The daily view 10/17/2024: Election, Billionaires, Elites, Parenting, Life Expectancy, Crime…

1. Although optimistic about the economy, I am looking at the 2024 election with dread. Either outcome means a more divided nation and an intensification of the culture wars, and god help us if the results are too close to call. An election in which the results are contested is the worst possible outcome. It will be very close though in terms of the electoral math; nothing at all resembling 2008 or 2012.

The downside of a Trump win is a possible worse counterresponse by the left. Recall, wokeness got much worse under Trump. The good news is Elon Musk is single handedly doing more to fight wokeness than anyone else now. Conservatives are in a much stronger position now than in 2020.

Either way, stocks and the economy should do fine. The wealth tax Kamala floated during early campaigning, predictably, she has discarded in favor of middle-class tax cuts.

2. With the epic Space-X chopstick maneuver and Robotaxi debut within 2 days of each other, plus Elon’s $100 million endorsement of Trump , the era of billionaires is in full swing. The rise of billionaires is inversely correlated with the decline of trust in public/cultural institutions and government officials:

In the early to mid 2000s the only celebrity businessman, as far as I can recall, was Steve Jobs. And maybe Trump, but the latter’s brand was much smaller compared to today. Now there are at least a dozen such individuals.

And then there are also people who have influence at the intersection of academia and business, who are also wealthy, such as Yann LeCun, who is the lead of Meta’s AI division. Similar to Bell Labs and PARC in the ’50s and ’60s, tech companies have extended to academia by having research divisions, that operate with only limited oversight by the main business. The idea is to attract top academic talent for research that may be of commercial use later, but also to raise the profile of the tech company as a leader in that field.

3. Another post by the always-excellent Scott Greer, Everybody Hates Elite Aspirants.

The problem has been that the right plays for points or the crowd, whereas the left plays to win. The right wants to succeed within the left’s framework, whereas the left wants to create the framework itself. An example is credentialism. The right’s free market orthodoxy makes credentialism worse, as credentialism is just a manifestation or offshoot of the free market at work. The political-right has neither the political capital nor inclination to do anything about it, so the left always wins in this regard.

J.D. Vance epitomizes the elite aspirant, so it’s not like it’s hopeless. There is an intellectual-wing of the right, but it’s dwarfed by that of the left. But business selects for different people or temperaments compared to government, law, or academia. Government is more about cooperation, patience, and compromise, which are more left-wing traits, in contrast to business, which is more competitive, winner-take-all, and short-term. So the most ambitious people on the right tend to go into business, not government. The opposite is generally seen on the left.

4. Interesting tweet:

It’s nice to see a backlash to bootstrap-ism, popularized by the boomers during the 90s and 2000s to pull up the ladder for later generations. Gen-z and millennials see the benefits of helping their children instead of the ‘tough love’ of the Boomers, Silent, and ‘Greatest’ generations that dominated for a century, leading to resentment and falling birth rates.

5. Crime and policing:

It’s not so much that America is under-policed, but that America’s police are more productive. Fewer police are needed because America’s police have more firepower and are more effective at preventing crime via deterrence (when controlling for demographics) or stopping crime. Long sentences for recidivism and well-armed police are an effective deterrent compared to the police elsewhere in the developed world. Plus, better technology. When you get stopped, the police take your data and run it through huge databases for warrants. In other countries this does not happen as often or at all.

Crime is always a difficult subject. There are so many variables to consider, such as the under-reporting of crime, crime that goes unnoticed, or crime which leads to a police report and arrest but is unprosecuted, or crime which is reported but unacted on by police.

6. How to lie with stats 101:

Step 1. Truncate the bottom of the y-axis to make the difference appear greater than it actually is. If the y-axis started at zero, then 2-3 fewer years of life expectancy would appear much less dramatic.

Step 2. Fail to control for demographics.

Step 3. Fail to take into account R&D costs. Foreign countries piggyback off the R&D of American pharma companies.

7. Bitcoin rebounds, but it will not last. Betting against Bitcoin is a surefire play. We can already see it stalled at $67-68k. The 8-month downward channel is intact, giving a price target of $50-60k as it breaks lower. If Trump loses, Bitcoin will crash. If he wins, he will ignore it. Trump has a long history overpromising and underdelivering, as we saw in his first term. He’s happy to support crypto in so far as raising donations, but that is it. He still believes in the supremacy of the dollar.