Weekend Reading & Selected Links
Happy weekend! Here are some links to things I've been reading or watching that you might also enjoy:
- I’m launching a $2,500 YouTube Shorts editing competition—and it starts now. The purpose is to hire a talented video editor for future episodes. (You don't have to be a video editor to enter the competition.) For details, go here.
- It's been a while since my last newsletter. In the interim, I've published three new episodes: Francis Fukuyama; Greg Kaplan & Michael Brennan; and Barry Marshall. At the bottom of this email, I've included two highlights from each conversation (hard to pick just two!).
- Nassim Taleb is publishing the transcript of our podcast conversation in his technical book. He published the draft chapter online on Friday.
- Three guys from Adelaide have just released what is currently the most popular video game in the world. (Bloomberg interview with them here.)
- 'The Demographic Future of Humanity', a recent keynote by Jesús Fernández-Villaverde.
- Australia is #1 in the world for having two equally dominant top cities.
- 'City sizes, housing costs, and wealth', 2001 RBA discussion paper by Luci Ellis and Dan Andrews.
- 'Flounder Mode: Kevin Kelly on a different way to do great work'.
- The Launch Sequence, a new collection of essays by the Institute for Progress on how to use AI to catalyse science and security projects.
- 'Two-Sigma Tutoring: Separating Science Fiction from Science Fact'.
- Inflection Points: a new Australian policy journal.
- 'The Europoors Are Choosing To Have Less Than Americans. It Doesn't Have To Be This Way.', a recent article by Sam Bowman.
- 'China Unveils Mosquito-Sized Microdrone for Covert Surveillance'.
- 'Political courage: Some Australian examples', 2007 article by the late, great John Hirst.
- Casey Handmer reacts to two of my podcasts.
Thanks, and have a great weekend,
Joe
Two excerpts from my podcast with Francis Fukuyama
1. Wars at the end of History
JOSEPH WALKER: Hegel thought that there would still be wars at the end of history, but Kojeve thought that there wouldn’t be. How do you make sense of Kojeve’s view?
FRANCIS FUKUYAMA: Well, I think that Hegel is probably more correct. I mean, if you take thymos seriously … In fact, I think I said that in one of the last chapters of The End of History, that there’s actually nothing like the risk of violent death in a struggle, in a military struggle, that makes people feel as human, fully human. And I think that that’s going to continue to be the case. I think that a lot of the political turmoil that we see around us now is really driven by that kind of desire. People want struggle for its own sake. They want risk and danger. And if their lives are so contented and peaceful that they don’t have it, they’ll create it for themselves.
So why are all these kids at Stanford and Columbia and Harvard and other places camping out on behalf of the Palestinians, right? I mean, why do they care about the Palestinians? What they want is to be seen as people that are struggling for justice, because that’s a noble human being. And I think that desire is really not going to go away. And that’s why the ultimate struggle for justice is really one where you actually do risk your life. And I think that’s the sense that Hegel had about why war wasn’t going to disappear.
WALKER: Yeah, but how do you make sense of Kojeve’s view?
FUKUYAMA: I don’t know.
2. An exclusive preview of Fukuyama's next book
WALKER: What, if any, books are you working on at the moment?
FUKUYAMA: Well, I’ve just written a little bit of an autobiographical memoir.
There’s actually a thread that runs through a lot of my writing that might not be obvious but that connects different books I’ve written. So one of them is something we’ve talked about already, which is the idea of thymos, which starts in The End of History, but it continues to my most recent book about liberalism [Liberalism and Its Discontents], but the other one is about bureaucracy and why I actually spend a lot of time worrying about the state and the nature of the state and how that’s all related to a bunch of different ideas I’ve had over the course of my career.
So, for example, I’ve got a chapter in the autobiography on delegation, because at a certain point I began to realise that delegation within a hierarchy is one of the most difficult and most central questions to management, to public affairs, to law. And it’s something we’re still fighting about, right? Republicans believe that we’ve delegated too much power to the state and people on the left think we haven't delegated enough.
