The Editorial Board of the Wall Street Journal, although finding much with which to agree in Pope Leo’s new encyclical on AI, is dismayed at the Pope’s naive faith in the state. A slice:
Technology invariably requires workers to adapt, often with considerable disruption to the status quo. But it also eases their yoke over the long haul. Throughout history the diffusion of technology has democratized information and improved living standards, especially for the poor. The internet and social media have enabled people living under repressive regimes to share information, which is why Iran’s regime has cut them off for weeks.
“Every introduction of automation and AI should be accompanied by verifiable measures to protect the employment, retraining and participation of workers,” Pope Leo writes. He calls for regulation of algorithms that “influence credit distribution, personnel selection or access to services and opportunities” and “measures to ensure equity: taxation, social protection and industrial policies.”
Amen, nods AOC. While AI isn’t without risk, government control is likely to result in an even greater concentration of power. Regulation tends to protect incumbents and retard competition. Repressive regimes can also use AI to suppress dissent, as China’s Communist Party uses AI to surveil and censor its people.
Most fanciful is the pope’s claim that the mandarins at the United Nations should be entrusted with overseeing AI. He says they “are essential instruments for promoting a civilization of love, for they can foster dialogue among nations and promote the peaceful resolution of conflicts.” This is truly the triumph of hope over experience.
There’s no doubt that as AI develops it will need an ethical rudder, and the pope’s contributions are worth listening to. But his faith in a beneficent state is misplaced.
Also troubled by many of Pope Leo’s expressed views on AI is Wall Street Journal columnist Barton Swaim. Two slices:
So large and discursive is the document that one assumes the pope intended it for the well-informed few, the sorts of people who write books and articles and make policy decisions about the encyclical’s main subject: artificial intelligence.
Its inscrutability to ordinary people is part of what robs the document of whatever power it may have had at a third the length. The more fundamental problem is that so many of the pope’s pronouncements seem aimed to please jet-set transnationals.
Few such power brokers and tech-industry elites will disagree with Leo’s assertion that “every introduction of automation and AI should be accompanied by verifiable measures to protect the employment, retraining and participation of workers” or that schools have a duty to train students to use AI tools “responsibly, critically and creatively, rather than passively succumbing to their influence.” The pope’s contention that “the use of force, violence and weapons reflects a relational poverty that always has disastrous consequences for civilian populations” won’t provoke any objections from the global glitterati.
…..
Plainly Pope Leo has genuine concern for the ill uses to which artificial intelligence may be put. But nobody yet understands the moral import of AI technologies, and the pope’s foray into the subject doesn’t impress. Calls for governments to “regulate” AI are about as coherent, and as dangerous, as those to regulate “misinformation”: nebulous terms in both cases. He might reflect—not that he wants the counsel of a hardened Prot—on the rapturous praise his essay received from the usual precincts. As another priest once put it, “Woe unto you when all men shall speak well of you, for so did their fathers to the false prophets.”
GMU Econ alum Ryan Young, writing at National Review, offers three arguments against tariffs. A slice:
The incentive problem is that, even if policy-makers were able to design a wise tariff policy, it would never make it through the political process intact. Tariffs are made by the government we have, not the government we wish we had. Tariffs also provide policy-makers with tools to reward friends and punish enemies.
In the last year, Trump has raised tariffs for reasons ranging from a television commercial that aired during baseball’s World Series to irritation with the Swiss president’s tone during a phone call.
More generally, politicians’ incentives are to look good so they can win reelection. Good policy is a lesser priority.
The Editorial Board of the Washington Post describes Zohran Mamdani’s housing policy as “less a plan than a raid.” A slice:
The mayor also vowed to “take aggressive legal action” against landlords who chronically fail to maintain their buildings to his standards. That could result in government seeking to “transfer ownership to responsible stewards” of his choosing.
In practice, that means expanding use of the city’s 7A program, which allows the Department of Housing Preservation and Development to pursue legal action against owners whose rental units have fallen into disrepair. No doubt there are some irresponsible landlords, but they aren’t the primary driver of New York’s housing crisis.
The truth is that a century of improper state interventions in the rental market are the leading culprit for why so many apartments have deteriorated.
The pattern is always the same. Rent controls are introduced. Landlords pull properties from the market, reducing housing supply. The quality of the remaining housing declines because there is little incentive — and even less money — to renovate or improve units.
While we’re on the subject of elites who have little respect for property rights, Trump says that Americans “hate our country” if these Americans seek refunds of the taxes – a.k.a. tariffs – they were unlawfully compelled to pay.
My intrepid Mercatus Center colleague, Veronique de Rugy, warns of the economic damage that will be unleashed by California’s billionaire wealth tax. A slice:
Start with the Billionaire Tax Act. The gap between what it promises and what it would deliver is stark. Joshua Rauh of Stanford University has run the numbers with his Hoover Institution colleagues, and the results cast doubt on the prospect of any revenue gain whatsoever.
Proponents claim the tax would raise $100 billion. Rauh’s team found that billionaires have already been voting with their feet: Larry Ellison left California in 2020, and six others, including Google cofounders Larry Page and Sergey Brin, departed between the proposal’s announcement and Dec. 31, 2025—the day before the liability would take effect.
Corey DeAngelis makes the case that “school choice can make America healthy again.”
Rich Lowry is correct: “Data centers aren’t the enemy.” A slice:
The evidence doesn’t show much effect on the price of electricity, though. Rates are high in states with misbegotten policies that make electricity more expensive, while rates are lower and increasing more slowly in the states that have the most data centers. That’s because a state like Texas, with a large concentration of data centers, has a policy of energy abundance that easily absorbs more demand.
The water concern, too, is overblown. All sorts of other activities use much more water. The Substacker Andy Masley points out that if the amount of water used by data centers triples by 2030, they still would require only 8 percent of the water it takes to maintain the nation’s golf courses.
According to scare-mongering headlines, AI data centers are practically sucking Texas dry. Yet Masley notes that they have added an infinitesimal 0.005 percent to the Lone Star State’s water demands.
Then there’s the complaint that data centers are unsightly. People post beautiful natural vistas on social media, commenting that data centers don’t belong there. This makes it seem as if data centers are going to be located in the middle of, say, Zion National Park, rather than on sites that would otherwise host warehouses or other industrial-type projects.
“Social Security’s funding problems are worse than expected.”
David Bahnsen exposes Elizabeth Warren’s appalling ignorance of private equity.
Paul Krugman enthusiastically tweeted about Thaler’s prize: “Yes! Behavioral econ is the best thing to happen to the field in generations.” Thaler gives Paul and the other plausible illiberals another reason to recommend bossing people around. For their own good, you understand.
In civilized society it is indeed not so much the greater knowledge that the individual can acquire, as the greater benefit he receives from the knowledge possessed by others, which is the cause of his ability to pursue an infinitely wider range of ends than merely the satisfaction of his most pressing physical needs. Indeed, a ‘civilized’ individual may be very ignorant, more ignorant than many a savage, and yet greatly benefit from the civilization in which he lives.
He [Hamilton] knew that a capital surplus (net inflow), mirroring a merchandise deficit, was akin to an international vote of confidence in the United States.
Private markets contain mechanisms to guide economic actors. Property rights over the means of production incentivize owners to use resources efficiently because they reap the rewards for doing so and bear the costs of failing to do so. Prices emerge through market exchange and inform producers and consumers of the trade-offs they face in the purchase of inputs for production (producers) and in the price they pay for purchasing final outputs (consumers). Finally, profit and loss accounting informs producers about whether their decisions align with the underlying preferences of consumers.
