Before we get to this week’s missive, due to George Noble’s generous mentions of the existence of this substack on his recent Twitter Spaces, there has been an influx of new subscribers. For those people, as well as any other subscribers who have not done so, I strongly suggest you review the first post of this substack from late November: Welcome to Kayfabe - whatever the hell that is. It lays out the analytical framework which informs this substack, and hopefully reviewing will provide context and make more sense of my ramblings.
Do you have Larry Summers Syndrome (LSS)?
I do not know and have never met Mr. Summers, and I sure as heck did not attend Harvard, so his being afforded this honorarium is primarily due to my age and the fact this concept first entered the frightening realm of my head many years ago around the time he was on his way out as President of Harvard. What is LSS and how can you contract it?
Do you have an extremely high IQ/level of intelligence?
Do you profess a belief in capitalism and free markets?
Are you an endless source of ideas for policies that happen to tilt the scales towards the kleptocratic class?
Do you have secret thoughts that the world’s problems could be fixed if only you were appointed emperor?
If you have 2 or more of these symptoms, then you may want to get checked out to see if you have LSS.
Of course, this is partly tongue in cheek, but the era of the technocratic class screwing things up has been protracted and with severe consequences. There are a lot of really smart people who have all sorts of interesting and creative ideas as to how to shift policies, incentivize behaviors they deem productive, and try to improve the lives of people. The problem? They appear to not ACTUALLY believe in markets or the laws of economics.
Capitalism is the worst economic system, except for all the others.
That was a statement often misattributed to Winston Churchill, and I am not aware of an original attribution but is an idea with which I generally agree. However, similar to concerns that democracy can be just a severe crisis away from voting itself into autocracy, so-called capitalists seem to similarly ‘use’ crises to try and pervert market forces into the opposite.
If we assign the most charitable motives to the technocratic class, then we can at least have empathy for their plight. Each crisis comes with real human costs and suffering. People really were losing their homes in 2008-2009. Covid was killing a lot of people in 2020-2021. Healthcare costs have been bankrupting families for years. High prices were hammering people in 1971 when Nixon announced price controls - Nixon may have been ‘Larry Summers’ before Larry was Larry Summers.
With the recent focus on the US Federal Reserve Bank, it may be a good time to consider how central banks have morphed from being lenders of last resort charging punitively high rates of interest to solvent entities experiencing liquidity problems to…well I am not sure how to describe them at this point. Financiers of kleptocracy who cosplay as empathetic technocrats?
This is not a treatise advocating for some sort of idealistic ‘free market’ utopian fairy tale. But I do believe the pendulum has swung far too much in the direction of central planning and technocratic tinkering. I would not be confident in central planning even if David Hume’s ghost were empowered to ‘fix’ the vast amount of problems the decades of central planning have already created.
Unfortunately, the direction of travel appears to be in the opposite direction. As I explored more fully in Regime Change, we appear to be in a sort of Newton’s Third Law of central planning escalation which keeps scaling in size as crises get worse. This all has me rather fatalistic as to where things may be heading, but a fundamental underpinning of The Worked Shoot is trying to differentiate between delusion and reality.
I believe the reality is that ‘smart’ technocratic central planning has largely gotten us into this huge mess. The delusion is that if we can just get the right smart people in those technocratic roles and give them more power, then they will fix what has already been broken.
Hopefully, reading this will help with identifying whether you or a loved one has contracted LSS, as well as offer a filter for when you are bombarded with all the great ideas from all the high IQ people in the weeks and months to come.
As a non-high IQ person, my ‘great idea’ is to place a moratorium on all new policies and allow markets to clear. However, I have clear symptoms of numbers 2 and 4 above, so probably best to ignore me just to be safe.