Minor pedantic point. The articles uses “Black immigrants” and “African immigrants” interchangeably.
The majority of Black immigrants don’t immigrate from Africa. The biggest source of Black immigrants is the Caribbean - Jamaica and Haiti, specifically.
I imagine as passive investment grows to become a larger and larger share of market activity, the opportunity for exploiting pricing inefficiencies also grows, increasing the potential reward for price discovery. I imagine there is an equilibrium somewhere that most markets will settle around.
Many years ago the Philosophical Economics blog argued that indexing actually makes markets more efficient by removing low skilled players from the game, increasing the average skill level of those actually doing price discovery. After all, does anyone think it has actually become easier to beat the market as indexing has gone from 0% of the market to its current juggernaut?
My experience living in NYC revealed an interesting dichotomy. I worked at a major advertising firm and met many successful black colleagues. It turned out that a number were 2nd-generation Caribbean immigrants. When we would discuss race and the gap between immigrant blacks and native blacks, the number one reason they came up with was education and a two-parent family.
There was a culture of education that was enforced by two parents. They came home and studied. Immigrants from Africa tend to be the best and brightest and the most educated. The culture they came from is one of education. They do not suffer from a lack of self-esteem or the climate of victimization that native born black Americans have. The legacy of Jim Crow still reaches deep in America.
Having gone to an Ivy late 80s-early 90s I recall that something like 2/3 of all black students were either 1st or 2nd gen Carribeans - add in Carribbeans as foreign students and the Africans as foreign students and it was probably 3/4 (the foreign students were generally to my eyes of elite-to-comfortable backgrounds but not the case of the domestic 1st/2ndgen students).
General feeling I recall from my friends amongst them were indeed they felt they didn't have a "culture of negativism" as one put it that native born did. Roots are clear for that 2nd of course.
Caribbean blacks are similar to native-born American blacks in that both were descended from slaves, and (if anything) Caribbean slavery was more brutal than slavery in the American South.
It's unlikely that slavery would have had a dysgenic effect on American blacks but not Caribbean blacks, so why the difference in educational performance?
Is it just that black Caribbean immigrants to the US are themselves a selected minority, or was there something about the black American experience specifically that fuelled anti-intellectualism, that didn't exist in Caribbean black culture?
I wonder if the use of rigged "literacy tests" to disenfranchise black Americans may have been a fairly direct driver of anti-education sentiment in black American culture?
I am guessing we have to charge welfare with the breakdown of the black family, and when that broke down, so did the culture of education. Add in the black drug gangs and general hopelessness, single working moms with older kids who cannot have their activities monitored, and you’ll get poor attendance, poor study habits, and general disdain for doing the work.
I guess the nearest equivalent of Jim Crow for Caribbean blacks would be post-slavery European colonial rule: maybe the issue is that the nastiest racism came not from the ruling elite, but from whites lower in the pecking order who were more likely to see blacks as a threat to them personally?
I wouldn’t say blacks didn’t have discrimination or violence. I just don’t think you can compare the size and animosity of the Southern States vs. Jamaica or Trinidad. Although it is still hard to imagine that Brazil didn’t end slavery until the late 1880s. I can just say they don’t have the victimization that our poorer urban blacks seem to have
This used to be true in CCP (the leadership leans heavily on technocrats with elite education) but Xi has changed all that.
Xi is from the Cultural Revolution generation that had their education cut short, and he distrust the “elites”, so the leadership now is heavy on loyalty and low on competence (yeah we know what that’s like)…
Only when it comes to certain things. China is in the unusual circumstances of having government policy that forces it to put resources towards capital investment that it should be directing towards consumption instead.
Why does it follow we need 100% in fact, it probably helps reduce poverty on the margin for families with lower-middle class incomes. But yes- we could and should tax inheritance much more than we currently do. We should get rid of the step-up basis for one. And for the concerns of needing to sell the family farm or business, rather than forcing the taxes to be paid immediately- lower the basis, which will defer the tax until the gain is realized. Don’t apply this to things like art- only operational businesses- still probably some room for tax evasion (have your business own the art) but it probably raises the effective rates and compliance overall
So? Every kid doesn’t have to work hard in school because of their race or family history? The percentage of Americans who leave behind generational wealth is minuscule.