So there’s a lot of things like that aren’t obvious to a lot of people. So, anyhow, this is going to try to tie those threads together in a more comprehensive way.
WALKER: When will this be published?
FUKUYAMA: I have a contract. I’m going to have to revise it, but probably in the next year or so.
WALKER: Okay, so your stuff on delegation, it’s not readily apparent, or that theme isn’t readily apparent or organised in your existing published body of work.
FUKUYAMA: Right.
WALKER: Could you share your most interesting takes on delegation?
FUKUYAMA: Well, I’ll start with an anecdote, which is why I really started thinking seriously about this. In the late 1990s, you were in the midst of the first dotcom boom and the whole of Silicon Valley was arguing in favour of flat organisation. They’re very opposed to hierarchies of various sorts. And there was a feeling back then, in this very libertarian moment, that everything could be organised on the basis of horizontal coordination. The idea was the Internet was going to reduce transaction costs involved in this kind of coordination and nobody would actually have to listen to a boss in the future. And that is not true. You actually need hierarchy because actually you can't coordinate on this horizontal basis.
So in any event, this being the zeitgeist in the 1990s, I was still working at the RAND Corporation and the last study I ever wrote for them was called ‘The “Virtual Corporation” and Army Organisation’. Because it seemed to me and a colleague of mine, Abe Shulsky, that the army is quintessentially the hierarchical organisation. And here was Silicon Valley organising itself in a much flatter thing, without these hierarchies. And could the army learn something from Silicon Valley?
So we went around – this was sponsored by the Training and Doctrine Command in the army – to a lot of different military bases, talked to a lot officers. And we realised that actually Silicon Valley didn’t have anything to teach the army because they understood this already, that after Vietnam they had done a lot of soul searching about why that war went so badly. They began to change their doctrine. They borrowed it a lot from the Wehrmacht and from Germany military practice. There is a tradition in the German army called Auftragstaktik, which is basically a doctrine about delegation. And it says that if you’re going to be a successful military organisation, the senior leaders, the generals, have to give only the broadest strategic direction and you have to delegate the maximum amount of authority to the lowest possible command level. Because in a war, the people that actually know what’s happening are the second lieutenants on the ground that are trying to assault this village. And it’s not the general way back 100 kilometres at headquarters that understands that.
And then I began to realise that in corporate organisation that’s true as well. The Toyota just-in-time manufacturing system: every worker on the assembly line had a cord and if they saw a production problem or a defect, they pulled the cord and stopped the entire assembly line. If you think about what that means, you’re delegating the ability to stop the entire output of the factory to every single individual low-level factory worker. And that requires trust, but it also requires this huge amount of delegation.
And it’s for the same reason the army was delegating authority: it’s the lowest levels of the organisation that actually know what’s really going on.
WALKER: Right, so it’s like a Hayekian point.
FUKUYAMA: Yeah. So the article that I always have my students read is Hayek in 1945 wrote an article called ‘The Use of Knowledge in Society’. And he said that in any economy, 99% of the useful information is local in nature. It’s not something that's known centrally but it’s you in your particular local context. And that’s why he said that a market economy is going to work better than a centrally planned one because price making in a market economy is based on local buyers and sellers that haggle and set prices and therefore allocate resources efficiently. And so all of a sudden I said to myself, yeah, this really is important, that in any hierarchy you need the hierarchy because you need the generals to set the broad targets. But most dysfunctional organisations are ones that don’t delegate enough authority.
And the army really fixed itself. I mean, the US army has become the best fighting force in the world. The IDF in Israel had a similar kind of doctrine and that’s one of the reasons that they got so good at warfare. That’s why the Ukrainians have been beating the Russians, because they absorbed a lot of this American doctrine about delegation, basically.
That’s where this all started. The only thing I wrote systematically about delegation was actually this Rand study on army organisation. But it shows up in other things that I’ve written.
