's really hard to find that one person. You don't know who that one person is. In fact, the odds that you would find them are almost zero--that you are going to find the one person who loves the finished basement. So, in what sense does that person across the street have an ability to charge above the price they're willing to accept? It seems unlikely given that there's lots of people willing to sell them--

Glen Weyl: Above the price that they are willing to accept for the house? Well, I mean, you sort of know almost immediately that that's the case, precisely by the process that you described about what will the market bear for this. You set your price not on what you'd be willing to accept for it, but what the, what you think you can get away with charging someone.

Russ Roberts: Absolutely.

Glen Weyl: So, that is precisely the principle of monopoly. I mean, the principle of competition is, you set the price that you can, you know, that's not based on what you think you can get someone to pay eventually but instead, based on what you'd be willing to accept for that property.

Russ Roberts: No--you set the price--and I'm sure there's some real estate agents listening. You set the price based on what are called the comparables.

Glen Weyl: Yes.

Russ Roberts: You look around at houses that are like yours, and you set a price similar to yours. You don't say, 'Well, I can get more than that because I'm the only one selling this one.' You set the one that you think is comparable. Is that a foolish game we're playing? Is there really no comparable to my house, because it's unique.

Glen Weyl: I'll give you another example. One of the places we were considering--just saying--had been on the market for almost two years, even though it was new construction. In a hot market. Because they had tried to get a price that was much better than what, I think, the market would end up, you know, comping that place at. And it's very common. Because the market is relatively thin. And there aren't always those comparable houses available. They went about--they ended up coming down about 10% or almost 20% on that place, over the course of that year and a half, and they still haven't sold it. So, clearly that is a waste of resources. Houses lying vacant for an extended period of time because they were attempting to use the uniqueness of what they had to offer to extract a rent. And that leads to waste. And it adds up across the economy. And it gets much larger, of course, in these hold-out situations we were describing.

Russ Roberts: 3928 Well, what I agree with you is that markets for housing and land work imperfectly, because there is uncertainty about the future. And people get overly optimistic. Especially when markets heat up, as you suggested: and people think, 'I can make a lot more.' And it's true that in those settings sometimes it's harder to find a house, if you are moving into that area. But, of course, I'm not sure your setting of that price, self-assessment, is going to solve that problem. Because, in a market where I think there's a lot of demand and people are desperate to move into it, I'm going to pick[?] higher and higher prices, potentially, for my value. Of course, I'm also going to pay a cost in the form of the tax. That's going to discourage that, I suppose.

Glen Weyl: Yep. And, not only that, but because the value of all assets would factor in this tax, the value of the assets would fall dramatically. And so, it would be much more like rental. There would be much less up front cost. And, as we know, rentals turn over much more quickly to their best uses than sales do. Sales is a much more cumbersome, burdensome process, precisely because people are thinking about all that speculation on the future, and several other things.

| | 40:39 |

Russ Roberts: Let me ask one more practical question, and then we'll turn to a different topic. So, you or I, we both talked about moving into a new area. So, I wanted to move--you wanted to move into Hoboken or somewhere near Hoboken; and I was talking about moving into suburban Maryland. How would I do that, practically, in a world where--every house, potentially is available to me? Kind of exciting? Right? I don't have to wait for a house I really love to go on the market--

Glen Weyl: And, you know all the comparables. You know. You are talking about comparables. You would have so much more information about comparables, because everything would have a market price.

Russ Roberts: Yeah. Well, Zillow does that now. It doesn't--we could debate whether it does it well.

Glen Weyl: Yeah, it's not so great; but, anyway--

Russ Roberts: Yeah; it's flawed. As would this process be, by the way, I'd have my own challenges to try to figure out my own price. I assume institutions would emerge with brokers that would help me fix it. Help me decide it. But, how am I going to look at a house, in this world?

Glen Weyl: That's a great question. So, the idea is that you could freeze the price of a house and pay an inspection fee to the owner to come and look at it in a reasonably timely fashion; and they couldn't change their price once you'd expressed interest. But, you wouldn't be obliged to buy until you completed the inspection of the house.

Russ Roberts: So, anybody can come inspect my house any time they want.

Glen Weyl: In exchange for a reasonable fee and, you know, on terms of not being intrusive and so forth that are consistent with the way that inspections work for home purchases right now.

