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It may be the case that manufacturing throws off positive externalities. I see no argument for favoring manufacturing for internal consumption over manufacturing for export. So low-zero restriction on imports, a whopping VAT, progressive personal consumption taxes to the extent administrative feasible, and taxation of net CO2 emissions to raise resources for infrastructure & human capital investment (and maybe to try picking a few winners). Tax exports if there are rents to be taxed (that's more for infrastructure and human capital investment). Avoid macroeconomic instability and XR overvaluation.

It seems to me this is what successful developing countries have mainly done.

And yes, the returns to this strategy may not be as great now as earlier, but Neoliberalism is still the best you can do.

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Next episode: Brexit. 1/31/2024 will be 4th anniversary. What should the US learn from Brexit now that the plague has subsided? Don't blame immigrants and trade treaties for decades of chronic low public investment? Don't listen to lying, incompetent, outrageous, nationalist politicians.

Consumer confidence is interesting, but this seems like something you two could tee off on in multiple media. The anniversary and similarities to Trump makes it topical for others to run with it.

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Jan 22·edited Jan 22

RE: Rock music. I would call this an example of the "long tail" of the internet. Also IF a Pink Floyd member really became a nazi, could this be due to the much broader definition of nazi that is in vogue among progressives?

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Great podcast - but you didn't mention the important role that manufacturing has played in absorbing the surplus labour in agriculture. When there is something better for labour to do than continue to eek out a living on ever smaller parcels of land per person, it starts to make sense to apply more capital and technology to land, not just more fertiliser. Fewer farmers with more land brings higher agricultural productivity, which can change political dynamics in ways that support a more open trade agenda. Productivity growth in manufacturing comes from applying technology at scale - which needs access to markets that have a lot of consumers with an ability to pay. Import substitution strategies generally fail on the scope for scale unless they can export. But to do this they need to produce at a competitive price and quality. The growing protectionist trend is more of a barrier to other countries replicating the Asian success stories than labour saving technology.

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Yes very true—it is one of the few good ways to manage rural discontent springing from rapid agricultural delaborization...

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This would make a good subject for a future article. Given that manufacturing worldwide is now being done with more automation and fewer workers, what is to become of displaced agricultural workers?

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Yes: this is a huge problem for the world's poorest... Brad

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I'm not worried about global warming I'm worried about suboptimal policies to deal with global warming. It is certainly possible to spend a lot more resources than necessary to reach an optimal concentration of CO2 in the atmoslohere without reaching an optimal concentration of CO2 in the atmosphere.

I would not even be worried about distribution if I were not worried that the distribuees will not like low cost ways of doing it, an exact parallel of the climate change problem.

I'd also venture the guess that the global expenditures needed to mitigate the effects of CO2 already emitted will go much more toward moving atoms than moving electrons.

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Coincidentally, I was reading Poul Anderson's The Golden Horn the other day and had cause to look this up: the Old Norse for Constantinople is Miklagarðr, but modern Norwegian Miklagard. However, the Old Norse is often transliterated Miklagard too.

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“Sometime during the plague, Brad DeLong really did turn into a grumpy old man yelling at clouds.”

As an even grumpier and slightly older man, I welcome you to our ranks.

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I am an even older man. I am not grumpy and I do not shout at clouds. I cheerfully patiently try to explain to them why they they are mistaken about taxation, deficits, immigration, PH messaging, climate change, (as the most important failure to levy Pigou taxes on externalities, urban congestion taxes being another big one), law enforcement, land uses and building codes.

Unlike Ms J. Mitchel, I am not much concerned about not understanding clouds so long as they understand ME. :)

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Is our Prussian Army, our educational system where our workers learn the soft skills??? Seems we are moving college level subjects down to high school and making college a requirement for everyone.

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RE: Perelli family

Reminds of LBJ's War On Poverty. I had a co-worker who was engineering liaison to a factory making military equipment in Charleston WV. He had interesting stories about the workers attitudes towards work.

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More Cow Bell!!!

My music era was the 50's. High school and college. After college I was too busy with family and trying to keep our economic heads above the waterline.

Listening to you guys is like listening to a tour guide in Florence. Describing a world I never experienced or live through. I must have been isolated in Plato's cave.

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To me everyone still alive is a young whippersnapper. BTW does whippersnapper describe what young men used to do when they snapped the young women's bra straps??? The World Wonders.

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The Fed has a perfectly good Grand Narrative, FAIT. Each communication should reinforce it, including to admit when it messed up and badgering Treasury to provide it with even better tools such as more intermediate tenor PCE defined TIPS and paired RGDP securities and BLS to produce wage indexes with approximately the same disaggregation as its price indexes .

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