2) Regarding Tariffs / Goodwill: Neither Canada or Mexico have been acting as goodwill as they allow illegal aliens, deadly drugs, weapons, and criminals cross our borders causing rapes, murders and drug deaths to skyrocket. Goodwill of China similar. Goodwill of EU and NATO, deplorable.
3) The Founding Fathers are applauding the first three wks of Trump rn. Raskin is a horrible actor and therefore a horrible source to quote about 4th branches of govt. Regarding any 4th branch of govt I refer you back to Tom Renz thread regarding the legitimacy of DOGE.
ps. We all color our conclusions from our own personal framework and biases, but I think you could stand a closer inspection regarding your framework and biases. pss. I still love you.
It seems many ideas being pursued right now are either not well thought through, or are, but with a need to pretend otherwise.
For example, using tariffs to fund income tax reductions is a transfer of tax payments from those with the most to those with the least.
The biggest beneficiaries of income tax reduction will be the people with the largest incomes, and the people most impacted by tariffs will be the people who spend the highest percentage of their income.
The idea that Trump and his people promoting these polices don't know this seems hard to accept.
For the most part, I agree, but in my opinion, you miss some things that matter.
Why does this happen? It's not like Trump fell from the sky. The election campaign, Biden, many developments since decades leading up to that all are a logical path unfolding. It's ideology delivering answers that match less and less.
You do not question that the intention is to MAGA, despite reasoning self-destruction. Could it just be greed for money and power? That's what made the USA big at a time when that answer led to success. The birth rate and the absurd cost of living shows the decline has started long ago. It's not a crisis, it is a development. The majority does not benefit since a while already. An atmosphere where people primarily defend themselves economically is what brings nations down.
Trump isn't the root cause. He is a symptom. You can love or hate him, the root cause will not be impressed. The world has seen many cultures and all of them always thought to be the best and last, and traversing history, the majority was wrong. There were other world dominating powers in history that are now gone. Do you seriously think it will be different this time?
And within that context, there is hope. Should the USA be able to reduce bureaucracy, even if something breaks in the process, it would be the first country managing to do that and it would help big time. All countries so far assigned that task to bureaucratics. Nobody expected that to work and it did not. It is not sure such a radical change will work, but anything less radical will fail for sure. If a bunch of rich people get richer from that by taking from the poor, well, that would have happened any other way, too.
Trump is trying something. It may work, or not. The problem is not that he's trying. The problem would be if he didn't recognize bad outcomes and would persist in mistakes.
The present is not the past. Some things may stay the same, some may be different than decades ago, regardless what the economic history books say. (Not the same person, not the same river.) We don't know until we try. One thing is sure: we can't keep going the way we have been going for the last 2 decades. This is decline and fall. We need a change in direction.
Soros became a billionaire by changing his mind very fast when facts changed. As long as Trump does the same, and it seems that he does, I'm optimistic.
I don't see anything bad in renegotiating bad deals with our "friends" and "allies". On one hand, people are complaining that we have an increasing gap between haves and have nots, on the other the same people whine when the government is trying to stop the hemorrhage of money to various other countries and special interests. Instead of goods, we've been exporting ideology (e.g. at USAID) and projecting weakness (very dangerous when one is the alpha).
Put me down for another member of the “We Love Kyla’s Brain” fan club.
Your articles have grown more pessimistic as of late (for understandable reasons). I think you lay out who the losers are fairly clearly here. My question becomes, then, who are the winners?
This group of folks in and around the Trump orbit aren’t dumb. So what is the long game? Or have we given up the long game for short term gains followed by a hard exit of our wealthy class once they’ve gained what they can?
Not in a conspiracy theory game, mind, just in a blast of profit maximization.
One weird puzzle piece in all of this is Japan, the US' 4th biggest trading partner. Everything seems fine? Trump seems to really like Japan (see all the Shinzo Abe/Trump memes). They're terrified of China, but also seem totally capable of navigating Trump's ego and interests to ensure continued partnership. I suspect it is because they do not criticize him in public, invest in US manufacturing, and Tokyo is impressive (Trump's a big aesthetics guy apparently). There's probably worth studying something there about what Trump wants from potential partners.
I do think there are other alternate futures than the ones you mapped out. One is the Long Rebuild, where US consumers absorb a decade of higher prices as US domestic supply catches up to demand, pricing underneath the tariffs. They would have to drive much lower with automation to be competitive globally, but who knows where trade would be in that world? Another (a very low confidence, practically conspiracy theory) is that Trump would prefer China as an ally than anybody else, Europe, Canada, Mexico, etc. I have this hunch he actually admires China and Xi—he wants an economy like that, he loves all the construction and manufacturing, he'd love to have the power that Xi has. If he could find terms to carve up the world with China, he would do it (I think the cries of fascism are premature, but this scenario is very heavily shaded by 1940s Japan and Germany).