Off topic, but Noah any chance you could investigate whether claims of layoffs due to AI adoption are bogus? My hunch is that the bigger economic mistakes are driving layoffs, but companies prefer to say AI...
Google and Microsoft maybe are driving innovation, but lets stop pretending that Meta has anything to offer please, have you ever clicked on the AI link below a Facebook post before? Its the very definition of junk learning from junk, its embarrassing to a level that makes ChatGPT hallucinations look like the work of Einstein. It is well past time that everyone accepted that with Facebook, Zuckerberg had one great idea (which is fine, thats 1 more great ideas than most people have) and he was particularly skilled at monetising that one idea, but he is not an original or innovative thinker, he has zero insight into the future and what it will look like (the Metaverse anyone, how about NFTs?) and stop pretending that he has anything to offer when it comes to building the future
The Facebook AI Research lab has been doing lots of excellent ground-breaking research. Examples include SAM and JEPA. The fact that these have not made it into META products is more likely to be a management failure.
I don't think we should base our opinion of Meta's AI capabilities from an observation of clicks on Facebook postings. I have no association with them but I do know that Meta's AI team has some of the top AI researchers from around the world.
This is fair but leadership matters (or maybe it didn’t and happy days that means we can stop with the absurd pay packages for CEOs) but the facts are everything I’ve seen from their AI is significantly worse than ChatGPT (which itself is terrible, the best test as always is to ask it stuff you yourself are an expert on, the problems become instantly apparent) and that Zuckerberg from the well before the fiasco of the Metaverse doesn’t seem to have had a good idea since buying Instagram (so to be fair that’s 2 good ideas he’s had)
As of now, I yield the point. Yann LeCun and many of his team have left Meta. My opinion of Meta's AI capabilities were largely based on his presence there. We'll have to see where it goes from here.
>Officials explained that the 10,000-yen levy will apply to hotel stays costing 100,000 yen or more per night
I can't imagine the average Kyoto tourist will be spending $650 a night - when I went years ago we spent about $250 for a 4 star hotel. It'll be good for revenue but I have doubts about crowd control.
My wife was a semiconductor executive at both Intel and TSMC. She has long predicted that Chinese semi will never catch up to the US.
Her reason is that it is actually not tech know how or lack of equipment, but cultural.
An advance wafer can have more than a hundred layers where each has to meet quality standard. So if your yield for a single layer is 99% (which many would think k that is pretty good), the yield for the whole chip is (99%) to the power of 100. One can quickly see how difficult that is. (This explanation was what my wife was telling her Huawei customer who has the yield question, after thinking about it, he replied that “yeah we don’t have the culture for that kind of quality”). A Temu TSMC is just not gonna cut it.
Then again let’s not blame the Chinese, right now nobody but TSMC can do it (Samsung and Intel used to be contender but have now fallen far behind). The TSMC fabs in Arizona is only successful because the engineers are all shipped from Taiwan (who is willing because of the green card )…
This is so dumb. Cultural arguments for why group X will never accomplish Y have failed every single time. Yes culture is real but people and organizations are adaptable, especially when there's a reason to motivate them to change. This take though is especially wtf because if the Chinese will never catch us then how the hell did the Taiwanese do it? If they're not the same culture now they both at least developed out of the same culture. Remember when all our cheap crap used to be made in Taiwan?
Taiwanese culture is a unique blend of Chinese and Japanese. the attention to service is the cultural trait that is lacking in mainstream Chinese business.
People who has done change management all agree that process and technology changes are easy, culture changes are hard.
I will put forth a counter argument for you: (assuming you are an American) “when American adapt their culture by having gun control they can solve a lot of problem in their society”
If you think these two cases of culture change are different, I would like to know why.
