JD Vance, the Pope, and Some VCs Walk Into a Bar
And more from this week...
Your one thing to read this week is JD Vance’s speech at the recent American Dynamism summit, which the Vice President’s office was kind enough to republish at Commonplace. Vance tackles the question of whether the “techno-optimist” and “populist” factions of the New Right coalition are in conflict, drawing on Pope John Paul II’s encyclical Laborem Exercens, which opens:
Through work, man must earn his daily bread and contribute to the continual advance of science and technology and, above all, to elevating unceasingly the cultural and moral level of the society within which he lives.
“Real innovation,” explains Vance, “makes us more productive, but it also, I think, dignifies our workers. It boosts our standard of living. It strengthens our workforce and the relative value of its labor.” Conversely,
cheap labor is fundamentally a crutch, and it’s a crutch that inhibits innovation. I might even say that it’s a drug that too many American firms got addicted to. Now, if you can make a product more cheaply, it’s far too easy to do that rather than to innovate. And whether we were offshoring factories to cheap labor economies or importing cheap labor through our immigration system, cheap labor became the drug of Western economies.
Thus, whereas eviscerating worker power and suppressing wages was a guiding principle of the Old Right (“Cheap labor leads to a booming stock market? That benefits everyone,” in Club for Growth founder Steve Moore’s unedifying formulation), leveraging innovation to make workers more valuable represents a promising and unifying theme for all factions of the New Right.
I’d ask my friends, both on the tech-optimist side and on the populist side, not to see the failure of the logic of globalization as a failure of innovation. Indeed, I’d say that globalization’s hunger for cheap labor is a problem precisely because it’s been bad for innovation.
Both our working people—our populists—and our innovators gathered here today have the same enemy. And the solution, I believe, is American innovation because, in the long run, it’s technology that increases the value of labor.
The whole speech is very much worth reading for the comprehensive narrative it weaves together on why making things matters, how the Trump administration is approaching economic policy, and what the future of the conservative coalition will emphasize.
BONUS LINK: Vance closes on a note similar to the one I struck in my January essay in Foreign Affairs, on How Trump Can Rebuild America. “Trump’s ambition to build,” I wrote, “marks a rare point of agreement among the diverse factions that compose the Republican Party under his leadership.” As Vance puts it:
You’re not just building your own business. I think that you are part of a great American industrial renaissance. Whether it’s the war of the future, the jobs of the future, the economic prosperity of the future, we believe that we must build it right here in the United States of America. Thank you all for building. Thank you all for building in America. And thank you all for building the kind of society that I want to raise my children in.
WHAT ELSE SHOULD YOU BE READING?
Homes for Young Families: A Pro-Family Housing Agenda | Wendell Cox & Lyman Stone, Institute for Family Studies
Lots of talk this week about “Abundance” and more urban housing as the corrective to what ails American (including on the American Compass podcast!). Cox and Stone provide an interesting look at what Americans raising children actually want, which is… single-family homes with lots of bedrooms in good neighborhoods. They also provide a helpful overview in this thread.
China Delays Approval of BYD’s Mexico Plant Amid Fears Tech Could Leak to US | Financial Times
Strong “you can’t break up with me, I’m breaking with you” energy here.
To Bring Manufacturing Back to America, Close the Round-Tripping Loophole | George Callas, Arnold Ventures
This is a helpful overview of some of the most complex facets of corporate tax policy, and opportunities for revenue-raising improvements. I must confess, though, that my main takeaway is that tax policy is a weak tool for trying to counteract the bad incentives and outright distortions of our broken international trading system. If the goal is to reshore manufacturing and achieve balanced trade, we should focus more directly on doing that. Trying to counteract all of the distortions and preserve our free market and the ideals of free trade simultaneously is unlikely to succeed. Rather than consider free trade a natural extension of the free market, we should recognize that the situation is more like: Free Markets, Free Trade: Choose One.
U.S. Companies Are Helping China Win the AI Race | Samuel Hammond, City Journal
The obvious and willful failure of U.S. tech leaders to abide by export controls is an absolute scandal that should be met with crushing fines and probably some jail time. Firms could take it upon themselves to police their supply chains. They could also use technology to ensure that their chips are not misappropriated. Looking the other way and cashing the check is just gross.
STUPID AI TRICKS
Powerful AI Is Coming. We’re Not Ready. | Kevin Roose, New York Times
“The insiders are alarmed.” Admittedly, the insiders have a product to sell. “There are still enough credible independent voices with short A.G.I. timelines that we should take them seriously.” But what is their evidence? “The A.I. models keep getting better.” OK, sure, so do toothbrushes. “If you really want to grasp how much better A.I. has gotten recently, talk to a programmer.” So, the evidence for imminent artificial general intelligence is that the one thing the computer is really good at is writing computer code?
