6 Economic Lessons from Books About Power, Propaganda, and Decline

What Tolkien, Canetti, Girard and more can teach us about discord, scapegoats, and the test of institutions.

I had the chance to talk with Rachel Janfaza about trends and data - tradwives and the new girlboss movement, young people and the labor market, and of course, how social media is impacting us all. I hope you enjoy the conversation!

---

I’ve been spending some of my time in the mountains over the past few days. Trail running is a decent metaphor for life - dodging tree branches and skipping rocks, tremendous climbs and delicate descents. The quiet. The thundering noise of nothing.

Photo credits to Zach!

It’s given me some time to think. And the past few months and weeks have been indescribable. I keep returning to this phrase as I slammed my head into the keyboard over the past few days, typing it out, deleting it, typing it again.

How do you describe the indescribable? I mean, think about it -

• A single day contained both political violence and a school shooting

• Jimmy Kimmel said something (false) around Charlie Kirk’s death and was taken off the air but the underlying reason was because (1) Trump wanted him to be taken down (2) the FCC threatened ABC (3) a merger has to go through

  • Nexstar owns dozens of local TV stations. Now it wants to do a $6 billion merger with Tegna, which owns dozens more. To do that, it needs to be on the FCC’s good side. The head of the Federal Communications Commission was very unhappy with Kimmel, taking to Benny Johnson’s podcast to make his stance clear - kill Kimmel’s show or else the FCC will haunt you.

• Speaking of mergers, Paramount Skydance fresh off their $8b merger, is preparing a bid for Warner Brothers Discovery, which would put CBS News and CNN under the same roof.

• TikTok is being positioned for sale designed specifically to appease China, with plans to sell to an investor group including Oracle and a16z, possibly giving the Ellison family vast access to media ecosystems. Trump has extended the deadline four times now, which is illegal.

• More than 300 South Korean nationals were arrested in a raid at a Hyundai-LG battery plant in Georgia which they were helping to build (which the administration says they now regret). The plant, which the US needs, won’t start up again until 2026

• The attempted firing of Fed Governor Lisa Cook over mortgage fraud (only to find that literally everyone else is committing fraud) and continued threats to Fed independence

• Stephen Miran is appointed to the Federal Reserve board while taking a leave of absence from his job as Chair of Council of Economic Advisors, raising the question - does he still agree with his 2023 tweet on independence?

• Consumer sentiment remaining persistently gloomy for young people coupled with a continued rise in youth unemployment rates since 2024 (as AI reduces the number of junior people hired). The broader labor market is weakening too (across both white collar and blue collar work), coupled with rising inflation.

• Politicians are increasingly deciding that their role is not to represent their constituents but is instead to become social media stars

• The Nepali government was overthrown and a new PM was voted in via Discord

• The continued exuberance of the stock market alongside a growing gap between the rich and poor as the top 10% now account for almost 50% of total spending

• Trump’s approval cratering because the economy is showing major signs of weakness (contrary to the view of Internet, most people really just care about the affordability of groceries)

So how do you describe the indescribable? You describe it as a test. Every one of these stories - Kimmel and the FCC, Paramount and CNN, TikTok, Miran at the Fed, youth unemployment, Trump’s slipping approval - is a stress test of institutions. Can media resist capture? Can central banks stay independent? Can governments maintain trust?

We are living inside overlapping crises of trust, violence, and attention, alongside weakening material conditions. It feels mythic - the human struggle with meaning and certainty is nothing new. And maybe that’s the best way to understand it. The old myths help explain why this feels both absurd and eerily familiar.

The Chicken and the Egg

A big debate right now is sort of a chicken and egg problem. Does social media cause Problems, or does it simply amplify deeper ills - like zero-sum thinking, institutional collapse, and inequality? Does the algorithm come first, or does the despair?

I think it’s complicated. I believe that The Machine is designed to monetize human attention, which is then sold to advertisers. And in an attention-based economy, outrage is cheap fuel, something you toss on the fire to make it burn bigger and brighter. Truth, nuance, and analysis are luxury goods that most people can't afford to produce consistently - so they ragebait.

Meanwhile, companies chasing giant mergers bend themselves into silence, because nothing (not even the law!) can jeopardize regulatory favor. My billion dollar merger must go through, you see. Attention gets harvested, but so does independence.

And people aren’t just “fooled by algorithms.” They’re living with real pressures. The economy is weakening. Young people have very different priorities in life, and there is continued divergence between young men and young women.