So if Taiwanese success is explained by the infusion of Japanese culture, why shouldn't we get another TSMC from Manchuria, which was occupied by Japan for almost the exact same amount of time? Speaking of Japan, during the Shogunate they had the most hidebound and traditionalist culture in East Asia until the Meiji Restoration, when they switched to being outward-looking and innovative. Which just goes to show that huge cultural shifts are possible.
This neatly illustrates how attempts to explain outcomes with culture nearly always rely on just-so stories and the representativeness heuristic. We have stereotypes of the solicitous Japanese (and Americans) and rude Chinese, but on the other hand startups that need to manufacture a prototype of their product often say that Chinese manufacturers are much more responsive and accommodating than American ones. Cultures are way too vast to make easy generalizations about them in that way. Especially a culture with over a billion people and dozens of regional sub-cultures.
BTW, before you were talking about a culture of quality, now you're saying it's service. When pressed on that you can shift to any other trait you can think of. It's totally non-falsifiable.
Re: gun control in America, there are more or less the same number of people who are adamantly anti gun control as there are who are strongly for it. By contrast no one in China is against catching up to the US in semiconductors as a concept. And yet, if you were to say that America will never have gun control I would not agree with you, just because forever is a long time.
Manchuria did not absorb much of the Japanese culture. I have theories but not enough due diligence to stand behind.
Everything you cited as “culture” is not what I was talking about . Rude Chinese or hidebound Japanese you stated. By my lens Japanese culture stayed very consistent from shogunate to modern times.
Of course TSMC’s success have many parents, not just “culture “, it was the right enterprise at the right time. (Many TSMC old guards are worried that as they retire from the scene, whether the company can keep their edge).
Regarding China: part of the difficulty re culture change is that there are opposite forces that work against it. Chinese tech environment is brutal (be it EV, Solar, or semi). It is very much win or die. Speed is probably the number one cultural trait for success. And speed works against the need for the detail oriented work needed for high end chip work.
At the end of the day, I am an engineer type who believes in data. Give me a semi success story of someone who (eventually) will eat TSMC’s lunch, and I will be happy to eat my word.
I have seen universities achieve their affirmative action goals by recruiting African immigrants (both students and faculty). This is a policy failure. Programs that focus on domestic students escaping poverty seem more likely to meet policy goals of developing brilliant domestic students. I am also a big fan of increasing African increasing skilled immigration to the US just as I favor skill immigration from Asia and Europe. But such a policy has the goal of recruiting the very best minds from the entire world.
Regarding your antitrust post… We need to distinguish between economic sectors in which it’s possible to grow the pie and those in which the pie is more or less fixed and all we’re trying to do is figure out how to divide it.
It probably won’t work to use antitrust legal enforcement against things like social media, crypto, AI, computers, etc. As soon as we corner one of them, someone invents a New Thing that renders the old debate obsolete. At best, we can kneecap today’s Villain of the Week and free up space for an even more nefarious villain to take its place.
The same logic DOES NOT apply in sectors which are roughly capped in size—agriculture, for instance, or meat production, or lumber. In sectors such as these, the presence of oligarchs lead not so much to innovation as monopsony: a relentless squeezing of margins and Gilded-Age dynamics.
We need to develop a legal framework (and economic analysis) nimble enough to make this distinction and not try to shove everything into a one-size-fits-all framework.
Do you then agree with Trump that meat packers greedflation is why beef prices are high, rather than tariffs on imported meat, fertilizer and equipment or the crackdown on foreign laborers? Four companies dominate meat packing, but that is twice as many that dominate computer or phone operating systems.
I do agree that it’s a big part of the problem. But it’s not the entire problem. Those other factors you mentioned all play a role too. However, there’s a difference between the meatpacking industry and cellphones. While both are monopolies (or at least oligopolies) there’s no realistic chance that we will innovate our way around meatpacking. I’m willing to bet you—any amount, any odds—that a century from now people will still be eating meat. (And it won’t all be grown in labs.) That means monopoly as far into the future as we can project.
