In this episode of The Human Progress Podcast, our editor Marian Tupy speaks with the world-renowned psychologist Steven Pinker about recent trends in meaning and mental health, the decline of religion, and whether or not human flourishing requires spiritual transcendence.

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Below is an edited and abridged transcript featuring some highlights from the interview.

Today, I’m pleased to have with me Steven Pinker, a world-renowned Harvard University psychologist and author of best-selling books including The Blank Slate, The Better Angels of Our Nature, Enlightenment Now, and of course, most recently, When Everyone Knows That Everyone Knows. Highly recommend all of them.

Let’s start at a high level and look at how Americans think about the country. Gallup shows that 80 percent of Americans are either satisfied or very satisfied with their lives, but only 20 percent are satisfied with the way that America is going. That’s a bit of a discrepancy.

What does a psychologist have to say about that?

It’s a fascinating phenomenon that pollsters have known about for decades. They call it “the optimism gap.” It appears in just about any question.

“What is the quality of education in this country?”

“It’s terrible.”

“What’s the quality of your child’s school?”

“Well, not bad.”

“How safe is the country?”

“Oh, you can’t walk anywhere. You’ll get mugged.”

“How safe is your neighborhood?”

“Oh, I feel perfectly fine.”

Part of it is that, because none of us can experience the entire country ourselves, our opinions are based on media coverage, and the media have a number of negativity biases. The nature of news selects for negative events because it reports what’s new and discrete enough to be a story. New, discrete events are more likely to be bad than good because there are many more ways for things to go wrong than for things to go right. And while bad things, like a terrorist attack or natural disaster, can happen quickly, positive things tend to be things that don’t happen or things that happen gradually, like the long-term decline in extreme poverty, the rise in literacy, and many other trends that you’ve written about.

Editors also feel more responsible if they emphasize negative stories over positive ones. I’ve heard one editor say, “Well, negative news is journalism, and positive news is advertising.” I think it was Stewart Brand who once said, more generally, that a pessimist sounds like he’s trying to help you, while an optimist sounds like he’s trying to sell you something. So, our picture of the country and the world as a whole is distorted both deliberately and accidentally by the very nature of news.

Let me mention one other thing. There really are problems in the world, to put it mildly, and some things have gotten worse in the last 10 or 20 years. But one has to have a quantitative, statistical, probabilistic view of the world to acknowledge the reality that things can get worse while still being better than they were historically, and that some things can get worse while other things are getting better.

You don’t conclude from something that genuinely has gotten worse that everything has gotten worse or that we’re in a worse situation now than we ever have been.

You mentioned literacy. Recently, I’ve been reading about freshmen entering university without basic reading and math skills. People are reading fewer books. Are we getting dumber, and is education an example of something that is worse than it was 40 or 50 years ago?

Yes, and it’s not the only example. The world’s democracy score has gone down in the last couple of decades. War deaths are worse now than they were 20 years ago, although still better than they were in the ‘60s, ‘70s, ‘80s, and most of the ‘90s. But yeah, educational scores have gone down. The Flynn effect, by which IQ scores rose for about three points a year for almost a century, has now gone in the other direction.

Now, that doesn’t mean that we’re back to the level that we were 100 years ago, but there’s been a bit of a droop. It may be that there are pathologies in our educational system, that the drive for equity and especially for equity across all racial groups has led to bringing down the top rather than raising the bottom. It could be that our schools of education have been training teachers to use the wrong methods. There’s also the fact that, while reading and literacy are good things, they are cognitively unnatural. We didn’t evolve with print; it’s a recent invention, and we’ve seen, especially in the last 10 years, that a lot of people prefer listening and watching to reading. Thanks to the massive availability of video, people may no longer be putting the effort into developing literacy, which we have reason to believe was one of the drivers of the Flynn effect and of cognitive sophistication in general.

My understanding is that the decline of reading and math scores is most severe at the low end. The smart students have not declined much, but weaker students have. So, it is a problem, and I think it’s a problem that ought to be addressed.

When it comes to the decline in reading books, there may be one other factor: the optimal length of a work of text may no longer be a book. I have found that, as a curious person, I can get lost in reading about things on Wikipedia like the history of the potato chip or transatlantic travel or planets. There’s just a flood of information out there and it’s all really interesting. And I say this with some embarrassment because I write books, and sometimes very long books, but for some kinds of information, it may be that a book has diminishing returns.

Let’s now look at other criticisms of human progress.

You and I had an article in The Free Press pushing back against the “crisis of meaning.” Have you ever seen any hard evidence suggesting that people’s lives are more meaningless in rich countries versus poor countries or that lives are less meaningful today than they used to be?

No, I haven’t.

We don’t have survey data on “How meaningful do you think life is?”, but meaning and happiness seem to be partially correlated. So, in general, people who are happier say their lives are more meaningful. But some sources of meaning are not the same as sources of happiness, and vice versa. Just to give a couple of examples, if you’re dedicating your life to some cause, there can be setbacks and frustrations that make you less happy, but you say your life is more meaningful compared to a life of pleasure and leisure. Time spent with friends is more pleasurable, while time spent with family is more meaningful. So, meaning and happiness are not perfectly correlated, but they are partially correlated.

Over the course of history, if you look at the whole range of countries, there has been more of an increase in happiness than a decrease. In countries that are very affluent, like the United States, there has not been an increase in happiness. We may be close to the ceiling. But overall, across the world, there’s reason to believe that happiness has increased, so that would suggest but not prove that there has not been a decline in meaningfulness.

Anecdotally, there have been complaints that life is meaningless as far back as you go. Ecclesiastes: “Vanity of vanities, all is vanity.” Henry David Thoreau in 1854: “The mass of men lead lives of quiet desperation.” T.S. Eliot, 1920s: “We are the hollow men, we are the stuffed men.” So, it’s a constant complaint, and the fact that people say it doesn’t necessarily mean it’s true. It’s always tempting to think that life is meaningless. We like to think that there is a plan to the universe, and we get disillusioned when we find out there isn’t one. The laws of nature don’t tell any story with an ending. There are things built into the evolutionary process that guarantee that life is going to appear meaningless. There’s the law of entropy. Things fall apart and decay. We die, we get older, we weaken. Even our closest relationships are never perfect.

Now, I think the answer to that is to focus on human purposes, like not dying young, not getting shot, knowing more, experiencing art and culture, experiencing friendship, and seeing the world. But one has to reorient and realize that those are the goals of life and not expect that the universe itself tells a satisfying story.

People often look at proxies for meaning, such as anxiety and suicide. There seems to be some evidence that rich countries have higher rates of anxiety than poor countries. Of course, definitions can change and expand. Trauma used to mean being bombed by the Germans; today, it may be that you are breaking up with your boyfriend or girlfriend.

Do you have any sense as to how reliable the data on anxiety and trauma is?

There’s certainly been some diagnostic category creep. I’ve seen this in my own students. There’s an eagerness to diagnose oneself, sometimes with bogus diagnoses like autism for introversion. There’s a funny kind of cachet to having a pathology. But looking retrospectively at surveys, I think there probably has also been, on top of that, some increase in anxiety since the late 1950s.

Some of that may be that we’re taking on more responsibilities and adding to our anxiety burden. When I think back to my parents in the 1950s, there were a lot of things that they just never thought about. Are they getting enough exercise? Are they exposing themselves to skin cancer risk by going out in the sun? The state of the climate, inequality. Most people didn’t think about these things.

Jean Twenge and Jon Haidt have been trying to make the case that social media, especially through smartphones, has led to a genuine rise in anxiety, particularly in younger people. There’s some controversy there over cause and effect—maybe anxious and depressed kids turn to social media—but there seems to be at least some evidence that suggests causation.

Let me offer to our listeners what I consider to be the strongest argument in favor of rational optimism.

The clearest sign of unhappiness is when you kill yourself. Here in the United States, we’ve had an increase in suicides, but suicides are dropping in most, if not all, other rich countries. So, it seems there is a particular American pathology rather than a general pathology in prosperous countries. What’s wrong with this argument?

When I report on violence, I usually concentrate on homicide, simply because homicide is the most objective measure of violence. A dead body is hard to argue away, and people record homicides pretty accurately, so it’s the best indicator of violence. By extension, one might think that suicide would be the best indicator of unhappiness. But, partly to my surprise, that doesn’t seem to be right.

There is more ambiguity in how officials record suicide deaths. For example, when there’s a stigma against suicide, they’re often classified as accidents. Also, as best as we can tell, there’s not an excellent correlation between the suicide rate and national unhappiness. There’s even what some researchers call the suicide-unhappiness paradox, which is that countries where people are happier can sometimes have higher suicide rates, partly for the same reason that suicide rates increase around Christmas: if you look around and everyone is happy and you’re not, then you really think you’re a loser.

Suicide rates are also driven by contagion and by how easy it is to commit suicide. I quote the rather macabre poem by Dorothy Parker: “Guns aren’t lawful, nooses give, gas smells awful, you might as well live.” Suicide went way down in Britain when they changed the composition of cooking gas from coal gas to methane, which is not toxic. In developing countries, access to pesticides, a common method of suicide, has a big effect on actual rates. And in the United States, the availability of guns seems to be one of the drivers.

So, there are a lot of puzzles with suicide rates. But generally, I think it’s important to point out, as you do, that suicide rates are actually dropping globally, especially in poorer countries, but also in many rich countries. The United States is something of an anomaly. Since the 1990s, when the Global Burden of Disease project began to collect data, suicide has gone down by about 40 percent. A lot of that is thanks to urbanization. When a woman is put into an arranged marriage and leaves her village for the village of her husband, where she is dominated by her in-laws and has no friends and no way of escaping, that leads to a lot of suicides. In a more modern urban culture where you kind of have more freedom, there’s less desperation. So globally, modernization and urbanization have led to falling suicide rates. Even in the United States, suicide rates went down until the mid to late 1990s. That was a low point, and they’ve been rising since then, but it’s not as if they’ve been inexorably rising over the last century.

Those are very good caveats, thanks for introducing that nuance.

One thing that you and I discussed in our Free Press article was the criticism that meaninglessness in the West is driven in part by falling religiosity. A defender of religion might say that religion is essentially a cognitive or cultural technology for producing responsibility, happiness, restraint, and gratitude. So, if you remove religion, you may be making people more irresponsible, more unhappy, less restrained, and less grateful.

What do you think about that argument?

There is a need for community institutions and organizations that bring people together, that discuss meaning and morality, and that are a locus for collective action. The problem is that if you bundle that with theology, miracles, scripture, and invisible agents, it just isn’t going to be convincing anymore.

Religion wasn’t taken away from people; people left religion. In every developed country, there’s been a move away from organized religion. The churches are still around, and no one’s stopping people from attending; they just don’t find that religion gives them meaning and purpose. This is partly because the institutions themselves have not been sources of morality or meaning. The Roman Catholic Church with its sex abuse scandals, evangelical Protestantism in the United States with its embrace of far-right politics, the subordinate role of women in the more conservative religions like Orthodox Judaism—these are just turn-offs.

I’m gonna quote G. K. Chesterton, who is supposed to have said that when men stop believing in God, they don’t believe in nothing, they believe in anything. A 2021 national survey found that young Americans are more likely to believe in witchcraft, luck, black magic, and spell casting.

What do you make of the argument that Christianity keeps the belief in black magic and witchcraft at bay?

A few things. The witch hunts of the 16th century were a Christian movement. I mean, “Thou shalt not suffer a witch to live” is in the Christian Bible. I also think Chesterton was wrong about the idea that people who are more religious are also more open to astrology, ESP, the paranormal, crystal healing, and other kinds of New Age woo-woo. I don’t think it’s true as a general correlation.

The data that you cite on openness to paranormal beliefs is interesting. I’ve never reported this, but I’ve looked at trends in the belief in devils, ESP, precognition, curses, and all kinds of paranormal things. As best as I can tell, it’s been pretty flat since the 1970s.

Something to be aware of is that there are different ways in which societies can change, and quantitatively, it’s not always easy to tell them apart. There can be a cohort effect, that is, as one generation replaces another, that generation has beliefs that they carry with them as they age; a period effect, where everyone changes their beliefs; or a life cycle event where, as people age, they change their beliefs. As best I can tell, what you cited is largely an age effect. Younger people are more open to woo-woo and magic than older people. So, I think those data are correct, but don’t necessarily mean that societies have become more open to the paranormal.

One way or another, there is a sizable chunk of the population that is attracted to the supernatural or transcendental, the so-called God-shaped hole in the human heart. Critics say that irreligious people are offering a meaningless, cold universe without a purpose, and that people really need some form of transcendence to make sense of their lives.

What do you think of that argument?

I think it’s literally wrong in the sense that people’s craving for meaning and purpose isn’t shaped like a God. In fact, that argument is sometimes used to explain the rise of wokeness, that religion was replaced with the idea that differences between groups are a moral emergency, and you have to find the oppressors responsible and punish them. There’s no God in any of that.

Granted, many people do search for transcendence, but kids like to believe in Santa Claus. That belief doesn’t have to be indulged. Kant’s definition of the Enlightenment was man’s escape from his self-imposed childhood. Part of growing up involves some hard lessons, like the universe is a cold place, and it doesn’t care about you. That does not mean life is meaningless, because the fact that the universe doesn’t care about you doesn’t mean that other humans don’t care about you or that we don’t have to care about other humans. We have a purpose, which is to make people as well off as possible, to increase flourishing, to increase knowledge, life, health, freedom, and safety. These are really meaningful goals that I don’t think should leave you empty.

Without religion, what is the basis of morality? Where does morality come from if not from man being created in the image of God?

Well, man being created in the image of God doesn’t give you a whole lot of morality. If you look at the Old Testament, God is commanding the Israelites to rape, massacre, and mutilate their enemies, while there are religious prescriptions against mixing linen and cotton, lighting a fire on Saturday, and other crazy stuff that has nothing to do with morality as we could argue for it.

Conversely, I think the obvious source of morality is some kind of Golden Rule. The way we teach kids to be moral is we say, “How would you like that if someone did that to you?” The logical basis of mortality is that, as long as I’m not the galactic overlord and my fate depends on other people, I’ve got to agree to some sort of social contract that treats us as equivalent. That’s why versions of the Golden Rule have been independently discovered by many different cultures.

Here’s the most common counterargument I hear to that point of view: it is very well for an intelligent professor who reads a lot of books to derive moral principles from reciprocity, reason, and self-interest, but ordinary people don’t think like that.

What’s wrong with just picking an oven-ready set of moral norms off the shelf, like those presented by modern Christianity, which have been made more humane over time? You don’t have to do much thinking, for which you might not have time or ability.

Well, I think that could be a means to an end, but one must keep in mind what the end is, which is humanistic morality that we can justify. As we know, religions can contain off-the-shelf moralities such as “kill anyone who insults the prophet Muhammad,” “execute blasphemers or gay people,” or “thou shalt not suffer a witch to live.”

Now there are religions guided by humanistic, enlightenment, universalist principles, such as some of the liberal Protestant denominations and Reform Judaism. I don’t oppose keeping some symbolism and ritual if the institution has moved in a humanistic direction. Maybe that would be a good thing.

A somewhat different criticism of progress has to do with status competition, essentially the idea that no matter how much things get better, ultimately, as you once again put it in your book, men don’t contend with the dead but with the living.

Are our efforts at Human Progress bound to fail because people care about relative rather than absolute improvements in life?

I love that Hobbes quote. He introduces it by saying there’s a natural reverence for antiquity because men contend with the living, not with the dead. That is, intellectuals and moralists will tend to revere earlier eras and bemoan the present era because complaining about the present is another way of complaining about your contemporaries, who are your rivals. That’s another reason there is a negativity bias.

That’s an aside on elite status competition, but we all compare ourselves to others. So, in that sense, there won’t ever be a utopia. People will always compare themselves to others and be less happy than they ought to be. Still, it’s worth working toward progress. Even if you’re a spoiled first-world brat, it’s still better that you live to 80 instead of 55. It’s still better that your kids don’t die. It’s still better to travel the world instead of being confined to your village.

There’s a quote on my wall from a psychologist called Richard Layard that reads, “One secret of happiness is to ignore comparisons with people who are more successful than you are. Always compare downwards, not upwards.”

How do we go about explaining to people that it’s okay that there is always going to be somebody who is taller, smarter, and more handsome than you are?

You’re right that this is a piece of wisdom we’d be better off having, but it’s not easy to engineer. Some features of culture are very bottom-up. They can be influenced by education and by the messages that we give children, but no one’s really in charge; it’s the result of millions of people interacting with each other every day. However, we shouldn’t abdicate our responsibility for what we teach kids. We can do our part and try to nudge them in the right direction.

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Nearly a century later, that prediction seems justified. We are richer, healthier, and better educated than any society in history, yet economic growth has slowed, trust in institutions is fraying, birthrates are collapsing, and a deep pessimism hangs over much of the developed world.

In this episode of The Human Progress Podcast, our editor Marian Tupy speaks with writer and policy scholar Brink Lindsey about his new book The Permanent Problem: The Uncertain Transition from Mass Plenty to Mass Flourishing. They discuss why material abundance creates dissatisfaction, the decline of marriage and community, bureaucratic stagnation, and the cultural and institutional innovations needed to produce mass satisfaction without scarcity.

Listen on your favorite podcast app

Below is an edited and abridged transcript featuring some highlights from the interview.

Today, I’ll be speaking with Brink Lindsey, an American political writer and Senior Vice President at the Niskanen Center. Previously, he was Cato’s Vice President for Research and a dear colleague. Today, we’ll be discussing his latest book, The Permanent Problem: The Uncertain Transformation from Mass Plenty to Mass Flourishing.

I want to start by congratulating you on your excellent book. It is concise, thoughtful, and beautifully written. As a published author, I’m envious of your style, and I really recommend the book to our listeners.

Let’s start with the most obvious question. What is the permanent problem?

I stole that line from the British economist John Maynard Keynes, who wrote a fascinating essay called “Economic Possibilities for Our Grandchildren.”

That essay came out in 1930 in the depths of the Great Depression, but he was brave enough to argue that this global catastrophe was just a bump in the road in a much longer process of modern economic growth, which he believed would continue until his audience’s grandchildren were grown. By that point, he said that the economic problem, meaning serious material deprivation, would be more or less solved. With that done, he foresaw that humanity’s permanent problem would loom into view: how to live wisely and agreeably and well with the blessings that modern economic growth has bestowed upon us.

He got some specific things wrong. He imagined that by now we’d only be working 15 hours a week, which hasn’t panned out. However, he got the big picture profoundly right, which is that an abundant future was coming, and that moving from tackling the economic problem to the permanent problem would be traumatic for societies. That they would have to unlearn the habits of untold generations.

He imagined that this transition would be, in his words, something like a “general nervous breakdown throughout society.” That phrase struck me as a pretty good description for the predicament that the United States and other advanced democracies have found themselves in. We’re richer, healthier, better educated, and more humanely governed than any people have ever been before, yet economic growth has slowed to a crawl in most advanced economies, class divisions have sparked a global populist uprising against elites and established institutions, personal relationships are fraying, mental health problems are on the rise, faith in democracy is wavering, and widespread pessimism is one of the few things you can get people across the political spectrum to agree on.

So, the thesis of the book is that our predicament amounts to the fact that we are in this no man’s land between mass plenty and mass flourishing. That, having achieved mass plenty, we’ve moved the goalposts of what makes a successful life. It’s no longer just about having food, shelter, and clothing, but meaning, purpose, belonging, and status. While we are providing those conditions for a larger fraction of the population than ever before, for 70 or 80 percent of people, our current way of life is not providing the conditions for flourishing that one would imagine would go with our level of technological and organizational prowess.

So, in America today, things are so good that we are moving to the top of Maslow’s hierarchy, but on the other hand, we have a hysteria where people are saying basic necessities like food and shelter have never been more unaffordable.

Can both be true at the same time?

I think we are absolutely materially richer than any society before. People who are discontent with the status quo grope for something quantifiable that has gone wrong, and so they try to make an argument about material decline that just isn’t consistent with the facts. It is true that we are rich enough to take our basic material needs for granted. Nonetheless, we enjoy these blessings with a kind of asterisk, which is that we get them only by spending the bulk of our waking adult lives working 40-hour weeks.

The blessed 20 or 30 percent at the top have an arena for flourishing. They’ve got intellectually challenging jobs that offer a lot of autonomy and scope for creativity, and social status. The rest are in fairly low-autonomy jobs with a lot of scutwork, and they’re one stroke of bad luck away from losing their job and falling into a serious hole. They’re shadowed by both the precarity of their hold on mass plenty and also by the need to spend a lot of their lives in drudgery to pay the bills.

According to Gallup, life satisfaction in America remained pretty much the same between 1979 and 2025. Roughly 80 percent of Americans say they are either satisfied or very satisfied with their lives, while only 20 percent of Americans believe that America is going in the right direction.

So, how bad is it really, if 80 percent of Americans say that they are satisfied or very satisfied with their lives?

I don’t put much stock in self-assessments of life satisfaction. Psychologically healthy people make the best of things, whatever the circumstances. Plus, happiness and life satisfaction surveys have a lot of cultural variation. Latin Americans seem to report higher life satisfaction given their level of GDP than Scandinavians or Japanese.

What I look at instead is the conditions for a well-lived life. The chances to do work that is challenging, fulfilling, and interesting are very good for a considerable fraction of people, but they’re not so good for the majority. There’s a large divergence there between the well-off and well-educated and everybody else. That’s also translated into diverging odds of even being in the workforce: there’s been a small drop-off in male prime-age labor force participation for college-educated men from the mid-’60s to the present, and a big drop-off in labor force participation for non-college-educated men. There’s been a similar divergence in the odds of getting married and in the odds of growing up in a two-parent home. And finally, in recent years, we’ve seen a divergence in life expectancy. Rather than the poor catching up with the rich over time, they’re now pulling apart.

So, are we doing better than ever before? Sure. But I don’t think that exhausts the inquiry. In a society organized around progress, a purely backward-looking standard of evaluation isn’t dispositive. In some of the more intangible aspects of flourishing, there are warning signs that things are going in the wrong direction.

So, do you have in your mind a sense of what an agreeable life should be?

At least in broad outlines.

In the agrarian age, to quote Hobbes, “Life was poor, nasty, brutish, and short,” but it was not solitary. People were miserable and poor, but they weren’t atomized or alienated. Now, I think it’s a real liberation that we’re not stuck in the same place that we were born, working the same trade as our parents. We can choose our own lives, and that’s a great opportunity. The next question is, “Are we going to develop cultural and institutional supports in these new conditions that will help us to have satisfying lives?

It’s beyond serious dispute that for most people, the most important determinant of the quality of their life is the quality of their personal relationships. And once upon a time, when the world was poor, your face-to-face relationships with other people filled vital practical functions. Your spouse was a partner in economic co-production. Your kids were economic assets. Your neighbors were an insurance policy. The main source of entertainment was hanging out with your friends and talking.

Over time, as we’ve gotten richer, we’ve outsourced a lot of those functions either to the marketplace or the welfare state. Personal relationships with people have become just one consumption option in a sea of expertly marketed alternatives. Learning to live wisely and agreeably and well amidst riches requires cultural and institutional supports that push us to spend our time on what really matters, which is the people who are close to us. We don’t have those, so we’re seeing fraying human connection.

This is cashing out most fatefully in the declining rate of people getting married and having babies. More than half of people now live in countries where the fertility rate is below replacement. That puts the whole demographic sustainability of liberal, democratic, capitalist, cosmopolitan, affluent civilization in doubt.

I want to ask you about the danger of presentism.

When we see a problem on the front pages of newspapers, we tend to extrapolate from it a broader crisis. In other words, we have trouble separating that which is fundamental to our civilization from that which is just a passing trend.

Let me give you a few examples. You write in the book that “we are getting fatter, dumber, and our mental health is deteriorating.” It certainly feels like it, right? But obesity is already declining in the United States because of Ozempic. Increasingly large numbers of young people are switching off social media. Apparently, Gen Z, the newest ones, are the best at that. Suicide rates are falling in rich countries outside of the United States, meaning this may be a particular American problem, or even simply a problem of measurement, rather than a general problem with modernity.

So, are we underestimating human adaptability and technological innovation?

That’s a very good point. We learn over time that some things that we thought were great turned out to be bad, and we put them behind us. Forty percent of American adults used to smoke, and we covered our walls with lead paint. And yes, we’ve got what looks like a deus ex machina for obesity, but the fact that the obesity wave happened at all is a good example of a more general challenge of being rich.

When we were poor, we developed a scarcity-based morality of self-discipline and self-control and resisting temptation out of necessity, but as those material constraints lessened, there was an inevitable and appropriate loosening. People could indulge their desires more. They could, to a greater extent than in the past, follow an “if it feels good, do it” kind of path. Well, it turns out that those qualities of self-discipline and self-mastery are still extremely helpful today, not for keeping you from falling into horrible poverty, but for keeping you focused on the things that really matter, rather than trivial, distracting desires.

Capitalism gives us what we want, and we don’t yet have the cultural supports that make sure it gives us what we want to want.

One set of problems that you identify has to do with the disintegration of personal bonds and the atomization of society.

Now, if I wanted to make grandparents more reliant on their children, to make neighbors more helpful to each other, and to increase church attendance, I would start by abolishing the welfare state, which I think has eroded the kind of mutual, voluntary reliance that people once had on each other.

This might irritate you, but I see the welfare state as an integral part of modern capitalism. Nowhere do we see a complex, technologically intensive, organizationally intensive division of labor without a strong welfare state. It’s possible to imagine such a thing, but it’s also possible to imagine a human being that’s 100 meters tall. If you actually had a human being that tall, he would collapse under his own weight. Plus, the libertarian movement in the United States has made zero headway in knocking back the welfare state, so I think libertarians need some kind of plan B.

The hopeful future I have in mind is more localistic and involves reimbuing our face-to-face relationships with practical functions, which will allow people to live without the welfare state to a considerable degree. You can imagine a world of small modular nuclear reactors and 3D printing and vertical farming where small communities, with small divisions of labor, could have a degree of material affluence that today requires large-scale divisions of labor. But even in the here and now, if people are living together in communities, they can reassume duties of care that have been outsourced to private enterprise and the welfare state, such as taking care of little kids and elderly people and educating the young.

I wonder what is going to be more effective at driving culture change: appealing to people, or changing the incentives. When the government says, “We can pay for your child to go to a school,” you can opt out, but you will have to pay twice if you want to send your kids to a private school.

At the very least, I think we agree we will need to have competition. We could give the welfare state to the states and let them play around with it so that different jurisdictions can learn from each other.

Yeah. And, even more importantly, on the regulatory side.

So far, I’ve been talking about what I call capitalism’s crisis of inclusion, which is the weakening relationship between growth and widespread conditions for the good life. Meanwhile, though, we have a crisis of dynamism, a weakening capacity of the system to just keep delivering growth and pushing the technological frontier outward. Mancur Olson identified this problem a long time ago, which is that the richer you get, the more people you have with a stake in the status quo. For those people, the prospect of disruptive change is anxiety-provoking because it could knock them off their privileged perch, so they have an incentive to stop change. Also, the richer you get, the lower communication costs are, and the easier it is to band together with like-minded people and throw sand in the gears of creative destruction.

Meanwhile, the knowledge economy has created this large class of knowledge workers who desire to control and rationalize everything in their grasp. When something isn’t working, the solution is to add another layer of bureaucracy and process. Obviously, we’ve got lots of this kind of dysfunction in the public sector, but I think we also see it in the private sector, with the explosion of administrative staff on campus, the HR-ization of corporate life, and also in personal life, with helicopter parenting. These same professionals, on their off hours, deploy their managerial instincts to squeeze every drop of spontaneity out of childhood in the name of safety.

Those impulses are deep-seated, and they have contributed to an increasing drag on our dynamism.

One of the most effective ways to tackle this is inter-jurisdictional competition, allowing different groups to have different rules to limit the exposure of those different rules. Then, if that different set of rules really is producing better results, they can be emulated elsewhere. Beyond that, we’re just ineradicably culturally pluralistic people, especially under conditions of modernity. People are not going to agree with each other on what the good life is. They’re going to have different values. Having us all crammed together under one set of rules makes those value differences really high stakes and combustible and has produced a lot of the dysfunctional politics we’re experiencing now.

Last question.

My view of what living wisely, agreeably, and well may be very different from a guy who is perfectly satisfied living in his basement playing games and smoking a lot of pot. I would find such a life appalling, but who am I to tell this person that they are not living wisely, agreeably, and well?

In other words, aren’t you worried that even if all your hopes come to pass, the future may still contain a lot of people who will not be living wisely, agreeably, and well, just as they are today?

We can talk about flourishing at the individual level and then flourishing at the societal level.

In the book, I talk about projects, relationships, and experiences. Some people are really focused on projects and very light on relationships, and they do fine. Some people are great at cultivating amazing experiences, and they’re not very practical about anything else, but they live well that way. So there are a lot of different ways to have a good life.