So lately I’ve been taking on the whole DOGE, stupid effort. This ridiculous effort of Elon Musk’s to combat waste, fraud and abuse in the government. He’s so wrong about so many of the things. But he repeats this conservative mantra that the bureaucracy has too much autonomy, that it makes all sorts of decisions that are leftwing, out of touch with the American people and out of the control of the democratically elected leaders. And it’s 180 degrees wrong. The problem with the bureaucracy in this country and in most other countries is that it is too controlled by the political authorities. There are too many rules that bureaucrats feel they have to follow. If you want to fix the bureaucracy and make it more efficient, as Elon Musk claims, you have to delegate more authority to them. You have to let them use their judgement. You don’t try to control them through thousands of pages of detailed rules and regulations for buying an office desk or a computer or something like that.
So I think this delegation issue plays out in contemporary American politics, as well as in military affairs and as well as in factory organisation. All sorts of places.
WALKER: Right. That’s super interesting. Yeah. For me, as an Australian outsider looking in, the DOGE effort is very much symptomatic of the kind of Lockean American political culture that doesn’t trust government and wants to place more strictures around it. Starving the beast, so to speak.
FUKUYAMA: Yeah. And as a result, they kind of get the opposite of what they intended.
WALKER: Because the bureaucracy becomes so risk-averse, it breaks down the feedback loop between policy design and policy implementation.
FUKUYAMA: Exactly, yeah. And that’s what I teach my students here in this policy program that I run.
WALKER: Right. I’m not sure whether you’ve quantified this concept of delegation, but is there a correlation between bureaucracies that delegate more effectively and state capacity?
FUKUYAMA: Yes. I just won this award last year. It’s a kind of lifetime achievement award in public administration. So this is a field that Americans really don’t pay any attention to because they don’t like bureaucracies. But I think that one of the reasons I won the award was that I published an article back in 2013 that did exactly that. It said, what’s the appropriate amount of authority to delegate in a bureaucracy? And I said it’s determined by the capacity of the people to whom you’re delegating authority. So in the Federal Reserve, the staff of the Federal Reserve are all PhD economists, so you can safely delegate a lot of authority to them. Whereas the TSA, the Transportation Security Administration, are full of high school graduates, and you’re not going to delegate a lot of authority to them to make complex judgements about ‘Does this person look like a terrorist?’ or ‘Am I going to stop this person?’. You just give them simple rules to follow. And so, that’s how it plays out, the relationship between capacity and delegation.
Two excerpts from my podcast with Greg Kaplan and Michael Brennan
1. What can we learn from the excellent TFP growth in Australia's agricultural industry?
JOSEPH WALKER: The standout over the last three and a half decades [in terms of TFP growth] is “agriculture, forestry and fishing”. My understanding is the component that has done the best is agriculture. Do we know why that has gone gangbusters?
MICHAEL BRENNAN: I know a couple of reasons, some not to do with productivity per se. It depends a bit on weather conditions (now, that doesn’t explain the secular trend)—drought versus good rain conditions. Those are inputs that aren’t measured in the productivity stats, so obviously there’s something going on there.
WALKER: Just to dwell on that for a moment: drought is an unmeasured input that will depress output, so that’s going to deflate the numerator without deflating the denominator.
BRENNAN: That’s right, so it makes productivity look poor; and good conditions will make productivity look great.
GREG KAPLAN: Can I just add: if you stare at the figure—maybe our viewers can see it—it has grown the most. It’s also by far the most volatile.
WALKER: And I think that maps to periods of drought and good weather.
KAPLAN: I think that’s exactly right.
BRENNAN: But has agriculture done well? I reckon it has.
It’s hard to pin down causal factors, but I think there’s been a degree of rationalisation in the sector over this period. There’s a bit more scale in farming than there's been in the past. Farming is a much more professionalised sector.
Farm management—even where a farm passes down hereditarily through a family—younger generations coming into farming now typically have got much stronger management skills—they’ve studied it. The management of farm enterprises has changed, and I think is quite different to what it was in 1990.
The scale of farming, because there has been more rationalisation.