Russ Roberts: So, one of the things about this idea that's troubling to me is it ignores the cultural norms that have evolved--which is one that you're mentioning now. The idea of somebody coming into my house to look at it whenever they want by paying me a fee, I find--unappealing. Most people do. Yes, when I want to sell a house, that's part of the deal. But in our current culture, the idea that someone could come look at my house--because it's mine. I have this weird idea that it's mine; and you provocatively suggest that that's not a healthy attitude--

Glen Weyl: Yeah--

Russ Roberts: in all kinds of ways, by the way: I want to let listeners know that you don't just say, 'All property is bad.' You have some interesting, very thoughtful ideas about why it would be a better world if we didn't feel as attached to our houses. But right now, we do. So, that's going to be a tough change.

Glen Weyl: Yeah. Yeah, I agree it would change culture in a lot of ways. We have a lot of arguments about why that would make culture better; and in fact, we think it addresses many of the most common criticisms of the way that capitalism, you know, pushes people towards possessiveness and a focus on material possessions rather than on communities, a focus on taking advantage of people in negotiations rather than just having mutually beneficial interactions, etc., etc. But, yeah. Those cultural changes would take a while, and that's why we don't want to implement this overnight. This is why we think we could apply it to--and I think you wouldn't object--to applying it to spectrum, intellectual property, natural resource rights, etc., first. And, you could already get to 20% of the capital stock that way. So, that's not nothing. And then you could move on to business assets next, and commercial real estate. And then, you know, gradually walk your way towards this. You could get 50, 60% of the benefits before you'd get towards anything that would really challenge some of these notions of personal attachment. And then, yeah--you've got about 40% of the way to go that would require progressively changing the culture on these things. But, hopefully, by that time, people would already have some exposure through their business dealings to arrangements like this.

Russ Roberts: Yes; I like some of those applications. And you are right: those would probably be an improvement. I would just mention--even though I agree with you that we are probably too attached to material items--

Glen Weyl: yeah--

Russ Roberts: and possessions, that our homes might be in a different category. I don't think it's capitalism that makes us possessive of our hearth. I think there's something deeper, more primal there. But, that's probably--

Glen Weyl: Well, yeah. That's a conversation for a longer discussion--

Russ Roberts: Yeah, it's beyond the scope of this.

| | 45:02 |

Russ Roberts: Let's move on to some of the other areas in the book. Let's move on, which I'm actually intrigued by rather than skeptical of, which might be more fun--or less fun--which is immigration. And, you make the point--you and Eric Posner make the point that, on the surface, the allocation of human beings to different geographical areas is extraordinarily inefficient. That, there is an enormous benefit potentially for humanity from people moving where they live. And yet, it doesn't happen. There are barriers to migration that are severe. And you suggest a very thoughtful way of getting around those. Describe it.

Glen Weyl: Our argument is that the basic inhibition against the sort of value that you are describing from migration is the fact that most middle class, lower middle class people in wealthy countries don't really benefit very much from migration. Whether they actually are harmed by the competition in labor markets or not, is a topic for debate and we don't take a strong position on that. But, it's pretty clear that most of the benefits of migration go to the migrants themselves. Or, to people who live in wealthy cities, where migrants bring diversity via[?] food, and culture, and so forth. Or, more importantly to the employers of those workers, who benefit from access to, you know, competitive labor force. [?] And that, those employers are mostly the owners of capital, or wealthier people. And, because most people in the country don't own a lot of capital, they are not directly benefiting from migration. So, what we want to do, is create a new system of migration where every citizen could benefit more or less equally from the chance to sponsor migrants. And to negotiate with the migrant for a share of the benefits that she would receive from coming to the United States. And, we calculate that, roughly, that would be something like $5000 or $6000 a year, if you sponsored a temporary migrant, possibly more if you sponsored a more permanent migrant, for every migrant sponsored. So that could be a significant source of income for many American workers.

Russ Roberts: And, what would sponsorship involve?

Glen Weyl: So, sponsorship would involve helping the migrant find a job; living in proximity to the migrant--because we want to foster not just economic value transfer, but a sense of responsibility, cultural exchange, and community with that migrant. So that we, he[?], have a gradual opening of people not just to the economic opportunity that migrants offer, but also to the cultural value that they potentially offer, as well as a sense of responsibility where people wouldn't want to bring in those that might potentially cause cultural conflict or violence and so forth.

Russ Roberts: So, how would that work? How would I--how would it work, practically?