In contrast, I’ll bet that even 30 years from now, people will NOT still be stuck choosing between iPhones and Androids. (Although I’m less confident about this one. Maybe 90%.)
If I’m right, then the two pose different problems. To change how meatpacking and the like work will require market restructuring. That’s a big lift.
No such restructuring is required for cellphones. Instead, they merely need to be prevented from abusing their monopoly power while it lasts. That’s an easier lift and indeed has already started.
It’s a really good point. I would make two points in return. The first is minor, which is that computers are far less indispensable to life now than they were then, as indicated by the fact that OSs are all free now. If we still had to pay, there might be more competitors.
Second, and more important, I do not expect that Apple and Android will disappear, and I do expect that you’ll still be able to buy a descendent of today’s iPhone or Android if you want to. (I could’ve been more clear on that.) I just think they’ll probably be more of a niche product. Most people will not rely on standalone phones to communicate or consume content.
Windows isn't free; only updates are. If the manufacturer of your computer didn't pay for a Windows licence (if, for example, you built it yourself from parts) then there's a good chance that you'll need to buy one.
I'd generalize that to "MacOS, Windows, or Unix-like operating systems" as Linux isn't the only example of the third (even if we look only at open-source examples we've got the BSD variants as well).
I too also felt that it was never a compelling argument to say we should sell China our high-end chips in order to keep them dependent and to prevent them developing their own AI hardware stack. It always seemed obvious to me that they would try to reverse engineer our stuff whether or not we were selling it to them.
But I’m not a well known smart economist, so I figured I must be naive and missing something.
Also not to mention, during the Cold War nobody tried to make the case that we should sell our advanced military hardware to the USSR in order to disincentivize them from developing their own.
Very nice set of topics.... Especially enjoyed the "selective immigration" topic. Selective immigration intensity seems to correlate heavily with unicorns/capita in US cities.
Good Active Investing > Passive Investing > Bad Active Investing
Sounds simple, but is true. Lumping the first with the third isn’t a good comparison to the second. All three have a place. Passive is great while you are accumulating wealth and/or don’t have the time to learn your way through being a bad active investor into becoming a good one. Every active investor is bad when they start. When you buy an index fund, you are by definition buying a bunch of crappy stocks and most likely are underinvested in the good ones. You also pay management fees.
It's important to note that America *does not* hold an advantage in advanced chips. Taiwan does. And Trump's disastrous trade policy and overtures to move advanced chip manufacturing on-shore will only drive a wedge between the two partners. Taiwan holds all the cards here. Fortunately they also benefit greatly from the current alliance. The bond will hold, if we have someone competent holding the policy reins.
Minor pedantic point. The articles uses “Black immigrants” and “African immigrants” interchangeably.
The majority of Black immigrants don’t immigrate from Africa. The biggest source of Black immigrants is the Caribbean - Jamaica and Haiti, specifically.
I imagine as passive investment grows to become a larger and larger share of market activity, the opportunity for exploiting pricing inefficiencies also grows, increasing the potential reward for price discovery. I imagine there is an equilibrium somewhere that most markets will settle around.
Famous paper from 1980 made that argument. Look at the Grossman-Stiglitz paradox in Wikipedia.
Many years ago the Philosophical Economics blog argued that indexing actually makes markets more efficient by removing low skilled players from the game, increasing the average skill level of those actually doing price discovery. After all, does anyone think it has actually become easier to beat the market as indexing has gone from 0% of the market to its current juggernaut?
Noah
My experience living in NYC revealed an interesting dichotomy. I worked at a major advertising firm and met many successful black colleagues. It turned out that a number were 2nd-generation Caribbean immigrants. When we would discuss race and the gap between immigrant blacks and native blacks, the number one reason they came up with was education and a two-parent family.