But it’s also the continuation of that trend, that we talked about, over the last 100 years: the application of scientific progress to this sector, and it’s been particularly amenable to it.
WALKER: Better fertilisers, better seed varieties. Things like that.
BRENNAN: Yeah, that’s right.
There are two things that are… And this goes to your point, Greg, that you can’t always copy-and-paste from one sector to another. But it might give you a clue as to what some other sectors might be missing; it doesn’t necessarily tell you what to do about it.
There are two things about agriculture. One: it’s internationally exposed. It’s a globally-exposed business with no pricing power for the most part—some vineyards and some other niche products might. But for the most part—wool, beef, wheat, cattle, etcetera—they’re selling into a global market. They're price-takers; you’ve got no alternative but to drive productivity on-farm. That’s how you make money. That’s how you make margin. You can’t do it through price or better marketing.
The other thing is: we’ve had a pretty effective innovation system in agriculture. It often rests on public R&D or R&D collectively funded by farmers paying a levy—funding, say, the Wool R&D corporation or CSIRO or whomever—and then a system of extension officers who go out and help encourage farmers to take things up and spread good ideas.
WALKER: Help diffuse those innovations.
BRENNAN: Help diffuse—that’s right.
I think part of what has aided that—this is pure conjecture—is that farmers generally are not competitors. They’re selling their product on a global market. But they’re not fighting for market share among themselves. That culture of sharing information, in Landcare groups or just around town, is established in that sector and that’s probably aided the diffusion of ideas.
That’s not—to your point Greg—to say, “Well everybody should do that.” They can’t all just do that. That’s probably a thing that’s distinctive about that industry. But it might be there a couple of these other sectors where that innovation system is less well-developed and—particularly the ones where government is involved—maybe government should foster a better innovation-diffusion system.
2. Should we break the Sydney-Melbourne duopoly?
WALKER: We can talk about the sensible and obvious ideas in a moment, but I’m curious: are there any particularly unusual or ambitious ideas for lifting Australian productivity growth that you’ve come across in your travels?
KAPLAN: For me, the ambitious one comes back to geography.
WALKER: Moving Australia up. [laughs]
KAPLAN: Not moving Australia—I think Australia is in a beautiful spot. [laughs]
It comes back to this bigger question that 40% of our population is sitting in two cities.
That locks up, for the reasons we’ve discussed, the difficulty of being in those cities for many people and the constraints in getting to them.
If we could unleash other parts of the country to be engines of productivity growth—more broadly than,say, just mining—there’s a bit of throwing darts, but the potential returns are high.
There’s a role for government because it requires a huge amount of coordination and investment in infrastructure. To me, that would be a long-term bet worth grappling with.
WALKER: So this is potentially the “major new cities” thing, but also densifying existing cities like Canberra?
KAPLAN: I’m not sure if the answer is that we need more cities of two million people, another five-million-person city, or the issue is that we’ve got a bunch of cities with 80,000 people that really should be half a million.
But right now, the set of options for where to live available to a young person, ambitious, wants to contribute to productivity growth in the country—they're pretty limited and constrained by some cost factors.
Now, I might be wrong—you might blow a bunch of money trying to do this. But if you're asking what's ambitious and non-obvious—well, I don't know how non-obvious that is—but I think that's ambitious, and I think it's probably important if we want to have serious productivity growth over the longer run.
BRENNAN: Yeah, it's high stakes. I mean, part of the challenge is it’s the sort of thing that poorly done just results in a proliferation of grants and tax incentives and relocated government departments to small places. But yeah, I think it’s an interesting feature of Australia, and in fairness, we're comparing ourselves a bit to the US here and not to a lot of other countries, a lot of other geographies.
But, yeah, where’s the Phoenix? Where’s the Austin, Texas? Where’s the emergent regional competitor, if you like, to the hegemony of the big CBDs? I think that's an interesting question.