“Overpreparing is better than underpreparing.” Is it? That’s tautological, and of course what one says when one is in the process of admitting that the substantive arguments don’t hold water. How should we overprepare? “Most of the advice I’ve heard for how institutions should prepare for A.G.I. boils down to things we should be doing anyway.” Oh. And if we don’t? We might face “what happened during the social media era, when we failed to recognize the risks of tools like Facebook and Twitter until they were too big and entrenched to change.”
I mean, OK, so software that has gotten very good at coding merits overpreparation in the form of doing what we should be doing anyway, lest we experience the kinds of challenges brought about by social media. The analysis always seems to land around there. Is that what we’re all worked up about?
Make America Smart Again | Andy Kessler, Wall Street Journal
Andy Kessler consistently manages to produce the single worst article on whatever topic he tackles, so suffice to say I was excited to see him writing about AI and education, and he did not disappoint. “Maybe technology wasn’t completely ready in 2012 to replace teachers,” says Kessler, “but it is in 2025.”
Kessler’s example of this is a private school where tuition starts at $40,000 and they have teachers but call them “guides.” OK, then! “How do we scale this nationwide and then globally?” I guess you could start referring to teachers as “guides” tomorrow. The $40K per kid is going to be harder to swing though.
In a truly pious recitation of the Old Right dogma, Kessler concludes:
I can’t help but notice that the Trump administration’s entire America-first agenda is about returning jobs to the U.S. for those who didn’t go to college or even finish high school. If ever there was an indictment of our education system, there it is. Sure, it’s a smart vote-getting strategy, but using tariffs to hike prices and make select industrial jobs more economically viable in the U.S. is self-destructive. Why not spend the political capital to improve K-12 and move everyone up the value chain? Make America smart again. It’s time.
Sometimes I worry I’m being unkind in my characterization of the nonsense that steered conservatism into a ditch. I’m grateful to people like Kessler reminding me that no, it really was that bad.
WHAT ELSE SHOULD YOU BE LISTENING TO?
Taking the Long View on America’s Economic Upheaval | Bloomberg Trumponomics
Last Friday, I noted that Bloomberg Economics chief economist Tom Orlik had recently drawn an interesting analogy between the start of the Reagan administration and the tradeoffs in the “Volcker Shock” on one hand, and the start of the new Trump administration and the tradeoffs in their efforts at restructuring the global trading system on the other. That conversation is now available as a very interesting podcast.
The Crisis for Working People with Oren Cass | Sean O’Brien, Better Bad Ideas
I had a phenomenal time recording a 90-minute conversation with Teamsters general president Sean O’Brien on his Better Bad Ideas podcast. It’s a fun and especially wide-ranging conversation, I talk a lot about my personal background, etc. A real If you had told me five years ago… scene.
HIGHLIGHTS FROM COMMONPLACE
Beyond Vance’s remarks, some other interesting reads from this week:
Will AI Automate Away Your Job? | Jason Hausenloy. The time-horizon model explains the future of the technology and what it means for the jobs of today.
A Post-Consumerist Economics | Fred Bauer. The end of the fiction that cheap stuff is the essence of the American Dream.
The MAHA Response to the Infertility Crisis | Natalie Dodson. The Trump administration can move beyond Big Pharma’s “solutions” to address the fertility crisis.
And on the American Compass Podcast this week, Ezra Klein joins me to talk Abundance. How many times will I have to redirect him from trashing the populist Right to talking about his own book and its arguments? Listen to find out!
Check out the latest every day at commonplace.org, follow us on X @commonplc, and subscribe for the best of each week directly in your inbox.
Enjoy the weekend!
Oren
if Trump administration so keen on innovation & "building", why trash research organization like National Science Foundation & National Institutes of Health???
It's strange to read a speech and about the importance and value of labor and how great it's all going to be while the administration you lead so openly treats workers like garbage. The treatment of federal workers is just one example, where they've been razed with such rabid ferocity and pointless destructiveness--there is an actual art to downsizing--and these are not the workers who hounded Trump for years at the CIA and FBI, et al. They're just tens of thousands doing work that most people rely on, and not making tons of money either. The singular aspect that we've seen from this administration so far is simply a boundless expression of overreaching anger, and I think Oren is diminishing himself in imagining that it's all in service of building something. I increasingly don't see that--aside from rhetoric of 'it's going to be great' there's virtually no evidence of it--and I was similarly hopeful that Trump would be a force for some kind of necessary rethinking.
What's happening to universities and immigration and free speech will not in any way lead to American innovation of any kind. Just the reverse. People are already thinking about whether they should come here, and those here who aren't citizens (and even some who are) are looking anxiously elsewhere.
I love Oren and appreciate his clarity and willingness to challenge tired orthodoxies. He's completely refreshing. But I suspect he's going to find himself increasingly wondering whether this administration really represents anything new or geniuinely exciting, or just a more militant, corrupt, and intolerant version of late-stage capitalism.