At the social level, there’s a little bit less variety. To take one example, you can totally have a flourishing individual life without having children, but you can’t really have a flourishing society unless a certain number of people are having babies. So, I think you can’t have a flourishing society that isn’t a free society where people are the authors of their own lives, and a free society requires the freedom to fail. Some people are just not going to live wisely and agreeably and well.

I think we can create better conditions for people to choose well than we have at present. But that doesn’t mean we need to converge on one way of living well. That would be boring. Getting richer should mean a flowering of variety, not everybody converging on one way of life. And I think a more pluralistic, localistic institutional environment is most conducive to that end.

And it seems to me that living in a pluralistic society doesn’t mean that you are voiceless, that you don’t have a right to express your views about other people’s lives. Pluralism does not require total relativism. I can still say to little Jimmy, “Spend less time playing video games in your room and go out and explore the world.”

Ultimately, if we are going to be living in a pluralistic society where people can choose their values and how they want to live, it should be possible for people to persuade them that some ways of living, such as living up to their best potential, are better than wasting their lives.

This is the ultimate challenge for Homo sapiens: are we cut out for freedom? Are we cut out for being allowed to choose the good? Or are we just such a refractory species that we have to be lorded over?

The dystopian novel Brave New World, I think, is a much better fit with the predicament we’re in right now than 1984. The human spirit is being degraded, not by a regime of fear, but by a regime of cheap pleasures. At the end of that book, there’s this long monologue by the head of the society making this argument that human beings just don’t know what’s good for them and need to be taken care of. I don’t believe that. I have faith that there is a human nature that wants the good, that wants to connect to the outside world, and to other people, and figure things out. And we have the great privilege of living in a very rich, technologically advanced world that gives more people opportunities to do those things. We just need to structure things a little bit better to make it easier to make the right choices.

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Zion Lights, a former radical environmentalist, now argues the opposite—that energy abundance is necessary for both thriving human societies and environmental protection. Her latest book, Energy Is Life, tells the story of her journey from Extinction Rebellion activist to outspoken advocate for nuclear power.

In this episode of The Human Progress Podcast, Zion Lights joins Chelsea Follett to discuss how modern environmentalism became fixated on scarcity, how nuclear power became so misunderstood, and why energy is essential to human wellbeing.

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Below is an edited and abridged transcript featuring some highlights from the interview.

Joining me today is Zion Lights, an award-winning science communicator who is known for her vision of a high-energy, low-carbon future. Her latest book is titled Energy is Life: Why Environmentalism Went Nuclear.

Zion, tell me, what inspired this book?

There are a lot of good nuclear energy books out there, but they tend to focus on the technology. That’s good, but people who read technical books tend to already agree that nuclear energy is good. I’m trying to convince people to think differently. So, I’ve written this book as a narrative following my journey as an anti-nuclear environmental activist to where I am now, while also explaining things like waste and accidents. Ultimately, I wanted to write something that would have changed my mind if I had read this book 15 years ago when I was out blocking roads.

We recorded an earlier podcast about your journey. But for people who aren’t familiar, could you just quickly summarize your history as an activist?

I’m what you might call a former radical environmentalist. I was very active in the major groups, like Greenpeace and Friends of the Earth, taking part in protests, organizing protests, and lobbying. I was doing all of that from quite a young age, from my teenage years and even before. And part and parcel of that was being anti-nuclear. I went on anti-nuclear protests and signed anti-nuclear petitions.

Over time—and this is a long story, I won’t get into it, but it’s all in the book—I changed my mind and realized how good this technology actually is for the environment. I decided I need to make amends for my own sake, but also because I believe in having clean air and a better future for my children.

Let’s dive into the book. You argue that “Energy is life.” That’s right in the title. What do you mean by that?

When I was in Extinction Rebellion, one of the things that we pushed for was net zero. This idea was influential everywhere, not just in Britain, where the group was founded. All over the world, people were suddenly setting net-zero goals, even in countries with very little capacity to actually meet them. And I’m not saying that the reasons were wrong. Climate change is an issue, and air pollution is an issue. The problem was that net zero or decarbonization became synonymous with renewable energy. That was a huge mistake. It should have been not just clean energy, but what’s cleaner? Gas is cleaner than coal, so really, it should have been a phasing out coal initiative.

I think the reason why net zero was tied to renewables was that activists were really trying to promote energy scarcity. How do we use less? This is an old idea that was present in environmentalism well before I was born. Less stuff, less consumerism, less energy. Even when I was growing up, I remember campaigns on TV about not leaving your lights on when you leave the room and not wasting your tap water. It was really drummed into us. So, net zero got lumped in with “We need to live with less.”

On various panels, I’ve been asked by people in the audience, “Isn’t there a danger of too much?” I think that’s really interesting. Why would there be a danger of having too much? Then, I started to realize it’s because those people aren’t connecting their everyday life with energy. They never had to live with scarcity.

I wrote the book to challenge a lot of those ideas. I’ve tried to have readers imagine their lives without access to reliable electricity. What’s that life like? And do you really want to live that life? Because millions of people don’t.

My parents’ family in the Punjab in India live in a very poor rural area, although it’s not extreme poverty. They have food. They’re rice farmers. But here’s where the issues come in: they’re dependent on rain. If it doesn’t rain enough, then they don’t eat, and they don’t make any money. It’s so hard to imagine having that kind of lifestyle where you can’t just go to the shop and buy whatever you need.

I had friends who’ve gone to India, and they just go to the tourist sites and say, “Oh, it’s so peaceful, and I love how it’s not materialistic. They don’t have that stress of capitalism.” In reality, they don’t have the privilege. They are just trying to get through the day and make sure everybody’s fed, and nobody dies of a preventable disease. In the village, if you get bitten by a snake or a dog, which is very common, you’ll probably just die. The nearest hospital will be hours away by car, which nobody has. A lot of people have bikes. You think you can get to a hospital on a bicycle carrying a sick child when it takes four hours by car? All this impacts education as well. I remember my parents trying to pay for a teacher to live in the village. They’re very well off compared to most people in India, so they had a building built, thinking they were giving something back to a community, and they couldn’t find a teacher, even after offering a really good salary, who’d be willing to live in a village where they might die of a snakebite.

So they don’t have those privileges that we have, and spreading those privileges will require burning a lot of fossil fuels, unless someone goes over there and builds them a load of nuclear power plants. They will need coal, and then gas, to enable access to things like public transport, hospitals, and schools. And then if you have a school, you could have people there who know how to administer antivenom. You’ll have all of those incremental things that we developed over time that come with having access to energy.

So, it’s the people who grew up with abundant energy that protest that same benefit and say, “Well, we’ve had too much.” And I think some of that comes from guilt. But feeling guilty doesn’t help my family in India. You trying to get people to use less is actually detrimental to them because then you have things like COP, where poor countries get pressured to sign agreements to burn less fossil fuels.

Many energy discussions, you point out, focus almost entirely on emissions targets. Why do you think people take that approach, and how can we improve upon that?

For quite a few people, climate change equals the apocalypse, so that is the sole problem they think we should be focused on. They also seem to not pay much attention to human wellbeing. In a way, they think people are part of the problem. And that’s where the scarcity argument comes from, the idea that we need to have less. That kind of self-flagellation might make activists feel less guilty, but it doesn’t really help those who are impacted by climate change.

For me, it’s a bit different. I want the planet to be healthy because I care about people. I want my neighbor to be healthy. I want people to be well-fed and not struggling.

Poverty is one of the many issues where I think we could have moved forward a bit more than we have. We’ve got brilliant thinkers crunching out reports explaining how we can alleviate poverty, and it hasn’t happened because we’re over-focused on environmental targets. I have spoken to people who do this work independently, trying to alleviate poverty, and they have said to me privately, “The climate thing’s just taken over. It’s hard to get funded for anything because all anyone cares about is climate.” I’m not saying climate change is not an issue, I’m just saying it’s not the only issue.

How do you respond to the idea that prosperity must mean restraint and degrowth?

I knew someone in Extinction Rebellion who was going to go and live in this community with some other degrowthers. He’s one of the most well-off people I know. He’s an academic professor, he’s got a country house, he’s got everything that might create a perfect life, but obviously, he didn’t feel like that, otherwise he wouldn’t be saying, “Well, I need to go and live on the land.” It’s almost because he has everything that he wanted that he believes he’s unhappy because of modern society.

It’s almost because he has everything that he wanted that he believes he’s unhappy because of modern society. That’s a very common argument. “Our mental health is bad because of how we live.” I’ve had people say that to me, and I’ve said, “Well, do you think that people living in poverty have good mental health?” Where’s that assumption coming from? You just think that they’re happy every day because they can’t go to a shop and buy whatever they want or have whatever they want to eat for dinner?

When I visited India, I would ask people, “What would you do if you could leave?” When I asked my cousin, she said, “Well, I can’t leave. I’ve got to support my brother, who’s disabled. I’ve got to help my mum cook.” I couldn’t even get her to imagine having these choices. This academic and these Degrowth people would say, “Oh, they’re so selfless.” No, they just don’t have a choice. They don’t have the choice to think about their own needs. They don’t think in terms of choice because poverty takes away their choices. I remember saying to her, “You could be a doctor.” And she just said, “No, I could never. I don’t have the money to do it. I don’t even know how to fill in the forms.” All of those things were true. There are so many barriers that she couldn’t even think of it as a possibility. And that made me sad because even on the hardest day, I still think, “How can tomorrow be better? What could I do differently? What are my choices?” They are endless.

If I wanted to, I could go and live on the land and embrace degrowth and grow my own food, but I’d only be pretending. If I got sick, I could still go to a hospital. The people who really live in the situation of degrowth, where they have a very low carbon footprint, also have very little agency.

If you look at it honestly, the idyllic idea of “living on the land” is not actually better for the environment on any metric. People in dense cities consume much less than those in the country. When lots of people live in one place, when they are connected to a grid and have public transport or can walk to places, they become really efficient. And people are already moving to the cities, so all that policy needs to do is make sure that cities are well-connected and that we have access to everything we need.

I live in what you’d call a 15-minute city. I know that’s taken on negative connotations with people, but everything I need is within 15 minutes. There is a primary school, a secondary school, several supermarkets, and a post office that I use regularly. I moved here specifically because I wanted to be somewhere where I could get to these things on foot. It’s much easier and also definitely much better for the environment. To live this way, I need the grid, and I would like the grid to be clean and reliable and not reliant on gas from Russia.

I would like it to be better than that. Our electricity is very expensive. It’s not the most expensive in Europe, but it’s up there. We could do what France did. In 10 years, we could build 58 reactors and decarbonize the grid. That would tick the box on our climate goals, but most importantly, it would make electricity cheaper at home. I have been told several times that it’s too ambitious, but I think it’s less ambitious to do what France did than to try and do what Germany did, which was decarbonize with just wind and solar. For some reason, that’s not seen as ambitious, but that’s the thing that we know doesn’t work.

Why do you think there is so much skepticism toward nuclear power? And why is it so misunderstood by the public?

The reason that I was afraid of nuclear technology for quite a long time was that it was conflated with weapons. Once I started thinking about energy, and then separating the military and civil technology, I realized that there’s not as much crossover as they’ve made out. And actually, it’s very, very difficult to develop nuclear weapons.

And then there are scary stories that we hear all the time. There’s a new Chernobyl series, right? They’re constantly pumping these out. Just the word Chernobyl is enough to scare people. Another story I was told by some of these activist organizations was that loads of people died because of the Fukushima Daiichi power plant meltdown. Now, if you look into it, they actually died because of the tsunami and the earthquake, not the meltdown. We even got it from The Simpsons. The most evil person in The Simpsons is Mr. Burns, the nuclear industry owner. And what’s a nuclear plant worker like? Homer Simpson. Lazy and irresponsible. One of the worst caricatures of a person. Even in the intro, there’s nuclear fuel portrayed as green, goopy waste just lying around.

These stories caused entire populations to associate nuclear energy with a bad feeling, and environmentalists used that fear and pushed it further.

If listeners take away just one idea from your book, what should it be?

I would like people to stop thinking in terms of scarcity. We’ve always been told, “You’re wasteful. Are you wasting food? Are you wasting electricity? Do you need to buy that thing?” That message, which is pushed all the time, makes us feel guilty for our prosperity, and in the extreme, it leads people to believe we should give it all up.

So, instead of saying, “These people have too much,” we should ask, “How do we get this to more people? How do we make this thing more efficient? How can we make better technology?” The reason we got to where we are today is that we kept pushing for more. That is the space in which human progress happens.

The best word for it is abundance. I want to see abundance for everybody, and I want to get rid of this old Malthusian idea that we can’t have it for everybody, or the planet will die.

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He finds that, from ancient Athens to the Dutch Republic, humanity’s golden ages follow a strikingly similar pattern: they are built on openness, intellectual freedom, and trade, and are undone by fear, orthodoxy, and isolation.

In this episode of The Human Progress Podcast, Johan Norberg joins Chelsea Follett to discuss the conditions that create human flourishing, why golden ages so often come to an end, and what history can teach us about preserving our current, global golden age.

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Below is an edited and abridged transcript featuring some highlights from the interview.

Joining me today is Johan Norberg, a historian, commentator, and my colleague here at the Cato Institute. His books include The Capitalist Manifesto, Progress: Ten Reasons to Look Forward to the Future, and Open: The Story of Human Progress. His latest book is Peak Human.

Johan, tell me about what inspired you to write Peak Human?

One reason is that we live in a golden age right now, and I would like it to keep going for a bit longer. I think it’s useful to look to history for clues about how you build and maintain thriving, dynamic civilizations.

What do you mean by the term golden age?

I’m glad you asked. I’m not thinking about mighty empires and territorial expansion. I’m thinking about decent, dynamic, and innovative civilizations that grow and prosper. I’m looking at periods where you saw a great many innovations in different spheres of human experience: cultural creativity, scientific curiosity, technological innovation, and economic growth.

You have this great line in the introduction where you say, “If we discard all the achievements of those who came before us because they weren’t sufficiently enlightened and decent, and they weren’t, we will eventually lose the capacity to discern what is enlightened and decent.”

What did you mean by that?

It’s incredibly easy to dismiss everything that wasn’t up to our modern moral standards, but if we do that, we lose the ability to understand progress. Some of these past civilizations, imperfect as they were, were incredibly important stepping stones on the way to the Enlightenment, to individual rights, and to prosperity.

Let’s walk through the different golden ages you focus on, starting with ancient Athens.

In the 4th century BC, Athens was just one among thousands of different Greek city-states. That was a great thing for them, because they could compare what they were doing with others and learn. And the Athenians, partly because of their bad soil, were a trading civilization that ventured outward to find useful things, which created a spirit of curiosity and innovation. They even created this ancient form of democracy that, while it excluded women and slaves, gave a lot of power to the average man.

Along with all these things—democracy, openness, and trade—they began to experiment with new ideas in everything from architecture to theater to philosophy. I would argue that this was the first civilization where we actually see people saying that it’s a good thing to criticize your forefathers and come up with something original. And if you start doing that, you’ll come up with lots of exciting ideas.

What lessons can we learn from Athens?

One obvious lesson, which appears in all of these golden ages, is that without one strong man in charge, you open up the whole system to experimentation; ideas can come from anywhere in the network. You basically crowdsource your ideas and, while you’ll get more bad ideas, you’ll also get more great ideas that people can build upon.

I think that’s an important lesson for us. When we think of how to move on and find something better, do we create a great big plan telling people what to do, or do we simply allow more people to join in the game?

What brought the Athenian golden age to an end?

The very long Peloponnesian War against Sparta started to erode that sense of openness and curiosity. Thucydides, the great Greek historian, talked about how people on all sides became tribalists, constantly thinking about how to search for scapegoats and traitors rather than new trading partners. Obviously, the strongest example is when Socrates was sentenced to death for his teachings. That’s something that happens by the end of most of these golden ages; once they sour on intellectual openness, they try to impose some sort of orthodoxy and force people to think and behave in the same way.

Let’s move on to Abbasid-era Baghdad and the Islamic golden age.

One thousand years ago, the greatest thinkers in Europe got their best ideas from Arabs, who had far superior science and technology. Algebra, algorithm, arithmetic, average—all those terms come from this melting pot of an empire that was built from northern Africa all the way to Afghanistan. It was a huge free trade area with the same set of laws and the same language, but it was also very open to different peoples and religions. In Baghdad, they invited thinkers from other cultures and from other religions to talk about their ideas, and constantly translated their texts in order to benefit from them. They considered themselves the successors to the Greek philosophical tradition.

It is often said that the end of the Abbasid Caliphate was when the Mongols invaded in the 1250s. However, by the time of the Mongol invasion, the Caliphate had already been in decline for over 200 years. It started losing its way internally because of a fear of religious difference. Not fear of Christians or Jews, but fear of different traditions within Islam. The Abbasids built state-funded schools where teachers simply repeated Sunni dogma. The intellectuals who used to have various, diverse benefactors got government jobs on the condition that they left their critical judgment outside. That began to undermine the dynamic, open-minded intellectual tradition of the Arab world. You can actually see how texts on science and on technology begin to decline in the areas that got these state-run Madrasas.

Tell me about Song Dynasty China. It’s been said that they came very close to initiating an industrial revolution.

Karl Marx talked about how, in the 19th century, there were three major innovations that ushered in bourgeois society in Europe: Gunpowder, the compass, and printing. But the Chinese had those 1000 years earlier. They were the most innovative and wealthiest society on the planet.

How did they become so wealthy? Well, you have to focus on the Song Dynasty. From the 10th century to the 13th century, China had a relatively strong rule of law and free market. Farmers had property rights rather than being feudal peasants. They were very innovative; they borrowed new crops from other parts of the world, created new irrigation systems, and even came up with paper money. So much food was produced during the Song Dynasty that the Chinese population doubled. That led to urbanization and the rise of an early manufacturing economy. They produced so much iron and steel that Europe couldn’t compete for several hundred years. They also experimented with new textile machines in order to automate the manufacturing of textiles. It’s possible that if they had continued that path, they might have come up with some of the innovations that gave us the Industrial Revolution.

Unfortunately, this golden age was cut short. There was a period of war against Mongol invaders, then civil strife, and in the 14th century, the Ming Dynasty took power. They very self-consciously styled themselves as the dynasty that would restore stability in a top-down uniform way, and they wanted to halt economic change. They grounded their amazing armada and restricted international trade. They were almost role-playing a nostalgic idea of Chinese culture, and even forced people to dress like they did 400 years previously. People were bound to their local village and to their professions. All this created stability at the cost of hundreds of years of stagnation. In the end, the greatest civilization on the planet became a relatively poor civilization that was ultimately humiliated by Western colonial powers.

Moving on to Renaissance Italy, which was also an incredible era of human flourishing.

After the long Middle Ages, the Italian city-states began to pick up scientific, technological, and business ideas from trade with the Arab civilization. The Pope didn’t like all this trading with the infidels, but the Italians said that trade should be free all the way to the gates of hell, which I think is a very powerful free trade slogan. This combination of new ideas and new technologies, combined with these fiercely competitive city-states, led to a lot of experimentation and social mobility. And when you have social mobility, people want to show their status, and they did that by funding art. There was an intimate connection between this new capitalist wealth and a spectacular cultural flourishing.

How did it end?

It sounds like I’m repeating the Abbasid story, but it was religious fragmentation. Both the Pope and the Protestants began to think that they had the one true religion, and that the only way to create a harmonious, unified society was to ensure we all thought in the same way. This “competitive fanaticism,” as Stephen Davies calls it, started in the early 16th century and created widespread fear and anxiety. The popes, who used to be very tolerant of the Renaissance humanists and their secular ideas, began to think, “We have lost our way. We have to return to something pure, something strong.” So, they began to purge the dissenters like Galileo Galilei. Over a very short period, you move from a very tolerant, dynamic, and open Italian civilization to a battle over fanaticism, and no matter who wins, they start to purge their societies of this tolerance.

That’s a great segue into the next society you feature: the Dutch Republic.

The Dutch Republic was the great European exception. They were crazy: they thought that people should be allowed to believe different things. So even though there was a Calvinist majority, other Protestants were accepted, as well as Catholics and Jews. So, in the 16th and 17th centuries, the Dutch Republic collected refugees and dissenters from all over Europe, and books that were purged and burnt in other places could be published in Amsterdam. Everyone from John Locke to Descartes moved to Amsterdam to develop their ideas.

Everybody else thought that Dutch society would break down in utter collapse. Instead, the opposite happened. The other great European states broke down thanks to civil strife and religious war, and the only place left standing was the Dutch Republic. And it wasn’t just that they had relative peace and stability; they also managed to build the richest civilization on the planet because of their relative openness, free markets, and rule of law.

The success of the Dutch Republic was an incredibly important lesson for Europeans in the 17th century, and I think it was one of the reasons that classical liberalism began to take off. As our dear colleague Deirdre McCloskey points out, for the first time in Europe, there was a sense that it was not bad to be a merchant or producer. Previous European civilizations did a lot of trade and production, but they frowned upon it. They thought that production and trade should be left to slaves and foreigners because a real gentleman should just own land passively and make war. This begins to change in the Dutch Republic.

What led to the downfall of the Dutch Republic?

That’s a very sad story. One of the great recurring themes in history is that fear and anxiety often create some sort of societal fight or flight instinct. When you think that everything is breaking down, you want to hide from the world behind walls or a strong leader. This is what happened in the Dutch Republic in the late 17th century.

Admittedly, they faced difficult prospects. They were being invaded repeatedly by their neighbors, and in 1672, they were invaded by England and France at the same time. It was an existential moment where almost everything broke down. Unfortunately, the panicked reaction amongst the Dutch people, and especially some of the more radical Calvinists, led to this idea that, again, we have to return to some pure orthodoxy in order to protect what we’ve got. They began to purge their universities of independent thinkers, and they started to hand power to a strong man, the Stadtholder William of Orange, whom they wanted to assume total power. In 1672, rioters lynched their previous prime minister, Johan de Witt, and even ate parts of him. The fact that even the sensible Dutch can go that far in times of trouble speaks volumes about human nature when we’re anxious.

Let’s move to the Anglosphere, the last Golden Age featured in your book.

This is a long story: we’ve got the Enlightenment, the Scottish Enlightenment, the Industrial Revolution, and the foundations of liberal democracy. But it all starts with a Dutch invasion in 1688. This is the nice ending to the Dutch Republic story: when they feared being surrounded once again in the 1680s by France and England, the Dutch decided to do one last Hail Mary and invade England. However, it’s not a standard foreign invasion; they were invited by the English Parliament; the Whig party wanted the Dutch to protect them against the Stuart monarchs. The Dutch succeeded with this invasion, and many of their ideas were passed on to the English. Ideas about limiting the power of the royalty, property rights, free trade, and free speech.

The rest is history. We get more experimentation, new ideas, science, and technology, and that leads to the Industrial Revolution. It’s not just a British story, of course; it’s a pan-European development, but it is turbocharged in Britain in the late 18th and early 19th centuries. Then we get it in America as well, and that changes the whole world. The Dutch ideas that had been transplanted into a bigger British body politic were now transplanted into the American one. And after the Second World War, America decided to be the protector and guarantor of a relatively liberal world order, which is based, I would argue, on Dutch ideas.

With this world order, which makes the world relatively safe for liberal democracies, we see for the first time a truly global golden age. Weird peripheries like Sweden or East Asian nations can suddenly get access to the frontier knowledge and technology. We suddenly move from a world where 8 out of 10 people live in extreme poverty to one where less than one out of 10 people live in extreme poverty. Despite all the problems today, we live in history’s greatest golden age.

How do we ensure that our current golden age doesn’t end?

The first thing is to learn from our mistakes. First, don’t take progress for granted. We take wealth and freedom for granted because we happen to have been brought up in an extraordinarily prosperous world. But that wasn’t the rule throughout history; it has to be fought for. We have to fight for our institutions if we want to continue enjoying their results.

The second lesson is that we have to learn how to count to ten when we’re anxious. As Thucydides, the ancient Greek historian, put it, there are two different mindsets: the Athenian mindset of going out into the world to learn or acquire something new, and the mindset of staying at home to protect what you’ve got. If you do that, you tend to lose what you’ve got because it’s not there. Knowledge, technology, and ultimately wealth are not like piles of gold that just lie around; they have to be constantly regenerated. If we become like Spartans and try to protect what we’ve got by ending openness, trade, migration, and the rule of law, we will lose what we’ve got, as we’ve seen throughout history.

You also have a prediction in your conclusion that future golden ages might be more diluted than in the past.

What sets this time apart from all the others is that we have more golden age eggs in different baskets.

Historically, when Rome or Baghdad collapsed, you could really talk about the end of civilization. You lost knowledge that was only rediscovered thousands of years later. Today, we live in a global civilization, not just when it comes to our values or ideas, but in terms of access to the latest knowledge about science and technology. Even if we failed and stopped producing stuff, others would pick up the torch, and in a way, that’s a relief. We won’t see the complete end of civilization this time around unless we do something really bad.

This also means that I have a hard time thinking that some part of the world could just speed ahead of everybody else, because we can imitate ideas so much faster than we could in the past. The only question is, what do you do as an individual, as a business, as a city, or as a nation? Are you open to those ideas? Are you constantly comparing notes and benchmarking, or do you shut your mind off to all that stuff? That will decide whether or not you help create a golden age, not where you happen to be placed geographically.

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In this episode of The Human Progress Podcast, Adam Omary speaks with Chris Ferguson, a clinical psychologist and Stetson University professor, about what the research actually shows about our psychological well-being.

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Below is an edited and abridged transcript featuring some highlights from the interview.

Before we talk about your book, Catastrophe! How Psychology Explains Why Good People Make Bad Situations Worse, I’d love to talk about your recent excellent article on what people have called the “Loneliness Epidemic.”

Americans are increasingly alone, but are they really lonely?

This idea has been batted around for about a decade, and it was reinforced by the US Surgeon General about two years ago when they released this advisory saying there’s a loneliness epidemic and we’re lonelier than ever.

I was curious to see what the evidence was in support of this idea, and one of the things I noticed was that people kept switching what they were talking about. They would say, “We have a loneliness epidemic. Look over here, we’re spending less time with other people.” But those aren’t exactly the same thing.

We are spending a modestly smaller amount of time with other people. In one of the studies that the Supreme Court had highlighted, it worked out to be about a 1.7 percent decrease over about 20 years, excluding 2020, the Covid year. That seems to be robust, but of course, very modest. On the other hand, that’s not necessarily bad. People can be annoying, so sometimes spending less time around other people can be good. The classic example is that more people are working remotely, and remote work seems to be something a lot of people prefer.

Above all, we just don’t see robust evidence that we actually feel worse because of this modest change in the time we spend with others. So, I think the Surgeon General made a mistake by interpreting a modest decline in time with others as a mental health crisis.

These measures of time spent alone also revolve around physical proximity, literally being in the room with someone. But what about hanging out online? I’m a pretty big geek, and I play Dungeons & Dragons online with friends from around the country. We’re talking, we’re laughing, we’re having a good time, but we’re thousands of miles away from each other. Shouldn’t that count as time spent with others?

You and I met online and are talking in real time, which feels pretty socially fulfilling. I’ve done, at this point, well over 100 podcasts like these and met over 100 people that I’ve not met physically. So, I feel, in some ways, more socially connected than I would have been without this technology. On the other hand, it’s probably true that if none of these online avenues were afforded to me, I would go out and meet more people in person.

Is it a problem that, because meeting our social needs online is more convenient, people choose to do that over meeting people in person?

There are people who really do benefit socially from social media and smartphones because they struggle to meet people in real life. You can think of high-functioning autistic individuals, people with social phobias, or regular old garden-variety introverts. There are also certainly some people who don’t do social media well. Most people are probably somewhere in between, where it’s just frosting on the cake. They’re fine with it, but they would’ve been fine without it, too.

There are a few studies that looked at this and found that time spent on smartphones and time spent on social media do not actually have much impact on real-life relationships. Usually, time spent on social media and on smartphones draws teens and young adults away from television. So television is really the big casualty of the social media age.

Now, fifty years ago, people worried about television drawing people away from real-life relationships. The landline was also the subject of a similar panic 100-plus years ago, but it was about women. There was a sense that women were going to neglect their household duties and find lovers via the telephone. People also worried about the telegraph. And at the beginning of the 19th century, people were worried that young people would spend hours looking into kaleidoscopes and ruin their lives. So, there is a cycle of panic that goes on and on without anybody worrying too much about evidence.

To some degree, this is a perennial problem. People, especially older generations, tend to catastrophize new technology, but new generations eventually adapt to it.

At the same time, we are seeing real trends of worsening mental health, and it seems plausible that, especially in young people, social media could be creating maladaptive patterns. You could imagine that, if someone is raised in a world where online interaction is the default, they might lack the opportunity to build the skills that would allow them to delay gratification and find a healthy balance between screens and in-person life. Do you worry about that?

