We had rent controls in Britain until 1915 to 1988 and during this time housebuilding regularly hit over 300k per year. Since they were removed, the house price to income ratio has gone from 4:1 to around 8:1, and housebuilding numbers have collapsed. https://t.co/qRKr062FVg
— Gareth (@g_f_red) March 29, 2026
Supply and demand may actually operate in microeconomics, but as Sonnenschein, Mantel and Debreu demonstrated (mathematically!), micro is not a suitable as a foundation for macroeconomics.
Vienna has fewer homes per capita than Vancouver. By supply-and-demand logic, the Austrian capital should be more expensive. Yet prices are 50% lower. Why? Because over half of Vienna’s housing is non-market. The issue isn’t supply. It’s commodification. https://t.co/LBo9u2Iic1
— Canadian Dimension (@CDN_Dimension) March 26, 2026
"The past is never dead. It's not even past." - William Faulkner
Thinking about what it took our forefathers to come to the colonies in the New World is daunting. They encountered unimaginable wildness, Indians, and more. It's sensible to conclude that a peculiar insane optimism is one thing that could account for the post-Columbus migrations from Europe to America.
Spanish explorers like Columbus, Cortez and Pizarro made war on the native societies, even discarding their achievements in medicine and mathematics as they did. But what led to most of this largest-historical-genocide that killed 90% of the New World's population was the Old World diseases brought by the explorers themselves, particularly yellow fever and malaria, although measles and smallpox played a role too.
So the European immigrants encountered a much-weakened native population, and vast stretches of land they abandoned as they died out. And even then, the Europeans fought them.
To work the land where malaria and yellow fever were rampant, the Europeans imported African slaves who had at least some immunity to these diseases. Slavery thrived between the Mason-Dixon line and the northern border of Argentina, where the vector mosquitos for those diseases were. Slavery was necessary, not optional, to grow all that cotton before mosquito eradication was discovered as a preventive.
Meanwhile, when Andrew Jackson stole the southeastern US from the natives--defying both Georgia's and the US Supreme Courts--the cotton planters were ecstatic. They quickly borrowed to buy slaves and farm what was the Cherokee's land as the Indians walked the "Trail of Tears" to move to what would become Oklahoma.
Then, in 1835, Andy Jackson did what many people even today believe would be a good idea. He paid off national debt entirely and closed down the central bank. This meant there were no publicly-issued dollars. People did their business with monetized gold ("specie") and over 7,000 varieties of private bank notes of varying reliability.
The planters with their new, stolen land, were unable to pay their loan payments because the cotton surplus made the price of cotton hit the floor, even with 60% of the crop warehoused, and Jackson's debt payoff depleted their dollar savings. A wave of asset forfeitures and foreclosures ensued. As is the case for all significant reductions of national debt, the economy tanked in the subsequent "Panic of 1837."
One further bit of encouragement for civil war: slaves tend to not care about long-term soil health, so the typical slaver would deplete his soil, then move west to get more. The North was unwilling to bless making new states in the West slave states.
What can we conclude about the historical precedents for the American temperament? First, unrealistic optimism was an absolute requirement for new immigrants from Europe. Second, perceived economic necessities trumped any reasonable accommodation of the natives, even if they had something to offer. Third, slavery was a clear dedication to putting some (white) people in the driver's seat.
So...has much really changed?
Meanwhile: JFK and LBJ's Defense chief Robert McNamara dined with his Vietnamese counterparts after the Vietnam war was over and done (and lost by the US). The Vietnamese asked McNamara why the US bothered with Vietnam in the first place. McNamara--by all accounts an intelligent and even charming dinner companion--responded by saying it was to contain China. The Vietnamese were outraged. "We've been fighting China literally for millenia!" was the gist of their response. So that war was simply a waste of men and money. Yet large populations in the US remain optimistic that warfare--now in Ukraine, Gaza and Iran--can have a miraculously wonderful outcome.