Greg and I were chewing the fat on this, saying, “Well, why isn’t Canberra a city of a million people?” I mean, you could densify that place, barely anyone would notice. It's a great city. It offers a great lifestyle, pretty proximate to both other cities and other features. I don't know. I don't know why.
KAPLAN: It’s got high skills. It’s got an anchor industry already.
BRENNAN: High skills, yeah.
WALKER: Say the federal government just decided to go all in on, okay, let's get Canberra to a million-plus people. What are the actual policy levers? Do you have visas and the condition for the visa is people have to settle in Canberra for two years, or how do you implement that?
BRENNAN: No, I think you’ve got to look at fundamentals. I think it probably is partly about land supply and the ability to densify in the ACT. I think that's a big part of it.
In fairness, that is both a Commonwealth and a territory issue because the Commonwealth agencies have some planning responsibility there. And yeah, it could be that the transport infrastructure plays a role. I’m not a high-speed rail fetishist, but, you know, maybe.
Two excerpts from my podcast with Barry Marshall
1. PCR testing on Charles Darwin's whiskers has revealed the probable cause of his lifelong stomach pain: H. pylori
JOSEPH WALKER: It’s well documented that poor old Charles Darwin struggled with dyspepsia most of his adult life. He had stomach pain, nausea, and if you read his letters or his diary he complains about this a lot. He and his doctor put it down to nervous dyspepsia, so it also ruined his social life and turned him into a recluse.
How good is the evidence that it was actually H. pylori that was causing his problem?
BARRY MARSHALL: That is the subject of a rejected letter to Nature that a friend of mine submitted. I don’t know whether I was co-author, but I knew about it. The epidemiology is that in the 19th century the whole human race was infected with it, and there are many famous characters in the 19th century who died from stomach trouble or had it their whole life, which made them particularly cranky and intolerant.
Charles Darwin would have had it—most people had it—and he had this issue that whenever he was under stress or pressure, he would get these vomiting attacks. There were all kinds of theories about why he had “nervous dyspepsia”—the fact that he was in seminary school and later became an atheist, you see. He used to call himself the “devil’s chaplain” because he didn’t really believe it anymore. All the Freudians came up with reasons why he had stomach trouble and he was conflicted, et cetera.
But like anything that you don’t understand in medicine, and a lot of other areas, if we don’t know the cause of it, we say it’s caused by stress—because every person on earth has stress, so you can always blame it on the patients. Everyone said it was stress. In his biography, of course, even Alfred Nobel had the same diagnosis with stomach aches and so-called stress.
But Charles Darwin is an interesting one because, if you look at the details, his vomiting attacks started before his boat left Southampton on the voyage of the Beagle. On the voyage he supposedly got “seasickness” all the time, but you used to have to go and sit on the boat for a few days while they were waiting for the right tide and loading it up.
So he was in his cabin on the Beagle and had vomiting attacks then, even before he went on the voyage. So the story of it being seasickness is pretty much bogus.
On the voyage of the Beagle he had episodes where he would be laid up for days, and everyone said, “Oh, that was Chagas disease in South America,” and some other things.
For his whole life, he was a member of the Royal Society, but he couldn’t really travel up to London except once every 10 years to give a speech, because he would decompensate. He was always vomiting, he was always taking health cures like icy cold water and things like that. He even was treated on one occasion with bismuth treatment, which probably put him into remission because it does kill the H. pylori. So they snagged a good treatment at one point.
He was always sitting there with this great beard, plucking whiskers out of his beard and mucking around, so on his desk there were whiskers. When he died—this is what I’m told third-hand, I don’t have any proof, it’s not published yet—the housemaid swept up his desk and put all his whiskers in an envelope, all these loose whiskers. And then a friend of mine, who shall remain nameless at the moment, got hold of some of these whiskers from the Darwin family and ran a PCR on them, and they’re labelled with Helicobacter pylori.
So yes, he did have Helicobacter pylori, and that is certainly the most likely explanation for Charles Darwin’s lifelong guts aches.
WALKER: That’s amazing. This feels like a scoop, right?
