At least five interesting things for your weekend (#36)
The silent majority and the Palestine protests; immigration is fine; batteries make solar work; building warships in Japan; the decels of the Right
I’ve been a bit busy this week, with two conferences and jury duty. But I will continue to strive to provide you with large volumes of the content you crave.
Brad and I have a very special Hexapodia episode, where we talk about the work of the late Vernor Vinge, our favorite science fiction author:
And I also have another “mailbag” episode of Econ 102, where I answer a bunch of questions from listeners:
Anyway, on to this week’s list of interesting things!
1. The Palestine protests don’t represent the young generation
I’m pretty tired of writing about the Palestine protests. I said pretty much all that I wanted to say in my post two weeks ago, and my central point was that the whole movement is kind of boring. But I feel like I should post the results of this recent poll, because it pretty much vindicates what I was saying.
Generation Lab surveyed 1250 college kids, asking them to pick up to three issues they thought were important. Only 13% mentioned Palestine at all:
Axios has some more details from the poll:
Only a small minority (8%) of college students have participated in either side of the protests…
The survey found that three times as many college students blame Hamas for the current situation in Gaza than they do President Biden…Some 34% blame Hamas, while 19% blame Israeli Prime Minister Benjamin Netanyahu, 12% blame the Israeli people and 12% blame Biden.
A large majority (81%) of students support holding protesters accountable, agreeing with the notion that those who destroyed property or vandalized or illegally occupied buildings should be held responsible by their university, per the survey…A majority also said they oppose the protest tactics: 67% say occupying campus buildings is unacceptable and 58% say it's not acceptable to refuse a university's order to disperse…Another 90% said blocking pro-Israel students from parts of campus is unacceptable.
And all this is despite 45% of students saying that they sympathize at least “a little bit” with the protesters’ cause.
Perhaps this isn’t too surprising. Unless we’re in a war, Americans naturally care less about foreign policy than about domestic issues closer to home. But given the results about protest tactics, it seems likely that there’s more at work here. The protesters’ general bad behavior and failure to suppress antisemitism, along with the fact that many are explicitly pro-war, has probably alienated the silent majority, even among the young generation of Americans.
No matter what you think of Israel’s war, it should be clear that this kind of thing helps precisely no one. Fortunately, it also means the threat to Biden’s reelection chances in November is probably a lot smaller than the protesters like to claim.
Meanwhile, the protesters continue to waste any political clout they have. They continue to direct all their hatred at Joe Biden, despite the fact that Biden is actively exerting pressure on Israel to restrain itself, even as Trump urges unconditional support for Israel’s war effort.
In any case, the more data comes in, the more it becomes apparent that the Palestine protests have not set the Zoomer generation on fire with activist passion. Instead, most young people are just quietly waiting for the whole thing to go away.
2. The harms from immigration just keep failing to appear
As an immigration supporter, I try to be generous to the skeptics and critics. Any country has a right to let in — or to refuse to let in — whoever it wants. And if people are worried about immigration changing their culture, that’s perfectly legitimate.
But at the same time, immigration restrictionists also claim lots of economic harms from immigration — lower wages, strains on government finances, etc. And yet these arguments keep getting contradicted by the evidence.
For example, plenty of evidence shows that immigration — even low-skilled immigration — doesn’t have a negative effect on the wages or employment prospects of the native-born. Here’s a recent paper from Michael Clemens and Ethan Lewis with a very “clean” identification method — a randomized visa lottery! — that supports this conclusion:
U.S. firms face a binding quota on visas to employ foreign workers in low-skill occupations outside of agriculture. The government allocates this quota to firms in part through a randomized lottery. We evaluate the marginal impact of the quota on firms entering this lottery in 2021 and 2022, using a novel survey and pre-analysis plan. Firms exogenously authorized to employ more immigrants in low-skill jobs significantly increase production (elasticity 0.20–0.22), investment (1.5–2.1), and the rate of profit (0.15). Because the foreign-native elasticity of substitution in production is very low in the policy-relevant occupations (0.8–2.2), the effect on native employment is zero or positive overall, and positive in rural areas.