I don't necessarily agree with you on everything that you are saying here, but I very much appreciate the very well argued and analyzed piece that you put together. Neither side is completely right, but we need more of what you are doing here instead of yelling at each other, so thank you and keep up the good work.
Enjoyed your perspective on tariffs. I always think I have an understanding of the economics of a situation and then read what you write and realize there were about 6 layers that I missed.
Interesting take on DOGE as well. Definitely think there's going to be an issue with the speed at which they're coming in with a wrecking ball (and what that amount of new people looking for a job is going to do to an already thin market), but on the other hand, a Silicone Valley approach to government was probably long overdue. Young people getting involved in government is definitely a good, and long overdue thing. Part of this does just feel like it's the circle of life, where the young come in with their way of doing things, and older people hate change and love reliability.
Will be interested to hear your take on what Trump said about Gaza (if you decide to poke that bear). I definitely get how "let's build hotels on the water" seems like a bit of a way too early comment, but, it does also seem like a "teach a man to fish" approach versus just sending aid that if I understand correctly, was often not received by the people who needed it. Building hotels isn't a perfect solution, but it creates economic activity, including jobs, and brings more money to the area.
Just well done. The fuckery we are witnessing may be in service to tax cuts for the wealthy and deregulation but overall it is not good for the macroeconomy nor is it good for our firms and their prospects in the long run. Billionaire class has made a devils bargain and we all must pay the price it appears
Follow-up: "I am glad the government is working with younger people". WTF. In what way are the Thiel's boys representative of young people? Bernie anihilated with young people in both 2016 and 2020. Feudal-libertarians are a freak minority.
The DNC just elected David Hogg as a vice chair. Young people being involved in government is great. Just because you (and I) find the DOGE youth to be weaponized against the wellbeing of our nation doesn’t mean that elevating young people within government is not an inherently fantastic thing (see: our senate having an average age in the upper 60s).
I love your insights and have for years. This one is very depressing.
That Argentina tidbit really hit hard. He is leading our country as if he was an enemy of our country.
Kyla,
You are very much off base here in your op-ed.
1) Regarding DOGE, I leave you w Tom Renz Thread regarding the legality and more. https://x.com/RenzTom/status/1887038847629877714
2) Regarding Tariffs / Goodwill: Neither Canada or Mexico have been acting as goodwill as they allow illegal aliens, deadly drugs, weapons, and criminals cross our borders causing rapes, murders and drug deaths to skyrocket. Goodwill of China similar. Goodwill of EU and NATO, deplorable.
3) The Founding Fathers are applauding the first three wks of Trump rn. Raskin is a horrible actor and therefore a horrible source to quote about 4th branches of govt. Regarding any 4th branch of govt I refer you back to Tom Renz thread regarding the legitimacy of DOGE.
ps. We all color our conclusions from our own personal framework and biases, but I think you could stand a closer inspection regarding your framework and biases. pss. I still love you.
It seems many ideas being pursued right now are either not well thought through, or are, but with a need to pretend otherwise.
For example, using tariffs to fund income tax reductions is a transfer of tax payments from those with the most to those with the least.
The biggest beneficiaries of income tax reduction will be the people with the largest incomes, and the people most impacted by tariffs will be the people who spend the highest percentage of their income.
The idea that Trump and his people promoting these polices don't know this seems hard to accept.
For the most part, I agree, but in my opinion, you miss some things that matter.
Why does this happen? It's not like Trump fell from the sky. The election campaign, Biden, many developments since decades leading up to that all are a logical path unfolding. It's ideology delivering answers that match less and less.
You do not question that the intention is to MAGA, despite reasoning self-destruction. Could it just be greed for money and power? That's what made the USA big at a time when that answer led to success. The birth rate and the absurd cost of living shows the decline has started long ago. It's not a crisis, it is a development. The majority does not benefit since a while already. An atmosphere where people primarily defend themselves economically is what brings nations down.
Trump isn't the root cause. He is a symptom. You can love or hate him, the root cause will not be impressed. The world has seen many cultures and all of them always thought to be the best and last, and traversing history, the majority was wrong. There were other world dominating powers in history that are now gone. Do you seriously think it will be different this time?
And within that context, there is hope. Should the USA be able to reduce bureaucracy, even if something breaks in the process, it would be the first country managing to do that and it would help big time. All countries so far assigned that task to bureaucratics. Nobody expected that to work and it did not. It is not sure such a radical change will work, but anything less radical will fail for sure. If a bunch of rich people get richer from that by taking from the poor, well, that would have happened any other way, too.
This article feels quite biased.
Trump is trying something. It may work, or not. The problem is not that he's trying. The problem would be if he didn't recognize bad outcomes and would persist in mistakes.