We have evidence that contradicts that narrative.

First, in most countries that have adopted smartphones and social media, we do not see a pattern of declining youth mental health. It seems to be something very specific to the United States. For various reasons, I think the best metric to track is suicides, because a body is a body, and self-report tends to be rubbish. And in most European countries, and in Japan, Australia, and New Zealand, we don’t see any evidence of a youth mental health crisis. In the United States, there was an increase in youth suicide in the 2010s, but it has now begun to reverse. Maybe it will reverse again, but so far, we’re seeing an improving trend for youth in the United States.

Second, the increase in suicide was actually much worse for middle-aged adults than it was for teens. Everybody’s worried about teenage girls, but a white male from 45 to 55 has roughly a three to five times elevated suicide risk compared to a teenage girl.

It seems to be a generational thing: Gen X was one of the worst generations on record, and if you follow the US trend line in teen suicide, it tracks almost perfectly with the suicide trend for middle-aged adults. We tend to find that the teens who are at the highest risk of suicide are those who have had parents who committed suicide, have substance abuse issues, or have been incarcerated, so the problems we’ve seen with teens in the United States may be downstream of their parents’ mental health problems.

We also have hundreds of studies that look at time spent on social media and mental health. Generally, across this literature, we do not find that time spent on social media or smartphones is predictive of negative mental health outcomes, nor do we find that reducing social media time improves mental health in experimental studies.

What makes the US an outlier for suicide?

Probably a few different things. Part of it is simply that the United States has a sine wave when it comes to suicide. In other words, it constantly goes up and down. We had a peak of suicide in the late ‘80s and early ‘90s that was as high as the peak around 2017 in the United States.

Nobody really knows why the US has this sine wave of suicide, but changes in media use don’t seem to matter. What you do see is that parent suicide predicts later teen suicide. Political instability or polarization also seems to correlate, as well as income inequality. There were also some changes in education that occurred in the 2010s. For lack of a better word, I’m going to use the term “woke.” I understand it’s a controversial word, but the narrative that the US is racist, sexist, and oppressive seems to correlate with an increase in teen suicides.

My best guess is not that teens are watching the news and picking up on political polarization, but that these all represent general anxieties in society that are affecting the parents, and that trickles down. If your teacher is telling you that the US is racist and sexist and you have no chance of succeeding, and your parent has a fentanyl addiction, you’re getting hit from both sides.

I think the big mistake we made in this whole narrative about teens is that the real anxious generation is their parents. We looked at kids by themselves and didn’t look at their parents and how badly they are doing. It’s like the blind man and the elephant parable; if you only touch one part, you don’t see the larger picture. To the extent that teenagers are struggling, it’s probably because their parents, and to a lesser extent, their teachers, are freaking out. We should have addressed this as a middle-aged adult issue rather than a teen issue.

I’ve been fascinated lately with the role of narrative in mental health. There’s this interesting paradox where you can have stories that are objectively false, but still have real causal outcomes, including something like having a pessimistic take on your own history or identity.

Do you think that children might be more susceptible to those pessimistic narratives?

Yeah. Young kids are going to believe what the authorities tell them. When they hit puberty, they start believing that adults are wrong. So, first off, lessons need to be developmentally appropriate. On the progressive side, messages about race and gender issues were just not developmentally appropriate. You don’t want to tell five-year-olds that their country’s a hellhole or that maybe they’re a boy instead of a girl.

At the same time, you want to tell kids the truth. You could rightly criticize earlier conservative teaching as whitewashing American sins around slavery, segregation, and brutality towards native Americans, but that’s no longer the norm in American teaching. There was an overcorrection that portrays the United States and Europeans as uniquely bad, that slavery was invented by Spaniards and Native Americans before European arrival sat around campfires holding hands and singing Kumbaya. I think you can tell kids that people did bad things throughout history, and all societies have good and bad features. That we’re all human, and deeply flawed. But nobody wants to tell the truth; the truth is complicated.

Speaking of developmentally appropriate narratives, it’s interesting how children’s stories are dramatically oversimplified. There’s a good guy and a bad guy, and everyone’s cheering for the hero. You also talk in your book about how political narratives often simplify things with a similar binary. It’s cognitively demanding to digest nuance.

A lot of this comes down to a cognitive bias called “myside bias,” which is that we are generally more forgiving of individuals that we see as part of our social group and less forgiving of those we see as part of another social group.

Back around 2020, we saw a lot of progressive cancel culture. If you said the wrong thing about a sensitive issue, you could lose your job. Everybody on the right said this was terrible, which was true. You shouldn’t lose your job over a controversial post on your personal social media page. And now, five years later, we have people getting arrested by ICE because they wrote the wrong op-ed in a newspaper and getting canceled for their opinions about Charlie Kirk’s murder. Some of the things people posted were awful and unwise, but there was this reversal where conservatives who criticized cancel culture in 2020 suddenly thought it was the right thing to do today.

Cognitive biases are a perennial problem with human nature, which is, I think, both great news and tragic news. The great news is that society isn’t suddenly crumbling before us; these are problems we’ve overcome before. On the other hand, even highly educated people cherry-pick data and default to tribalism and emotional thinking. It takes not only training, but constant practice to overcome these biases.

I sometimes see my own rational thinking slip into some of these intuitive arguments, though fortunately, I have a network of peers and colleagues who can check me.

Yeah, it’s important to recognize that none of us are perfect, and sometimes the same people who talk about the importance of rational thinking can themselves slip into nonsense. We need to have the humility, both moral and epistemological, to recognize that sometimes we can just be wrong, and there’s no shame in reversing our position if the data shows us that we should.

People also often simply take the positions that they get rewarded for taking. 2020 was a great example. For like six months, everybody was saying “defund the police.” I do some criminal justice research, and I thought I woke up in opposite land, because there’s nothing in criminal justice research that suggests any form of defunding the police is going to be effective. If anything, you want to train them better and attract better talent, which is going to cost more money. Then, a couple of years later, people came forward and quietly said, “Well, I never really thought that was going to work, but I was so scared that if I said anything, I would lose my job or my funding, or I wouldn’t be able to get published.” I’m talking about academics here, but I think it’s true in a broader sense as well.

One thing that stood out to me in your loneliness article is that, oftentimes, technically true claims are spun in a way that packs unwarranted punch.

Let’s talk about the claim from the Surgeon General’s report that we discussed at the beginning, that loneliness has the same adverse health effects as smoking up to 15 cigarettes per day. When you read the original study, they have a categorical measure of smoking. There are people who smoke more than 15 cigarettes per day, and people who smoke less, and it’s technically true that the small adverse effect of loneliness was the same as the effect of cigarettes on people in the low smoking category.

In reality, the bulk of the effect is coming from people in the zero to one-cigarette range, and if you’re smoking 15 cigarettes, statistically, you’re almost identical to the next group up. So, while you’re making a technically true claim, people are going to interpret it as though loneliness causes the same amount of harm as smoking 15 cigarettes a day.

Sadly, as you mentioned, scientists are often incentivized to maximally spin the narrative within the realm of what’s technically true into whatever sells and gets the grant funding.

Yeah, it was a very strange comparison. And while it’s technically true, why compare loneliness to the low smoking group and not the high smoking group? The same person who did that study was the person who wrote the Surgeon General’s advisory. I reached out to her, and she just referred us to her frequently asked questions page. My only possible guess is that she used one to 15 because that was the comparison that sounded best.

You can also technically say that Americans are spending the most time alone that has ever been recorded. But the decrease in time spent with others over the past 20 years was 1.7 percent. So, one version of this story sounds horrible, and the other sounds like not a big deal.

This issue of effect size is a consistent problem with a lot of research in medicine and the social sciences. It’s entirely true that a study can find a statistically significant effect that has no meaning whatsoever in the real world. There’ve been a couple of unpublished studies of cell phone bans in schools that have been hyped as if they provide evidence for these bans, but they don’t, because the effect size is near zero. The actual impact of cell phone bans on student learning is zero. It does not improve student standardized testing scores, grades, or anything else. But when you run 600,000 kids through an analysis, everything is statistically significant. Plucking a hair out of their head once a day could’ve been statistically significant.

We need much greater rigor around this issue of effect sizes, and unfortunately, we are not rigorous either in medicine or in social science around that issue right now.

Despite your book being called Catastrophe, it ends on an optimistic note: once we’re aware of our cognitive biases, we can seek to limit them and prioritize truth seeking. Are there any of these adaptive strategies that we ought to cover?

Yeah. There are two things that I can think of. One is simply that people do listen to data; you just have to be super patient with them. Most people are not going to back down in the middle of an argument and admit they’re wrong, so oftentimes when you’ve persuaded people, you may never find out. So, persuasion can feel very unfruitful and unrewarding. I have had arguments with people where I thought we’d never talk again, but a month later, they came back and said, “I actually thought about what you said, and I agree with some of the points you made.” And then usually you try to reciprocate and say, “Well, you made good points too,” and you eventually find some common ground. So repeating data over and over can work if you are patient and try to look like the more reasonable one in the debate. And you should recognize that you may not get rewarding feedback.

Another thing is the idea of stoicism. I find the research that stoicism is a good aspect of resiliency to be pretty compelling. First off, a lot of Cognitive Behavioral Therapy is essentially trying to teach stoicism: you have this belief, so test it against reality. What are some alternative hypotheses that may explain the same event? What is the evidence you have for each of these? How can you approach this in an intellectual rather than an emotional way?

Over the last 10 years, we’ve told people to do the opposite of that, to immerse themselves in their feelings and explore every nook and cranny of their trauma. I actually find that trying to intellectualize your way through things is related to more positive outcomes. I was just talking about persuasion in the sense of trying to give people data, but on the other side, being able to change our hypotheses about the world and about ourselves in accordance with data is very, very healthy.

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These claims are mostly wrong, and the errors behind them are shockingly trivial.

In this episode of The Human Progress Podcast, Scott Winship, a senior fellow at the American Enterprise Institute, joins Marian Tupy to explain how bad measurement choices dramatically distort the picture of poverty, inequality, and economic mobility in the United States.

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Below is an edited and abridged transcript featuring some highlights from the interview.

Let’s start with the broader picture. It is my sense that popular narratives about the state of the American worker are much darker than the data support.

Am I terribly wrong in this assessment?

There are surveys that look at economic anxiety or insecurity among Americans. And if you look at a question that has been asked for 25 years or so, about how people feel about their own personal finances, about half the population says their finances are “excellent or good.” We might wish that number were higher, but the main thing is it’s not any lower than it was 25 years ago. It’s been pretty steady over time.

However, if you ask people how they think the American economy is doing, the share of people who say “excellent or good” is really low. So, there’s this misconception about how other people are doing, but if you ask people how they’re doing, they aren’t especially worried.

That is a finding in psychological literature that repeats itself time and time again. It’s called the optimism gap. When people are asked to reflect on their own lives, they are invariably much more optimistic than when they are asked about the situation in the country. The explanation for this phenomenon, according to psychologists, is that people are much better judges of what is happening in their own personal lives as opposed to what is happening to the country as a whole. In the latter case, their opinion is also swayed by the media, which is very negative.

There is also this myth that the American worker has not really seen real progress since the 1970s. What would you say to that?

I was born in 1973, so I don’t have a lot of memories in the 1970s, but it was a period of high inflation, worse than we’ve had in the last five years. And for a longer period of time, there was very high unemployment. There was a lot of terrorism and other violence. There were a lot of drug overdoses. Not a great decade, I think, by anybody’s standards.

People often claim that earnings have stagnated since the 1970s, particularly men’s earnings, but the numbers that I’ve published in the last year suggest that since 1973, earnings among men are up by something like 45 percent, and earnings among women are up by around 120 percent. Hourly wages, annual incomes, and family incomes are all either at all-time highs now or have been at some point in the last five years.

Another major part of your work has to do with mobility and opportunity in the United States. We are told that society is fundamentally stagnant: if you are born into unlucky circumstances, then you are stuck there.

So, how would you summarize your research on economic and social mobility in the United States?

There are two main ways that people talk about intergenerational mobility. One is comparing adult kids to their parents. The way to think about that is “if you start in the bottom fifth, are you able to make it to the middle fifth by the time you’re an adult?” That hasn’t gotten worse over time, but you’d be hard-pressed to find people who say it’s gotten better, either.

The other big way that people think about mobility is “Do you make more money at the same age than your parents did?” The conventional wisdom there is based on the work of Raj Chetty and his colleagues, who found that, if you were born in 1940, you had a 90 percent chance of ending up better off than your parents. For kids born in 1980, that had dropped to about a 50 percent chance. So, a big decline over time.

My colleagues and I are investigating that evidence right now. Preliminarily, it looks to us like if you use a better inflation adjustment, and if you take into account the fact that families have become smaller, it looks to us like in the United States, 70 percent of recent waves of adults are better off than their parents were, down from 90 percent.

Now, everything I said about mobility was comparing individual people to their parents. If you’re just asking how well new generations are doing compared to previous generations, the evidence is that Millennials and Gen Z are already better off at the same age than previous generations in terms of earnings and wealth.

However, student debt levels are higher in younger generations because college graduation rates are higher than they used to be. But for most people, that investment is going to pay off down the road. And Homeownership is lower. Now, I think the reason that homeownership is down for recent generations is that marriage rates have plummeted, and single young adults have never had high homeownership rates. There’s been a case of reverse causality there, where people say, “nobody’s getting married because they can’t afford a home,” but it’s never been the case that a majority of young parents have owned a home. They’ve always tended to be renters, and then after some time, they become homeowners.

What did you find out about income inequality in the United States?

Ten years ago, I was writing a ton on this. I was trying to push back on Thomas Piketty and Emmanuel Saez, who were claiming that there was an incredible increase in the share of income that was being captured by the top 1 percent.

There were a number of problems with their analysis. They used pre-tax and pre-transfer incomes, which miss the effect of progressive taxation and the social safety net. There was a problem where a lot of teenagers and young adults who were living with parents with a summer job were classified as low-income Americans. There were also issues with how they treated capital gains. People strategically time when they receive these gains based on tax law and the state of the economy, so you might have 20 years of gains that show up in the data as one year, which, as you can imagine, tends to inflate the incomes at the top. They also only included taxable gains, and the main way that the middle class gets wealth is through homeownership, which didn’t show up in the data.

Eventually, Saez, Piketty, and Zucman improved on the earlier estimates and found smaller increases in inequality over time. So, the consensus now is that inequality has gone up, but by much less than everybody thought around the time of the financial crisis. And when you take into account redistribution through progressive taxation, there hasn’t been much of an increase in inequality since the 1960s.

You’re a mild-mannered scholar and might not want to endorse what I’m about to say, but reporting pre-tax and pre-transfer statistics seems like intellectual deceit. What does it matter what your pre-tax income is if the government ends up taking 40 to 50 percent of it? And what’s the point of talking about Americans at the very bottom of the income ladder not earning anything if they are getting tens of thousands of dollars in transfers?

Yeah, I agree. Folks on the left would point to the Piketty and Saez numbers and say, “Look how bad inequality is, we need more redistribution,” but they weren’t even counting the redistribution we currently do. If you don’t include redistribution, inequality wouldn’t fall even if we leveled incomes.

Even the official poverty statistics that the US government releases don’t include most of the ways that we have tried to reduce poverty over time. It doesn’t count food stamps, Medicaid, housing subsidies, or refundable tax credits, which are the major ways that we’ve tried to reduce poverty over the last 20 years.

That’s extraordinary.

It reminds me of the finding in the Gramm and Boudreaux book, The Triumph of Economic Freedom: Debunking the Seven Great Myths of American Capitalism. They found that once you account for taxes and transfers, the difference between the top quintile and the bottom quintile of American earners decreases from 16 to one to four to one.

One last thing on poverty. We have a relative poverty measure that tends to bump around between 12 percent and 8 percent since the 1960s. But I have seen a couple of papers suggesting that once you measure poverty by consumption, it falls to about 2 to 2.5 percent.

Why would there be such a huge difference between the official poverty rate and the consumption poverty rate? Are people simply not reporting their incomes?

I think a couple of things are going on.

First, you’re absolutely right that people underreport their incomes. If you look at the bottom fifth of families, for instance, people are spending 20 or 30 percent more than the incomes they report. And I’ve talked to folks on the left who say, “Oh, that’s because they’re going into debt.” Bruce Meyer and his colleagues have looked at that, and that doesn’t seem to be the case at all. It’s pretty well known that there’s a lot of underreporting both at the bottom and at the very top, and that underreporting has gotten worse over time.

The second issue is that most of the poverty measures out there, including the official ones, simply don’t count a bunch of sources of income. And they overstate inflation, so the poverty line becomes a more and more difficult threshold to get over. When you measure incomes more comprehensively and when you use a better price index, the income poverty trend tends to look a lot like the consumption poverty trend.

You could argue that poverty lines are ultimately pretty arbitrary. You can set them so that 2 percent of the population is poor, or you can set them so that 10 percent of the population is poor. The important thing is that you hold them constant over time. Rich Burkhauser, Kevin Corinth, and Jeff Larrimore have a paper where they say, All right, let’s take seriously when Lyndon Johnson said in 1963 that 20 percent of the population was in poverty. Let’s measure everything as best we can and see what that implies about poverty today. And it’s 2 percent.

Now, you run into people who say, “How can you believe poverty is at 2 percent? That’s completely unrealistic.” To which I say it’s arbitrary. If you prefer to start today with the official poverty rate of around 10 percent, we can go back to 1963 and see how many people lived under that line. It turns out that was 70 percent.

Good god.

Let me just repeat that for our listeners. If you decided that the poverty rate today in the United States is 10 percent, then, by that standard, 70 percent of Americans were poor in the 1960s?

That’s right.

Michael Green, who I believe is an investor of some kind, posted on his Substack that the real poverty line in the United States today should be $140,000. For reasons that are mysterious to me, The Free Press decided to republish that article on its website, which of course got everybody very excited. And then you stepped in. So, what does he get wrong?

He gets to this number two different ways.

The first thing he did was misinterpret the official poverty line. In the early 1960s, Lyndon Johnson wanted to start the war on poverty, and he wanted to say that a fifth of the population was poor. And there were a number of different researchers who had arrived at a poverty line of around $3,000 at the time. One of those researchers was a woman named Mollie Orshansky, who had gotten there by noting that nationally, Americans at the time spent about a third of their incomes on food. The US Department of Agriculture had this minimally adequate food budget, so she just took that and multiplied it by three, and that got you to a little over $3,000 for a family of four. Eventually, in 1969, they said, let’s just go with Mollie Orshansky’s numbers, except we’re going to adjust them for inflation moving forward. So, we’re not going to get into how much of people’s income they spend on food. We’re not going to change what an adequate diet is. We’re just going to take her line and adjust it for the cost of living over time. And that’s still the official poverty line today.

Green thought he understood how the poverty line was initially developed, and he said, “Okay, let’s look at how much Americans spend on food today.” And it turns out Americans today spend around 5 or 6 percent of their income on food. From there, Green said, “Okay, so let’s not multiply the original food budget by three. Instead, we should be multiplying it by 17. And clearly, if you multiply this number by 17 instead of 3, you get a much higher threshold.

It’s a ludicrous way of calculating poverty. We spend a smaller share of our incomes on food because we are richer, but Green has used that to argue we are poorer. It makes no sense.

The other way that he got to $140,000 was that he took these estimates of how much families of four need to spend on things like food, childcare, health care, housing, transportation, and some other things. He got these from this living wage calculator that someone has created online, which also had a bunch of problems with it. Maybe the biggest one was that he was using Essex County, New Jersey, to represent the United States. Turns out Essex County is one of the four or five richest counties in the country.

The key thing for Americans to understand is that, in general, wages are increasing faster than prices. However, certain parts of our spending, primarily education and healthcare, are becoming more expensive relative to wages.

So let’s finish by talking a little bit about the Baumol effect, which is basically that, even in industries where there is no growth in productivity, we still have to pay people higher wages because of productivity growth in other industries. Basically, nurses and teachers might not be getting much more productive over time, but we still need to pay them more, or we won’t have any nurses or teachers.

However, in the book that I co-wrote with Gale Pooley, Superabundance, we found that plastic surgery prices are dropping like a rock relative to income. So, how much of the inflation in healthcare is thanks to the Baumol effect as opposed to government subsidies? Would the Baumol effect be lessened if we had proper competition?

It’s a great question, and I don’t think there’s been enough research done on it. But clearly, government intervention has been incredibly important.

In every realm except for healthcare, insurance is essentially a tool to pay a little bit in regular amounts to avoid a giant cost that you have a low probability of ever having to pay. That’s why we have car insurance. There’s a small chance that you’re going to get in a big car accident, and rather than risking bankruptcy if that accident happens, you pay into an insurance policy that will take care of it.

In healthcare, largely because of government mandates, it’s not like that at all. Health insurance covers annual checkups, which are completely predictable. By including a bunch of things like that in health insurance coverage, you incentivize people to overconsume health care, which pushes up costs.

The analogy I make is imagine if the government mandated that car insurance had to cover paint jobs. Well, if I’m paying for insurance that includes an annual paint job and I’m not taking advantage of it, then I’m a sucker. Other people are getting these fancy paint jobs with their insurance coverage, so I will too. That’s going to increase the cost of car insurance, and it’s going to increase the cost of paint jobs. That’s what we’re getting in the healthcare sector.

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The data say otherwise, and his viral rant reveals more about the New Right’s worldview than reality.

In this episode of The Human Progress Podcast, Yaron Brook joins Marian Tupy to explore why pessimism has become a cultural default, how bad ideas warp public perception, and why the evidence still overwhelmingly favors human progress.

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Below is an edited and abridged transcript featuring some highlights from the interview.

Today I’m going to be joined by Yaron Brook, the host of the very popular Yaron Brook show and a prominent advocate of free markets, individual liberty, and Objectivism.

Yaron, I want to talk to you this morning about a recent tweet by Matt Walsh, a very prominent American conservative. He’s the host of the Matt Walsh show and appears very frequently on the Daily Wire.

Here is what Matt Walsh posted on his Twitter: “It’s an empirical fact that basically everything in our day to day lives has gotten worse over the years. The quality of everything, food, clothing, entertainment, air travel, roads, traffic, infrastructure, housing, et cetera, has declined in observable ways. Even newer inventions, search engines, social media, smartphones, have gone downhill drastically. This isn’t just a random old man yells at clouds complaint. It’s true. It’s happening. The decline can be measured. Everyone sees it. Everyone feels it. Meanwhile, political pundits and podcast hosts, speaking of things that are getting worse, focus on anything and everything except these practical, real-life problems that actually affect our quality of life.”

So, Yaron, when you first read that tweet, what did you make of it? What was your first reaction?

Well, this was not new to me. I’ve been talking about Matt Walsh and the general populist attitude to human progress for the last 40 years. It’s a theme that the left used to advocate for. Now the populist right seems to have agreed on the idea that the 1970s were some kind of utopia where income was maximal, women didn’t have to work, you could buy a home, and everybody was happy.

I think Matt Walsh is just reflecting that deep-seated pessimism that exists today across the entire political spectrum. And of course, my response is that he’s wrong about almost all of the examples he gives.

Let’s first talk about this concept of American pessimism. What do you attribute it to?

One of my theories is that we’re experiencing a negative emotional contagion driven by competition within the media. We know that each additional negative word in a headline increases the click-through rate by about two and a half percent. And now you have traditional media competing with internet outfits, so if you want to get people’s attention, pessimism sells.

That’s definitely part of the problem, but I don’t think it’s the fundamental problem.

I believe that we are shaped by ideas, and therefore, we’re shaped by our intellectuals. And the intellectual class has completely betrayed Americans. They have rejected capitalism, which is the system that made us rich.

If you were a steelworker in Cleveland and you lost your job in the 1980s, what were you told? You weren’t told what we were told in America traditionally, which was “get in your car, drive to northwest Arkansas, and get another job.” You were told, “No, don’t worry, we’ll write you a check, and we’ll keep you on welfare while we, the intellectuals and the politicians, work on getting your job back.”

This has been the story that politicians have been telling workers for a long time. They’re lying; the steel job will never come back. And they’re destroying the worker’s self-esteem, that self-reliance that’s so core to the American ideal. So, 20 years go by, and the steel job doesn’t come back, and this person and the culture around him develop real resentments against the system. And intellectuals have told Americans that their job loss is a consequence of capitalism, that capitalism caused the great financial crisis, and that they’re looking for an alternative, something to replace free markets, private property, and the dynamism of the marketplace.

One area in which America really is declining is in education. We have K-12 education that teaches kids to trust their emotions rather than their reason. We saw this maybe 10, 15 years ago with microaggressions and political correctness, and then that evolved into the woke phenomenon, which was all about avoiding hurt feelings or causing offense. So, we’ve created generations of people who are very attuned to their emotions but can’t really think, and as a consequence, rely on their primitive human instincts.

People don’t understand the world because they haven’t been taught how to think about it conceptually, so they revert to perceptions. They’re afraid because perceptions don’t lead them to knowledge, and when people are afraid, they join tribes. There’s comfort in tribes. So, you get tribalism and perceptual-level mentality, and that combination is what drives this spiral of fear and pessimism.

Let me ask you questions specifically about the GOP.

Back in the day, during the Reagan Era, it was all about America being the shining city on the hill. That there was nothing that Americans could not do, and our best days lay ahead. Now all of that seems to be gone. What happened to the Republican Party and the conservative movement?

I think it’s a combination of two things, one ideological and one historical.

Ideologically, the GOP has changed its composition and who it’s trying to appeal to. And I think the change actually happened under Reagan, who made religion a crucial part of what it meant to be a Republican. And I think that religion undermines the ability to think about the future in a positive way. Many evangelicals, particularly when they see cultural phenomena like the gay movement, Roe versus Wade, and immigration, are afraid of the future. That fear was reinforced by three major events.

The first was 9/11, which was completely misinterpreted by the American right. Ultimately, the Bush administration lied to all of us and engaged in endless wars that didn’t achieve any of their goals. So, a lot of American idealism died in Afghanistan and Iraq. And then there was the great financial crisis, which collapsed the image of American capitalism as this amazing economic engine of prosperity. Instead of intellectuals coming out and saying, “Oh, no, you misunderstood. The crisis happened because of particular regulations and the Federal Reserve,” the intellectuals came out and said, “This was caused by capitalism. We need a new model.” And finally, we had COVID, which undermined the concept of America as the land of the free. We got locked up in our homes, and the political and expert class panicked and had no clue what to do except infringe on our individual rights.

Those three crises have led Americans to be skeptical of everything that’s uniquely American, and, in the GOP, revert to a kind of religiosity that they imagine the Founding Fathers had. Michael Knowles, for example, who is also on the Daily Wire, has said, “I want a culture of 1220.” So there’s a certain medievalism in some people on the right today. They long for the certainty of religious dogma and simple life, and none of this exposure to foreign cultures or people with different sexual orientations.

Evolutionary psychologists tell us that there are certain permanent aspects of human nature. And amongst the things evolutionary psychologists say are pretty firm in human nature are tribalism and zero-sum thinking. You already argued that the right is deeply tribalist, and the left is clearly very driven by zero-sum thinking.

So, are promoters of freedom and capitalism simply fighting a losing battle against human nature?

Absolutely not. And the evidence for this is in the work you do at Human Progress. Look how far we’ve come. Look at how rich we are. It’s stunning. We were hunter-gatherers once, and we established cities, agriculture, philosophy, mathematics, and science. Every single step in those achievements was a consequence of the rejection of tribalism and zero-sum thinking. Every single step came from the use of reason. So I think human history repudiates the idea that we have to be tribal and zero-sum.

Now, it’s true that when people don’t think, when they refuse to put in the effort to actually use their mind, the default is zero-sum. Tribalism and zero-sum thinking are defaults people revert to when they’re overwhelmed by emotion. And when you have an educational system and intellectuals that undercut reason and elevate emotion above all, you get zero-sum thinking and tribalism.

To me, it’s all about the intellectuals. The intellectuals shape culture. It’s not an accident that America is a consequence of an intellectual movement called the Enlightenment. The Enlightenment sowed certain ideas, and those ideas flowered into the Industrial Revolution and the great wealth that we have since benefited from. Our intellectual class, though, has worked hard to undermine the Enlightenment for more than 200 years, basically since the Enlightenment ended. It is amazing how much we have progressed despite such lousy intellectual guidance.

So we need a new set of intellectuals who can guide Americans, and really all of humanity, towards an understanding of their own potential as thinkers, as reasoners, as creators. And at whatever intellectual level you have, whatever IQ or whatever measure you use, you can produce, and you can be happy. If we can dominate the intellectual sphere, the world will change. But right now, what’s dragging us down are people like Matt Walsh and other intellectuals who are constantly feeding the public the exact opposite message: defeatism, anti-reason, anti-freedom, and anti-capitalism.