Glen Weyl: So, you could imagine a variety of arrangements. There could be corporations that set up boarding houses within cities. And, you might not, every day see your migrant; but you might interact with the migrant that you are sponsoring every, you know, couple of weeks; but they would live in some area in your bayou. Or you could imagine putting them up in your home, subject, of course, to some regulation and inspection, because you wouldn't want people to be abused by a potential host. But, you know, there's a program called the Au Pair program where people host migrants in their homes to take care of their children. And, effectively you could think of this as expanding that to other economic functions other than just caring for children. Which only a small part of country can afford someone to full-time care for their children. So, those are a couple of ways that you could put someone up. And, in terms of the economic arrangement, I can imagine several different ways. You can imagine something where the migrant agrees to pay a fixed amount to the sponsor in order to stay in the country--sort of like a visa fee, which, you know, in many contexts, migrants already pay fees like that. Or, you can imagine that they would say, 'Okay, in Pakistan I make $500 a month. In the United States, I might make thousands of dollars a month. Some share of that increase in my wage, I'll share with my host in exchange for putting me up.'

Russ Roberts: So, again--I think there's a lot of practical issues here. But the idea of it is interesting. Wouldn't--a lot of people have proposed a simpler version of this, with less potential, I think, for abuse. And I want your reaction to it, which is: Let's just sell the right to come here. So, you know, right now--say, to the United States--of course, we're not the only country people want to come to, but it's the one that's on the minds of a lot of Americans right now. And, right now there's a lot of debate about Mexican immigration. The idea of a wall. I happen to be more of an open-border kind of guy, but I understand that people are concerned about, say, American culture, or they are concerned about the economic impact. I think those effects are small. But, reasonable people can disagree somewhat about those things. So, why don't we just say that anybody can come here who can pay a $10,000 fee? And provide some--and you have a certain amount of time to find a job; and if you don't find it, we send you back? But that opening fee would then be given to people who are concerned at least as some form of compensation. Because that's really what we're talking about, here. We're trying to find ways--you are really suggesting compensating people for accepting migrants. And, of course, that's not going to make other people happy, who would say other people shouldn't be allowed to do that, just like they don't like the idea that corporations or employers should be allowed to do that now. What's wrong with just charging a fee to get a--a big fee? Because right now people pay large fees to get smuggled here. Why wouldn't one want to capture that for the public?

Glen Weyl: So, first of all, I agree with you, Russ. I think that would be a major improvement. And I'm quite sympathetic to that idea. And in fact, we mention that idea in the book as an initial foray. But, the reason why we propose--and, by the way, we're not 100% set on the precise structure that we're describing. It's much more important to us, the broader idea--which your proposal would also accomplish--of channeling the benefits from migration more broadly. So, I think we are 90% on the same page. The question is in the details of the proposal, the real difference between yours and mine, is that yours has more of a centralized structure, where you[?] put more of the responsibility of vetting onto some sort of a central agency that would monitor; and you allow it to be a purely economic transaction where people wouldn't really get to know migrants. And so forth. And our perspective is that, that addresses much of the issue, but not all of the issue. I'm worried about people feeling that they don't know exactly where this money that they are receiving is coming from. And, I'm worried that, to build support for migration and for a diverse society, people need not just to receive some economic benefit that's quantitative: they also need to be exposed to the people that they are receiving these benefits from. Because it will make it much more vivid for them. And it will open their minds. And I think that that's what has happened to people like you and me. Probably the reason people you and I are so sympathetic to migration is we spent a lot of time living in, you know, relatively cosmopolitan big cities, where we get lots of benefits from migrants. Not just direct, simple cash, but also, you know, we learn things from them; we have different sorts of food. We enjoy opening ourselves in the context of a mutually beneficial economic transaction. And we think that those cultural aspects are important, as well. And, that the ability of citizens to express their preferences over the sorts of people they want to open their community to. Within reason. You don't want too much blatant racial discrimination or something like that. But, people may have preferences over the languages that people speak in their community. You'd have to think about whether you want people to, you know, have preferences over religion and things like this. But, allowing a little bit more of a decentralized market process for those sorts of determinations rather than forcing it all to just be 100% filtered just through money, we think would be important to dealing with some of the cultural and social aspects of making migration work.

| | 55:11 |

Russ Roberts: Y', I don't see that working at all. Let me just say why, respond to your observation about myself.

Glen Weyl: Yeah.

Russ Roberts: My love of more open borders than we have now is not based on my personal experience--at least I don't think it is. Of course it could be, subconsciously. I do have a Guatemalan housecleaner and have a Vietnamese handyman. And I benefit because they do a good job, and their prices are lower than they would be, I think, if we didn't have a more open society, [?] even less open. So, I benefit financially from it. Culturally, I happen to like lots of different kinds of music--and, so I think there are some personal benefits. For me, it's just a simple matter of justice. It's a reflection of the fact that I'm alive because my ancestors came here in the late 19th century rather than staying in Eastern Europe where I would have been killed--they would have been killed--by the Nazis and I wouldn't exist. So, I'm a big fan of choice. And freedom. So, I think it's really good that people be allowed to live where they live. At the same time, I understand the concerns that people have about culture and its vulnerability to large changes due to large influxes of immigrants. I happen to think, as you do, that many of those changes in culture are healthy. But, I understand why people might not agree. And I don't think your proposal is going to solve that problem. The people who are most alarmed about it are not going to sponsor an immigrant. Not going to come into contact with them. They are going to resent their neighbors for bringing them in. And making money off of them. How do you answer that?

