Weekly Links (Midweek Edition) 01/29/2025
1) A Venn diagram showing the internal contradiction in Trump's trade policy:
https://cafehayek.com/2025/01/trump-doesnt-understand-trade.html
Ever since he left the NYT and started writing on Substack, Paul Krugman has been on fire, with a series of posts expounding the principles of international economics and lacerating the misconceptions and absurdities of the new administration's trade and immigration policies. Here, he explains how tariffs, rather than protecting or reviving the manufacturing sector, will, in fact, damage it.
David Henderson explains why the proposed tariffs on Canada and Mexico will be much worse for U.S. consumers -- and producers -- than tariffs on Chinese imports
2) Matt Johnson argues that Trump's foreign policy is a return to the global regime that characterized the 19th and early 20th centuries, in which a small number of powers -- in today's world, the U.S., Russia, and China -- each controlled a "sphere of influence." This, in Matt's reading, explains Trump's aggressive approach on Colombia, Panama, and Greenland, along with his deference to Putin and Xi.
Dan Drezner discusses the likely consequences of Trump's economic coercion of Colombia for U.S. relations with foreign allies and competitors.
3) In this brilliant post, UK historian Alice Evans explores "The Great Splintering," in which the technology of the smartphone facilitated the shattering of a common culture into numerous tribes and subtribes.
4) John Cochrane assesses the new Chinese DeepSeek LLM, announcement of which was the occasion for a deep dive in the stock-market value of U.S. companies that have invested heavily in AI.
James Pethokoukis notes that there are still many unanswered questions swirling around eepSeek's accomplishment and that there are good reasons for thinking that AI spending will continue to grow rapidly.
5) Brazilian economist Marcus Nunes is on Substack at "Money Fetish," covering international macroeconomic and monetary developments. In this post, he compares China's growth path with that of Japan.
Diane Coyle reviews Wolfgang Munchau's new book, Kaput: The End of the German Miracle, which analyzes the structural weaknesses and policy errors which have led to the relative decline of the country once viewed as Europe's powerhouse.
http://www.enlightenmenteconomics.com/blog/index.php/2025/01/swings-and-roundabouts-or-slides/
6) Alex Tabarrok discusses solar geoengineering technology and its potential for aiding in the long-term transition to a less fossil-fuel dependent energy supply.
https://marginalrevolution.com/marginalrevolution/2025/01/make-sunsets.html