Well, the old intellectual elite has disgraced itself and is on its way out because of Iraq, COVID, the great financial crisis and so forth. The problem is that the intellectuals who are waiting in the wings to replace them are worse. We are talking about people like, I’m sorry to say, Matt Walsh, Adrian Vermeule, and Curtis Yarvin.

Now we have to give the devil his due and talk about specifics. So, Yaron, is food in America now worse than it was in the 1970s?

It’s just funny to me to read something like that.

I mean, in the 1970s, the food was bland, and choices were minimal. Maybe there’d be one Chinese restaurant in the neighborhood. Now, the best of the best different foods from all over the world are available in any major city in the United States. I’m a foodie, so the joy of eating new foods with new flavors and in new combinations is just amazing. And we have restaurants that are super cheap. In LA, you can go buy tacos that are some of the most delicious in the world at a food truck. And if you go into a supermarket, you can get fruits and vegetables that only grow in certain regions of the world all year round, and at very reasonable prices.

So, we have such a variety and such a selection in the United States today, of all the things to pick on, food is comical.

Another point raised by Matt Walsh is air travel.

In the olden days, you simply didn’t travel by air. Holidays would be spent near where you lived. There’s a fantastic bit in Mad Men where these rich guys from New York decide to go to California and fly across the country, and it’s a big deal. The whole Office is talking about it, and they are bringing a bag of California oranges back to New York because you couldn’t get them otherwise.

Now, it is uncomfortable in economy class, yet tens of millions of people take economy class flights every year. They are voting with their wallets. What’s the tradeoff here?

The tradeoff is to get to where you want to go. The ability to travel, the ability to see the world. And it’s unbelievably cheap. In the 1950s and 60s, nobody could afford to take a cross-country trip by air. Today, almost everybody can afford to do that. In addition, air travel was not as safe back then. In America, except for that one accident at Reagan, we’ve had no fatal accidents for like 20 years. So, it’s super cheap, and if you want to pay more money, you can sit in business class and be more comfortable.

And there are discount airlines that specialize in bare-bones service and very uncomfortable seats, yet they’re always full.

There is this meme about the ability of the American worker to support a family on one income. But even today, you can have a 1950s or 1960s lifestyle on one income. It will mean that you are never going to fly across the country. It will mean that you are going to be living in a much smaller home without basic appliances. It will mean that you will have access to 1950s or 1970s health care. So, the point is, people opt to have two-income families because life is just so much more amazing that way.

Matt Yglesias had a really good essay on this, in which he found a house that is the same size as it was in the 1950s—about 1500 square feet, versus today’s over 3000—and yeah, it’s easily affordable on one income. When I grew up, there were six of us, four kids and two parents, with one bathroom. If you want every kid to have their own bedroom and bathroom, two or more cars, and to travel to Europe and see the world, then yeah, you need two incomes.

But there’s something even more important than that: the 1950s really, really sucked if you were a woman. You were stuck at home. You didn’t have many employment opportunities. There was real discrimination against women. And because there were no washers and dryers and dishwashers and all of that, women spent a lot of time taking care of the house.

Now, the opportunity cost for them to stay home is huge. They have an opportunity to build a career, go to school, develop themselves, and pursue the life they want. The consequence of that is two-income families that raise the standard of living. It’s shocking to me that people think that there’s something wrong, A, with women pursuing their own dreams and B, with people actually being richer and living in bigger homes.

You’ve already noted housing, and maybe that is the subject that we can end on.

If you look at what Mark Perry from the American Enterprise Institute calls The Chart of the Century, it shows that housing relative to income is about 10 percent cheaper than it was 20 or 25 years ago. That means wages have been increasing faster than housing prices. So, even though housing is much more expensive than it used to be, wage growth has been higher and, consequently, housing is actually more affordable on average in America.

Another thing that people do not account for is the great improvement in housing. They also focus far too much on particular problems in metropolitan areas such as New York City, whereas in the rest of the country, things are going pretty well. What’s your take on all that?

First of all, there is massive geographic diversity. You can find relatively affordable homes in Florida, Alabama, Mississippi, and in much of the center of the country. Certain metropolitan areas have oppressive laws that have made it very difficult to build, and, as a consequence, rents have gone through the roof. I made a lot of money on homes in California, not because I’m a speculator—I believe housing should be a consumption good, not an investment—but because nobody was building in the neighborhoods that I lived in. Demand was high because of the weather and economic opportunities. So prices just took off. Why isn’t supply matching demand? We know that when demand increases, prices will go up, then supply will enter, and prices will come back down. That doesn’t happen in these areas for political reasons. Homeowners don’t want new houses built, so they vote for people who ensure no new supply is added.

But there are also lots of places in the country where it’s hard to sell a home because nobody wants to live there, or there are plenty of homes. You know, rents and home prices have been dropping significantly in Austin, Texas. During COVID, demand in Austin increased significantly, and supply couldn’t match it immediately because it takes time to build a home. So, prices went up a lot. Then supply came online, and since then, prices have been drifting downwards. And you see that in a number of cities across the country where politics don’t severely restrict housing supply.

The second thing you mentioned is that houses are very different today. They’re dramatically bigger. The average home in America today is over 3,000 square feet with amenities that you couldn’t have imagined in the 1970s. Three-car garages, air conditioning, dishwashers, and so on. The construction quality is also much better. For example, houses are far more resistant to fire. Many more people died from home fires in the 1970s than today because we’ve figured out how to make cheaper fire-resistant materials.

So Matt Walsh could be talking to America about the great successes in GOP-dominated states where housing was deregulated, and rents and house prices are actually coming down. He could be promoting those successes and saying, “Look, if this can be done in Right America, it can also be done in Left America.” But instead, he’s embraced negativity.

The modern American right doesn’t want to highlight those things because that would highlight the successes of freedom and capitalism. The new right are not freedom lovers. Freedom scares them. I think they see that if you advocate for economic freedom, why stop with economics? Shouldn’t individuals be free to make all kinds of choices in their lives? What god to worship or not to worship, who to love. If they can’t tolerate freedom in the realm of personal choices, long-term, they’re not going to tolerate freedom in economic choices. That’s what we’re seeing with the right today. They used to only want to regulate our social choices, and now they want to regulate everything, just like the left.

The great tragedy of America right now is that there’s really nobody in politics who represents freedom in both the personal and economic realms.

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In this episode of The Human Progress Podcast, policy analyst Marcos Falcone joins Chelsea Follett to discuss the historical roots of Milei’s recent victory and the economic reforms he might pursue using this new political leverage.

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Below is an edited and abridged transcript featuring some highlights from the interview.

Joining me today is my colleague Marcos Falcone, a policy analyst focusing on Latin America at the Cato Institute’s Center for Global Liberty and Prosperity. He joins the podcast today to discuss the dramatic recent election win of President Javier Milei, who has led his party to a landslide victory in Argentina.

Let’s start with a bit of a history lesson. Argentina has a long history that has not always been a history of progress. Could you walk us through some of that background?

Argentina is one of very few countries in the world, and perhaps the only one, to have gone from being a developed country to a developing country. During the late 19th and early 20th centuries, Argentina was among the richest economies in the world. It was second to the US in terms of the net number of immigrants received. It also had extremely low taxes, low public spending, and very few regulations.

But, of course, international ideological trends also affected Argentina. Nationalism, corporatism, and fascism began to rise in popularity, Juan Domingo Perón came to power in 1946, and Argentina started to diverge from the rest of the world. Whereas much of the world opened up to trade during those years, Argentina became a highly closed, protectionist economy and missed out on all the benefits of trade that increased dramatically after the end of the Second World War.

When Argentina became a closed economy, special interests began to emerge, including trade unions and crony capitalists, who depended on Argentina remaining a closed economy, which in turn made it harder to re-liberalize Argentina’s economy. Governments couldn’t, for example, lower public spending, because people were counting on it. They couldn’t open borders because industries were dependent on them being closed. They couldn’t deregulate labor relations because of the unions. And so, we started to drift into a declining path.

On a happier note, Argentina also has a very long intellectual tradition of classical liberal thought. Could you tell us about that?

The architect of the Argentinian constitution was a classical liberal called Juan Bautista Alberdi. He was a lawyer, but like many intellectuals of the 19th century he wrote about many things, including economics and moral matters. The constitution he designed, which closely followed the example of the US Constitution, went into effect in 1853. It has suffered changes, but really no major changes were implemented until the mid-20th century. So, for almost 100 years, Argentina retained this very classical liberal constitution that greatly benefited the country.

Liberty was also at the forefront of Argentina’s politics and culture. At the end of the 19th century, both the ruling elite and the opposition had classical liberal ideas. The socialists, for example, were very much against protectionism and the creation of a central bank, because they thought it would be bad for workers. However, as fascism and communism began to rise in popularity, this classical liberal environment started to fade away, to the point that we had a Supreme Court that basically allowed the military to seize power in 1930. From that point, it would be over 50 years before Argentina had a fully democratic regime once again.

Still, even during the 20th century, Argentina had a very strong classical liberal tradition. For example, Alberto Benegas Lynch, who is a Cato adjunct scholar, founded a university called ESEADE, where classical liberal thought was spread. We saw the founding of various think tanks in the 1980s and 1990s within the classical liberal tradition, such as my previous employer, Fundación Libertad. We began to rebuild the classical liberal culture that had been lost in Argentina for so long, which also contributed to the rise of Javier Milei, who started out speaking at forums at classical liberal think tanks. I actually met him over 10 years ago.

So, Argentina initially had a strong classical liberal tradition, which it lost for a while but has now regained. And that’s one of the reasons why I’m actually optimistic about the future of the country.

Let’s talk about Milei’s victory. Walk us through what was going on going up to the election and the election itself, and why that outcome took so many people by surprise.

Javier Milei won the presidency in 2023, when many people thought that was impossible. Politicians in other parties actually thought that they were taking advantage of Milei’s presence because he would take votes away from their opposition. But we have to understand the context of Argentina to understand why Milei became popular. In 2023, Argentina had an annual inflation of over 200 percent, on the verge of hyperinflation. And the country hadn’t grown in about a decade.

Everyone who wanted to do business in Argentina knew that this was next to impossible because of how regulated the economy was, and there were also unbearable situations in daily life. For example, rent control was so stringent that many landlords decided not to rent their places, and this caused prices to go up. Ryan Bourne and I interviewed one person who told us that back in 2023, it was so expensive to find a place to live that it could be cheaper to live in a hotel.

So Argentina had been trying interventionist policies for a long time, and they were not yielding good results, and Javier Milei arrives, wielding a chainsaw, saying, “we need to cut spending, we need to slash public spending, we need to lower taxes, we need to deregulate, we need to open up the economy, and we need to dollarize.” And after he wins the presidency, so many people say, “A libertarian can’t last long into office. He will have to resign after a month if he tries to do what he says.” And well, Milei has been president for almost two years now, and many of the radical reforms that he announced have not caused any sort of upheaval.

I think that the most important reform was balancing the budget. Argentina had a 200 percent annual inflation rate because it was running deficits, and nobody trusted Argentina to pay back its debt, so all the government could do was print money. In just one month after taking office, Milei had balanced the budget—something everyone else had said was impossible. Ten days into his presidency, Milei repealed the rent control laws. One year after that decision went into effect, we saw prices going down in real terms by about 30 percent. We saw the supply of apartments triple in the city of Buenos Aires.

During the 2025 midterm election a couple of weeks ago, there was some pessimism that maybe the Peronists were going to win. Many people, including political analysts, were saying that Milei’s changes were so profound that people would not tolerate them, and this fueled a run against the peso. But Milei won over 40 percent of the vote, and this is bringing a new wave of optimism to Argentina because, since Milei previously only had about 15 percent of seats, there were many reforms that he couldn’t make. Now, while Milei still doesn’t have a majority, he needs fewer alliances to pass the reforms that he wants.

Let’s talk about some of those policies.

It seems like the priorities of the Milei administration will be to pass tax reform, social security reform, and labor reform.

In Argentina, taxes are not just high, but also very complicated and superimposing, meaning you have taxes on taxes. To give you an example, the last Doing Business report by the World Bank, which came out in 2020, said that a business in Argentina that paid all of the taxes it was legally required to pay would end up paying 106 percent of its income. That means you’d be better off not doing any business at all. So, you can imagine how complicated the tax system is in Argentina, because obviously, businesses can’t pay 106 percent of their income. The Milei administration could only make very limited changes up to this point because, constitutionally, he needs Congress to legislate over tax matters.

Argentina also has a very high degree of informality in its labor market because it’s very expensive to hire employees legally, and it can be even more expensive to let them go because of litigation. Businesses, particularly small and medium enterprises, are constantly trying to avoid litigation because they know, due to the way that the judicial system is set up, if they face a lawsuit by a former employee, they’re going to lose. This needs to stop, and the Milei administration knows this and is going to push for labor reform.

When it comes to social security, Argentina has the common problem of an aging population. We have the typical Ponzi scheme, where if the base keeps growing, then there’s no issue, but if the population pyramid is no longer a pyramid, there’s likely not going to be enough people in the future to pay for those who are paying taxes today. Now, this is aggravated in Argentina’s case because of populist policies. For example, beginning in the 21st century, over a million pensioners were integrated into the system without having made any payments to social security beforehand at all. We’ve also had an increasing amount of fraud over the past two decades. It’s statistically impossible to have as many disabled people as Argentina seems to have. We see towns in Argentina in backward provinces where maybe 50 percent of all people are cashing in a disability payment. Those are the kind of things that the Milei administration will try to tackle.

I would also like to see more far-reaching trade liberalization and dollarization, because Argentina will eventually have another left-wing or Peronist administration. We’re in a democracy, governments change, and we haven’t really seen that the Peronist economic agenda is becoming more reasonable. So, we need to protect people, and particularly the assets of the people, and the best way to do that is dollarization.

Let’s talk a little bit more about dollarization because this is such an important policy issue in Argentina.

Milei promised to dollarize the economy back in 2023 in the context of near hyperinflation. Now, while annual inflation is still over 30 percent, the problem has become less salient, and it seems as though maybe you don’t need to dollarize if you can just get inflation back under control. But we have this problem, which we just saw before the recent elections, where whenever there’s uncertainty about the future in Argentina, you have a run against the peso, and people rush to buy dollars. This basically stops all economic activity because people don’t want to make decisions amid all the uncertainty. And what ends up happening is that the people who benefit are those with dollars, who are usually the richest ones, and the poorest suffer the most because they have the national currency that is constantly losing value. And in many cases, the people who have dollars don’t even invest them; they just keep the physical dollar bills, so this also takes money out of the financial system.

Argentines don’t need to live like this. We have seen examples of successful dollarization processes that have defended people against populist governments. Ecuador dollarized its economy 25 years ago, and after dollarizing, it had a left-wing administration led by Rafael Correa that lasted for ten years. Many people thought he could have been another Chavez. He wanted to turn Ecuador upside down and implement all sorts of interventionist policies. But the dollar was more popular than he was, and he couldn’t de-dollarize, so even though he did a lot of damage to the Ecuadorian economy, dollarization protected the value of their assets.

What are some of the potential implications for the broader region? Do you think that this renaissance of classical liberal or libertarian policy could catch on throughout Latin America?

I think Argentina could become an example that other countries in Latin America can imitate. In recent years, we have had different administrations in countries like Brazil, Chile, and Colombia that have gone left-wing, and in many cases, in more extreme ways than in the past. And in Latin America, presidents who are not left-wing tend to be more conservative or nationalistic. So, Argentina is relatively alone in the region, but I hope that Milei becomes a sort of beacon that can help libertarian politicians in other countries rise to prominence.

We are seeing that in Chile, where even though the most popular figure right now is a communist, you also have a libertarian candidate who might go to the runoff against the communist and potentially win. And that could undo a lot of the bad policies that Chile has recently engaged in.

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Explaining that transformation is among the most important questions in economics; the answer shapes not only how we understand prosperity, but also how we might preserve it.

In this episode of The Human Progress Podcast, the economist Peter Boettke joins Marian Tupy to examine the institutional foundations of the modern world and what’s at stake if we lose them.

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Below is an edited and abridged transcript featuring some highlights from the interview.

Today, I’m speaking to Peter Boettke, a Professor of Economics at George Mason University, who has a new book out with Rosolino Candela called The Historical Path to Liberty and Human Progress.

Let’s start with the big picture. What’s the book about?

This book is based on work that Rosolino and I have been doing for about a decade on the institutional requirements for pursuing productive specialization and social cooperation under the division of labor.

This notion of social cooperation, which is at the core of what Ludwig von Mises wrote about in Human Action, is the foundation for modern economic growth. We’re trying to tell the story of how institutional frameworks throughout history have empowered individuals to pursue productive specialization and realize social cooperation through mutually beneficial exchange.

By institutions, we mean both the formal and informal institutions. So, it’s not only the formal institutions that you might read about in Acemoglu, but also those informal institutions that you would read about in McCloskey. Deirdre McCloskey likes to draw a line between her work and the institutionalist work, but we’re trying to see a joint program. We’re trying to see how all those things fit together.

When we think about economic progress, we often think about free markets and competition. But the free market is also about cooperation. Can you tell us a little more about that?

Yeah, especially among modern economists. Classical economists had a much better notion of the role that markets play in making us more cooperative.

Voltaire says that the Jew, the Gentile, and the Muslim can hate each other, but when they go into the market, the word heathen is left only to those who don’t honor their contracts. That thesis, called doux commerce, has been de-emphasized in modern economics in favor of the idea of competition and market discipline, that we’re going to be constantly seeking the highest rate of return so resources will be allocated in an efficient way, and that after we do that, and after we have exhausted all the gains from trade, we end up continually producing more with less.

All of that is true, but behind it is the idea that after two individuals meet in a market, both thank the other for the exchange. The term “catallaxy,” which Hayek used a lot, means not only exchange, but also turning a stranger into a friend. It’s symbolized by a handshake, meaning mutual agreement. That’s the core of what we are talking about with regard to social cooperation and the division of labor.

In chapter one, you put a lot of emphasis on economic development being a result of private property and the price mechanism. Can you describe briefly why private property and the price mechanism matter?

Prices guide our behavior, profits lure us, and losses discipline us. If we don’t have those signals, we end up engaging in activities that are wealth-destroying rather than wealth-creating. Private property creates those incentives through exchange, which produces prices. So, if you attenuate property rights, the rest of the system gets distorted, and if you try to abolish property rights, the system breaks down.

To make it more concrete for the listener, in somewhere like the Soviet Union, the state has property rights rather than individuals, and therefore prices are not properly generated. You have overproduction of stuff that people don’t want, and underproduction of stuff that people need.

After the collapse of the Soviet Union, a lot of people became unemployed, and there was a lot of suffering. Many blamed that suffering on capitalism, but it was socialism that had employed so many people in unproductive ventures that needed to be shut down because they were reducing national wealth.

Yeah. They had firms for which the value of the inputs was greater than the value of the outputs. They were wealth-destroying. So, they needed to shut those firms down and reallocate their capital and labor more productively.

So, you already summarized the importance of property rights and the price mechanism, but they exist within institutional frameworks. There are different institutional frameworks, such as socialism and capitalism, that create different levels of believable knowledge or information.

How does the information part of it—the knowledge problem—relate to these different institutional frameworks?

When Mises and Hayek asserted that private property and incentives matter, the response by the socialists was, “Oh, wait a minute, the base determines the superstructure. So when you transform the material base, you’re going to transform the superstructure and the attitudes of the individuals within it. All those greedy little things that need to be organized and capitalized are going to go away, and rather than homo economicus, we’re going to have homo sovieticus.”

Mises and Hayek then said that, even making that assumption, those individuals will not have the knowledge necessary to accomplish the task. It’s not only a matter of mobilizing information, but also generating that information.

So, economic information doesn’t just exist out there; it has to actually be produced. Private property and the freedom of contract give rise to prices. Those prices then help entrepreneurs form wishful conjectures about various enterprises. Profits tell them they’re doing the right thing, and losses tell them they’re doing the wrong thing. It’s their ex-ante expectations being defeated by their ex-post realizations that cause the market to constantly churn, agitate, and create new ideas. Without competitive markets, it’s not that the information is difficult to process; it doesn’t exist.

That is very important for the current AI debate.

I’ve encountered arguments that once we have super quantum computers, they will be able to predict what needs to be produced and in what quantities: the ultimate socialist dream. But the problem is that decentralization is fundamental for the production of that information.

Yeah. They think of information as existing outside of the system. Imagine that you have a sand pile, and you’ve got to move it from one place to another. In the old days, we were trying to move the sand with a shovel, and now we’ve developed a backhoe. What Hayek and others argue is that without that generative process, you don’t even have that sand pile to play around with.

Of course, once we have knowledge, it does have to be mobilized. In a book that I wrote with Chris Coyne many years ago called Context Matters, we divide the entrepreneurial moment into three moments: serendipity, search, and seize. The most important moment is serendipity. That notion of actually being aware of a possibility that others hadn’t seen before is the essence of the entrepreneurial moment.

Is that why it’s so difficult for governments to identify and encourage entrepreneurs? Because you don’t know who, out of the 8 billion people, will have that serendipitous moment?

One hundred percent. This is a very Julian Simon point. In the beginning of The Ultimate Resource, he tells a story about the priest at Normandy looking at all the graves, whose eulogy is basically, “who among these could have been the next Mozart? Who among these could have been the next Einstein?” The ultimate resource is the human imagination. And economic thinking that pushes that to the wayside because we can’t model it misses out on understanding innovation and ends up being excessively pessimistic. And, again, there’s the key problem of identifying the institutional conditions most conducive to utilizing human creativity.

Let’s pursue that line of thought. In your book, you talk about “polycentric constitutional order” as leading to the best outcomes.

Can you briefly describe what a polycentric model is?

The best model is from Bruno Frey. He has papers on what he calls functioning, overlapping, and competing jurisdictions. Basically, you have lots of governments with overlapping jurisdictions that citizens can move freely between, depending on the bundle of goods and services they are offered. This puts checks on political actors so that they don’t engage in as much predation.

To put it in a very American sense, imagine American federalism on steroids. Take the basic structure of these United States, the American federalist system, and push it even further so that governance is at the most local level.

This seems close to Eric Jones’s emphasis on the geographical decentralization of preindustrial Europe. Basically, whereas most of the world was ruled by large land empires, Europe was divided into hundreds of different statelets. So there was a horizontal competition, as well as a vertical competition, where your feudal lord had to compete with the king and the clergy, and that competition created a mishmash of different liberties and responsibilities that people could choose from.

Does that qualify?

One hundred percent. I have a very brilliant economic historian colleague named Mark Koyama, who wrote a book with Jared Rubin called How the World Became Rich. It’s a textbook. And I asked Mark, “When did the Eric Jones European miracle thesis get defeated?” And he thinks it’s never been defeated. People just got bored and moved on to other explanations because that’s what they thought they needed to do.

We’re trying to resurrect that idea again in this book: this notion that polycentric governance provides the infrastructure that allows us to pursue productive specialization and realize peaceful social cooperation among greater and greater numbers of people.

My biggest takeaway from your book is that the European miracle was really the result of a multi-century, perhaps even multi-millennial process of gradual liberalization. You write that the “accumulation of liberties leads to institutionalization of liberty, which leads to generalized increased returns, which leads to human progress.”

Thank you for finding that sentence and reading it. That is the heart of the book. Liberty is won through numerous hard-earned battles for particular liberties. Alfred Marshall, the great economist, said that “History doesn’t move in one giant leap. It moves in little marginal steps.” You see these small victories where various oppressed groups are able to push back the oppressor and gain some space for themselves.

In my book, The Struggle for a Better World, I describe this in terms of winning victories against the crown, the military or other forces of violence, the dogma of the church, the bondage of slavery, and the mercantilist interests. These various victories accumulate until you reach a tipping point that creates an economic transformation.

This issue of transformation is important. If it were simply the case that every liberty we win improves us, we would have a straight line of increasing prosperity instead of a hockey stick. The great economist G. Warren Nutter used to ask his students, “Explain to me how a larva turns into a butterfly.” And then he would pause for a minute and say, “Now try to explain it to me in a Solow growth model.” In economics, we like to think about these things as Solow growth models, but Deirdre McCloskey’s work tells us that a Solow model cannot explain the Great Enrichment, but what can explain it is a transformation akin to a larva turning into a butterfly. That accumulation of liberties, and the moment they get institutionalized, creates a transformation.

You mentioned the Soviet context before, and in the Soviet culture, they had an issue that they called tall poppy syndrome. Which is that when anyone gets ahead, they are cut down rather than celebrated. This is McCloskey’s point: let me give it a go and I’ll make you rich. Well, for a lot of human history, we didn’t let people give it a go. We penalized them if they tried to do something different. So, we needed to get to the point where those accumulated liberties provided enough security that people could think differently and pursue things that no one had done before. That’s how you unleash the creative powers of civilization.

It’s almost like a nuke going off. You have to have a critical mass of whatever it is that you’re trying to blow up, and then eventually you achieve ignition.

It seems to me that this process of liberalization you are describing takes place on two different levels. One is the philosophical or moral level, and the other is the political or economic level. There are these little liberties that get institutionalized into law. For example, you can now trade overseas, there is no longer a monopoly on salt, you can open a new factory without being a member of the guild, and so on. That’s the political-economic level. Then you have the moral level, which is where McCloskey comes in. She says that on top of the political and economic system, you need to have people who are comfortable with you exercising your freedom and doing with your life and with your property what you want.

McCloskey explains that the transaction costs of enforcing a rule are going to rise or fall depending on people’s value systems. So, for example, private property was introduced long before the economic takeoff, so you can’t explain the takeoff using just the formal right to private property. All our liberties rely on informal value systems that lower the costs of enforcing those rights.

Let me just tell you about two reformers in Russia whom I knew. One was Anatoly Chubais, who became the head of privatization in Russia, but at one time was a young academician just like me. Yegor Gaidar was another. In the late 1980s, all these people were reading Western thinkers like Milton Friedman and Hayek. Then, all of a sudden, they became the people in charge.

They were ridiculously young and given all this power, and, prior to them being in politics, they were as hardcore a Friedmanite or Hayekian as you’d meet at any Cato University event. And Gaidar, when he stepped down, what did he create? A giant scientific research center for himself. What did Chubais do? Chubais ended up getting a lucrative contract for a book he never wrote. And he ended up taking control of a state-run energy corporation.

Those guys became oligarchs. They violated the rule of law under the guise of privatization. How are you going to constrain that kind of behavior? You need to have the rules, but you also need to have morals that justify and legitimate those rules.

My last question is as follows: Steven Pinker says that progress is due to the Enlightenment. Deirdre McCloskey says it’s due to liberalism. But in your book, The Historical Path to Liberty and Human Progress, you call liberalism “the political philosophy of the Enlightenment.”

Could we say that those two explanations are really part of the same process of gradual liberalization?

That’s the argument we make.

I think that the Enlightenment project is critical to understanding the co-evolution of both liberal political and legal institutions and liberal economic institutions. And it’s the co-evolution of those two things that, over centuries, gets us to the tipping point, this combustible combination that leads to the world that we benefit from to this day. Despite the growing role of the state, we still have enough space—enough elbow room, as Thomas Sowell says—that ordinary people can do extraordinary things. That’s, I hope, the message that we get across.

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In this episode of The Human Progress Podcast, Sarah McLaughlin, a senior scholar at The Foundation for Individual Rights and Expression, joins Chelsea Follett to discuss another threat to campus speech: the rising influence of foreign authoritarian governments.

Please note that we recorded this interview before Kirk’s murder, so he is not mentioned, though we believe that event makes conversations like this one even more relevant.

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Below is an edited and abridged transcript featuring some highlights from the interview.

Joining me today is Sarah McLaughlin, a senior scholar in Global Expression at the Foundation for Individual Rights and Expression. She has a new book out entitled Authoritarians in the Academy: How the Internationalization of Higher Education and Borderless Censorship Threaten Free Speech, which examines how higher education has entangled institutions with censorship demands here in the United States.

Before we dive into the book and its arguments, let’s zoom out to the big picture. Why does freedom of speech even matter? What does it do for humanity, democracies, scientific advancement, and progress?

A lot of political and social movements that have helped protect our rights were only possible because people could speak their minds and draw attention to problems. Free speech also acknowledges a certain humility: human beings are fallible, and we need to be able to question what everyone else believes to be true. If you don’t have that freedom, it becomes very difficult to advance human knowledge.

I also believe that human beings have an innate need for freedom of expression. If we don’t have the ability to express ourselves, it really stunts our growth and limits who we are and what we can become. So, it’s important both for societal and individual development.

My understanding is that FIRE is a nonpartisan organization. Why hasn’t your organization aligned itself with a political party?

I think being nonpartisan is the best way to protect freedom of expression. If you start picking and choosing whose rights you want to defend, you’re not really defending the principle of freedom of expression; you’re just defending political views that you agree with.