MARSHALL: It is kind of a scoop.
WALKER: That’s incredible. Can you tell me a little bit about how that works with the PCR and the genetics?
MARSHALL: PCR is polymerase chain reaction. The coincidence is that Kary Mullis discovered that the same year that I and Robin Warren discovered the importance of Helicobacter pylori in 1983. It was a bit of a landmark as the new biotech started to come in.
So let’s talk about PCR. With all bacteria, all life forms—and criminals, as you know—everybody’s got unique DNA, and bacteria have got a unique DNA.
So with, for example, [Darwins’] whiskers, you dissolve the DNA off them in a test tube and shake it up. Then you put it into a polymerase chain reaction set-up in a machine. If it finds the particular sequence of H. pylori sequence in there, you put a probe in and look for that, it will amplify that little piece of DNA a million times—or a thousand million times. Then you can take a bit of that fluid out of the test tube and put it on a gel, and you can see this little band of proteins appearing. That won’t happen unless you’ve got an exact match.
That’s why PCR is an amazing thing. And, of course, Kary Mullis won the Nobel Prize for that in 1993, I think—ten years later. Sadly, he passed away about two years ago. In the last 100 years, a lot of important Nobels, but that would be one of the best.
2. The world's most cancer-causing pathogen could easily have been discovered 25 years earlier than it was
WALKER: The 1954 study by Palmer—this sort of titan of American gastroenterology—looked at over 1,100 sub-gastric samples and couldn’t find spiral bacteria in any of them. That solidified the consensus that the stomach was sterile and probably reduced enthusiasm for looking for bacteria in the stomach. How did he miss H. pylori with that many subjects?
MARSHALL: Someone in his lab was cheating. That’s the only thing you can think of.
WALKER: Oh, really?
MARSHALL: Palmer was a great pathologist. He used to run Walter Reed Hospital’s pathology department. You can imagine—World War II—there’s all kinds of body tissue turning up in different places, tropical diseases. They were the doyens of pathology in the United States. If they said something, you believed it. Palmer was great.
I met Stone Freedberg when I was in Boston years later—he was in his 90s, about 96, still seeing patients. He was a cardiologist and a general physician, but he published a paper in 1937 or so finding bacteria in the stomach of patients who’d had gastrectomy mostly for ulcers. I think he found it in 46% of his samples and presented it. Then it was World War II; diabetes had just been discovered, or insulin had just been discovered—there was all kinds of fancy stuff going on in medicine. He became a general physician and a cardiologist—so he did okay.
A few years after the war, Palmer and his friends decided to check the bacteria issue. He said to his registrar or research fellow, “Look, there are 1,100 samples in our biopsy collection—go down and have a look, see if any have these bacteria.” He gets a report back a few months later: “We looked at them—we couldn’t see any.” He signs off on the paper—he was the senior author. I don’t know who else was on it, because you just remember him—you remember when famous people make horrible mistakes.
Everybody believed it and never bothered to look. The only way you could miss these bacteria was by not doing proper research—not staining them properly—or just totally faking it. It was inexplicable, but he was deceased by the time I started asking this question.
WALKER: So either someone got lazy and said, look, if we say there's no bacteria that fits with the paradigm, it's a pretty safe thing to say. Or there was some sort of malicious…
MARSHALL: So Palmer might have said to him, look, this is rubbish. Bacteria can't live in the stomach. Go and look at these things and then publish a paper, and then we'll give you your PhD and off you go. So that was it. And I don't think he ever went and looked at them.
So that gets on to fraud in scientific research and how important it can be—not to do it. If he had seen the bacteria and started doing what we did, the literature was available—the tetracycline treatment study, bismuth—he could have done a lot of that. And maybe ulcers and Helicobacter could have been worked out before 1960.
Since 1960, you know, half a million people or a million people a year would have been dying around the world from ulcers. Millions of people were having their stomach removed and never enjoying their food ever again, losing weight and having a horrible life.
And that was because of that screw up in Palmer, in Walter Reed.