Declining prospects funnel young men into hyperspecific online ecosystems, where economic disappointment curdles into cultural grievance. Anxiety creates the psychological conditions that algorithms exploit.

AI is weird too. Platforms are under control by actors who might not have the best intentions at heart (continually refining Grok so it fits an ideology is not great). When the machines become echoes for someone’s worldview, who are they really for?

So yes: it’s the despair and the algorithm, together. To explain where that leaves us, I think we need myths. Myths give us language for recurring human patterns, and frameworks for understanding whatever is going on. They describe the harmony and discord, conflict and scapegoats, plagues and crowds. Books.

(1) Discord

Then the discord of Melkor spread ever wider, and the melodies which had been heard before foundered in a sea of turbulent sound. - The Silmarillion, J.R.R. Tolkien

In the opening of The Silmarillion, the world is sung into existence by the Ainur, the holy ones, each contributing their voice in harmony to a vast symphony directed by Eru Ilúvatar. But then Melkor, the most powerful of the Ainur, introduces discord into the music. It’s chaotic, a melody of pride and violence. When it gets woven into the very fabric of creation, it permanently scars the world.

Our world feels the same - the age of struggle between order and chaos. Discord (lowercase d, ahem) has become a central organizing force. In Nepal, Discord servers (capital D) coordinated mass protests that toppled the government. And the same rails that carried that also carried the confession of Charlie Kirk’s killer.

The world has become very small, and the platforms have become very powerful. Social media is one thing - where we all yell at each other in the feed - but private chatrooms are increasingly important to understanding the suburbanization of the Internet.

Trending topics mean millions of people are suddenly focused on the same thing, in their own algorithmic universe, whether it’s a school shooting in the US or political unrest abroad. They sing their discord and bring turbulence: half-truths, polarization, confusion. The algorithms are tools of engagement, and many people know that it’s all a game. Why not sing darkness into the fabric of creation? It’s a good way to make a lot of money, after all.

(2) Blame

The account thus shows once again the omnipotence of mimetic contagion. What motivates Pilate, as he hands Jesus over, is the fear of a riot. He demonstrates "political skill," as they say. This is true, no doubt, but why does political skill almost always consist of giving in to violent contagion? - I See Satan Fall Like Lightning, René Girard

The discord shows up continuously. When Charlie Kirk was killed and when Representative Hortman and her husband were killed, two high profile instances of political violence in the last few months, the response was instant politicization.

For Kirk, there were demands that he be remembered in a particular way and the Department of Justice is making it their duty to enforce that. Representative Hortman got none of the respect she deserved, no lowered flags, and a mocking tweet from Representative Mike Lee saying “Nightmare on Waltz Street” with a picture of her killer.

For both cases, death became a partisan talking point. René Girard's mimetic theory helps explain what's happening here.

• Human desire is imitative - we want what others want (the business model of social media), which creates escalating conflicts as people compete for the same objects of desire.

• This mimetic rivalry builds tension until it threatens to tear communities apart.

• The ancient solution was scapegoating: the community would unanimously direct their violence toward a single (perhaps innocent) victim, achieving peace through shared blame.

• It worked because it required unanimity.

• Everyone had to agree, at least publicly, on who was responsible for their troubles and that collective accusation created social cohesion, even if it was built on a lie.

But online, that type of unanimity is structurally impossible. The same tragic event gets processed through completely different frameworks all at once. Murder becomes a way to validate an existing worldview and reinforce a sense of moral superiority. Digital scapegoating amplifies it across feeds. Tragedy becomes content.

(3) The Permanent Crowd

A murder shared with many others, which is not only safe and permitted, but indeed recommended, is irresistible to the great majority of men. - Elias Canetti, Crowds and Power

The crowd craves content. Canetti saw crowds as boundless, with a hunger for expansion, contagious, all-encompassing energy. In his world, the crowd was more physical than what we have now - more bodies in a square with a single purpose.

Now, the crowd is mostly online. The digital crowd is everlasting, omnipresent, overwhelmingy powerful. It doesn’t need a public square. It is always scrolling and always metabolizing whatever is fed into it.

You can see this whenever violence breaks through. A shooting, a protest, whatever, it doesn’t matter. The crowd swells instantly, understandably. Some condemn, others cheer, others meme. Again, the algorithm doesn’t distinguish between condemnation or celebration, just raw engagement.