I think sometimes Americans who are wary about free speech have this idea that it’s a limited resource, that if some people have it, that means others don’t. But that’s not really how it works. In fact, the more people it’s protected for, the more we can ensure it stays protected for everyone. If you defend one group, you’re actually not hurting your own cause: you’re helping it in the long run.

Let’s move on now to your book. What inspired you to write Authoritarians in the Academy?

For the first few years that I was at FIRE, I was mainly working with students and professors because, for most of its history, FIRE only worked on campus free expression cases. We recently expanded, but at that point, we were only doing campus work. You could probably guess what a lot of these cases were about. Speech about abortion, guns, race, and Israel—the standard starting points of censorship and controversy. But over time, I began hearing more and more about people who felt like they couldn’t speak freely about foreign authoritarian governments. Most often, the Chinese government, but there were also problems arising from universities’ relationships with the Gulf States.

When an industry becomes global, it also becomes vulnerable to pressure from foreign governments. Viewers have probably seen stories about the sometimes-outlandish apologies that companies have issued to the Chinese government because they accidentally mentioned Tibet or Hong Kong. But when higher education is a global industry, there are really unique concerns that emerge. As I mentioned earlier, freedom of expression is essential for the production of knowledge, which is one of the main purposes of higher education. If higher education is not a place where people can speak openly about foreign authoritarian governments, what does that mean for global discourse and research?

Could you tell me about some of the incidents that you witnessed?

One of the more disturbing examples I’ve seen was in 2022 at George Washington University in DC.

There was a group of students who put up posters ahead of the Beijing Winter Olympics that were meant to criticize human rights abuses in China, and some student groups complained to the university, saying that the posters were offensive, hurtful, that they insulted China, and that the university needed to act. To my surprise and the surprise of many, the university did. The university president at the time said he was personally offended by the posters and that he was going to take them down and conduct an investigation to find the students who posted them.

Can you describe in more detail the content of these posters?

They were not particularly graphic. They were actually designed to look like promotional posters for the games, but when you got closer, you realized that it was kind of faceless, anonymous members of China’s team engaged in surveillance or violence, the implication being that this is what the Chinese government does to minorities in its country.

To be clear, the president of George Washington University, after he received criticism, relented and admitted he made a mistake. And that’s a good thing: university leaders need to be able to acknowledge when they’ve made a mistake. But I wrote about it at the time, and I pointed out that if any of the students who put up the posters were international students from China, the university would have been using its own staff to unmask critics of the Chinese government and put them in really serious legal peril. So it’s not just about taking down posters. It’s about students from a foreign country who, after expecting to be able to speak their mind, ended up at risk of serious legal trouble at home.

This is a major fear for dissident students here in the United States. If you are a vocal critic of the Chinese government, there’s a very good chance that, at a minimum, your family will receive threats and visits from Chinese officials. I’ve spoken to students who have faced exactly that. Some of them have courageously come forward under their real name and said, “my father was brought in for questioning because I attended a protest here in the United States.” So that’s something universities need to be aware of. They have large numbers of international students with very specific and unique threats to their free speech, and the universities need to make sure that they are helping protect those students, not helping repress them.

Let’s try to understand the incentives that are driving this kind of cooperation with authoritarian regimes. Why do you think the president of George Washington University initially supported tearing down these posters?

I think when universities receive reports from students about offensive speech on campus, their reflex is to respond to their concerns. But that’s something that needs to be treated with care. There is a trend of students who support foreign authoritarian governments making bad faith claims that certain speech is offensive and that the university needs to censor it. I have examples in the book of students calling for the censorship of speakers who are coming to talk about being victims of horrific abuse by the Chinese government, by claiming it is hate speech. So that’s part of it.

There’s also a broader question of universities’ relationships with China. Part of it is international students, but another part of it is the funding that universities have been pursuing. Universities are seeing themselves more and more as businesses rather than institutions of academic freedom and free expression. There was a pretty disturbing example from about a decade ago at Harvard Law, where a visiting Chinese scholar intended to hold an event about human rights in China, and a vice dean at Harvard Law contacted him and said, “I don’t want you to hold this event because it’s going to coincide with a trip that Harvard’s president is making to China to work on the university’s relationships there.” So I think sometimes you can see business decisions being made at the cost of academic freedom and freedom of expression.

Now that we’ve talked a bit about China, can you also provide some examples of censorship in academia related to the Gulf States?

Absolutely. So, universities have been looking abroad for funding because there have been a lot of funding challenges here in the US. And they’re looking in wealthy nations, including Qatar and the UAE. So, there’ve been a lot of satellite campuses popping up in Qatar and the UAE from American universities. That isn’t necessarily a bad thing. It’s good for people to work together and share knowledge across borders. But it’s also important to be transparent about what is actually happening on the ground on those campuses.

One of the more disturbing examples was a few years ago, on Northwestern’s Qatar campus, when they invited a rock band to an event on campus. The lead singer of that event is openly gay, and so they soon cancelled the event because of “ security concerns.” But the Qatar Foundation, which is a state-linked institution that funds these universities, came out and they said, “That’s not what happened. This event was canceled because it didn’t accord with Qatari laws and social customs.” So, universities are opening these campuses and making very flowery promises about freedom of expression, but they’re not willing to talk about the chasm between their commitments to free expression and local laws.

When universities are not transparent about these issues, it allows these authoritarian countries to point to these institutions and say, “If our country were so illiberal and censorious, would we really have an American institution opening up here?” It’s a major PR victory for these countries.

Can you talk about how those in higher education can fight against this rising censorship and authoritarian influence?

There are a lot of different ways.

First, university administrators need to reinvestigate their dealings abroad. That doesn’t mean that they need to end them, but they do need to reconsider the basis on which they started them. A lot of universities started this engagement 15 to 20 years ago, and the sad truth is, China and some of these other countries have significantly worsened over that time period, so the political environment in which you opened up a satellite campus in 2005 might not be the same one as today. They need to consider whether those programs are still appropriate, as well as whether there are adequate protections on the ground for academics. I think they also need whistleblower protections because a lot of the academics I spoke to very understandably feel that if they spoke out about these censorship issues at their campuses, they would be fired, and this is in a field where jobs are scarce.

When it comes to international students, make sure they understand what their rights are. They should be making sure students know what resources are available to them if they feel like the Chinese government is knocking at the door. Alumni should also be getting involved and pressing their universities to take this issue seriously. And when it comes to legislators and politicians, we need to encourage them to pursue speech policies that are not destructive to either the rights of immigrants or Americans.

Absolutely. And if people are curious how their own university measures up in terms of freedom of expression, I believe that your organization provides some tools to help them do that.

Yes, the FIRE has rankings, and we also look at university speech codes, so people can go and get a good sense of how free their campus is and what policies need to be changed. And FIRE’s policy reform team does a fantastic job of working with universities to try to revise these policies at both public and private universities. So, if you think your university has a speech code that needs reform, give us a call and we’ll be happy to help.

Thank you so much for highlighting these stories. I think it would be very tragic if universities lost their tradition of freedom of speech, because historically they’ve been so important to scientific progress and the advancement of knowledge, and there do seem to be some very troubling trends.

However, because this is The Human Progress Podcast, we usually try to end on a positive note. Are there any trends that you’ve seen that give you hope for the future of freedom of speech on university campuses?

The situation for free expression is definitely troubling in the United States right now, but I’m hopeful that people will start to see why freedom of expression is so important, why it’s so necessary, and that we can take this moment to fight back for our rights.

Something I say in the book is that free campuses are a building block of free societies. So, I think if we figure out a way to better defend and protect our rights there, we will better defend our rights in civil society more broadly. That’s as hopeful as I can be.

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In this episode of The Human Progress Podcast, the economist Bryan Caplan joins Marian Tupy to challenge that conventional wisdom. They discuss the impact of education on economic growth, whether school is more about learning or signaling, and what all that means for the future of innovation.

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Below is an edited and abridged transcript featuring some highlights from the interview.

I want to start with a broad question. What is economic growth, and where does it come from?

Economic growth is just change in economic well-being. Usually, we measure it with GDP.

Where does it come from? There are a lot of stories that people tell. Traditionally, people said it comes from capital accumulation and better-quality labor. But when you really go to the numbers, neither of these things can explain anywhere close to the full change, so most growth has got to be from technological progress, broadly defined. That is the main difference between the world of today and the world of 2000 years ago.

In your piece, you distill it to a single word: ideas.

That’s right.

Why is economic growth important?

In any given year, it seems like getting another percentage point of growth couldn’t make much difference. You barely even notice it. And yet, as many people have pointed out, when you compound an extra percentage point of growth per year over the course of 100 years, it’s the difference between poverty and riches. And riches are what allow you to buy free time. Riches are what allow you to buy culture, to save your child from worms.

Right. So economic growth is an increase in wealth, it comes from new ideas, and ultimately, it is highly correlated with things like better infrastructure, better hospitals, and so on.

Absolutely.

What is the purported relationship between education and growth?

The normal view is that education is the crucial determinant of growth, that it turns unskilled humans into the skilled workers of the modern economy. This is an idea not just from politicians, teachers, and the general public, but also from economics. If you take a class in economics, they will constantly talk about how it’s important to have lots of education because that’s how we build human capital.

So, the purported relationship is that education creates human capital, which creates new ideas and thus more growth?

That’s one version. The more common one is simply that education leads to human capital, which immediately leads to growth. The typical college grad isn’t going to invent anything, but they’re capable of being a more valuable cog in the machine.

Right, so the standard inference is that if you have a more educated workforce, they can accomplish more sophisticated tasks. What does the evidence show?

So, I have a book called The Case Against Education, and I’m not going to be coy about this: I expected to find that education was overrated. However, I also expected to find that a lot of other people researching would say they had clear evidence that education raises economic growth.

However, when I read all the mainstream work on education, there was a big debate about “how come we’re not finding what we know to be true, which is that education is the crucial cause of economic growth?” I think that they are finding the truth, which is that education isn’t a factory for building human capital, but a certification machine for stamping people: good worker, great worker, not so great worker. People like to think about education as a way of building skills, but actually, it’s more like a passport to the real training, which happens on the job.

So, by going to university, you are offering your employer a sign that you are intelligent and conscientious enough to do so.

You’re showing intelligence, conscientiousness, and also conformity. There’s no “I” in team. Most jobs require you to follow a chain of command to achieve the goal of the group. While on some level I don’t like conformity, on a deeper level it’s really important for most purposes.

I want to read you something that you wrote. “Contrary to conventional stories about the positive externalities of education, mainstream estimates of education’s national rate of return were consistently below estimates of education’s individual rate of return.”

What does that mean?

Great question.

A rate of return is basically a measure of how good an investment is. So, for example, you might try to calculate the rate of return of putting extra insulation on a house. We can do the same for education and figure out how all the costs of education compare to the payoffs.

When you do this from the point of view of an individual person, it’s pretty common to get a 10 percent inflation-adjusted rate of return. In my book, I say this is probably too high, but you can bring it down to maybe 7 or 8 percent.

We can also think about this at the level of the country. What if we raise the education level of the whole workforce of a country by a year? How much does that enrich the country? What that quote is saying is that even the high estimates of how much a year of education does for a country are typically around half of what it does for an individual. And a lot of the estimates find that sending the whole country to school for an extra year increases national income by 1 or 2 percent.

In other words, a stamp is a good way for one person to get ahead in life, but stamping the whole country does not help that country get ahead; it just creates credential inflation. You need more and more degrees in order to get the same job that your parents and grandparents got with fewer.

Let’s talk a little bit about innovation. Where do new ideas come from? Are we talking about a very small group of individuals who share certain characteristics?

It’s an exaggeration to say that innovation only comes from a few people. There are millions of small-scale improvements coming from many different people. Opening a new kind of restaurant is not revolutionary R&D, but so much of the improvement in our living standards comes from these small acts of entrepreneurship. When I was in high school, there were only three kinds of restaurants: American, Italian, and Chinese. Now we have a cornucopia of different cuisines. The same goes for so many other simple products. Dog collars now come in 100 more varieties than they did back when I was growing up in the ’80s.

However, the really revolutionary stuff—new vaccines, new business models, new forms of energy—comes from very special people. I think it’s reasonable to say that almost all the really big ideas are coming out of the top sliver of the IQ distribution. There was a psychologist named Lewis Terman in California who, I believe, in the 1920s, saw that there was a standardized test administered to all the kids in the state of California school system. He managed to get data on the top hundred scorers in the whole state of California in that year, and he followed them through life. In his honor, these kids are named the termites, and there’s been a lot of research on them.

While the vast majority of this group didn’t do anything really impressive, they had many times, maybe a thousand times, the normal rate of stellar success. So, just doing these kinds of tests is a good way of identifying the most promising people. At a minimum, just have a system where you basically let children advance as rapidly as they’re capable of. A lot of very intelligent people feel very isolated from their own age group, and it makes sense just to advance them as far as their talent will take them.

I have a personal view, which is that our society is very open to the idea of the STEM prodigy, but we are very closed to the idea of there being a prodigy in, say, history. And I think that there are history prodigies. I have met kids with not just a broad, but a deep understanding of history by the time they’re 13 or 14. People think it’s crazy to put them in a PhD program in history when they’re 14 years old, but I don’t. Why not skip that kid ahead and let him become a star? Look, maybe he wants to be a regular 12-year-old even though he is a genius, but maybe he doesn’t. Maybe he wants to be with a peer group of geniuses. Let’s pave the way for him if that’s what he wants.

Do you think that AI will allow us to continue innovating if the population starts declining?

There was a long period where people working on AI kept over-promising and under-delivering. I would personally hear extravagant claims and check them out and find that they weren’t true. Finally, about two years ago, they started being correct. I was as shocked as anyone. I actually have a bet out about AI, which I’m probably going to lose. It’s embarrassing because I have otherwise a perfect public betting record.

That said, one incredible achievement does not mean that they’re going to have a whole series of incredible achievements. And there’s a lot to the idea that AI is basically just amazing at compiling what has already been said rather than truly coming up with new stuff. While it’s not impossible for it to get better, a lot better, it’s also not guaranteed.

Another thing worth pointing out is that we’ve had, by many measures, falling rates of innovation despite a rising population. There’s an idea that we’ve already discovered a lot of the low-hanging fruit, and so we need to keep multiplying our efforts to maintain the same rate of growth. Another plausible story is that we have doubled the number of people that we call researchers, but really only the best ones count, and the other ones are kind of fake.

Given that much of the money we spend on education is spent poorly or even counter-productively, what should we do with the money instead?

I’m totally on board with giving it back to the taxpayers or just paying down the national debt. We badly need austerity. We are driving at 100 miles per hour towards a brick wall, but there’s still time to change course and get our foot on the brakes. One of the easiest ways of doing that is by spending less on education.

Is education more useful in the developing world?

Poor countries have a severe problem with teachers even showing up. They, on paper, have many years of education—I think Haiti now is around where France was in 1960—but mostly they are just throwing money at a corrupt system that doesn’t even teach basic literacy and numeracy. The way that people in the third world are learning to use technology is the way that almost all normal people learn anything, which is by doing.

It seems to me that we are doing the exact opposite. We are keeping people in the education system for many years, which could prevent them from starting to work and learning by doing.

Yeah. It would be much better if people started adult life at an earlier age. They’re totally ready for it. There’s no reason why 13- or 14-year-olds should not be working. One of the best ways to get kids to actually learn stuff, especially the kids who hate school, is to make it practical. They need to see concrete results and make money.

If you read biographies or autobiographies of people in earlier eras, it is amazing how far people got at young ages. By the age of 15, Malcolm X had worked four different jobs and been all over the country. Many people listen to me and say, “Oh, that’s so dystopian.” I think the system we have now is dystopian, where someone has to sit in a classroom until they’re 30 listening to some boring windbag talk about things he doesn’t even know how to do.

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There’s a longstanding and counterintuitive finding in global happiness research: the richest countries don’t always report being the happiest, and rising wealth doesn’t necessarily lead to higher life satisfaction.

More disconcertingly, people in wealthy nations—especially younger generations— seem to be experiencing rising rates of anxiety and depression.

What should we make of this paradox?

In this episode of The Human Progress Podcast, psychology researcher Tim Lomas joins Chelsea Follett to discuss his research on global human flourishing and what it reveals about the relationship between economic development and well-being.

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Below is an edited and abridged transcript featuring some highlights from the interview.

Joining me today is Tim Lomas, a psychology research scientist at the Human Flourishing Program at Harvard University. He joins the podcast today to discuss the Global Flourishing Study.

Could you start us off by just telling us a little bit about this study and what questions it contains?

The two masterminds behind the study are Tyler VanderWeele, director of the Human Flourishing Program at Harvard, and Byron Johnson at the Baylor Institute for the Study of Religion. Around six years ago, they hatched this incredibly ambitious plan to do a global study of flourishing.

There are lots of international studies of well-being. The Gallup World Poll, for example, has been around for 20 years, covering some 150 countries. However, one issue with that study is that it’s cross-sectional: it’s a snapshot of people each year. It doesn’t track people over time, so it can’t really tell us about causal trends or patterns other than at the international level. Our study takes a set of people and follows them over time.

In 2023, we did the first wave of data collection from over 200,000 people. 2024 was wave two, so we now have two waves of data. Wave three has just gone into the field. The plan has been for it to go on for at least five years.

The heart of the study is a questionnaire covering different aspects of flourishing. It’s centered around a framework with five main domains of flourishing plus an additional sixth one. So the five main domains are happiness and life satisfaction, health, both physical and mental, meaning and purpose, character and virtue, and close social relationships. The additional sixth dimension is financial and material stability. That’s not exactly an end in itself like the others, but it’s pretty important for securing those other domains. There are also questions on religion, spirituality, society, government, relationship to nature, and some that are harder to categorize, such as experiences of beauty connected to nature.

There are some well-known issues with self-reported data. There are the issues of subjectivity, individual interpretation, and differing cultural norms. So, we need to interpret this data very cautiously and ideally alongside some more objective metrics. That said, it’s still really interesting, and some of the insights are very counterintuitive.

Let’s start by examining more of these different domains. Can you tell me about the different main domains and why they were selected?

The domains were selected by Tyler VanderWeele on the basis of being prominent in the literature, as well as just making intuitive sense. Most of the attention in the literature has been on those first two domains: happiness, life satisfaction, and health. Obviously, for health, there are plenty of objective metrics.

When it comes to happiness and life satisfaction, it’s hard to find objective metrics, and there are lots of nuances to get into. One of the papers I’ve been leading compares life evaluation with life satisfaction and with happiness. These concepts all seem very similar and are sometimes even used synonymously, but there are actually considerable and intriguing differences between them. But I would say those two domains have been very well covered. Close social relationships are also a big focus of attention.

The other two main domains, character and virtue, and meaning and purpose, have had much less attention, but we think that they’re integral to human flourishing. If you score highly in the other domains but don’t have a sense of character and virtue, or meaning and purpose, then your life could feel hollow or superficial.

The sixth dimension, financial material stability, is fairly well studied. In a lot of our analyses, we seek to combine the self-report data with objective metrics, and that can be interesting. For example, incorporating something like GDP per capita creates some very strange and perplexing patterns.

Absolutely. That was one of the interesting points to me. The countries that score the highest are not necessarily the ones that you would expect based purely on material standard of living. Many of the countries that score very high, like Indonesia, Mexico, and the Philippines, are middle-income countries. They’re not very rich, but they are experiencing a high growth rate. I would be interested in hearing your thoughts on that.

I really love your insight about trajectory. I’ll start with a caveat relating to what you mentioned about cultural and linguistic differences.

To give you an example, Japan is at the bottom of a lot of the rankings. And Japan is clearly an economically developed nation. I’ve been there a few times and I love the place. You walk around thinking, this is an amazing society. And then when you see this data, you think, “am I missing something as an outsider, or are there cultural differences that I’m not picking up on?” There is a suggestion in the literature that Japan and other cultures in that region might have more pressure to be self-effacing. So, the question arises, does that account for their relatively low scores? My sense is that would account for some of it.

That is just a general caveat about the task of comparing cultures. That said, you can still see some meaningful patterns, and I think you’re right, the countries that seem to do very well in terms of flourishing are not the most economically developed countries. And then one might wonder whether development comes at the expense of other aspects of flourishing, like societal cohesion, community structure, traditions, religion and spirituality, and social connections.

The lesson here isn’t that societies shouldn’t develop economically because that’s a vital component of flourishing. The question is how to develop economically without sacrificing those other domains. That’s really the key question we’re trying to think through.

I also want to touch upon your point about the trajectory. One’s sense of how well one’s life is or how well one’s society is doing is not static. It’s based on where it’s been and where it’s going. I can imagine two countries that are almost identical in terms of their current state, but one is on a downward trajectory, and the other is getting better. My sense of which society is better might be the one that’s improving. So even if those countries may not be as developed economically, the people in those countries sense they’re on this upward trajectory, and that positive sentiment is reflected in their flourishing scores.

I’ve seen completely unrelated studies that show something similar happening with age. In most countries, almost all of them, actually, older people have more positive reports across many domains than younger people. I wonder if that might have to do with the greater perspective that older people have, especially if they’ve seen a lot of positive economic change in their lifetime. What do you think about that?

I think that’s a really key point. There is this striking trend where satisfaction, happiness, and even flourishing generally are somewhat U-shaped over lifetimes: they are relatively high in the young, then they fall to their lowest level around middle age, and then they rise again as people get older, though it tends to fall off as people get very old. This U-shaped pattern is well corroborated, although now the left-hand side of the U is starting to come down into a kind of J-shaped curve, where older people are doing even better than younger people, with the lowest level still in middle age.

You can even see this with self-reported health. Objectively, the younger person is going to be in better health than an older person, but it’s a question of relative judgement. Do you feel like you’re doing okay relative to where you expect to be, or to your peers, or to people in the past?

This emerging J-shaped pattern is also kind of worrying in terms of what it shows about the well-being of young people. Perhaps younger people today are facing significant challenges that weren’t faced by people of a similar age in earlier generations. Things around the climate, the economics of AI, and the future of work. You can imagine there are so many issues on young people’s minds that could be weighing them down.

Absolutely, though every generation has its challenges. My parents’ generation had to hide under their desks in drills out of fear that a nuclear weapon could fall on them. I think something that has changed is the perspective people have. At Human Progress, we believe that many people lack historical perspective, and it’s important to show them longitudinal data about how things have changed.

That brings me to mental health. The United States is not scoring as well on self-reported mental health as a lot of countries that are economically worse off. For example, Tanzania, Kenya, Nigeria, and Egypt all seem to have what you call a surplus in this domain of mental health.

I wonder if people in wealthy countries have become much more fragile or sensitive in this domain. With growing acceptance of mental health struggles, you might even get a social reward for saying that you have anxiety or for ranking your mental health poorly. So I wonder how much we can really make of some of these comparisons.

You could imagine that in certain cultures, and maybe the US is one example, certain states of mind or experiences are more likely to be medicalized, and in other countries, perhaps less so. There’s been so much work around the therapization and medicalization of ordinary life, not just in the United States, the tendency to take ordinary struggles and see them through a mental illness lens. I can see certain incentives for using mental illness as a badge of identity, let’s say.

There’s also evidence that technology plays a role. Not technology per se, but the way in which it’s used, certain apps and so on. You could imagine that in certain cultures, perhaps the more economically developed ones, those risk factors could be more prevalent. Progress always has a dialectic; it brings good things and bad things. So countries with less economic development could have less opportunity to benefit from the gains, but also less exposure to the risks.

Another factor you mentioned is voluntary community life. Group activities, both secular and religious, seem to be associated with greater flourishing. Even after controlling for other well-known predictors, it seems like some of the best support systems for human flourishing, as measured by this study, are these bottom-up systems of voluntary communities, civil society, and religious organizations.

Walk me through some of your findings there.

Yeah, I think they’re so important. Close social connections and social institutions are both strong predictors of happiness and life satisfaction, and key aspects of flourishing themselves.

You’re often asked with studies like this, what can people do to improve their well-being? Many aspects of life are out of our control, but one thing that is within our control is trying to find community. Some groups can be more conducive to flourishing than others, but as a general principle, joining communities and organizations is a powerful route to flourishing.

I also think that at least part of the counterintuitive relationship between economic development and flourishing is that development can come at the expense of traditional communities and groups. The takeaway here is that economic development alone is not sufficient; we should also try to preserve things like community, tradition, social structures, and close social relationships, and try to learn lessons from countries that seem to be doing that.

One of the factors that a lot of the literature has looked at is a sense of agency or an internal locus of control. People who are high agency, who feel that they do have more control over their lives, often report higher well-being across a whole range of dimensions.

Do you see that trend in this study as well?

We do. Now, when we ask about agency, it’s more at a societal level. We’re asking people, “Can people in your society trust each other? Can you trust the government? Is there corruption? Do people in your country have the freedom to do X?”

So, agency as freedom from coercive institutions, freedom to pursue one’s own ends economically, religiously, and so on. And we do find a strong correlation between this kind of structural agency and flourishing.

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Many popular remedies for the supposed excesses of capitalism rest on familiar historical narratives: Dickensian factory owners exploiting anemic child laborers, predatory robber barons monopolizing 19th century industries, the unchecked greed of the 1920s sparking the Great Depression, and so on.

However, many of these narratives are simply wrong, distorting the true lessons of history.

In this episode of The Human Progress Podcast, economist Donald Boudreaux joins Marian Tupy to discuss some important misconceptions about American economic history and why it’s crucial to set the record straight.

Listen to the interview

Below is an edited and abridged transcript featuring some highlights from the interview.

Today, I have with me Don Boudreaux, a professor of economics at George Mason University. He has a new book out, co-authored with the former senator from Texas, Phil Gramm, called The Triumph of Economic Freedom: Debunking the Seven Great Myths of American Capitalism. It’s a fantastic read, full of information and killer arguments.

We’re going to discuss that book today. But first, Don, why is the study of economic history important?

What we think we know about the past determines how we assess the present.

For example, if we think that in the past, a certain monetary policy did this or did that, that’s going to affect how we think monetary policy should be conducted today. So, in order to make good decisions in the present, we have to do our best to understand how various policies worked out in the past. That’s what we try to do in the book.

Let’s jump in and tackle trusts, or as we call them today, monopolies. We often hear about the power of monopolies in today’s America, but let’s go back to the 19th century. What was the trust problem, and what was the solution meant to address?

Some of the first original research I did as a young scholar was looking into the Sherman Antitrust Act of 1890. I had a colleague, Tom DiLorenzo, who, in 1985, published a wonderful paper on the origins of the Sherman Act, 95 years after its enactment. Astonishingly, no one in that near century-long period had ever bothered to check what had actually happened to the prices and outputs of the industries that were supposedly monopolized. So, Tom looked at these data and adjusted them for deflation—there was a deflationary period from the end of the Civil War until the early 20th century—and found that in the decade leading up to the Sherman Antitrust Act, the prices of the outputs of these allegedly monopolized industries fell faster than prices in the economy as a whole. Likewise, the outputs of these industries rose faster, and in most cases, multiple times faster than the output of the overall economy.

This is inconsistent with the monopoly story. Monopolies are supposed to raise prices, not cut prices. In reality, there was no monopoly problem in the 1880s; there was a competition problem. We had, for the first time, a fully transcontinental economy, thanks to the railroads and the telegraph, and soon thereafter, the telephone. So, a lot of firms could now take advantage of economies of scale. John D. Rockefeller in petroleum refining, Gustavus Swift in meat slaughtering, James Buchanan in tobacco manufacturing, and so on. And these firms did grow large, but “large” is not an appropriate definition of a monopoly. A monopoly is a firm that can suppress competition, raise prices, and suppress output. These firms did the opposite. They grew big, but they grew big precisely by being so efficient that they could lower their prices and expand their output.

Now, whenever this happens, other producers complain. And in the 19th century, the complaints came disproportionately from local butchers and local cattle raisers. Before the railroad and refrigeration, slaughtering took place locally. So, when the first meat packers set up shop in Chicago and began centrally slaughtering livestock and shipping the meat out across the nation by refrigerated railroad car, they destroyed an age-old line of work. These local butchers and independent cattlemen raised hell, and local politicians listened to them, villainized these firms, and attacked them with antitrust statutes.

Frankly, these early antitrust statutes, and the subsequent ones, were not intended to address what was truly perceived as a problem of monopoly. They were aimed at placating disgruntled producers who had been outcompeted by larger, more efficient, and more entrepreneurial rivals.

You mentioned the D word, “destruction.” The destruction of local butchers by big, centralized butchers. Is that a good thing?

Well, economic growth requires that resources move from where they are less productive to where they are more productive, so change is inevitable if you want economic growth.

Some people might naively say, “Well, look, we’ve had enough growth, let’s just stop now,” and try to freeze everything in place. Now, I’m sure almost everyone alive today is very happy that our ancestors did not settle for the level of economic activity that existed when they were alive. You and I would not be talking over Zoom, and web designers would have eight legs.