How to respond? Is it sad? Frustrating? Testimony that "The more things change, the more they remain the same"? [sigh!]
I’ve been studying the punishment bureaucracy and suing judges, prosecutors, and police across the U.S. for more than 15 years. One defining feature of our legal system is that there is rarely any accountability for massive corruption and criminality by those with power. This… pic.twitter.com/TELvR3SPWR
— Alec Karakatsanis (@equalityAlec) March 22, 2026
At a party given by a billionaire on Shelter Island, Kurt Vonnegut informs his pal, Joseph Heller, that their host, a hedge fund manager, had made more money in a single day than Heller had earned from his wildly popular novel Catch-22 over its whole history. Heller responds, “Yes, but I have something he will never have … enough.”
Update: Thorstein Veblen Question: If much of modern consumption exists not to meet human needs but to signal status and superiority, why do we treat rising consumption as evidence of prosperity rather than as evidence of social rivalry and waste?
🚨 Do you understand what's happening at Amazon right now?
— Tuki (@TukiFromKL) March 12, 2026
Their own AI coding agent Kiro reportedly "decided" the fastest way to fix a config error was to delete the entire production environment. Gone. A 6-hour outage. 6.3 million orders lost.
Amazon's SVP called thousands of… https://t.co/1p9QeSm4us
(c) by Mark Dempsey
An acquaintances yearning for more peaceful politics reminded me that he was a fan of Ronald Reagan and was nostalgic for simpler times. Reagan is hardly a remedy for our current woes.
A few of Reagan's policies:
The Savings & Loan Crisis
Before the subprime/derivatives meltdown in 2008, the largest financial and political scandal in US history was the S&Ls. It was orders of magnitude bigger than Teapot Dome, or Credit Mobilier, the previous "biggest-ever" scandals, and took nearly a half trillion dollars to cure, if you count the interest on the bailout. It was huge.
It happened, and was it so big because Reagan made a rather ordinary bank scandal worse by deregulating the S&Ls. Rather than "growing their way out of trouble," they just made more crooked loans. For the details, see Martin Mayer's The Greatest Bank Robbery Ever: The Collapse of the Savings & Loans.
In fairness, Reagan and Bush 41 regulators actually acted to stop the crooked S&Ls. According to regulator William K. Black, they filed more than 30,000 referrals for criminal prosecution, and the Justice Dept prosecuted more than 1200 cases with a 90% conviction rate. They got big fish, too, Mike Milken and Charles Keating among them.
In financial terms, the more recent subprime/derivative meltdown--the "Global Financial Crisis"-- was 70 times bigger than the S&L scandal. The scandals are getting worse, not better. The number of referrals for criminal prosecution filed by the Obama administration's regulators: zero.
Obama prosecuted about a dozen cases, all small fish. One Swiss banker went to jail, but the big malefactors were given slap-on-the-wrist fines and walked away with the vast majority of their loot without even an admission of guilt, which makes the cases for civil damages harder to prosecute. No one lost his job, no one even lost his bonus. America's net worth declined by 40%, there were 8 - 10 million foreclosures. People lost their homes, their jobs and their savings. It was an economic bloodbath. It's no surprise Trump won in 2016, after the economy digested this outrage.
My Democratic friends send me YouTubes decrying Trump's pardons, and the billions they cost the courts and the victims of the pardon recipients' frauds. But, according to our central bank's own audit, during the Global Financial Crisis, it issued between $16 and $29 trillion in credit to the same financial sector whose frauds crashed the economy.
Just a reminder: a trillion is 1,000 times a billion. And Obama didn't have to pardon people because he didn't jail the criminals. Reagan set the direction; Obama pressed the accelerator.
Iran/Contra
The Reagan administration wanted to wage a war against Nicaragua because Nicaragua elected a socialist government. Congress disagreed and withdrew funding for the mercenaries ("Contras") fighting the elected government.