The simplest reason for this is that immigration isn’t just a labor supply shock — it’s also a positive labor demand shock, because immigrants buy lots of stuff, which requires labor to produce. But there are probably other reasons, too. Here’s a new paper from Alessandro Caiumi and Giovanni Peri, which finds that immigration helps native-born Americans to get better jobs:
[W]e calculate that immigration, thanks to native-immigrant complementarity and college skill content of immigrants, had a positive and significant effect between +1.7 to +2.6\% on wages of less educated native workers, over the period 2000-2019 and no significant wage effect on college educated natives. We also calculate a positive employment rate effect for most native workers.
And a 2020 paper by Mark Colas and Dominik Sachs shows that this upskilling effect could be enough to outweigh the drain on local government resources that low-skilled immigrants are known to cause. Of course, the resource strain happens in the short term, while the indirect and long-term fiscal benefits happen only in the long term. Still, this is one more piece of evidence that immigration is more economically beneficial than the restrictionists claim.
I’m sure the people who are dead-set against immigration for cultural reasons will still rush to pull out some old study by George Borjas that claims to contradict the growing mound of evidence that immigration is economically beneficial or benign. But with every piece of evidence that accumulates, their protestations are looking more and more forlorn.
3. Battery storage is for real
One of the biggest knocks against solar was always the fact that the sun doesn’t shine at night. That is a fair point; in order to have solar power replace natural gas, we’re going to need to figure out a way to store solar energy during the daytime for use at night.
The most obvious way to store electrical energy is just…a battery. For a long time, solar skeptics have claimed that battery storage is just too expensive to ever be feasible. But batteries, as they so often do, are proving the doubters wrong. California — which has trouble building solar because of NIMBYs, but can build batteries just fine — has been building a ton of battery storage for utilities.
And those batteries are now coming online, and already making a huge difference in how Californians use energy:
Meanwhile, Texas is building even more battery storage than California:
Last year, Texas overtook California in large-scale solar power capacity. When huge amounts of solar power rush onto the grid, batteries tend to follow. Now, Texas is building more grid batteries than California…Developers are expected to complete 6.4 gigawatts of new grid battery capacity in Texas this year…That’s…as much battery capacity as the entire United States built last year…The projection outpaces the 5.2 gigawatts set to come online in California.
Eventually, batteries will smooth out solar’s daily intermittency curve, allowing solar panels to produce enough energy for both nighttime and cloudy weather.
Now, seasonal intermittency — the fact that the sun doesn’t shine as much in the winter — is a harder problem to solve, because it will probably never make financial sense to buy giant batteries that only get discharged once a year. The easiest solution here is just to build more solar to compensate for the weaker winter light, but that could run into NIMBY land constraints (especially in California). Or we could go looking for other types of storage.
And in fact, battery prices are still crashing. Part of this is due to Chinese industrial overcapacity, which may not last forever. But thanks to the magic of scaling effects, even if China eventually has to cut back on production, their efforts will have made battery factories permanently better, cheaper, and more efficient.
In other words, human ingenuity keeps on defeating the techno-pessimists.
(Financial disclosure: I am invested in a battery storage company.)
4. The U.S. needs to build a bunch of warships in Japan (and Korea)
The U.S. has a huge problem building enough ships for its navy. And it doesn’t have much of a commercial shipbuilding industry to speak of. A lot of people are now rightfully freaking out about this problem, because it puts the U.S. in imminent danger of losing a major war to China.
But you know who can build ships? Japan and Korea. Together, our smallish Asian allies have shipbuilding industries whose combined size is almost as large as that of China. And while Korea is bigger than Japan in terms of commercial shipbuilding, Japan can make complex high-tech naval vessels too, having just built its first true aircraft carrier since WW2.
A simple solution presents itself: Build ships for the U.S. Navy in Japan. This would help solve the U.S. procurement problem in the short term. It would also help to bolster the flagging yen, by increasing demand for Japanese products, thus preventing currency market disruptions that could weaken a key U.S. ally at a crucial point in time.