However, even if we all agreed to settle for our current level of prosperity, we would still need to allow economic change, because some things are beyond human control. Supplies of raw materials can dry up. Natural disasters can destroy factories. So, we always need people to be able to adjust to the facts on the ground. That flexibility, that entrepreneurial alertness and creativity, is inseparable from capitalism. If you try to freeze our economy in its current pattern, you’ll collapse it. We can either continue to move forward and embrace creative destruction, or we can collapse into destitution.

Yeah, that’s fundamental. There are, in Donald Rumsfeld’s famous words, “unknown unknowns,” and we want to be as rich and as technologically sophisticated as possible when those challenges arise.

Okay, on to the big one, the granddaddy of them all, the Great Depression. Can you steelman the anti-market position about what happened in 1929? What went wrong?

Yes. In the 1920s, a fundamental contradiction of capitalism reached its peak. The rich were getting richer relative to the poor, and rich people spend a smaller portion of their incomes than poorer people. By the late 1920s, you had an increasingly unequal distribution of income, and a smaller portion of that income was being spent. As a result, America’s factories were producing more than America’s factories could sell, and a terrible spiral took place. The factories started laying off workers, which further reduced the income of factory workers, who responded by reducing their spending, which further reduced economic output and employment.

All of this happened when Herbert Hoover was president. And as everyone knows, Hoover was a staunch advocate of laissez-faire. He was a do-nothing president. The Depression happened, and Herbert Hoover just sat in the White House and twiddled his thumbs, hoping this recession would go away. Then, of course, it got worse. By 1932 and 1933, unemployment in America hit 25 percent. Fortunately, the American people elected Franklin Roosevelt, who came to office with a whole bunch of really good ideas and smart advisors. They developed the New Deal, a system of relief programs, and we were able to start recovering. Finally, World War II comes along, there’s more government spending, and we get out of the Depression. That’s the myth.

That’s what a lot of American kids learn at school. But I suspect that you don’t quite agree with that interpretation of the Great Depression.

No, I don’t. Let’s start with the easy one: Hoover was not a do-nothing president or an advocate of laissez-faire. Hoover was the president who signed the Smoot-Hawley Tariff Act. He created the Reconstruction Finance Corporation. Hoover spent at a deficit during every year of his administration. In fact, one of Franklin Roosevelt’s campaign platforms was that Hoover was too big a spender. Hoover’s administration was the first time, really, that any sitting American president did much to combat an economic downturn. So that’s a complete fallacy.

There are other problems too. In the 1920s—and this is from research done by Simon Kuznets, a Nobel Prize-winning, very respectable economist—the distribution of income did not grow more heavily toward upper-income Americans. In fact, it became a little bit flatter in the 1920s. In terms of spending, the mythical theory says that there just wasn’t enough spending to buy what the factories were producing. But if you look at the data on consumer spending in the 1920s, it was off the charts. It was a boom time for Americans.

What actually happened, and here I’m quite conventional, was bad monetary policy. The Fed was created in 1913 to serve as a lender of last resort. Before the Fed was created, whenever banking crises would happen, they had private arrangements where bank clearing houses would get together and channel liquidity to the parts of the banking system that needed money. And these panics, as they were called, were quickly undone. But after the panic of 1907, people said, “Well, we can’t have this. Let’s get the government to take over this process.” And they created the Federal Reserve.

When the downturn began in August of 1929, the Fed should have stepped in to prevent the money supply from contracting. But the Fed just stood by, and from 1929 to 1933, the money supply contracted by over 30 percent. That is huge. Then, on top of that, you have the hyperactive Hoover, who administered a historically unique level of economic intervention. And then it gets worse under FDR.

The big problem was what the economic historian Bob Higgs calls regime uncertainty. Hoover and Roosevelt became increasingly hostile to businesses and investors throughout the 1930s. Basically, they scared investors off. Well, if you want economic recovery, you can’t scare investors off. You can’t threaten their property rights. You can’t threaten to tax away their earnings. You can’t threaten to control prices. All of this was being done. Roosevelt became a little more friendly to businesses when he needed them to cooperate in the war effort, but there was still concern that after the war, Roosevelt would return to his increasingly anti-capitalist stance. But of course, Roosevelt died in April of 1945, and Truman, for all of his imperfections, was a businessman, and he was perceived, quite rightly, as much less radical than Roosevelt.

Higgs dates the end of the Great Depression as immediately after the war, 1946 or 1947. The war years, we can’t say much about. You’re conscripting people into a military, so unemployment looks low, but that’s not the result of an improved market economy. Prices are controlled. Wages are controlled. Certainly, the standard of living of ordinary Americans back home was falling. So, if you define the end of the Depression as a return to high and rising living standards for ordinary people, you don’t get any evidence of that until the years immediately following the end of World War II. So, the New Deal didn’t cure the Great Depression. If anything, it extended the Great Depression throughout the 1930s. If we’re going to actually rely on data, we must say that the Depression only ended after the end of World War II.

Now on to the final topic, the Great Recession.

The mainstream explanation is that financial deregulation created the housing crisis. Greedy, mustache-twisting bankers lent money to people who they knew couldn’t repay the mortgage loans, which anybody with common sense would know is not a good banking strategy.

In fact, what happened is that starting in the early 1990s, the government became intent on increasing the rate of home ownership. So, the government wanted banks to extend mortgage lending to people that they otherwise wouldn’t lend to, but the banks didn’t want to lend money to people who were unlikely to pay them back. So, the federal government said, look, Fannie and Freddie, increasingly large shares of your portfolio have to be made up of subprime mortgages, or we’re going to do all kinds of nasty things to you.

Say you’re a bank in Omaha, Nebraska, and someone comes to you to borrow money to buy a house. In the past, you’d say, “Sorry, you don’t have 20 percent to put down, and you don’t have a high enough income. I’m not going to lend you the money.” But now, Freddie comes by and says, “I really want to buy some subprime loans from you, so if you make some subprime loans, I’ll buy them from you and relieve you of the risk.” So, when that same borrower comes back, you lend them the money and sell the mortgage to a government-backed firm. Now you’re off the hook, but that bad loan is still out there. The result was that increasingly large numbers of house mortgages were held by people who couldn’t afford to repay them, and so any decline in economic activity, and certainly any decline in housing prices, would put a lot of the homeowners under water, and that is what eventually happened. The house of cards collapsed.

One final question: Why don’t bad ideas die?

There are at least two reasons.

First, if you show me a bad economic idea, I will show you a special interest group that benefits from it. This is what Bruce Yandle called the “Bootleggers and Baptists” idea: when you have a sincere but mistaken belief backed by venal interest groups who stand to gain materially by the maintenance of those beliefs, those beliefs become entrenched.

The second reason is that bad ideas are usually easier to grasp than good ideas. Good ideas tend to involve one or two steps of reasoning beyond the bad idea. And so, to push out bad ideas and replace them with good ideas requires good education. So, all the things that we’re doing, all the blogging and podcasting and tweeting.

It’s a struggle to present good ideas, but we have no choice. We have to keep doing it. And history shows that, if you’re effective at it, you can sometimes push bad ideas aside and replace them with good ideas. But it’s a never-ending battle. It’s not like the bad idea is defeated and then it goes away forever. It’ll always lurk. So, we always have to be at the ready to challenge it with good ideas. And we have to be very patient.

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In the West, many intellectuals have built their careers by condemning the very civilization that made their work possible.

Why has this kind of self-denunciation become so widespread in the world’s freest and most prosperous societies?

In this episode of The Human Progress Podcast, philosopher and author Maarten Boudry joins Chelsea Follett to examine the cultural and ideological roots of Western anti-Western sentiment—and why biting the hand that feeds you has become a hallmark of modern Western thought.

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Below is an edited and abridged transcript featuring some highlights from the interview.

Joining me today is Maarten Boudry, a philosopher and author with eclectic interests, including progress, cultural evolution, conspiracy theories, and more. You should check out his Substack. He joins the podcast today to discuss a fascinating essay titled “The Enlightenment’s Gravediggers.”

You start with a very powerful and illustrative story about Jean-Jacques Rousseau.

Rousseau was one of the first philosophers of the Romantic movement, which was a big part of the counter-Enlightenment. At this point in history, modernity hadn’t yet delivered anything tangible for the common people, but there was a relative measure of intellectual freedom, so, in that sense, we were already in the early stages of modernity.

Rousseau, before he was an established philosopher, was leafing through a magazine and came across an announcement for a prize by the Académie de Dijon. I don’t have the prize question with me here, but it was something to the effect of, “Have the improvements of the sciences also led to a betterment of morality in our society?” Rousseau describes that the moment he read that sentence, in a flash of insight, he saw the innocence of humanity in its original state and the depravity and decadence of civilization. And so he wrote his essay, a sweeping indictment of the whole of so-called civilization. It says that wherever the sciences are blossoming, wherever knowledge is improving, virtue is declining, and every supposedly great civilization eventually collapses under the weight of its own useless knowledge. By the way, he won the first prize—this is relevant for what comes next.

What I find fascinating is that Rousseau was a very cultured and educated man, but he condemned the whole idea of being refined and learned and cultured. In effect, he was biting the hand that feeds him. The Enlightenment philosophers had created this little island of intellectual freedom, which was the hand that was feeding him by giving him the freedom to study and exchange ideas. And he knew that hand would never punch him in the face. In fact, his friend Diderot encouraged him, even though he totally disagreed, because he relished the provocation of an Enlightenment philosopher tearing down the whole project of the Enlightenment.

That is one of the most fascinating and unique aspects of modernity. We do not just tolerate this sort of behavior; we encourage it. If you understand what is behind that story, it provides a lot of insight into what comes next in the 20th and 21st centuries: this very modern phenomenon of anti-modernity, the capitalist phenomenon of anti-capitalism, and the Western hatred of Western civilization.

Tell me more about the cultural trend of disdain toward Western civilization and capitalism.

There are a couple of different intellectual tributaries to this grand river of anti-modernity. There’s postmodernism, with the idea that we should undermine truth and reason, the foundations of modernity. There’s the victim versus oppressor narrative, sometimes called post-colonialism, which is the idea that you can neatly divide the world into oppressors and victims, which also leads to an indictment of Western civilization. And there’s environmentalism, which rejects the fruits of modernity. In the book, I ask the question, why do these different ideologies exist at all? Is there something about modernity that sows the seed of its own destruction?

The explanation that I eventually came up with is very simple: modern Western civilization is the only hand that allows itself to be bitten. If you were living under Stalin, you could never dream about criticizing the political ideology or economic system; dissent was just not tolerated. The same applies to China and to a lot of other unfree countries. And that leads to a sort of paradox, which I think was first described by an American politician called Daniel Patrick Moynihan, which is basically that there’s an inverse correlation between the number of complaints about human rights violations and the amount of actual human rights violations. If you ever find yourself in a society where nobody is complaining, and everyone agrees that the future will be glorious and the political system is great, you really have to get out of there as quickly as possible because that’s a completely totalitarian society.

You also talk about an alternative explanation: that this self-flagellation is some sort of mutation of Christianity.

As Nietzsche pointed out, a lot of the morality in Christian teachings is a kind of inversion, where the weaker and more vulnerable you are, the more virtuous you are. And there’s also the notion of original sin, that all of us are born tainted by evil. You can find these white guilt rituals on YouTube, where white people prostrate themselves in front of the people that their ancestors oppressed and ask for forgiveness. It’s very similar to the idea of original sin because, of course, they themselves didn’t own any slaves; it’s their whiteness itself, their identity, that they feel they have to apologize for.

However, many of these same people are also explicitly anti-Christian. They have completely secular upbringings and are rejecting Western civilization, which Christianity is part of. So, even though it’s possible that they’re unconsciously influenced by these Christian ways of thinking, it’s hard to prove. It also doesn’t work for all of the cases. It especially doesn’t work for the rightist forms of anti-modernity, which are muscular and aggressive and seem to be based more on pride than guilt.

My simpler explanation is that both on the left and the right, there are simply more opportunities to bite the hand that feeds you. I call this the supply-side explanation. I think the demand for complaining about the current state of affairs has always been there. People like to gripe about everything. I actually came up with something I call the Law of Conservation of Outrage in an earlier piece, which posits that, no matter how much progress society makes, the amount of complaining will always stay the same.

You say in the essay that anti-Western critics often like to pretend that their bravery will be met with universal outcry against them. But with a few exceptions, you note that these crusaders are not only given free reign but are also often handsomely rewarded.

Yeah, they are rewarded in specific contexts. So, in an academic environment, for example, you are rewarded for finding ever more novel ways to condemn Western civilization, and many of these anti-Western and anti-capitalist academics hold university positions that are paid for with tax money, which is basically the surplus production of the capitalist system that they criticize.

Can you talk about some examples of people who criticized their own societies, such as Edward Said and Michel Foucault?

Foucault is an interesting example. Early on, he was a member of the Communist Party, but he very quickly broke with communism. He was a postmodernist, so he didn’t believe in ideology or grand narratives. But he was biting the hand that feeds him in the sense that he was trying to demonize many of the institutions of modernity that we take as exemplars of moral progress.

I’m cutting some corners here, but Foucault’s argument always amounted to, “oh, so you think that we are so much better than we were in the Middle Ages?” In the Middle Ages, they were torturing criminals, but his argument was always that the modern way of treating prisoners or the mentally insane was actually even worse because although it presented itself as morally enlightened, it was really just a sinister bourgeois exercise of power to dominate the weak and vulnerable.

Foucault, of course, had unrestrained freedom to express his hatred of modernity, and he was rewarded by a lot of acolytes and followers who thought he was very brave to question the narrative of moral progress. Ironically, towards the end of his life, he contracted HIV and was treated in the Salpêtrière, which is a hospital in France that played a central role in Madness and Civilization, one of his major works. He bit the hand that feeds him, and the hand nurtured and comforted him until the end of his life.

Edward Said was one of the founders of post-colonialism, of this idea first expressed in his seminal work, Orientalism, that Western civilization, through the centuries, has always harbored a desire to oppress and invade the Orient. The intellectual groundwork for this conquest was laid by fiction and poetry, which, according to Said, presented the Orient as exotic, irrational, and sensual, in contrast with the rational, dominant, and masculine self-image of the West.

To be completely fair, there is some truth to what he wrote. It’s obviously true, especially if you go back centuries, that Western civilization had a very distorted view of other civilizations—just like every other culture in all of history. But Said was not interested in an even-handed or symmetric treatment of Western civilization; he was mostly interested in trashing the West.

The irony in Said’s case is that he studied in Princeton. He had guest professorships and distinguished chairs, and he got lots of awards for condemning Western civilization. Even in Israel, which he, in his later works, condemned as an oppressive, apartheid regime, he was welcomed. His books were published in Hebrew and put on university curricula.

Even more ironically, the opposite was true in the Palestinian-controlled territories. For a long time Said and Yasser Arafat had a friendship, but at some point, Arafat got fed up with Said and banned his books in the West Bank and Gaza Strip, which were under Palestinian control. I think there’s no better example of the difference between a hand that punches back and the one that allows itself to be bitten.

Up until now, we’ve been talking about how critics of modernity often receive prestige and accolades. That’s a metaphorical “feeding,” but you also talk about literal feeding. Tell me about that.

In Rousseau’s time, the feeding was purely metaphorical. He lived before the Industrial Revolution, and people were still as poor as they had ever been. The literal feeding only began in the 19th century, and what you see is that the more people enjoy the fruits of a capitalist society, the more opportunities they have to engage in criticism. So, capitalism and industrial modernity become a victim of their own success because they breed this class of people who have their material needs met and can spend their lives biting the hand that feeds them. Karl Marx is a great example. He was living off of the handouts that he received from Friedrich Engels which were made possible by Engels’ father’s cotton factory. Capitalism was affording him the freedom and the material prosperity to write screeds against capitalism.

There was a recent study about how the hotspots of degrowth—the philosophy that calls for an end to economic growth and a controlled shrinking of material production—are all in wealthy countries. You don’t hear a lot of degrowth-ism from people in developing countries because they have a more immediate understanding of the benefits of capitalism and industry. But if you’ve been prosperous and well-fed and affluent for a long time, you tend to take those things for granted. If you read the degrowth literature, they seem to have no clue at all about what it means to farm, for example, and be self-sufficient. They romanticize it, and they can afford to romanticize it because nobody is there to tell them what it was like. Even their grandparents never experienced it.

You end the essay on the nuanced point that, in some way, we should be happy that there are so many critics of our civilization because it is a sign that freedom is still protected.

Yeah, absolutely. Perhaps because I’m an inveterate optimist, I try to put a positive spin on this kind of ungrateful, spoiled behavior. But it is a serious argument; I wouldn’t want to live in a society where people are afraid to speak up. However, I also believe that a society that engages in too much self-abasement and self-flagellation loses confidence in itself, and I worry about what that portends for the future. There are signs, especially in Europe, of technological and economic stagnation. And if you look back to earlier modern eras, there was a lot more confidence and optimism and a stronger belief in progress. I do think something has changed, and we no longer seem to believe in ourselves.

I can give you one example where I think this kind of wholesale rejection of industrial modernity is very harmful. Think about the way that people talk about fossil fuels in Western countries, how they’re destroying the planet, and we have to ween ourselves off as quickly as possible. It’s one thing for a Western activist who is surrounded by fossil fuel products to indulge in these fantasies, but Western environmentalists are also telling poor countries, “Oh, you shouldn’t repeat our mistakes,” meaning you shouldn’t burn all these fossil fuels, and engaging in self-abasement, “we are so guilty because we have been doing that for two centuries.” That self-abasement leads them to actively sabotage fossil fuel development in poor countries. The IMF, the World Bank, and a lot of investment banks have openly promised not to fund fossil fuel investments in poor and developing countries. Not at home, mind you: they’re still building coal plants in Germany and gas plants in Norway. This virtue signaling mostly comes at the expense of poor and developing countries.

So, these delusions have consequences. Perhaps not yet here because we’re surrounded by so much material affluence, but there are already downstream consequences on the other side of the globe.

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Classical liberalism, which champions limited government, free markets, and individual rights, helped fuel centuries of progress. But today, its future is uncertain.

Populist movements reject its principles. Critics say it’s too weak to confront abuses of power and too tolerant of its enemies.

In this episode of the The Human Progress Podcast, the economist Tyler Cowen joins Marian Tupy to discuss the New Right, the relationship between freedom and progress, and whether classical liberalism is equipped to meet today’s political challenges.

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Below is an edited and abridged transcript featuring some highlights from the interview.

Tyler recently wrote a Free Press article titled “Is Classical Liberalism for Losers?” I'm delighted that he agreed to discuss it with me today.

Let’s start with the basics. What is classical liberalism?

Everyone has a different definition. I can tell you mine. If you believe in capitalism, limited government, free trade, sound money, free speech, toleration, and want to do your best to bring about peace, I would consider you a classical liberal.

Now, which of those get emphasized and to what degree? You’ll find differences of opinion.

What distinguishes classical liberals from conservatives and American liberals?

These words can be so confusing. When I hear the phrase "American liberalism," I think of a turn that happened in the 1930s with the New Deal and somewhat earlier with the progressive movement, where people who were broadly liberal fell in love with the idea of expanding government as an alternative means of realizing liberal ends. American liberals and classical liberals have a fair amount in common. They both believe in democracy and some form of capitalism. But American liberalism has much more faith in government, does less public choice analysis, and is less suspicious of concentrated power.

Conservatism used to be simpler than it is today. We’re now in the age of Trump, who I would say is not conservative at all. The conservatism I grew up with was religious. It was socially conservative, with particular views on abortion, gay marriage, and social norms, and it often wanted to use the government to enforce those norms. Furthermore, it tended to be hawkish on foreign policy. Now, it’s all so muddled. I’m not sure who it is I should call a conservative. In many ways, the people I used to call American liberals have become the new conservatives. They want to bring us back to what America was under Obama and undo some of these recent Trump revolutions.

What about practical differences? For example, in your article, you note the different way in which classical liberals and non-classical liberals perceive the use of force and the power of the state.

Classical liberals recognize that some government coercion is necessary to enforce property rights and finance some number of public goods. You can debate what those goods are, but there’s going to be some coercion. You’re just very suspicious of that coercion, and you want to keep it to a minimum because you think it corrupts both individuals and institutions.

So classical liberals are not comfortable wielding power, but don’t classical liberals need a strategy to dismantle the administrative state or greatly reduce its power? Otherwise, classical liberal efforts in politics will always be ineffective.

Well, the word strategy always makes me nervous. The notion of an aggregate strategy in the sense that maybe the Democratic or Republican party would have one is a mistake. The classical liberal vision has never been, well, we’ll keep on electing our governments for 20 years in a row, and by the end of the 20 years, they’ll have made all the changes we want. Frankly, I don’t think that’s realistic. In history, there are these periodic classically liberal moments. The American Revolution and the collapse of communism would be two of the most visible. They come along every now and then, and they achieve tremendous good when they happen. They’re motivated by classically liberal ideas, but they’re not some kind of continual rule where you just push everything you want through by force. Every now and then, you get your way, and I’m prepared to live with that. I don’t think we’re going to do any better. But still, those revolutions, like the abolition of slavery, can do so much good. We should just totally be on board with trying to bring them about.

Classical liberalism and the industrial revolution seem to be coterminous over the last 250 years. How much of a credit do you give to classical liberalism for the Great Enrichment?

Quite a bit.

Look at the recent example of Poland. It was very poor when communism fell. Now, it’s approaching the living standards of England. It will bypass Japan in a year or two if trends continue. It’s not exactly classical liberal, but it kept capitalism and trade, and it’s part of the EU. Ireland, when I was a kid, was thought of as a third-world country. In some sense, it was. Now, it’s a stable democracy at Western European living standards. What’s making it work is this mix of capitalism, democracy, and toleration.

We must also explain the mechanism through which classical liberalism in economics produces prosperity. Is it simply that classical liberalism gives people the freedom to do what they please with their lives?

While that’s broadly true, I’m not satisfied.

If you look at Latin America, which has seen a lot of liberalization, there’s still some way in which they have failed to solve their human capital problems. I’m not saying I blame classical liberalism for that, but I’m also not sure liberalism has solved that problem. It’s partly social. It has something to do with family relations and family structure. Some East Asian economies that were more interventionist did very well on that problem, but Mexico hasn’t, even though Mexico, in some dimensions, had a smaller government. So, there’s this other element, you could call it culture, family, or society, where you’ll do much better if you have the right cards in your hand.

There are alternative explanations for the Great Enrichment out there. For example, you have somebody like Gregory Clark, who emphasizes the importance of higher IQ amongst the upper classes in England. You have Joe Henrich, who discusses the role of the Catholic Church in banning cousin marriage and basically creating the nuclear family. You have Max Weber and the Protestant work ethic. Why not those other explanations? Why classical liberalism?

Well, I have particular opinions about each of those. On Greg Clark and IQ, I’m simply not convinced by his data. If you look at England today, especially northern England, it seems somewhat below average in conscientiousness. Where did all those genes go? Did they all go to the United States? I’m not sure.

However, I don’t think it’s correct to say classical liberalism is at the root of the success. If anything, classical liberalism was a result of earlier successes. It was a kind of luxury good that people figured out once they got a bit wealthier and a bit more educated.

There’s something fundamental that happened in England that started being measurable between 1620 and 1640 before classical liberalism was that big. It’s some mix of relatively free labor markets, protection from outside invaders, a strong enough nation-state, enough market incentives, something else cultural, hard to put our finger on, and they just got some economic growth that didn’t stop. They get a scientific revolution. And then intellectually, they do great things with that. Classical liberalism is part of the intellectual explosion from the scientific revolution. But the economic growth predates it, in my opinion.

Let’s bring it back to the United States and talk about the techno-optimist titans of Silicon Valley who have risen to prominence over the last few years. Are they classical liberals? And why do you think they have moved from their previously held center-left position?

Well, they’re generally very eclectic thinkers. I’m not sure they were ever center-left in the traditional sense. I think just being in California and having to live under the reign of the woke led to an intellectual rebellion. But I don’t think there’s any easy categorization of where they have ended up as a group. As a group of people, if I had to generalize, they simply change their minds a lot based on data. It’s mostly a good thing. I’m not sure many will ever be classically liberal with capital C and capital L, but they’ve all been exposed to classical liberal ideas and have learned a lot from them.

Many classical liberals are wondering if the cooperation of the Silicon Valley titans with the Trump administration will lead to greater rent-seeking or move society toward greater freedom. What is your impression?

In general, sincerity is underrated as a political motive. However, if you’re asking me to predict what we will actually get from the Trump administration, in some key areas, we will get more freedom. We will also have more corruption and rent-seeking. We’re going to get the bundle of both.

Increasingly, both left and right deny that we Americans are better off today than in the past. Conservatives point to the 1950s, while progressives point to the 1970s as the golden age. Are they right?

No. They’re just wrong. I lived in the 1970s; it was fun, but it was much worse than today. There’s no serious comparison. And I don’t just mean life expectancy, but actual crime rates, what you could afford to buy, how much you could travel. Again, it’s not close.

Let’s assume that we are right that life in America today is much better than it was. We still have to explain why the public perception is so negative.

My thinking is that people prioritize bad news, and we are living in a hyper-competitive news environment. If you want to grab those eyeballs, you have to offer them the worst possible news first. Do you agree?

I agree with that, but I would add that there are a bunch of things that have gotten worse. Deaths from addiction have been rising substantially for quite a while. Teenage mental health is harder to measure, but I suspect it’s worse than it was, say, 20 years ago. A lot of what we build is uglier than in the earlier part of the 20th century. So, some of the negative impressions are true. I just think it’s easier to focus on the bad things than the good ones.

If the news cycle continuously delivers bad news and ignores the good news, is that a market failure? Or is it simply a reflection of human nature?

People often want to read about the bad as a kind of talisman so that they feel protected and that their expectations cannot be dashed on the rocks. Individually, that might be rational, but collectively, the result is people are too pessimistic about their society.

If you write a book saying things are fine, it’s not going to be a best-seller, even if you’re correct. One reason why is that when people have something good, they become anxious because they’re afraid of losing it. So, the way they protect themselves psychologically from that fear is to anticipate that loss and play it out in their minds. Then they feel they’ve done what they can to protect against it. They use things like books and clicking on media stories as a way of producing those psychological defenses.

Critics say that classical liberals are temperamentally incapable of putting up much of a fight when faced with threats from the far left. How do you answer that criticism?

The far left does not rule many countries. There are plenty of things they do in media and academia that are bad, but the American center has done pretty well against the far left. I don’t like a lot of what the far left has done, but it’s not like they’ve taken over everything. It’s just this Trumpian talking point to justify how they want to use power to restructure society and the economy toward their own ends. It’s just not nearly as bad as those people would have you believe.

It was very interesting that the right in the United States had a complete meltdown right at the time when they were beginning to get some serious successes in public policy, such as, for example, a reversal on Roe v. Wade, a greater degree of educational freedom, and so forth.

Yeah, there’s this tendency on the right to tell people that Harvard is totally corrupt and worthless, and we could just destroy it, and nothing would be lost. I would say that many of the charges against Harvard are correct, but at the end of the day, there’s tremendous value coming out of Harvard, and you don’t want to wreck that.

The current right is not able to bring itself to that point. They’ve talked each other into a state of negative emotional fervor. There’s just this massive collective cognitive defect. You see it also with vaccines. They just all have to be so terrible. They’re killing all these people through heart conditions when we know scientifically that Covid is more dangerous for your heart than the vaccines are. It’s the same pattern again and again. It’s destructive politically and even personally. You see a lot of people on the right driving themselves crazy with these different worries. And often, there is something to the worry, but they just go off the deep end with it.

Is the future of American universities Hillsdale College, meaning not taking any government money? It seems to me that so long as Harvard and other universities take government money, they will be subject to political pressure. That cat is out of the bag.

I don’t think there’s room for many Hillsdale colleges. If you have a small number, they can raise a lot of money on the grounds that they don’t take government money, and I’m all for that. That’s a great business model. But you can’t have 50 schools doing the same thing. There are not enough right-wing donors to go around. So, I think the current model of Harvard will remain. Harvard and other such schools will just be tortured for decades to come, and they’ll be less effective, and their energies and attention will be drained. And that’s all unfortunate. I don’t favor torturing them, but I do recognize that, in large part, they’ve brought it on themselves by viewing themselves as an agent of political change.

Another criticism levied against classical liberals is that liberalism is so free, so open, and so tolerant that it is vulnerable to people who seek to destroy it. How should classical liberals deal with people who refuse to play by civilized rules?

Freedom does mean that Marxists and Kanye West will have freedom of speech. You’ve got to deal with that. You’re not going to get more of what you want by trying to ban those people; it will be used against you. So, there’s this perpetual struggle for more liberty or less liberty. I’m mostly optimistic. I worry about a major war coming to the world, but if that does not happen, the chances are quite good that we will end up as a somewhat freer society over the next several decades.