Canetti thought crowds had to find a release, a moment of catharsis before they dispersed. But our digital crowd never really goes away. It just keeps growing, folding one story into the next, a persistent force, but no moment of return to individual. What does politics become when the crowd never goes home?

(4) Habit

Resolve to serve no more, and you are at once freed. I do not ask that you place hands upon the tyrant to topple him over, but simply that you support him no longer.” - La Boétie, Discourse on Voluntary Servitude

The crowd can swell, but it can also become stagnant. La Boétie’s idea was that authoritarian power often depends less on coercion than on habit. People get used to serving, to accepting, and to normalizing. They don’t really resist because obedience feels like some form of order. People will accept almost anything if the transition feels gradual enough. The tyrant doesn’t always need chains. He just needs inertia.

But there is a broader application too. The erosion of independence feels familiar in an economy where convenience has become infrastructure. DoorDash with buy-now-pay-later, AI reducing entry-level jobs, politics turned into performance. People accept erosion not because they love it, but because resistance feels exhausting. The trap is voluntary servitude dancing with efficiency.

(5) Propaganda

This situation makes the "current-events man" a ready target for propaganda. Indeed, such a man is highly sensitive to the influence of present-day currents; lacking landmarks, he follows all currents. He is unstable because he runs after what happened today; he relates to the event, and therefore cannot resist any impulse coming from that event. Because he is immersed in current affairs, this man has a psychological weakness that puts him at the mercy of the propagandist. - Jacques Ellul, Propaganda

The crowd also responds to noise. Ellul argued that propaganda saturates - it pervades every aspect of life. It creates that exhaustion that leads to erosion of independence.. This is flood the zone before there was flood the zone. Create noise and force people to adapt their behavior to uncertainty. You don’t have to believe the propaganda for it to work, you just have to adjust yourself to its presence. It’s sort of La Boétie’s idea too - much of power depends on people never resisting.

Our media consolidation environment is starting to look like this. Paramount and Skydance circling Warner Brothers Discovery, a merger that would put CBS News and CNN under the same roof. Oracle might also have a bit of TikTok. Nexstar angling for Tegna, dependent on FCC favor. Everyone knows the game to be played - curry favor, do what must be done, make billions of dollars, sacrifice much of what those who came before you fought for, etc.

Ellul would say the danger is in what goes unsaid, the self-censorship. The saturation effect makes people cautious, quiet, reluctant. It narrows the space of speech without ever needing a formal ban. People know the consequences, and like the ABC execs, backdown instead of taking retaliation.

If propaganda works by poisoning the atmosphere, then what happens when our atmosphere is dominated by silence?

(6) Power

What we call Man’s power over Nature turns out to be a power exercised by some men over other men with Nature as its instrument. - C.S. Lewis, The Abolition of Man

Silence is the scariest thing. Lewis warned that when values are hollowed out, institutions risk being run by raw will. He called it the Tao: a shared understanding of right and wrong as the basis for all human values and the purpose of institutions. Once that framework is hollowed out, domination follows. The people operating the levers of power bend the machinery toward their own ends.

Central banks were designed as buffers of independence, neutral arbiters of monetary stability. Yet one of Trump’s appointees, Stephen Miran, now sits on the Fed board while on leave from his other job in the White House - a revolving door that he once criticized Lael Brainard for walking through. Does he still believe that? Or has independence itself become theater, a performance of neutrality rather than its practice?

Same thing for the media, too. Journalism’s grounding is the pursuit of truth. Remove that, and it gets messy. Outlets become vessels for whoever controls distribution, whether that’s Paramount/Skydance/a16zTikTok or a regulator with veto power.

Lewis’s warning was that when institutions forget why they exist, the what of their power gets captured. Technology, regulation, and expertise become instruments of will. And then, things get dangerous. Do institutions remember what they are for? Once the why is lost, the what can be bent into anything.

Final Thoughts

The question was whether social media causes despair or simply amplifies it. And like, we have bots running engagement farms for coffee shops. We have an economy that is currently built on rage, and a political system that is designed to feed it. So the answer is both. It amplifies what already exists, and in doing so, it reshapes what comes next.

What we are really facing is a broader test. Can institutions remember what they are for? Can media resist capture, can regulators stand independent, can governments maintain trust? Or will habit, propaganda, and hollowed-out values turn them into stages where power is simply performed?

The books remind us this isn’t the first time such uncertainty has existed (one could argue it’s always there), and likely won’t be the last time. In the most dramatic of terms, collapse doesn’t come from challenges, it comes from response.

Thanks for reading.