There was a culture of education that was enforced by two parents. They came home and studied. Immigrants from Africa tend to be the best and brightest and the most educated. The culture they came from is one of education. They do not suffer from a lack of self-esteem or the climate of victimization that native born black Americans have. The legacy of Jim Crow still reaches deep in America.
Having gone to an Ivy late 80s-early 90s I recall that something like 2/3 of all black students were either 1st or 2nd gen Carribeans - add in Carribbeans as foreign students and the Africans as foreign students and it was probably 3/4 (the foreign students were generally to my eyes of elite-to-comfortable backgrounds but not the case of the domestic 1st/2ndgen students).
General feeling I recall from my friends amongst them were indeed they felt they didn't have a "culture of negativism" as one put it that native born did. Roots are clear for that 2nd of course.
Caribbean blacks are similar to native-born American blacks in that both were descended from slaves, and (if anything) Caribbean slavery was more brutal than slavery in the American South.
It's unlikely that slavery would have had a dysgenic effect on American blacks but not Caribbean blacks, so why the difference in educational performance?
Is it just that black Caribbean immigrants to the US are themselves a selected minority, or was there something about the black American experience specifically that fuelled anti-intellectualism, that didn't exist in Caribbean black culture?
It’s selective migration crime is really high in Jamaica .
Although weirdly Jamaica in its last decade of British colonial rule had a lower murder rate than Britain itself.
Yeah George. It was likely that ex slaves outnumbered slave owners. They didn’t have 150 years of Jim Crow. They were not being lynched.
I wonder if the use of rigged "literacy tests" to disenfranchise black Americans may have been a fairly direct driver of anti-education sentiment in black American culture?
I am guessing we have to charge welfare with the breakdown of the black family, and when that broke down, so did the culture of education. Add in the black drug gangs and general hopelessness, single working moms with older kids who cannot have their activities monitored, and you’ll get poor attendance, poor study habits, and general disdain for doing the work.
I'd say the bigger problem is that white flight to suburbs stranded black Americans in inner cities where there were no jobs.
I guess the nearest equivalent of Jim Crow for Caribbean blacks would be post-slavery European colonial rule: maybe the issue is that the nastiest racism came not from the ruling elite, but from whites lower in the pecking order who were more likely to see blacks as a threat to them personally?
I wouldn’t say blacks didn’t have discrimination or violence. I just don’t think you can compare the size and animosity of the Southern States vs. Jamaica or Trinidad. Although it is still hard to imagine that Brazil didn’t end slavery until the late 1880s. I can just say they don’t have the victimization that our poorer urban blacks seem to have
I don’t believe they had 150 years of Jim Crow
Probably more like 90 years: from the end of Reconstruction in 1876 to the Civil Rights movement of the 1960s.
To be fair, in New York City as a whole, probably the majority of Black people are of Caribbean origin
I met quite. Colin Powell was one btw
> China’s leaders, being smarter than, say, a gerbil...
I wonder what having a government like that feels like. Must be nice.
This used to be true in CCP (the leadership leans heavily on technocrats with elite education) but Xi has changed all that.
Xi is from the Cultural Revolution generation that had their education cut short, and he distrust the “elites”, so the leadership now is heavy on loyalty and low on competence (yeah we know what that’s like)…
Offset by the secret police
Only when it comes to certain things. China is in the unusual circumstances of having government policy that forces it to put resources towards capital investment that it should be directing towards consumption instead.
Nobody should get any help due to the race or is their ancestry
Any help should be based on class. If you're poor getting the leg up is helpful
So you favor 100% taxation of inheritance and inter-generational wealth transfers, right?
Because me giving something to my kid is the same as someone else discriminating on the basis of race. solid argument
Why does it follow we need 100% in fact, it probably helps reduce poverty on the margin for families with lower-middle class incomes. But yes- we could and should tax inheritance much more than we currently do. We should get rid of the step-up basis for one. And for the concerns of needing to sell the family farm or business, rather than forcing the taxes to be paid immediately- lower the basis, which will defer the tax until the gain is realized. Don’t apply this to things like art- only operational businesses- still probably some room for tax evasion (have your business own the art) but it probably raises the effective rates and compliance overall
That families, communities, and history exist means that many people get help due to their race or ancestry.