Reagan's advisors then sold classified weapons to Iran, through Israel, and used the proceeds to fund mercenaries fighting the elected government. "Weapons laundering" through Israel made this possible because the public outcry would have prohibited it otherwise. After all, at the time, Iran had just released the US embassy hostages when Reagan became president.
To pressure Iran to release the US embassy hostages, the defeated Jimmy Carter had refused to sell the Ayatollahs spare parts for its US weapons bought by the US-supported Shah, but Reagan lifted that prohibition--a concession Carter advisor Gary Sick (October Surprise) says made Iran delay releasing the hostages for Carter. That almost certainly lost Carter the presidency. Not only that, Reagan sold not just spare parts, but classified weapons Iran did not yet own to get money to pay the Central American mercenaries.
This amplified previous US aggressive impulses. Carter and Congress previously funded the Mujahedin in Afghanistan. That's where Osama Ben Laden got his training, which he later used for the World Trade Center bombing. So the "uniparty" behaved as usual.
Reagan famously asked the Mexican President to endorse the war against Nicaragua--one of the two poorest nations in the hemisphere--because Nicaragua was such a threat to the US. The Mexican president replied that he would be happy to go along with his friend Ronnie if there was any way he could do so without being laughed out of office.
Update: 3/22/26 from Thom Hartmann
…Tragically for America and the world, it all came crashing down when a faction of Iran’s most extreme rightwing mullahs helped the fossil fuel industry’s candidate, Ronald Reagan, replaced Carter in the 1980 election. Reagan then killed the solar bank and the solar bond programs, and removed Carter’s 32 solar panels from the roof of the White House.
As a result, we’ve actually increased our consumption of fossil fuels so much that the fossil fuel industry’s billionaire investors have made an estimated $52 trillion in profits in the years since Reagan’s presidency. And global warming is now driving climate wilding that’s killing Americans and threatening all life on Earth….
During the Carter/Reagan election battle of 1980, then-President Carter had reached a deal with newly-elected Iranian President Abdolhassan Bani-Sadr to release the fifty-two hostages held by students at the American Embassy in Tehran.
President Bani-Sadr was a moderate and, as he explained in an editorial for The Christian Science Monitor, successfully ran for President that summer of 1980 on the popular position of releasing the hostages….
Carter was confident that with Bani-Sadr’s help, he could end the embarrassing hostage crisis that had been a thorn in his political side ever since it began in November of 1979 and support a moderate government emerging in Iran.
But behind Carter’s back, the Reagan campaign worked out a deal with the leader of Iran’s most hard-core rightwing radical faction — Supreme Leader Ayatollah Khomeini — to keep the hostages in captivity until after the 1980 presidential election. Khomeini needed spare parts for American weapons systems the Shah had purchased for Iran, and Reagan was happy to promise them….
Kemp-Roth -- Tax Cuts for the Wealthy & "trickle down"
Kemp-Roth is the name of the legislation that is one of the hallmarks of Reagan's administration. It cut the top income tax brackets for the wealthy roughly in half. It's also worth mentioning that between Reagan and his successor, payroll taxes also increased eightfold. Gosh, I wonder why there's such a big income divide in the US now!
Meanwhile, here's what GDP growth looks like in the US over time:
Notice that, in the 1980s, in return for his "trickle-down" policies, the reduced taxes on the rich that increased national debt by a record percentage, Reagan got what amounts to an average business cycle recovery. The Wall Street Journal called it "Morning in America," but it's very modest in comparison to the New Deal and that big public works project called "World War II" whose peaks appear earlier in the graph.
For reference, the government took over 50% of the American economy during WWII. Implementing the Green New Deal would only take 5%.
Reagan was also a fan of Milton Friedman's economics. Friedman says that the central bank (The Federal Reserve) should manage the money supply, and that would save us from the then-current "stagflation." This was tried and abandoned. Like most of Friedman's prescriptions, it didn't work.