This sounds like the kind of solution that’s too smart and out-of-the-box for the lumbering U.S. government to ever do. But it’s not! In fact, we’re looking for ways to do it right now:
U.S. President Joe Biden and Japanese Prime Minister Fumio Kishida will agree to explore closer cooperation between their nations' defense industries…The cooperation will not be limited to repairing U.S. naval ships at Japanese private shipyards but will also envision the co-development and co-production of munitions, planes and ships in the future…The U.S. sees huge potential to "integrate" Japan into America's defense industrial base, the [U.S. government] official said…
The use of Japan's defense industrial base will begin with ship repairs…[C]o-production of assets would likely begin with munitions. The U.S. is critically short of munitions, having to provide them to both Ukraine and Israel. Co-producing munitions with the Japanese defense industry will help backfill stockpiles for the Indo-Pacific.
We need to accelerate this effort dramatically. U.S. Navy ships and submarines, not to mention missiles galore, need to be rolling off the lines at Japanese shipyards as soon as possible. And Korea should be in this conversation too.
This would, of course, be a tremendous historical irony, given that the U.S. won WW2 by massively outproducing Japan. But times change, as do economies and alliances. Building ships in Japan is as close to a no-brainer as defense policy gets.
5. The decels of the Right
These days, you often hear tech people complain about progressives’ zeal for regulation of new industries, be it Lina Khan’s crusade against Big Tech at the FTC, Gary Gensler’s focus on crypto at the SEC, or various AI safety efforts. But some red-state governors are reminding us that conservatism can be just as decelerationist as progressivism. Florida Governor Ron DeSantis and Alabama Governor Kay Ivey have now signed laws to ban lab-grown meat:
Last week, Florida Gov. Ron DeSantis signed a bill into law to ban cell-cultivated or “lab-grown” meat from the Sunshine State…Then, on Tuesday, Alabama Gov. Kay Ivey signed a similar bill into law…
DeSantis banned the technology to protect Florida’s farmers and ranchers from future competition. But it was also a culture war win for the governor, as meat has become a hot topic in the right wing’s conspiracy-laden politics. The day DeSantis signed the bill, he posted a bizarre image on X accusing the World Economic Forum of an authoritarian plot to force people to eat cell-cultivated meat. An anti-vaccine group called Health Freedom Alabama, according to Wired, advocated for the state’s cell-cultivated meat ban.
Bizarrely, Democratic Senator John Fetterman supported the move.
Lab-grown meat is a pretty niche part of the tech industry, of course — it has huge future potential, but it doesn’t even really exist as a viable commercial market yet. But electric vehicles ARE a huge and rapidly growing market, and a pillar of the tech industry. And with China gunning for the U.S. EV industry, some amount of countervailing subsidies are needed for U.S. vehicles to remain competitive around the globe.
Enter Donald J. Trump:
The fate of the EV industry might hinge on former President Donald Trump’s reelection campaign.
During a meeting in Florida, Trump told a room full of oil executives that in exchange for raising $1 billion in campaign funds for his reelection bid he would roll back a slew of environmental regulations, according to a report from the Washington Post. The oil executives reportedly balked at the transactional nature of Trump’s comments…
Included in those future regulatory cuts was a promise to undo a series of regulations meant to encourage automakers to invest in and manufacture more electric vehicles…Should Trump’s hopes come to fruition, they could upset some of the carefully laid plans of U.S. automakers that have invested billions on electric vehicles.
The attacks on EVs and lab-grown meat should serve as a stark reminder to the tech industry that the Right is not a friend and ally to the cause of technological progress. When the technology in question pushes the right set of culture-war buttons, Republicans will instinctively respond with regulations that put Europe to shame.
That’s very sad, from my perspective. We can’t afford to have two parties who are both automatically skeptical of new inventions. The U.S.’ industrial future — as well as its geopolitical security — depends on a wholehearted embrace of rapid technological innovation across the board.
Another great set of five. Thank you.
I was relieved to read your first interesting thing about college attitudes toward the protests for many reasons including the probable minor effect on the 2024 election.
On immigration, I agree with you and the papers you cite 100%. The problem, however, is that for much of the working class, the talking point of "immigrants take your jobs and depress your wages" hits home. It's an effective albeit false talking point. That worries me.
Building ships in Japan seems like such an absurd kludge in the face of "just repeal the Jones Act". Like, sure, ideally we'd do both, but it's really troubling as a society that we can't fix the long-term problems, we only ever come up with the next kludge.