Private citizens are not subject to the 14th amendment
So? Every kid doesn’t have to work hard in school because of their race or family history? The percentage of Americans who leave behind generational wealth is minuscule.
That would matter if generational wealth were the only standard of ‘help’ that exists.
Not having deadbeat parents and having parents who value education is a huge help but government policies don’t seem to help there.
It all comes back to economics. Well off parents value education.
Plenty of poor and middle class parents also value education. That’s how kids from poor/middle class families go to good colleges and become rich.
Off topic, but Noah any chance you could investigate whether claims of layoffs due to AI adoption are bogus? My hunch is that the bigger economic mistakes are driving layoffs, but companies prefer to say AI...
Google and Microsoft maybe are driving innovation, but lets stop pretending that Meta has anything to offer please, have you ever clicked on the AI link below a Facebook post before? Its the very definition of junk learning from junk, its embarrassing to a level that makes ChatGPT hallucinations look like the work of Einstein. It is well past time that everyone accepted that with Facebook, Zuckerberg had one great idea (which is fine, thats 1 more great ideas than most people have) and he was particularly skilled at monetising that one idea, but he is not an original or innovative thinker, he has zero insight into the future and what it will look like (the Metaverse anyone, how about NFTs?) and stop pretending that he has anything to offer when it comes to building the future
The Facebook AI Research lab has been doing lots of excellent ground-breaking research. Examples include SAM and JEPA. The fact that these have not made it into META products is more likely to be a management failure.
I don't think we should base our opinion of Meta's AI capabilities from an observation of clicks on Facebook postings. I have no association with them but I do know that Meta's AI team has some of the top AI researchers from around the world.
This is fair but leadership matters (or maybe it didn’t and happy days that means we can stop with the absurd pay packages for CEOs) but the facts are everything I’ve seen from their AI is significantly worse than ChatGPT (which itself is terrible, the best test as always is to ask it stuff you yourself are an expert on, the problems become instantly apparent) and that Zuckerberg from the well before the fiasco of the Metaverse doesn’t seem to have had a good idea since buying Instagram (so to be fair that’s 2 good ideas he’s had)
As of now, I yield the point. Yann LeCun and many of his team have left Meta. My opinion of Meta's AI capabilities were largely based on his presence there. We'll have to see where it goes from here.
What exactly was Zuckerberg's great idea, given that Facebook itself was by no means the world's first social networking website?
>Officials explained that the 10,000-yen levy will apply to hotel stays costing 100,000 yen or more per night
I can't imagine the average Kyoto tourist will be spending $650 a night - when I went years ago we spent about $250 for a 4 star hotel. It'll be good for revenue but I have doubts about crowd control.
Prices have gone up. A standard room at the Kyoto Hilton is over ¥70,000 or $450 now.
I agree, that is just not enough more to stop anyone who wants to visit Kyoto. For many this is a once in a lifetime trip.
If that doesn’t reduce the crowd, they can keep raising it till it does. This is not a hard problem.
My wife was a semiconductor executive at both Intel and TSMC. She has long predicted that Chinese semi will never catch up to the US.
Her reason is that it is actually not tech know how or lack of equipment, but cultural.
An advance wafer can have more than a hundred layers where each has to meet quality standard. So if your yield for a single layer is 99% (which many would think k that is pretty good), the yield for the whole chip is (99%) to the power of 100. One can quickly see how difficult that is. (This explanation was what my wife was telling her Huawei customer who has the yield question, after thinking about it, he replied that “yeah we don’t have the culture for that kind of quality”). A Temu TSMC is just not gonna cut it.