Immigration
I've written about this before, but Friedman's economics was given an even more extensive test in Chile after the Nixon administration overthrew the elected government of Salvador Allende, and assassinated Allende and thousands of others. During the term of Allende's replacement--human rights abuser General Augusto Pinochet--Chile's economy grew by 8%. Neighboring South American nations had roughly 40% GDP growth. After Pinochet, Chile's unemployment rate was higher than when Pinochet began his rule.
This is related to immigration because it's standard policy for the US to create refugees who flee north to get behind the battle lines. Between 1798 and 1994, the US was responsible for 41 changes of government south of its borders, leading to a constant stream of political and military refugees coming north. Allende's niece, Isabelle Allende, lives in Marin County, California, and writes novels.
The economic manipulations that create refugees are as bad or worse. One might guess that Mexican corn farmers were harmed by having to compete with subsidized Iowa corn imports, and NAFTA gave the big farmers a bailout. True, NAFTA was a bipartisan collaboration between Harvard-educated Carlos Salinas Gotari, G.H.W. Bush, and Bill Clinton, not really Reagan's treaty, but Reagan would have agreed with the economics behind it.
In the wake of NAFTA, Mexican real, median income declined 34% (says Ravi Batra in Greenspan's Fraud). One has to go back to the Great Depression to find a decline like that in the US. The little subsistence corn farmers were only growing obscure varieties of that important crop that kept the disease resistance and genetic diversity of corn alive; but they weren't making any money for Monsanto, so forget them!
Reagan's contribution to the immigration discussion, besides the military refugees created by Iran/Contra, was an amnesty--something Republicans accused their Democratic opponents of advocating. It's a non-starter in the Trump era.
Antitrust
The Reagan administration effectively stopped enforcing antitrust legislation in the '80s. Breaking up monopolies is absolutely necessary to ensure the markets can operate and do legitimate price discovery.
Monopolies defeat markets, setting prices to maximize their own profits. Monopolies (and oligopolies) are price setters, not price getters--which defeats the free market's claim to make things affordable. The prices of EpiPens and insulin are just some of the latest instance of monopoly rents increasing prices.
Classical economics says there's a law of declining profits. Completely free markets without significant barriers to entry, or dominant monopolies/oligopolies, mean that competition drives prices lower, and with lower prices come lower profits. Firms know this and do everything from buying the competition to selling goods below their production costs to drive competitors out of business.
Here's an example from New Hampshire: "Here's a blow-by-blow of how utility regulators and utilities collude to screw you. In this case, Eversource, New Hampshire's largest utility, got a 43% increase in the fixed monthly charge consumers pay. 43%." (from monopoly specialist Matt Stoller)
Recently, Wright-Patman, a law forbidding different prices for large customers (e.g., Walmart) and small customers (mom-and-pop stores), has been revived, but it has been ignored since Reagan, too. The courts are reviewing one case now, but the game of different prices for the big guys vs. the little guys has been going on for a long time now.
Education/Homelessness
When Reagan was governor of California, he removed "civics" from the schools' curricula. Heavens to Betsy! We can't have educated voters!
He also closed the state's insane asylums, basically evicting the inmates to suffer the tender mercies of homelessness and the streets. In a bipartisan move, the Democrats did something similar to the big federal asylums during the Kennedy administration. The proposal was to close the big, isolated asylums and make transitional housing that integrated the inmates into society again. Congress terminated funding for the federal asylums and failed to fund the transitional housing.
In the presidency, as Reagan cut taxes on the wealthy roughly in half and increased payroll taxes, he also cut HUD's affordable housing budget by 75%. The current homeless population--the biggest since the Great Depression--is the result of public policy, not some accident.
War Crimes
This is hardly an exceptional accusation for really any president since WWII, yet Nicaragua qualifies as a war crime, as does Grenada.
Thatcher
Reagan and Thatcher were allies in economics, both promoting "trickle down" theories that favored the rich. Thatcher famously declared that "There's no such thing as 'society,' only families and individuals" -- a statement roughly equivalent to "You have only cells and organs; you have no body." Childhood poverty in the UK increased three-fold during Thatcher's reign.