Glen Weyl: Well, so, first of all, I think that the economic opportunity will attract many people who are currently hostile. But, second of all, I would allow communities to regulate this. I wouldn't want it to be a one-size-fits-all policy that would be imposed by the Federal government on the whole country. I would prefer it to be, at least partially regulated by communities determining how they want to allow people to exercise these rights within their borders. And then people could move to different communities that had different attitudes based on this because of the opportunity those communities might offer. So, that would give a chance to people to take advantage of things by embracing a more open, cosmopolitan culture. And I think many people would be attracted by that. Not everyone. But, if you think about the number of people who moved to cities from rural areas in response to industrialization and all the opportunities that that offered; and they have moved in China, in response to those economic opportunities, and the way that's changed their culture, and so forth--I think that economic opportunity like that could be a tremendous attraction.

| | 58:03 |

Russ Roberts: So, we're almost out of time. There are a lot of other creative ideas in the book--about voting, that people should be allowed to buy the opportunity to vote more intensely for things they--vote more than once about things they care about. Cast more than one vote. There's some interesting ideas about our allocation of investment and large investment banks and investment vehicles--places like Vanguard and Fidelity and whether those are good for the economy or not. There's some interesting discussion about social media and whether we should be--how we might be paid for our data as contributors to the knowledge that Facebook, Google, and others are using. We don't have time to get into those, but they are all interesting, and your analysis of the current situation of all these examples is interesting and provocative as well. But, I am struck by the--my favorite Hayek quote which has had a good run recently on the program--which is: The curious task of economics is to demonstrate to men how little they really know about what they imagine they can design. And, this is a book devoted to design. It's a book saying: 'We need to reorganize all this stuff. We can do a better--there's huge gains that are available if we would just follow some of the ideas here,' that you've outlined. And you are not unaware of the fact that this is--there might be, there are pitfalls. And you are well aware of the fact that it's not going to happen overnight. So, talk a little bit about that issue, and any unease you might have about your willingness to remake society. And then, how you might do it in small steps. Which you mentioned a little bit earlier--you alluded to it.

Glen Weyl: Yeah. So, I certainly don't want to overnight re-make the world in these ways that could potentially be very disruptive. For each one of these proposals, we have a set of relatively uncontroversial small steps that would get us a significant part of the way towards these ideas, and also offer testing grounds to learn about the pitfalls that you are just describing. You know--we talked about property, and the way this could be used for spectrum and intellectual property, and so forth; in voting, even though the voting system is quite radical, we already have a startup that's doing it for polling and market research, and we're interested in online aggregation.

Russ Roberts: And the name of that is? And we'll put a link up to the site.

Glen Weyl: It's called Collective Decision Engines. And, in the immigration system, you could try piloting it in a city, as we talked about--you know, different areas might take different approaches. So, with each one of these ideas we have some very near-term, concrete, relatively uncontroversial steps that you can take in that direction. And, at the same time, there's this growing movement--I don't know if your listeners follow the blockchain space at all, but--

Russ Roberts: Many do.

Glen Weyl: Yeah. So, within blockchain, there's a lot of interest in these ideas. And those are sort of experimental communities that are trying out different ways of arranging things. And, my guess is that some of them are likely to experiment with this. One of the leaders of Ethereum, Vitalik Buterin, recently wrote about his interest in these ideas. So, that's another interesting testing ground. But, the reason why I propose these things in such a bold and sort of visionary way, even though I expect there to be increments towards it, is that I think we are desperately missing an alternative vision that people feel could potentially address the problems of inequality and stagnation and political conflict that we are facing as a society. And I think in the absence of an alternative vision, we've seen the emergence of reactionary ideologies of both the Left and the Right--sort of, you know, the state socialism of Jeremy Corbyn and Bernie Sanders. And the nationalist populism of Brexit; and you see it in Italy and in Donald Trump, and so forth. And I think that we desperately need an alternative vision; even if the exact ideas we propose aren't the right ones, or aren't exactly right in the form that's been suggested, we think that they offer a different way of conceiving of political coalitions and social ambitions where markets can play an egalitarian and opening and aggressive role. And, we hope that vision can inspire people even if they don't agree with all of our exact ideas.

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