Then again let’s not blame the Chinese, right now nobody but TSMC can do it (Samsung and Intel used to be contender but have now fallen far behind). The TSMC fabs in Arizona is only successful because the engineers are all shipped from Taiwan (who is willing because of the green card )…
This is so dumb. Cultural arguments for why group X will never accomplish Y have failed every single time. Yes culture is real but people and organizations are adaptable, especially when there's a reason to motivate them to change. This take though is especially wtf because if the Chinese will never catch us then how the hell did the Taiwanese do it? If they're not the same culture now they both at least developed out of the same culture. Remember when all our cheap crap used to be made in Taiwan?
Taiwanese culture is a unique blend of Chinese and Japanese. the attention to service is the cultural trait that is lacking in mainstream Chinese business.
People who has done change management all agree that process and technology changes are easy, culture changes are hard.
I will put forth a counter argument for you: (assuming you are an American) “when American adapt their culture by having gun control they can solve a lot of problem in their society”
If you think these two cases of culture change are different, I would like to know why.
So if Taiwanese success is explained by the infusion of Japanese culture, why shouldn't we get another TSMC from Manchuria, which was occupied by Japan for almost the exact same amount of time? Speaking of Japan, during the Shogunate they had the most hidebound and traditionalist culture in East Asia until the Meiji Restoration, when they switched to being outward-looking and innovative. Which just goes to show that huge cultural shifts are possible.
This neatly illustrates how attempts to explain outcomes with culture nearly always rely on just-so stories and the representativeness heuristic. We have stereotypes of the solicitous Japanese (and Americans) and rude Chinese, but on the other hand startups that need to manufacture a prototype of their product often say that Chinese manufacturers are much more responsive and accommodating than American ones. Cultures are way too vast to make easy generalizations about them in that way. Especially a culture with over a billion people and dozens of regional sub-cultures.
BTW, before you were talking about a culture of quality, now you're saying it's service. When pressed on that you can shift to any other trait you can think of. It's totally non-falsifiable.
Re: gun control in America, there are more or less the same number of people who are adamantly anti gun control as there are who are strongly for it. By contrast no one in China is against catching up to the US in semiconductors as a concept. And yet, if you were to say that America will never have gun control I would not agree with you, just because forever is a long time.
Manchuria did not absorb much of the Japanese culture. I have theories but not enough due diligence to stand behind.
Everything you cited as “culture” is not what I was talking about . Rude Chinese or hidebound Japanese you stated. By my lens Japanese culture stayed very consistent from shogunate to modern times.
Of course TSMC’s success have many parents, not just “culture “, it was the right enterprise at the right time. (Many TSMC old guards are worried that as they retire from the scene, whether the company can keep their edge).
Regarding China: part of the difficulty re culture change is that there are opposite forces that work against it. Chinese tech environment is brutal (be it EV, Solar, or semi). It is very much win or die. Speed is probably the number one cultural trait for success. And speed works against the need for the detail oriented work needed for high end chip work.
At the end of the day, I am an engineer type who believes in data. Give me a semi success story of someone who (eventually) will eat TSMC’s lunch, and I will be happy to eat my word.
How much of a lowered yield will still remain profitable?
ChatGPT says around 60% being break even
I have seen universities achieve their affirmative action goals by recruiting African immigrants (both students and faculty). This is a policy failure. Programs that focus on domestic students escaping poverty seem more likely to meet policy goals of developing brilliant domestic students. I am also a big fan of increasing African increasing skilled immigration to the US just as I favor skill immigration from Asia and Europe. But such a policy has the goal of recruiting the very best minds from the entire world.
Regarding your antitrust post… We need to distinguish between economic sectors in which it’s possible to grow the pie and those in which the pie is more or less fixed and all we’re trying to do is figure out how to divide it.
It probably won’t work to use antitrust legal enforcement against things like social media, crypto, AI, computers, etc. As soon as we corner one of them, someone invents a New Thing that renders the old debate obsolete. At best, we can kneecap today’s Villain of the Week and free up space for an even more nefarious villain to take its place.