Where we are now:
Real, median income for the bottom 90% of US incomes has increased $59 since 1972, says investigative reporter David Cay Johnston. If that increase were an inch on a bar graph, the bar for the top 10% would be 141 feet high; the bar for the top 0.1% would be five miles high. The distortions this wreaks on society are everywhere to be seen. From the precarity of employment, to the largest homeless population since the Great Depression, we are all suffering from the policies that favor the rich and attack the poor.
Consider the alternative: The Carnegie Endowment pointed out that China’s entire strategy for competing with the United States has been to lean into economics, technology, construction, and training. Not military alliances. Not bombs. They build roads, ports, rail networks, energy systems. They invest in other countries’ infrastructure. They compete by making things. In the US, we compete by breaking things. And we’ve spent decades proving it.
We can’t build a subway line in under twenty years. We can’t make insulin affordable. We can’t keep a hospital open in a rural county. We can’t build housing fast enough to keep families off the street. But we can flatten a city on the other side of the world in a weekend. We’re really good at that part. We’ve had a lot of practice.
It's pretty unreal that people still believe Gutenberg invented the printing press, when it was invented a whole 7 centuries before in China.
— Arnaud Bertrand (@RnaudBertrand) March 8, 2026
When Gutenberg painstakingly printed 300 bibles in 1450 and went bankrupt because of it (as that lady describes 👇), some texts in Asia… https://t.co/gXCPUemdkW
from Alvaro Bedoya @BedoyaUSA
Open use of AI for military targeting is relatively new (we saw it in Gaza); but the use of AI for police and retail targeting is over a decade old. We’re about to re-learn some painful lessons. 1) It lets people ignore their gut. When I was a commissioner at the FTC we sued Rite-Aid over its use of AI to identify and target potential shoplifters. We alleged there were situations where staff would detain a Black woman based on a profile of “a white lady with blonde hair.” In other situations they’d detain an eleven year-old who had never set foot in the store. I don’t know this for a fact, but I strongly suspect that staff in these situations said - “wait a second here” - but they went ahead anyways. *Because the computer told them to do it.* (So we banned the use of face surveillance at Rite-Aid.) 2) It promotes magical thinking. In 2019, our team
@GeorgetownCPT found scenarios where police departments were running *drawings* of suspects into an AI face recognition system in order to arrest people. This is not a joke. Amazon Web Services bragged about how police in Washington State used a sketch to identify a suspect. Maricopa County Sheriff’s Office said you could use face recognition on “forensic busts.” Do you occasionally catch someone this way? Maybe. But the mistakes land innocent people in jail (and keep guilty people on the street.) 3) We are about to re-learn these lessons. Secretary Hegseth is bragging that the American and Israeli militaries used twice the air power as the Iraqi “shock and awe” campaign of 2003. I went to law school, and have subsequently taught law to, former military officers who were surface warfare and targeting specialists. These are some of the most serious people I know. But they are human. And if someone is asked to do something superhuman - i.e. generate an impossible number of targeting packages - it is only inevitable that they will “trust the AI,” even if their gut tells them otherwise. Yes, we’re dealing with new algorithms. The machine learning systems used in police and retail face recognition are Stone Age compared to the models being used today. But the new models make mistakes. (Yesterday Gemini told me that February 28 was a Friday.) And unlike with humans, where we know - “oh, Mike was a little rushed this morning” or “Larry always underestimates this” etc. - we are not trained to identify mistakes from AI. I hope we can avoid re-learning these lessons.
The science of fetal microchimerism should have broken the internet by now.
— The Curious Tales (@thecurioustales) February 28, 2026
It hasn’t.
When I read about a research I was so curious to know what’s actually happening.
Fetal cells — carrying the child’s own DNA — cross into the mother’s bloodstream during pregnancy and never… https://t.co/uQMDsvUbQ9
Austrians want to make microeconomics the foundation of macroeconomics. Sonenshein, Mantel and Debreu proved, mathematically that micro is u...