If you live, for example, in Britain and you encounter men marching through the streets calling for Sharia or advocating for the slaughter of the Jews, is there a space for more than just offering better arguments? In other words, are we destined to live with people who, if they gained power, would bring about the end of the freedoms we cherish?

Well, ethnic enclaves, in some instances, can be quite harmful. I sometimes say the problem with Northern England is it doesn’t have enough suburbs and enough cars. If you have Muslim migrants from, say, Pakistan, put them in the suburbs. It’s what the US has done. We don’t have Pakistani ethnic enclaves. Pakistani per capita income here is quite robust. Assimilation has gone pretty well. I know there are some other differences between the two societies, but this ideal of the European city, where you’re in the center, everything’s walkable, and everyone’s together, can be pretty crummy when you take in a lot of migrants quickly. Northern Virginia is a much better model than, say, Bradford or Birmingham.

Why are Americans so much better at assimilating foreigners than Europeans? Is it the nature of the immigrants themselves, how they are being assimilated, or a combination of the two?

Well, it might be both, but if you take people from India in America, I believe the median household income is $150,000, which would be the highest for any group in human history. The second wealthiest group would be Iranian Americans, who are, I think, in the range of $120,000 to $130,000 a year. Some of those are Jews, but mostly they’re Muslims. So it’s selection from within those groups.

Also, the fact that America is more religious than Western Europe actually makes us more hospitable to Muslims. Protestantism and Islam have some funny things in common. And we have freer labor markets. And the US is just a big country where it’s easier to spread out. Suburbs and cars are very healthy things that help people ease their way into a new country. I would say it’s all those factors and more.

Is the fact that we are getting the top of the crop the reason why we are doing better in terms of assimilation?

Well, we’re not always getting the top. There’s a lot of evidence that there’s not, on average, much positive selection from Mexico. We’re getting a typical selection. Many Mexicans have come, and it’s not really the elites who move here; they live in Mexico City. But even then, assimilation has gone reasonably well. It’s been a bigger problem with Central Americans than with Mexicans. So there are a lot of complex factors here, but it seems we do assimilation better even when we don’t have positive selection on our side.

I would also like you to address a criticism of classical liberalism made by Patrick Deneen, who believes that classical liberalism is unsustainable because it depletes the moral and cultural capital it inherited from pre-liberal traditions. So, as classical liberalism progresses, it undermines the very conditions—such as trust, civic virtue, and shared norms—that allow classical liberalism to function in the first place.

What do you think about that?

What’s the evidence? The forms that trust takes always change. We live in a world where you stay in an Airbnb or walk into an Uber and don’t think twice about it. That’s a form of trust. At the same time, the people who live across the street from me, I couldn’t tell you what their names are. I do kind of trust them just because they’re in the neighborhood, but who knows?

If you ask, “Do we see the Western world collapsing because there’s not enough trust?” I don’t see that. I do see a huge problem in our politics, and I don’t know how to fix that, but I also see a lot of ways in which trust keeps on going up.

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Liberal democracies are under pressure, both from without, as authoritarian regimes grow in strength and number, and from within.

In this episode of The Human Progress Podcast, Marian Tupy speaks with writer and political thinker Matt Johnson about historicism, progress, and how tribalism and the “desire for recognition” are testing the foundations of open societies.

Listen to the interview

Below is an edited and abridged transcript featuring some highlights from the interview.

Today, I’m very lucky to speak to Matt Johnson, who recently had a fascinating essay in Quillette titled “The Open Society and Its New Enemies: What Karl Popper’s classic can teach us about the threats facing democracies today.”

So Matt, could you tell us who Karl Popper was and what this big book is about?

Popper is mainly known for his scientific work, especially his ideas around falsifiability. He published a book called The Open Society and Its Enemies in 1945. He started writing it right after the Nazi annexation of Austria. It’s a very powerful and clarifying set of principles for anybody interested in liberal democracy and the broader project of building open societies around the world today.

So, why talk about liberal democracies and openness? It is our conjecture here at Human Progress that openness is very important. Have you ever thought or written about the connection between openness, liberal democracy, and the scope and speed of human progress?

That’s been a major theme of my work for a long time. I think there is a strong connection between the development of liberal democracy and open societies throughout the 20th century and human progress. Liberal democracy, unlike its authoritarian rivals, has error correction mechanisms built in. It allows for pluralism in society. It allows people to cooperate without the threat of violence or coercion. There’s also the economic element: Liberal democracy facilitates free trade and open exchange because it’s rule-based and law-bound, which are important conditions for economic development.

Human Progress also assumes that there is some directionality in history. We can say that living in 2025 is better than living in 1025 or 25 AD. But you begin your essay by raising the dangers of what Karl Popper called historicism, or a belief in the inevitability of certain political or economic outcomes. Can you unwind that for us? What is the difference between acknowledging the directionality of human history and historicism?

Popper regarded historicism as extremely dangerous because it treats human beings as a means to an end. If you already know what you’re working toward—a glorious worker state or some other utopia—then it doesn’t matter how much pain you have to inflict in the meantime. You’re not treating your citizens as ends whose rights must be protected; you’re treating them as raw material, as characters in this grand historical story.

The second concern is that historicism is anti-scientific because you can hammer any existing data into a form that fits your historicist prophecy.

Marx wrote that the unfolding of history is inevitable. In his view, leaders were just responsible for making that unavoidable transition easier. That’s the central conceit of historicism. If you take a Popperian view, you’re much more modest. You have to ground every policy in empirical reality. You have to adjust when things don’t work. You’re not just birthing a new paradigm you already know everything about. You don’t know what the future holds.

Stalin would say, anytime there was a setback, that it was all part of the same plan. It was all just globalist saboteurs attacking the Soviet Union, or it was some part of the grand historical unfolding that moving toward the dictatorship of the proletariat. There’s no sense in which new information can change the course of a government with historicist ideas.

That differs from a general idea of progress. We have a lot of economic data that suggests that people have escaped poverty at an incredible rate since the middle of the 20th century. We’ve seen democratization on a vast scale around the world. We’ve seen interstate relations become much more tranquil and peaceful over the past several decades. I mean, the idea of Germany and France fighting a war now is pretty much inconceivable to most people. That’s a huge historical victory, it’s unprecedented in the history of Western Europe.

So, there are good reasons to believe that we’ve progressed. And that’s the core difference between the observation and acknowledgment of progress and historicism, which is much less grounded in empirical reality.

Right. The way I understand human progress is backward-looking. We can say that we are richer than we were in the past. Fewer women die in childbirth. Fewer infants die. We have fewer casualties in wars, et cetera. But we don’t know where we are going.

Yeah, absolutely. There were moments during the Cold War that could have plunged us into nuclear war. It makes no sense to try to cram every idea into some existing paradigm or prophecy. All we can do is incrementally move toward a better world.

This brings us to another big name in your piece: Frank Fukuyama. Tell me how you read Fukuyama.

Fukuyama is perhaps the most misread political science writer of our time. There are countless lazy journalists who want to add intellectual heft to their article about some new crisis, and they’ll say, “well, it turns out Fukuyama was wrong. There are still bad things happening in the world.” That’s a fundamental misreading of Fukuyama’s argument. He never said that bad things would stop happening. He never said there would be an end to war, poverty, or political upheaval. His argument was that liberal capitalist democracy is the most sustainable political and economic system, that it had proven itself against the great ideological competitors in the 20th century, and that it would continue to do so in the future.

I think it’s still a live thesis, it hasn’t been proven or disproven. I suppose if the entire world collapsed into totalitarianism and remained that way, then yeah, Fukuyama was wrong. But right now, there’s still a vibrant democratic world competing against the authoritarian world, and I think that liberal democracy will continue to outperform.

You use a phrase in the essay I didn’t quite understand: “the desire for recognition.” What does it mean, and why is it important to Fukuyama?

The desire for recognition is the acknowledgment that human desires go beyond material concerns. We want to be treated as individuals with worth and agency, and we are willing to sacrifice ourselves for purely abstract goals. Liberal democracies are the only systems so far that have met the desire for recognition on a vast scale. Liberal democracies treat people as autonomous, rational ends in themselves, unlike dictatorships, which treat people as expendable, and that’s one of the reasons why liberal democracy has lasted as long as it has.

However, there’s a dark side. Because liberal democracy enables pluralism, people can believe whatever they want religiously and go down whatever political rabbit holes they want to. And, oftentimes, when you have the freedom to join these other tribes, you find yourself more committed to those tribes than to the overall society. If you’re a very serious Christian nationalist, you might want society organized along the lines of the Ten Commandments because that, in your view, is the foundation of morality. So, pluralism, which is one of the strengths of liberal democracy, also creates constant threats that liberal democracy has to navigate.

I noticed in your essay that you are not too concerned. You note that democracy is not in full retreat and that, if you look at the numbers, things are not as dire as they seem. What is the argument?

If you just read annual reports from Freedom House, you would think that we’re on our way to global authoritarianism. However, if you take a longer historical view, even just 80 years versus 20 years, the trend line is still dramatically in favor of liberal democracies. It’s still an amazing historical achievement. It’s getting rolled back, but in the grand sweep of history, it’s getting rolled back on the margins.

Still, it’s a dangerous and frightening trend. And you’re in a dangerous place when you see a country like the United States electing a president who is expressly hostile toward the exchange of power after four years. So, the threats to democracy are real, but we need to have some historical perspective.

So, we are more liberally democratic than we were 40 years ago, but something has happened in the last 15 to 20 years. Some of the trust and belief in liberal democracy has eroded.

How is that connected to the issue of recognition?

In the United States, if you look at just the past five or six years, there has been a dramatic shift toward identity politics, which is a form of the desire for recognition.

On the left, there was an explosion of wokeness, especially in 2020, where there was a lot of authoritarianism. People were shouted down for fairly anodyne comments, and editors were churned out of their roles. And on the right, there’s this sense that native-born Americans are more completely American than other people. All of these things are forms of identity politics, and they privilege one group over another and drive people away from a universal conception of citizenship. That’s one of the big reasons why people have become less committed to pluralism and the classic American idea of E pluribus unum.

Have you ever thought about why, specifically after 2012, there was this massive outpouring of wokeness and identity politics? Some people on the right suggest that this is because America has begun to lose religion, and, as a consequence, people are seeking recognition in politics.

I think it could be a consequence of the decline of religion. I’ve written a lot about what many people regard as a crisis of meaning in Western liberal democracies. I think, to some extent, that crisis is overblown. Many people don’t need to have some sort of superstructure or belief system that goes beyond humanism or their commitment to liberalism or what have you.

However, I also think that we’re inclined toward religious belief. We search for things to worship. People don’t really want to create their own belief systems; they would rather go out there and pick a structure off the shelf. For some, it’s Catholicism or Protestantism, and for others, it’s Wokeism or white identity politics. And there were elements of the woke explosion that seemed deeply religious. People talked about original sin and literally fell on their knees.

We also live in an era that has been, by historical standards, extremely peaceful and prosperous, and I think Fukuyama is right that people search for things to fight over. The more prosperous your society is, the more you’ll be incensed by minor inequalities or slights. The complaints you hear from people today would be baffling to people one hundred years ago.

I also think the desire for recognition gets re-normed all the time. It doesn’t really matter how much your aggregate conditions have improved; when new people come into the world, they have a set of expectations based on their surroundings. And it’s a well-established psychological principle that people are less concerned about their absolute level of well-being than their well-being relative to their neighbors. If you see your neighbor has a bigger house or bigger boat, you feel like you’ve been cheated. And this is also the language that Donald Trump uses. It’s very zero-sum, and he traffics in this idea that everything is horrible.

You raised a subject that I’m very interested in, which is the crisis of meaning. I don’t know what to make of it. Everybody, including people I admire and respect, seems to think there is a crisis of meaning, but I don’t know what that means.

Is there more of a crisis of meaning today than there was 100 years ago or even 50 years ago? And what does it really mean? Have you thought about this issue?

You’re right to question where this claim comes from. How can people who claim there is a crisis of meaning see inside the minds of the people who say that they don’t need religion to live a meaningful life? There’s something extremely presumptuous there, and I’m not sure how it’s supposed to be quantified.

People say, well, look at the explosion of conspiracism and pseudoscience. And there are people who’ve become interested in astrology and things like that. But humanity has been crammed with pseudoscience and superstition for as long as we’ve been around. It’s very difficult to compare Western societies today to the way they were a few hundred years ago when people were killed for blasphemy and witchcraft.

And look at what our societies have accomplished in living memory. Look at the vast increase in material well-being, the vast improvements in life expectancy, literacy, everything you can imagine. I find all that very inspiring. I think if we start talking about democracy and capitalism in that grander historical context, then maybe we can make some inroads against the cynicism and the nihilism that have taken root.

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Birth rates are declining across much of the world, presenting a serious threat to long-term economic growth and social stability.

However, solutions to this problem can be difficult to talk about. Calls to raise birth rates conjure specters of coercive population control and run into longstanding cultural rifts over individual autonomy and the role of women in society.

In this episode of The Human Progress Podcast, policy researcher and journalist Stephanie Murray joins Chelsea Follett to discuss the discourse around falling birth rates, the tension between pro-natalism and classical liberal values, and how it might be resolved.

Listen to the interview

Below is an edited and abridged transcript featuring some highlights from the interview.

In many places, fertility rates are hitting record lows. Practically all rich countries and many developing countries are now below the replacement fertility rate. Some countries are already seeing their populations age and decline, and if this continues for long enough, the global population will begin to shrink.

Your piece discusses an aspect of this topic that I find really interesting. So, let’s walk through it. You begin with an anecdote about how, a little over a year ago, you were conducting an interview about the possible causes of fertility decline. Tell me what happened.

I write on this topic with some frequency, and I follow research on it very closely, so I often interview people who research fertility, economists, sociologists, demographers, and so on. And so I was interviewing somebody, a demographer, about a certain cause of fertility decline. At one point in the interview, she kind of stopped and wanted to clarify that the issue here is that people are having fewer kids than they want. She wanted to make it clear that she wasn’t saying we should raise the birth rate for any kind of national interest.

My piece pushes back on that way of thinking.

Why do you think people tend to characterize the falling birth rate issue this way?

I think there’s a sense that catastrophizing low fertility could justify taking really drastic and coercive steps. And I think that is a major and legitimate concern. Getting the state involved in getting people to have children or stop having children could be a legitimate threat to civil liberties.

People also sometimes acknowledge that falling fertility is a problem, but they redefine it. They’ll say something like, “There are going to be economic challenges because of low fertility, but the problem is with our economic system, so let’s just change the economic system.”

I am sympathetic to people who want to talk about economic reforms, especially if pension systems, for example, are unsustainable. But as you say, there is no reason you can’t discuss both of those things.

There are definitely ways that we can adapt our economic system to low fertility, but there are limitations to that approach. You get this sense that people think that the need for children is just a byproduct of capitalism, and if we just changed our economic system, then we wouldn’t need endless growth propped up by a high birth rate. Maybe we can tweak our pension system or become less reliant on GDP growth, but it’s a fact of human existence that you need new people to take over as the rest of us get older.

Now, some demographers and economists push back on the idea that anything below replacement-level fertility is going to cause massive issues. Some think that we could have anything above 1.5 births per woman, and with immigration, technological advancement, and education, we’ll be fine. One demographer that I spoke to said that since we are becoming more productive per capita as time goes on, each generation has “broader shoulders” to stand on. So, maybe we can do more or as much as we are currently doing with fewer people.

That said, you can’t have a society without kids. We don’t know exactly when the falling birth rate becomes a big problem or how long we have before it’s a big problem. Lots of room for disagreement there. But eventually, it becomes a problem.

Let’s talk about some of the reasons that people are choosing to have fewer children. You make a very good point that in the past, parents captured more of the fruits of their children’s labor, while today, most of us are raising kids who will spend most of their lives working for someone else.

Yeah, for a lot of human history, parents were employers who grew their own laborers. There were steep economic incentives to raise kids. It could be brutal on a personal level. If you couldn’t bear children, your husband might put you aside and find somebody else who can. Today, parents still do a lot of the work of raising children, but they’re raising kids who are going to work for somebody else.

Of course, there are still practical reasons to have children. Basically everywhere in the world, lots of elder care is done informally by family members, especially adult children. However, even still, that care is not reliable in a liberal society. This is how liberalism works: when you grow up, nobody can tell you what to do, including your parents. So, I think capitalism, labor markets, and liberal values in general have altered the relationship between parents and children in a way that fundamentally changes the economics of child-rearing.

I do think it is easy to oversell the importance of economic considerations and downplay the psychological or cultural factors. It’s notable that, to date, no amount of government spending anywhere in the world has restored sub-replacement birth rates to replacement levels.

You spend a lot of your piece talking about another factor in people’s decisions about having children: the feeling that having children is good for your society’s future. Could you tell me a bit about that?

People often pitch parenthood as simply an experience that makes the parents feel good without acknowledging the important role parents play in society.

I think that undermines the case for parenthood. If we pretend that parenthood is just about you being happy, we rob parents of a source of satisfaction. Imagine if we tried to recruit people to the army by saying, “It doesn’t really matter how many people sign up. This is about you getting the experience of holding a gun and riding in a tank.” I really don’t think anybody would join. People are motivated to serve their communities. So why are we downplaying that? Why are we so scared of saying, “You should consider having kids because we need parents”?

How do you think that relates to this view that the world is overpopulated and having kids is essentially selfish? Do you think that kind of messaging might affect people’s decision-making?

Absolutely.

A couple of years ago, I signed up for this half-marathon hike and ended up hiking it with this woman who was a total stranger, and we were talking about fertility rates. You can’t go on a half-marathon hike with me without me talking about fertility; that’s pretty much inevitable.

So, we were chatting, and she, at one point, said that she felt like she was harming the planet by having kids, and since she had to take maternity leave, she was also slowing down work. She felt like she was doing a selfish thing and drawing resources away from the planet and from her workplace in order for her to have the experience of parenthood.

If that is how you view parenthood, it becomes a lot harder to justify the decision. And if you already have personal reservations like, “Would I be a good mother?”, it could easily tip the scales toward not having children.

This topic is very tricky for those of us who are devoted to a free society. I really love the last paragraph of your piece. You say:

Those of us who want to reverse falling fertility while preserving the values of a liberal society have a tricky task ahead. We’ve got to hold two truths at once: that no one ought to be coerced into parenthood, and that we will all suffer if no one raises kids. That may seem like an impossible line to walk—and yet, we walk versions of it all the time. I don’t think there’s anyone in the world that would hesitate to admit that we need doctors. And yet, most of us agree no one should be coerced into medical school. In other words, acknowledging the necessity of parents while respecting individuals’ right not to become one is really just a matter of applying the same logic to parenting that we do to every other path in life.

Could you expound on that?

I think most people can agree that we don’t want people to be coerced into parenthood, but we can’t allow that concern to make us overlook the fact that we need parents. They provide an essential service in society. So we have to be willing to hold both of them at the same time. I think people just have this impulse that that’s not possible, but we do this all the time with other types of work.

If we go with the military example, most people think that national security is important, but most people also oppose conscription. They want a volunteer army. It’s the same with basically any line of work. We don’t like forcing people to do things, but that doesn’t stop us from acknowledging that society can’t function without doctors or teachers.

You’re basically just suggesting that people voluntarily give more social recognition to parents. And you write that all around you, you can see that parents, and mothers in particular, are desperate for recognition that the work they are undertaking is valuable for the world. Do you think that more social recognition could shift the culture toward higher birth rates?

I do. I’ve always thought that parenthood is really important, but I constantly felt like the culture was telling me otherwise. There is this assumption that you shouldn’t get married and have kids right after college, right? That you should do something with your life. But having kids is doing something. And there are lots of ways that we denigrate parenthood and treat it as a waste of somebody’s skills and talents.

If we thought more about the work of parenthood in the way that we think about other work, if we treated it like a really cool way of contributing to society, maybe people would be more motivated to go into that line of work.

If you look at the few populations in wealthy countries that do have high birth rates, religious communities, for example, those populations give people a lot of positive messaging about how raising children is a good thing for society.

I just remembered that the woman I went on that half marathon hike with, who seemed to believe she had done a selfish thing by having children, told me about a time she visited Jordan. She was so struck by what it was like to have a child there. In the UK, where I live, sometimes when you go into a coffee shop, people almost groan if they see you brought your kids. But in Jordan, she said that when she would walk into a coffee shop or a restaurant, it felt like she had gifted them this child. She felt an overwhelming sense that people were delighted that she had this child there, and she didn’t even live in Jordan. I think this kind of social recognition changes how you think about having children.

Another other thing to remember about social recognition is that it’s free. It doesn’t cost taxpayers a single dime, and there’s not really any downside to people just voluntarily giving this kind of recognition to the parents in their lives.

One of the reasons that people are hesitant to talk about birth rates is that, as you wrote in your piece, it can feel icky to have a strong opinion on such a personal decision. You don’t want to try to make everyone follow the same path and become a parent.

I think we need to use other types of work as a model for how we think about parenthood. There are a lot of roles that need to be filled in society, and just because you are not filling all of them doesn’t mean that you’re failing society. You can appreciate the existence of doctors and nurses without feeling bad that you are not a healthcare worker.

We usually end this podcast with an optimistic note. What trends, if any, make you feel optimistic about the future of birth rates?

I think that people are becoming more receptive to the idea that parenthood, motherhood, and caregiving are valuable and often overlooked. It feels like we’re on the cusp of being willing to admit that we need parents. Not in a catastrophizing way, but in a “hey, this is important” way. So, I think we’re moving in the right direction.

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On Wednesday, we published an interview with trade expert Daniel Griswold correcting some of the false narratives about the impact of global trade.

Today, we’ve brought on Scott Lincicome, the vice president of general economics at the Cato Institute, to do the same for the Trump administration’s current trade policies.

In this episode of The Human Progress Podcast, Lincicome joins our editor Marian Tupy to discuss how the Trump tariffs will affect American prosperity, national security, government revenue, and industry.

Listen to the interview

Below is an edited and abridged transcript featuring some highlights from the interview.

Why is trade important to human progress?

Trade helps us access goods and services from around the world at low prices. That improves our living standards, allows our wages to go further, and makes life more fun. Thanks to international trade, we have year-round access to fruits and vegetables that used to be seasonal or simply not available at all.

But it’s deeper than that. Trade is part of the great prosperity machine of free markets. Individuals trade not only goods and services but also for knowledge. That boosts our society and prosperity. It allows for innovation, either via competition or by importing innovations from abroad. Trade also allows individuals to learn about other places. And in general, trade tempers the desire to go to war. You don’t want to kill your customers. And that helps make the world a little safer.

Now, let’s assume that you don’t like foreigners. You think they are nasty don’t treat us fairly and whatever else. We have 350 million people in America. Why can’t we make everything we need here?

We technically could make everything ourselves, especially in a place like the United States, but that would just make us poorer and less productive.

I’ll give you a good example. It pays about $12 an hour to work at a T-shirt manufacturing plant in South Carolina. It pays much more to go work at Amazon or Costco. So why not purchase T-shirts from a place like Guatemala, where working in a T-shirt factory is a good, high-paying job? It just makes sense for us to trade for those things and not force American workers into those low-wage jobs.

Instead of making clothes and shoes, we can outsource those things and focus instead on higher-value production. We can work in tech, services, or advanced manufacturing. That specialization is critically important for raising living standards.

Trade is also about opportunity cost. At any given time, we only have a set amount of raw materials, workers, and capital, and if you devote those resources to lower-value production, those resources can’t flow to higher-value options. This is part of the unseen aspect of protectionism. When we put tariffs on washing machines, we might get a washing machine plant in South Carolina, but what we don’t see is that all of the resources that went to making and operating that factory could have been deployed in more productive endeavors if we had just simply bought washing machines from abroad.

Resources are also wasted on the consumer side. If you and I are forced to spend an extra hundred dollars on a washing machine, that’s money we can’t spend elsewhere in the economy. Those washing machine tariffs I mentioned created about 1000 washing machine jobs, but it cost American consumers around $800,000 a year per job created. That’s simply a loss of financial resources that could have been deployed elsewhere.

What do you make of the arguments that consumption should take second place to something else, such as national cohesion or pride or security?

First we should simply note the facts.

The first thing to know is that the United States today is the world's second largest manufacturing nation. So, we are still a large manufacturing nation; we just don’t need a lot of workers because our workers are very productive, probably the most productive in the world.

The second is that American manufacturing is very dependent on trade. All manufacturers are consumers at some level, but that’s especially true for more advanced manufacturers like we have in the United States. They need access to cheap raw materials and parts. If you jack up the price of steel and throw a bunch of tariffs on auto parts, you end up lowering production in these more advanced industries. Steel was a case study of this. We imposed a bunch of tariffs on steel during the first Trump administration, and studies have shown that we saw a modest increase in steel output and employment, but overall manufacturing output and employment fell. According to the United States International Trade Commission, we had about a $500 million yearly net loss in manufacturing output because of the steel tariffs.

I should note one of my favorite stats: about half of everything imported into the United States today is a manufacturing input. It’s stuff that our manufacturers use to make other stuff. A lot of that also comes from their own companies abroad. So, Airbus has a facility in South Carolina that imports from Airbus France. BMW, also in South Carolina, imports from BMW in Germany. If you shut down their ability to access their parts and equipment abroad, you’re going to reduce their output in the United States. If you care about national defense, kneecapping BMW, Airbus, and Boeing is a bad thing.

Our manufacturers also need access to overseas markets and overseas consumers. About 95 percent of the world’s consumers live outside the United States. And so, if you deny American companies the ability to access those markets or make them globally uncompetitive by raising their input costs, then you’re harming the manufacturing sector.

So if you remember those things, as well as access to foreign capital, you realize that openness and production are not exclusive; they’re complementary. The former boosts the latter.

I also think there is a misunderstanding here about national security and trade. The criticism is that if we don’t have steel mills in the United States, we will depend on Chinese steel to build our aircraft carriers and tanks. But that’s not really how it works.

Right. We do import a good amount of steel, but the top steel suppliers to the United States are countries like Canada, Europe, and Japan. Countries like Russia and China are not in the top 10. And when you talk about a country like China with a billion and a half people and a massive manufacturing footprint, it makes sense for us to pool our resources with our allies and enter into trade and defense agreements. That allows us to work together boost the overall productive capacity of our defense industrial base. The US Defense industrial base includes Canada right now. That’s how close of an ally Canada is. So slapping tariffs on stuff from Canada just doesn’t make much sense, and it’s even more baffling that they’re doing it on national security grounds.

This is a good place for you to tell us about what’s been happening since Donald Trump took over the presidency. Where are we currently?

It’s been a busy few weeks. Shortly after President Trump's inauguration, he issued several executive orders invoking a national emergency with respect to fentanyl coming from China, Mexico, and Canada. By invoking that national emergency, he unlocked tariff or trade powers under the International Emergency Economic Powers Act. It’s a cautionary tale about congressional delegations of power, but that’s an issue for another podcast. The President has since then imposed 20 percent tariffs on all Chinese goods. And those are on top of the 25 percent tariffs from his first term on half of Chinese goods and 25 percent tariffs on imports from Canada and Mexico.

He has also jacked up tariff rates from 10 percent to 25 percent for aluminum, and he kept the 25 percent steel tariffs, but he closed all of the exemptions that had been there before.

This is a huge change because around half of all steel and aluminum imports were exempt from the national security tariffs that Trump imposed the first time around. There were a series of agreements with companies going to the administration and saying, “We can’t get the steel and aluminum we need here,” and getting an exclusion. Trump has now shut all of those down. Not great for our manufacturing sector.

The President has also promised reciprocal tariffs. So, if India has a 20 percent tariff on American motorcycles, we’re going to put a 20 percent tariff on Indian motorcycles.

Markets are not thrilled. Not only with the tariffs but also the uncertainty. Economic policy is not supposed to enacted via a switch in the Oval Office. The President is turning on tariffs and then turning them off, sometimes in the same day. As any investor or lawyer will tell you, the thing that companies hate more than taxes is uncertainty. Without that predictability and consistency in the market, they can’t hire or invest. They freeze up and sit on their hands. That’s probably a bigger immediate problem than the tariffs themselves.

The other thing they’re going to do is stockpile. Right now, people in the construction industry are filling warehouses with construction materials because they’re worried about tariffs on Canadian lumber and steel. Having a warehouse full of stuff is a huge cost. You have to rent the warehouse and buy all the stuff, and that’s capital that you can’t deploy by hiring more workers or boosting output. Instead of focusing on their business, people are focusing on these emergency game plan scenarios.

And by the way, they’re all also lobbying in Washington. Trade policy lobbying has skyrocketed. Trade lawyers are making fortunes. They’re building beach houses in Delaware, all because of this tariff uncertainty. That’s good for them but bad for the economy. And it contradicts so much of the rhetoric coming out of this administration about eliminating inefficiency and waste and reducing the government’s role in the economy. It seems they’ve forgotten all of that on the trade front, and they’re doing basically the opposite. That will counteract the good parts of their economic agenda.