The same logic DOES NOT apply in sectors which are roughly capped in size—agriculture, for instance, or meat production, or lumber. In sectors such as these, the presence of oligarchs lead not so much to innovation as monopsony: a relentless squeezing of margins and Gilded-Age dynamics.
We need to develop a legal framework (and economic analysis) nimble enough to make this distinction and not try to shove everything into a one-size-fits-all framework.
Do you then agree with Trump that meat packers greedflation is why beef prices are high, rather than tariffs on imported meat, fertilizer and equipment or the crackdown on foreign laborers? Four companies dominate meat packing, but that is twice as many that dominate computer or phone operating systems.
I do agree that it’s a big part of the problem. But it’s not the entire problem. Those other factors you mentioned all play a role too. However, there’s a difference between the meatpacking industry and cellphones. While both are monopolies (or at least oligopolies) there’s no realistic chance that we will innovate our way around meatpacking. I’m willing to bet you—any amount, any odds—that a century from now people will still be eating meat. (And it won’t all be grown in labs.) That means monopoly as far into the future as we can project.
In contrast, I’ll bet that even 30 years from now, people will NOT still be stuck choosing between iPhones and Androids. (Although I’m less confident about this one. Maybe 90%.)
If I’m right, then the two pose different problems. To change how meatpacking and the like work will require market restructuring. That’s a big lift.
No such restructuring is required for cellphones. Instead, they merely need to be prevented from abusing their monopoly power while it lasts. That’s an easier lift and indeed has already started.
People using computers with hardware keyboards are still stuck choosing between MacOS, Windows, and Linux, just like they were 30 years ago.
It’s a really good point. I would make two points in return. The first is minor, which is that computers are far less indispensable to life now than they were then, as indicated by the fact that OSs are all free now. If we still had to pay, there might be more competitors.
Second, and more important, I do not expect that Apple and Android will disappear, and I do expect that you’ll still be able to buy a descendent of today’s iPhone or Android if you want to. (I could’ve been more clear on that.) I just think they’ll probably be more of a niche product. Most people will not rely on standalone phones to communicate or consume content.
Windows isn't free; only updates are. If the manufacturer of your computer didn't pay for a Windows licence (if, for example, you built it yourself from parts) then there's a good chance that you'll need to buy one.
I'd generalize that to "MacOS, Windows, or Unix-like operating systems" as Linux isn't the only example of the third (even if we look only at open-source examples we've got the BSD variants as well).
I too also felt that it was never a compelling argument to say we should sell China our high-end chips in order to keep them dependent and to prevent them developing their own AI hardware stack. It always seemed obvious to me that they would try to reverse engineer our stuff whether or not we were selling it to them.
But I’m not a well known smart economist, so I figured I must be naive and missing something.
Thank you for the validation, Noah.
Not to mention, we saw what they did to us with rare earths
Also not to mention, during the Cold War nobody tried to make the case that we should sell our advanced military hardware to the USSR in order to disincentivize them from developing their own.
Because that would be silly, right?
Either it would be silly for us to do, or silly for them to accept.
Excellent point
Very nice set of topics.... Especially enjoyed the "selective immigration" topic. Selective immigration intensity seems to correlate heavily with unicorns/capita in US cities.
Another option is to not have race based affirmative action programs at all.
Good Active Investing > Passive Investing > Bad Active Investing
Sounds simple, but is true. Lumping the first with the third isn’t a good comparison to the second. All three have a place. Passive is great while you are accumulating wealth and/or don’t have the time to learn your way through being a bad active investor into becoming a good one. Every active investor is bad when they start. When you buy an index fund, you are by definition buying a bunch of crappy stocks and most likely are underinvested in the good ones. You also pay management fees.
It's important to note that America *does not* hold an advantage in advanced chips. Taiwan does. And Trump's disastrous trade policy and overtures to move advanced chip manufacturing on-shore will only drive a wedge between the two partners. Taiwan holds all the cards here. Fortunately they also benefit greatly from the current alliance. The bond will hold, if we have someone competent holding the policy reins.