The present is not the past. Some things may stay the same, some may be different than decades ago, regardless what the economic history books say. (Not the same person, not the same river.) We don't know until we try. One thing is sure: we can't keep going the way we have been going for the last 2 decades. This is decline and fall. We need a change in direction.
Soros became a billionaire by changing his mind very fast when facts changed. As long as Trump does the same, and it seems that he does, I'm optimistic.
I don't see anything bad in renegotiating bad deals with our "friends" and "allies". On one hand, people are complaining that we have an increasing gap between haves and have nots, on the other the same people whine when the government is trying to stop the hemorrhage of money to various other countries and special interests. Instead of goods, we've been exporting ideology (e.g. at USAID) and projecting weakness (very dangerous when one is the alpha).
P. S. Still a fan of this substack.
I wish I shared your optimism but Trump’s history of recognizing and adjusting to “..Bad outcomes…” is not particularly auspicious.
(2020 election comes to mind)
Besides, why do all the hard work when scapegoating’s so much easier.
Put me down for another member of the “We Love Kyla’s Brain” fan club.
Your articles have grown more pessimistic as of late (for understandable reasons). I think you lay out who the losers are fairly clearly here. My question becomes, then, who are the winners?
This group of folks in and around the Trump orbit aren’t dumb. So what is the long game? Or have we given up the long game for short term gains followed by a hard exit of our wealthy class once they’ve gained what they can?
Not in a conspiracy theory game, mind, just in a blast of profit maximization.
One weird puzzle piece in all of this is Japan, the US' 4th biggest trading partner. Everything seems fine? Trump seems to really like Japan (see all the Shinzo Abe/Trump memes). They're terrified of China, but also seem totally capable of navigating Trump's ego and interests to ensure continued partnership. I suspect it is because they do not criticize him in public, invest in US manufacturing, and Tokyo is impressive (Trump's a big aesthetics guy apparently). There's probably worth studying something there about what Trump wants from potential partners.
I do think there are other alternate futures than the ones you mapped out. One is the Long Rebuild, where US consumers absorb a decade of higher prices as US domestic supply catches up to demand, pricing underneath the tariffs. They would have to drive much lower with automation to be competitive globally, but who knows where trade would be in that world? Another (a very low confidence, practically conspiracy theory) is that Trump would prefer China as an ally than anybody else, Europe, Canada, Mexico, etc. I have this hunch he actually admires China and Xi—he wants an economy like that, he loves all the construction and manufacturing, he'd love to have the power that Xi has. If he could find terms to carve up the world with China, he would do it (I think the cries of fascism are premature, but this scenario is very heavily shaded by 1940s Japan and Germany).
I don't necessarily agree with you on everything that you are saying here, but I very much appreciate the very well argued and analyzed piece that you put together. Neither side is completely right, but we need more of what you are doing here instead of yelling at each other, so thank you and keep up the good work.
Although troubling, this newsletter edition was great!
Great article!
Enjoyed your perspective on tariffs. I always think I have an understanding of the economics of a situation and then read what you write and realize there were about 6 layers that I missed.
Interesting take on DOGE as well. Definitely think there's going to be an issue with the speed at which they're coming in with a wrecking ball (and what that amount of new people looking for a job is going to do to an already thin market), but on the other hand, a Silicone Valley approach to government was probably long overdue. Young people getting involved in government is definitely a good, and long overdue thing. Part of this does just feel like it's the circle of life, where the young come in with their way of doing things, and older people hate change and love reliability.
Will be interested to hear your take on what Trump said about Gaza (if you decide to poke that bear). I definitely get how "let's build hotels on the water" seems like a bit of a way too early comment, but, it does also seem like a "teach a man to fish" approach versus just sending aid that if I understand correctly, was often not received by the people who needed it. Building hotels isn't a perfect solution, but it creates economic activity, including jobs, and brings more money to the area.
thank you for persistent analysis and truth-telling. Your work helps me remain hopeful.
Just well done. The fuckery we are witnessing may be in service to tax cuts for the wealthy and deregulation but overall it is not good for the macroeconomy nor is it good for our firms and their prospects in the long run. Billionaire class has made a devils bargain and we all must pay the price it appears
Ray Dalio predicted the fall of America as an economic superpower, and here we see it coming to fruition in the matter of a fortnight. Sheer insanity.
Brilliant insights on a sad story.
"DOGE employees really do seem talented" unsubscribed
Follow-up: "I am glad the government is working with younger people". WTF. In what way are the Thiel's boys representative of young people? Bernie anihilated with young people in both 2016 and 2020. Feudal-libertarians are a freak minority.
The DNC just elected David Hogg as a vice chair. Young people being involved in government is great. Just because you (and I) find the DOGE youth to be weaponized against the wellbeing of our nation doesn’t mean that elevating young people within government is not an inherently fantastic thing (see: our senate having an average age in the upper 60s).