But what about fairness, Scott Lincicome? Is it fair that the Indians are placing a 20 percent tariff on us, and we are only placing 5 percent?

I have to tell you, when I heard about the reciprocal tariff, my lizard brain said to me, “Absolutely yes. Let’s make it fair.” What’s wrong with that argument?

A lot of the global trading system is based on this notion of reciprocity, but there are a few problems.

The first is the economics: matching other countries’ tariffs will make Americans poorer. Going back to the example of food, Mexico imposes certain tariffs on food, and we get a lot of food from Mexico. Does it make economic sense to impoverish our citizens in the way that Mexico impoverishes theirs? No, it doesn’t. So that’s the first issue.

There’s also a collectivist logic to this, that the government should punish some citizens to benefit others. But most of us don’t work in an export industry. We won’t benefit personally from any sort of expanded access to a foreign market. A few businesses might, but the vast majority of individuals won’t see any gains.

The other issue is America First. If you match other countries’ tariffs, you’re effectively letting them set your trade policy. I’ll give you examples because this can get very absurd. We buy a lot of coffee from Colombia. We do not grow coffee, except for a little bit in Hawaii. Well, Colombia has a 10 percent tariff on coffee beans from America, and we don’t send them any coffee beans. Should we let the Colombian government dictate our tariff policy in applying a 10 percent tariff on Colombian coffee? That’s not America First; it’s America Second. We should set tariffs and any other policy based on what’s good for America and what’s good for us as individuals, not what another country does.

Finally, practically speaking, this is a mess. You’re talking about thousands and thousands of different products from 200 different countries. You’re talking about trying to quantify not just tariff barriers but non-tariff barriers, subsidies, value-added taxes, you name it. Trying to administer this system would be incredibly difficult and would require thousands of new customs officials and tons of new paperwork, going back to how the administration is contradicting itself.

China is looming very large in this conversation. There is a lot of talk about the millions of jobs lost in the United States because of China. But my understanding is that most manufacturing jobs have been lost to automation.

First of all, is it true? And if so, should we be against automation? Tucker Carlson famously said he would be against autonomous vehicles if they took jobs away from truck drivers.

It is true that increased trade with China, starting around 1999, caused around a million manufacturing jobs to be lost. But there are two big caveats. First, those studies only looked at the jobs lost, not the jobs gained from lower input prices in manufacturing, jobs gained in services, and jobs gained from exports to China. When you include those figures, the overall net effect is a wash.

The second point is that those million manufacturing jobs were just a fraction of the total manufacturing jobs lost over the last several decades. Most of the manufacturing job loss over the last several decades was due to improving productivity. Not just robots, but computers, improved business practices, that kind of stuff.

And look, losing a job is painful, but it is an essential part of economic progress. The reason wages improve over time is productivity growth. In general, we want those robots. We want to outsource manual labor, unsafe labor, and the rest to machines because that allows us to make more stuff and have higher wages.

You can go back to telephone operators in the 1920s. That was a huge labor market shock, particularly for young women. But we would be worse off if we still had to pick up a rotary dial phone and have some woman connecting us like you see in the old movies. She’d have a job, but we would be worse off as a society. It is better to let that disruption happen and make it easy for people to adjust and move into other industries. We have all of these different policies in place—labor policy, occupational licensing, housing policy, regulatory policy—that make it harder for American workers hit by disruption to move on. That’s what we need to be focusing on.

I want to bring up one last subject. There’s a lot of discussion about Donald Trump playing some sort of four-dimensional chess. One of the arguments I’m hearing is that the tariff system is part of a concerted effort to reduce government spending and transition away from income taxes to a more consumption-oriented model. What do you think of that?

I’m extremely skeptical. One reason is the administration’s words and actions. There really isn’t a concerted effort in Washington right now to cut spending in the long term. The nips and cuts that DOGE is making are not going to make a dent in our spending trajectory. Mainly it’s Social Security and Medicare that need reform, and those are not being touched.

The second issue is the math. Tariffs aren’t a broad-based consumption tax; they are attacks on a narrow band of our consumption. Imports make up about $4 trillion out of $25 trillion in total consumption. And if you raise tariffs too high, you don’t get any imports, and you don’t get any revenue. So, there’s only so much revenue you can get from tariffs. You’re looking at maybe $400 billion a year maybe, and that’s generous. Others have said maybe $200 billion. Any more than that and imports will start shrinking. You would need to replace $2.5 trillion a year to eliminate the income tax.

The other big issue is that tariffs tend to cause the dollar to appreciate, which will make it harder for our exporters.

I just don’t see a lot of grand strategy here. And that leaves aside all the gossipy stuff we read in Politico. If we apply Occam’s razor, the simplest answer is that President Trump likes tariffs. He likes using them as negotiating tools. He likes how it makes CEOs and government officials run to him seeking favor. He likes that they’re raising some revenue and that he can use them to push foreign governments around. That’s a far more likely explanation than some deep grand strategy.

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Critics of material progress often point to a “crisis of meaning”: a widespread sense of purposelessness and the loss of clear values or direction in modern society.

The data, while hotly debated, are potentially concerning; in the wealthiest countries in the world, many people—especially in younger generations—report feeling lonely, anxious, depressed, and generally pessimistic about the future.

In this episode of The Human Progress Podcast, existential psychologist Clay Routledge joins Chelsea Follett to discuss his research into these trends and how we should interpret them.

Listen to the interview

Below is an edited and abridged transcript featuring some highlights from the interview.

Let’s start with the Progress Pulse Initiative, a project of yours that sets out to explore a fundamental question: do Americans believe humans will make significant progress on big societal and global challenges in the coming decades, making life better for future generations, or do they think we will fail?

Tell me about this project and what you found.

This initiative is part of a broader project I call “the psychology of progress.” In the progress space, there’s a lot of interest in economic policies, the technological and scientific drivers of progress, and institutional forces. All very important, of course. But when I started following the different thinkers in this space, I noticed there wasn’t a lot of talk about what’s happening inside individual human minds. But psychology is important to progress. Think about individual traits related to progress, like curiosity, openness, creativity, resilience, and motivation. And then there are questions like, how do you lead teams? How do you cultivate talent? And critically, culture matters a lot to progress.

The Progress Pulse idea was that, in addition to studying these individual traits, we should get a sense of what the public thinks about progress. And so, every month, we’ll be doing a national survey of around 2000 US adults in partnership with the Harris Poll. And we’ll just be asking a couple of questions. We started with a very simple question: “When you look to the future, do you see progress, or do you see decline?” And people are pretty evenly divided on that. Around half look to the future and see hope and promise; the other half think life will be worse for future generations.

You did find some differences among groups. You found that the youngest Americans, especially young women, are the most pessimistic, while older Americans are the most optimistic. What might explain those findings?

Yeah. It’s a great question. In a previous survey, we looked at the concept of hope and found that self-reported mental health was the strongest predictor of people’s attitudes about the future, and young people report worse mental health. That seems to account for a lot of the pessimism. If you’re depressed or anxious, you tend to fixate on what’s going wrong instead of what’s going right.

On the other side, you might say, well, older people have the advantage of wisdom and experience; they can look back and say, “You think now’s bad? We had world wars; we had the threat of nuclear Armageddon. We made it through that.” They have a perspective that young people don’t. So, it’s not just about the vulnerabilities that younger generations have but also the strengths and broader perspective of older generations.

Are anxiety and depression among young people increasing over time?

This is hotly debated. Certainly, at the self-report level, young people today are saying they’re more anxious and depressed. Some more objective outcomes, such as hospitalizations and suicide attempts, are consistent with that. However, some experts argue that part of the rising hospitalizations might have something to do with better reporting.

A lot of these statistics might also be due to cultural changes. Young people today are more likely to interpret normal psychological distress using the language of mental health. Sometimes this is referred to as the “pathologization of normal psychology” or “concept creep,” which is the idea that we’re expanding these mental health terms beyond their original definitions. Also, a fairly high percentage of people diagnose themselves with depression without a clinical assessment. All this makes it more difficult to know the extent of this issue.

There’s also evidence that when people start to think of themselves as mentally unwell, they put themselves on the path to being mentally unwell. So, if you think of yourself as someone who suffers from an anxiety disorder, you might use that as an excuse to avoid things that make you uncomfortable. Well, that makes you more likely to develop anxiety. What you should be doing is exposing yourself to the things that make you uncomfortable and working through it, which is what would happen if you went to a good clinical psychologist. So, self-diagnosing can become a self-fulfilling prophecy.

So there is some evidence that young people may have a darker view of the world. This gets into the Visions of the Future initiative. Could you tell us about that?

The Visions of the Future report is a really cool project. We partnered with a London-based firm called discover.ai, which has a team of experts who try to figure out how people are talking about things online using a machine learning platform. It’s a qualitative assessment, almost like you would if you were a marketing firm or brand looking to see what people think about different styles, aesthetics, or certain products.

We did that, but instead of looking at products, we looked at visions of the future. We asked, in the spaces where young people gather, what’s the mood when they talk about the future? We found that, while there are aspects of the future young people seem excited about, like advancements in healthcare, they’re generally pessimistic. They’re more worried about the dangers of artificial intelligence than excited about the benefits. They’re more likely to think that the American dream has been lost. They’re worried about climate change, political polarization, and the culture wars. So, unfortunately, the mood in these spaces is dark.

But these are important insights for those of us who believe in progress. A lot of times, people are pessimistic because they have an inaccurate understanding of progress. They think the world has gotten worse on measures that have actually improved. Knowing who is pessimistic about the future gives us the opportunity to persuade them.

Many people say that there is a crisis of meaning. I’m curious what you think about that. But before you answer, could you explain the difference between meaning and happiness?

Well, in psychology, happiness falls under the category of emotion. Feeling happy is an emotional state; it’s a mood. So, if you feel good in the moment, you might say, “I’m happy.” And if that happens often, you might say, “I’m a happy person.” So, it can also be a personality trait based on your general proclivity towards a positive mood. Certain philosophers and psychologists talk about happiness in a different, richer way, but that’s how I think about happiness.

When we talk about meaning, we’re adding in other cognitive and motivational dimensions. Humans self-reflect. We think about who we are, who we want to be, and our place in the world. It turns out that if you feel like you have a purpose, like you’re playing a significant role in the world, then you feel like your life is full of meaning.

Meaning tends to be associated with happiness. It’s bi-directional; research shows that when you’re in a good mood, it’s also easier to see how your life is meaningful. But this doesn’t mean that meaning and happiness are synonymous. For instance, things you value can be stressful and unpleasant. Those of us who are parents can easily come up with examples. Or think about people who work in difficult jobs, like police officers and first responders, who have to see some tough stuff. They might be going through a bad day while simultaneously feeling like their life is extremely meaningful. The relationship also goes the other way: meaning fuels happiness. Doing something difficult and stressful, like training for a marathon, might make you miserable in the moment but happier in general because exercising discipline and making progress towards a goal feels good.

It does seem like humans crave challenging endeavors. Some people argue that all our material progress, which has made life easier, has contributed to a crisis of meaning. What are your thoughts? Do we have a crisis of meaning?

I’ve certainly expressed that concern in the past. Consider the trends in young people’s mental health. Anxiety and meaning are highly related because meaning is an anxiety buffer. When your life feels meaningful, you’re more robust against hardship. You might think, “Right now, this is difficult, and I’m worried, but I have a reason to be here. I have a purpose, and I can push through.” So, it’s possible that rising rates of anxiety, if those rates are real, are related to a decline in meaning. On the other hand, there’s also other evidence that, in general, people do see their lives as meaningful. While traditional sources of meaning like religion and marriage are declining, people are creating new sources of meaning that we’re not doing a good job capturing.

I try to find a middle ground here. Maybe there are unique existential challenges that emerge in a highly affluent secular world with rapid technological change. Things that are good for economic growth and exploring new ideas might also make us feel unsettled and anxious. But I tend toward the idea that humans are existential entrepreneurs; we create new sources of meaning. Given all our intellectual assets as a species, I’m more confident that we’ll come out of this okay.

One way to determine whether affluent societies have a crisis of meaning might be to look at impoverished countries today. Do people with a much lower living standard also report a crisis of meaning?

In rich Western countries, people report being happier, but people in poorer countries report higher meaning. Part of that is explained by higher levels of religiosity. Part of that might also be that it’s easier for people in poor countries to detect meaning. If every day is a struggle for survival, you can easily see how people in your family and community depend on you.

That being said, within rich countries, poor people report lower meaning than higher-income people. It’s likely that, in the technologically advanced and wealthy world, we’re dealing with a whole different set of cultural issues. For example, it’s harder to appreciate material progress when you’re on social media thinking, “Look at these rich people and the amazing lives they’re presenting.” There’s a sort of irony where the privilege of having the technology to be on Instagram makes it more difficult to see the meaning in your own life because you’re making unhealthy social comparisons.

I want to ask you about your book, Past Forward: How Nostalgia Can Help You Live A More Meaningful Life. At Human Progress, we often discuss the dangers of romanticizing the past. So, sell me on nostalgia.

There are dark sides to nostalgia, but they’re far outweighed by the positives.

As you point out, people do romanticize the past. Oftentimes, people associate this tendency with conservatives, but people on the left sometimes have this view of the past where people lived in harmony with nature and didn’t need material things, and life was like a Disney movie or something.

However, for most people, most of the time, that’s not how they’re using nostalgia. Nostalgia is not making them see the past as better than the present. What’s happening is that the people are seeing problems in the present, and that’s making them nostalgic. For example, some of the most nostalgic people I’ve met are very active in the progress movement. They say things like, “Things aren’t great right now; there’s too much negativity, there’s too many barriers to building and creating and entrepreneurship.” Then they say, “Okay. Where can I find the inspiration for how to do things differently? Well, we used to be able to build a bridge in weeks. Americans were proud. We went to the moon.”

And so, a lot of times, nostalgia is not trying to repeat the past, it's pulling inspiration from the past. If you want to change the future in a positive way, the past might have some clues.

So that’s my pitch, and I’m prepared to litigate it with data. For instance, you might think that nostalgia correlates with being close-minded, but the people who are the most dispositionally prone to nostalgia also tend to be the most open-minded. They’re more creative. There are a lot of false ideas around nostalgia that aren’t empirically substantiated, and while there are ways that nostalgia can be bad, they’re far outnumbered by all the positives.

I’ll admit that I am a bit of a nostalgia skeptic, but when you put it that way, I see how nostalgia could be helpful. Maybe what you’re saying relates to what you said earlier about how older people, who remember what life was like in the past, tend to be more optimistic about the future.

Yeah, I think that’s true. We’ve been talking about historical nostalgia, but a lot of times, people are doing what we call personal nostalgia. They’re not saying life was better in the 1950s or 1800s or pre-industrialization. They’re looking to their own past.

Now, there’s a concept in psychology called fading affect bias, which is that the impact of negative experiences tends to fade faster than that of positive experiences. So, it’s easier to look back at the past through rose-tinted glasses. But that can also be good for our psychological well-being.

Do you know the phrase “Youth is wasted on the young”? That's not entirely true because older people can capture a youthful spirit using nostalgia. We did some research years ago on this, and we found that around the age of 40, nostalgia begins to make people feel younger than their biological age, and this matters because the age you feel is often how you act. You could be young but act old and think, “I can’t do anything,” or you could be old but act young and think, “I can go out in the world and do things.” The more nostalgic people are, the lower their subjective age.

Another benefit is that, when we have decisions to make, nostalgia helps direct us. It reminds us of the experiences we cherish and where we find the most meaning. That pushes nostalgic people forward. They’re more confident. They’re more motivated to pursue their goals. They’re more trusting of others. They’re more willing to help others. They donate more to charity. I think it’s because they’re pulling energy and motivation from their bank of meaningful memories.

So many people blame technology for this alleged loss of meaning. You mentioned that you have a project on digital flourishing that finds a bit of a more positive story. Can you tell me a little bit about your findings there? Or maybe give us a preview.

We found that the vast majority of Americans, close to 80 percent, report they are digitally flourishing on most of the dimensions we measure. Things like, “Do I feel able to present who I truly am online? Do I feel connected? Do I feel like I’m building communities? Do I feel like I know how to share my ideas in a way that’s respectful?” We also find that the people who are digitally flourishing are more likely to be flourishing offline as well.

So, the report is positive. Most of the attention in the public discourse is on all the bad things. And this report doesn’t dismiss those concerns, but it shows the bigger picture, which involves lots of positives related to our digital lives. For example, people will often focus on how social media harms young women’s self-esteem, but there are also a lot of young women on social media who are rocking it. They’re building brands, they’re finding connections, they’re networking for their professions. They’re using social media in all sorts of healthy ways. Instead of just focusing on what’s going wrong, why don’t we use those people as inspiration? What can we learn from the people who are using these technologies in ways that enhance their lives? That’s what we’re trying to highlight.

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Thanks to decades of relatively slow economic growth, Europe is increasingly falling behind the United States.

In this episode of The Human Progress Podcast, Jon Moynihan, a businessman, author, and life peer, joins Marian Tupy to discuss this economic divergence and how the UK and other social democracies can escape stagnation.

Listen to the interview

Below is an edited and abridged transcript featuring some highlights from the interview.

What does growth mean, and why is it important?

Great question. There are practical reasons why growth is crucial, but there are also moral reasons. The practical ones are that the world stagnates if you don’t have growth. And there are a couple of billion people for whom a great deal of economic growth is needed to bring them out of poverty.

Now, the moral reasons are, for example, that if there’s no growth, and you, for whatever reason, want to earn more money next year, then somebody else has got to earn less. So, the desire to better yourself, which is very natural, will always be at somebody else’s expense in a no-growth world.

These numbers are rough, so I don’t want anybody writing to me saying that I got the decimal place wrong or whatever. But 112 billion human beings have lived since the beginning of human existence. 104 billion have died. 80 billion or so died of infection. And those 80 billion had an average lifespan of about 30 years. Then Alexander Fleming discovered how to cultivate penicillin, and capitalism figured out how to manufacture it in bulk, leading to an enormous transformation of human existence. Now, you or I can expect to live till we’re about 93.

That’s economic growth. People think of economic growth as some dry set of numbers. Well, it’s not. It’s Alexander Fleming discovering how to cultivate penicillin and the capitalist process spreading that knowledge around the world. So I say to people, “Well, you say you don’t want economic growth. Well, how would you like to only live to 30 instead of 93?”

And in addition to having all those additional years of life, there’s the fact that you no longer have to bury your child before the age of one.

Absolutely.

Tell me more about the institutional underpinnings of growth.

Well, I’ve written this book in two volumes. The first volume talks about three big things that you’ve got to have for growth. The three big things are small government, a low level of taxes, and a low level of regulation. I went into this asking, “What creates growth?” I didn’t have a particular point of view. Then I looked through all these academic studies, and they’re absolutely dispositive. There’s no doubt that’s what you need.

The problem is that you’ve got a nasty little thing called Wagner’s Law. This Wagner was Adolf Wagner, who in 1865 said, “In a democracy, the size of government inexorably increases.” And what he meant was that in order to get elected, politicians promise the world to the electorate, and they sometimes even deliver it. And delivering it is expensive. Then they have to tax more, and that leads to big state, big tax, social democracy.

This is what the European Union is testing the limits of right now. In France, the government spends about 55 percent of GDP and taxes about 50 percent of GDP, which creates a significant deficit. Germany’s the same. And they’re not growing at all. They don’t have any economic growth. 20 years ago, our government was about one-third of GDP, and now it’s at 45 percent. So, you can come up with theoretical but very valid reasons as to why that will cut growth into ribbons. But in any event, real wages in our country are about 5 percent lower than they were 17 years ago.

That’s shocking.

It’s like that story about how you get poor slowly for a long time and then suddenly. The European Union is getting poor rather suddenly at the moment, but around the turn of the century, GDP per capita was about the same as the US. Now it’s what, 25 percent lower? Because America has kept on growing, and the European Union has kept on not growing.

The battle in the UK has been whether we manage to become more like America, which would lead to more economic growth, or more like the EU, which would lead to much less economic growth. And so far, even though we’ve left the EU, we’re still becoming more like them. This latest government has massively increased the size of government and is also attempting to increase the size of taxes.

My book says that won’t happen. Arthur Laffer’s been very nice about this book. I admire him tremendously, and in a rather cheeky way, I’ve gone beyond the Laffer curve to something I have egocentrically called the Moyni curve. I say that the amount of tax that a country can take from its people is invariant. However much it tries, it can’t go up from a certain flat level. And that level in the UK is about 36 percent.

Labor has published an economic plan that says we’re going to raise tax rates, and that will increase tax revenues to 38 percent of GDP. And I’ve been writing about this for the last dozen years, and every year, I say, “No, it’s 36 percent. If GDP isn’t growing, then tax revenues won’t grow.” And I said this last year when the Conservatives raised taxes, I said, “You can raise tax rates, but you won’t raise more tax revenues; it’ll stay at 36 percent.” And it did. And of course, they spent more because of Wagner’s law, but they didn’t raise more. So, the deficit in the UK now is 4.5 percent.

Now let me explain why the Moyni Curve works, and of course, I owe all this to Arthur Laffer, who’s a genius. I just lift off him. But you look at all the different countries. Interestingly, the Scandinavian countries have quite a high level. They can raise around 50 percent of GDP in taxes from their people. So can France. Singapore can only raise around 18 percent.

Why would they be different? Well, you may have heard about this psychologist called Hofstadter, who spent all his life trying to distinguish national characteristics. One thing he measures is how risk-loving nations are. And the French are very risk averse. Interestingly, the Brits are very risk loving. So, are the Irish, by the way, and very independent. They’re not collectivists. Scandinavian countries are much more collectivist. The French are enormous collectivists. Anyway, if you take Hofstadter’s measures of each country, you get a brilliant correlation with the level of their Moyni curve.

I surmised from what you said that Wagner’s law continues to demand that governments spend more, but they can only raise so much in taxes. So, the result is more borrowing.

Yes. The US has gone absolutely mad both under Trump and Biden in terms of the wasteful and squanderous way they are borrowing and spending. If you remember, the US was chided for having the “exorbitant privilege” of the world’s reserve currency, which allows them to borrow as much as they like. But that won’t last forever.

Sooner or later, your debt to GDP gets to such a level that investors are not very keen on buying any more of your debt or even holding it because they worry about you going bust. Let’s take Argentina as an example. In 1910, it was the 10th richest nation in the world. It’s an extraordinarily blessed country with wonderful beef and agriculture and so forth. And then they discovered Peronism, which is the Acme of Wagner’s law. By the turn of this century, they were regularly defaulting on their debts and constantly having to go to the IMF for debt restructuring and the like. So, there are a couple of examples of rich, prosperous, well-run countries that went to hell, and Britain could easily go to hell. France could easily go to hell. At some point, you can’t go on borrowing.

I want our listeners to walk away understanding how government spending impacts economic growth. Let’s talk about this chart from your book.

The vertical axis is the growth rate, and the bars are different categories of government. On the left, you’ve got governments that spend less than 25 percent of GDP. And over on the right, you’ve got governments that spend 50 and 60 percent of GDP. So, you can see on the right that those high-spending governments have very low growth. And it’s absolutely dispositive. I first produced that chart in 2012. I stole it from somebody else. Nothing that I say in the book is original. And I’ve been redoing that calculation year after year with new data and all sorts of different data, and you always get the same result.

Why does this happen? I appeal to common sense. Let’s say you’ve got three governments: one is spending 20 percent of GDP, another is spending 33 percent of GDP, and the third is spending 50 percent of GDP. Now, if the size of government is 20 percent of GDP, then for every one government worker or beneficiary, there are four private sector people paying for them. Now, increase the size of government to 33 percent. For every one government employee or beneficiary, there are two private sector people. Now go to the government that spends 50 percent of GDP. Every one employee or beneficiary now has to be carried on the back of just one private sector worker, and it becomes a crushing burden.

Let’s go back to the Moyni curve. The UK can’t raise more than 36 percent of GDP in taxes. Well, why not?

30 percent of all income tax in the UK is paid by the top 1 percent of taxpayers, and 60 percent of all income tax is paid by the top 10 percent. Those 10 percent are the entrepreneurial types. They’re not necessarily rich people, but they’re people who will bust a gut to build a business. They’re young, high achievers. They are millionaires, billionaires, and rich people who want to have an environment where they can invest their money and not have it confiscated. And it’s the risk-taking behavior of that top 10 percent that determines what the level of your Moyni curve is. It’s not the risk-taking behavior of the entire population. And right now, we have an absolute flood of millionaires leaving the country. We have an absolute flood of young high achievers in their 20s and high earners leaving the country. And we are the only country in Europe with a net outflow of millionaires.

And it’s not just a few of them. It is an awful lot of them. And it’s the richer ones. I know plenty; I can tell you a couple of funny anecdotes. Well, one anecdote is from a friend who runs a very high-end club, and he’s lost 700 members this year. Now, those members are all very rich; it’s just a matter of going off and living in their house in Italy or Dubai or wherever else.

A lot of our millionaires and young high achievers are moving to America. I moved to America when I was 26 and lived there for 20 years because I was fed up with the British economy. But the point is that we are the only country in Europe that’s losing millionaires. In every other one, they’re going up each year. And that’s how raising taxes, having a larger state that requires you to raise taxes, results in people leaving, which means you don’t raise the tax anyway.

Presumably, you left when Britain was doing very poorly in the 1970s. And now we are going back in that direction. What happened? Is it that people forgot about the 1970s?

It does look like you have to teach every generation the perils of socialism. We had a debate last night on a new law they’re bringing in to have a regulator for football. Now, by football, I mean soccer, not American football. It is the most absurd thing. By the way, this regulator will require that all football clubs have an EDI strategy that’s equality, diversity, and inclusion. And by equality, they mean equality of outcome.

I pointed out that soccer is a game. It’s a competition. There’s a thing in that game called a winner and another one called a loser. That is not equality of outcome. And I asked if this regulator would require that every game end in a draw. The whole idea is lunacy. We’ve got so many regulators. Now we’re going to have a regulator for soccer.

Another example is when I was moving some money from one bank account to another a couple of weeks ago, and I was told, “Well, you can’t transfer the money. You’ve got to write a check.” “Okay, fine, here’s a check.” “No, no, you can’t send it by mail. You’ve got to walk it down to the bank, prove who you are, and pay it in.” That’s only 45 minutes of my time. What could possibly be wrong about just taking a little 45 minutes of my time to walk a check down to the bank?

But consider that regulators are doing this sort of thing all over. They’ve been trying to build a new railroad in the UK, and there was a regulator who was worried about a colony of bats somewhere near this railroad. And they required that the builder build a roof over 10 kilometers of this railroad, known as the bat tunnel, to keep the bats out from flying in front of a speeding train. That cost 100 million pounds. Everybody in the House of Lords has been going, “This is dreadful, 100 million pounds to build this bat tunnel. How bat shit crazy is that?” And I said to them last night, “You’ve all been complaining about this bat tunnel, but you are putting in more and more regulators. Who do you think made you build that bat tunnel? It was a regulator you put in.”

More and more of life is regulated and just congealing, and I believe the whole economy is just going to congeal into inactivity. I may be exaggerating slightly.

So, you talked about three things that underpin economic growth: one is the rule of law, another is low taxes, and the third is small government. But small government doesn’t just mean that you spend less money. It also means that you regulate less.

Yes.

Now, let’s finish on this. I was struck by something that you said about how we are always one generation away from socialism. Do you conjecture that the default setting of a human being is more or less socialist?

Fortunately, I don’t think that is the case. And I’ll explain that assertion in this way.

Mother Nature or God or whoever you wish to believe ordered the way human beings are, so ordained it that half of human beings would be feelers and half would be thinkers. And it was Carl Gustav Jung who defined thinkers from feelers. Feelers act from the heart. It’s how they feel about something that informs their principles and how they behave and judge. Thinkers use their heads and use logic to get to their answers.

Now, the feelers’ primary thing is to be kind, and the thinkers’ is to be logical. Now, here’s the problem. Feeler-thinker is gender-differentiated. 40 percent of women are thinkers, and 60 percent are feelers. 60 percent of men are thinkers, and 40 percent are feelers.

The primary schools, which teach children up to the age of 11, are almost exclusively staffed with women right now. As a result, the “be-kind” philosophy is more inculcated into children than it was 30 years ago. Young people are told over and again that they must be kinder, that boys are toxic, and so forth. And so, everybody now believes that the default thing is to be kind, be nice, and that means be socialist. And I think that’s why we’ve got the problem that you just enunciated.

And I think that a reaction is starting now. We might see a bit of the opposite in the next few generations. But it is a problem because right now, young people do not vote for capitalism. They think capitalism is a horrible thing. They enjoy the fruits of capitalism every second of their ever-loving lives, but they don’t understand that, and, in general, they think that socialism is the way to go.

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