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Bryan Caplan is a name I've heard off and on in rationalist adjacent spaces and with Scott's recent review of one of Caplan’s books, I decided to actually take a look at his blog.
I was very surprised to see that he is an anarcho-capitalist: something that is very much unexpected in an academic economist. He acknowledges this in his blog, where he bemoans the left-wing focus on market failures rather than on market achievement. I probably agree with him on 90-95% of his positions, though I would have a different relative rank in the importance of those positions.
Of course, this being the internet, I won't spend any time on our many agreements but will instead focus on what I perceive to be his biggest shortcoming. Despite his expertise in a social science, he seems to think of society in abstractions: certainly a requirement for good economic modeling, but one that should always be grounded in reality. While possibly tongue in cheek, his statement that "it is humanity, not my arguments, that is flawed" does seem to reflect his mentality.
Exhibit A: Immigration and UAE
Caplan extols the virtues of the UAE, calling their mass-immigration a model for Western nations. And indeed, millions of Indians and billions of oil dollars have created a gleaming technical paradise. But as Caplan notes, UAE "immigration" is not the same as Western immigration. Only native Arabs have citizenship and enjoy the (extensive) welfare that oil money can afford.
The UAE understands that you can have mass immigration or a welfare state, but you cannot have both. They also are not squeamish about transactional relationships with imported labor, which makes the UAE's approach a complete non-starter in the West. No Western nation could import hundreds of millions of (mostly brown) labor, pay them "market wages", and refuse to provide citizenship and a social safety net. Even hard-core anarcho-libertarians would find the parallels with slavery uncomfortable.
The irony is that while the UAE does not have the human capital in either its native or foreign population as most Western countries, the West wastes its superior human capital on regulations, bureaucracy, and virtue signaling while the UAE just builds. Perhaps it is not "humanity" that is flawed, but just Western elites.
Regardless, the UAE's path is not sustainable. The native elite live off natural resources and imported labor rather than their own ingenuity and effort. There is no improvement in human capital, only a descent (slowed perhaps by the prohibitions of Islam) into hedonism. Copying their approach will neuter the unique ambition of the American spirit and accelerate our destruction.
Exhibit B: Immigration and Culture
Caplan implicitly downplays the negative aspect of migration on culture and social cohesion. Most immigrants will look, smell, act, and often vote differently than the "native" population. At scale, assimilation simply won't happen. Even with current immigration in the US there are sufficient numbers of Indians and Chinese to create clannish sub-cultures within the US. Caplan clearly thinks that we can still retain (and even improve) our high standard of living despite mass immigration, but this begs the question why high living standards don't already exist in India or China. Is it lack of physical capital? Is it human capital? Or could it be culture? (Obviously, all three have some impact). Given that capital is attracted towards the highest returns, it seems likely that a lack of human capital or a culture not conducive towards economic flourishing has to be a major cause for the lower living standard. If this is the case, there would be a decrease in the quality of life for the typical resident if third-worlders are imported en-masse.
At one point Caplan hints that indeed that may be the case when he points out that the fictional dystopia of Blade Runner is actually an improvement on modern-day India. This may not be the rock-solid argument he thinks it is. I want my children to enjoy a better life than I have today, not a better life than what a typical Indian has today.
In a guest post (which does not imply Caplan's endorsement), the "worst" neighborhood in Japan is visited. It is still safe and relatively clean. The writer implies that the US can model urban policy off Japan’s success. But again, this ignores the cultural aspect. Japan has a culture of order and cleanliness (and xenophobia). If Japan imported even 5 million Brazilians the "worst" neighborhood in Japan would look quite different.
Again, Caplan misses the "human" aspect of economics.
Exhibit C: Trade Deficit and Geopolitics
Caplan is either ambivalent or in favor of a trade deficit. Caplan posits the idea that the trade deficit could be the result, not the cause, of financial inflows. Rather than a trade deficit resulting in foreign nations having excess dollars that they then spend on US investment, US securities are in such high demand that foreign nations raise the value of the dollar, causing foreign goods to be relatively cheap and leading to a trade deficit. If this argument is correct, then one would expect any economically vibrant and pro-growth country to have a trade deficit. The trade deficit indicates that the US economy and regulatory regime is more conducive to growth.
Yet much like with the UAE, Caplan doesn't seem to grasp the human side of this equation. He assumes economic output is "value free". A service-oriented economy begets a pampered paper-pusher bureaucracy, while the relocation of former blue-collar work to "higher-value" labor hasn't happened at scale. The service economy erodes the will and ability to actually build in the physical world, while the dearth of blue-collar work has led to zombie communities addicted to handouts and opiates. A country should choose to focus industrial policy on broad outcomes including domestic production. Any economy needs direction lest it degenerate. The invisible hand of the market finds local maxima, but it takes vision to push the hand towards a global maxima.
Since Caplan has a tendency to see everything through the lens of economics, he minimizes the geopolitical implications of US policy. We are in the middle of a great geopolitical reset in which protectionist policy plays a key part. The Trump administration has given up Europe as lost. The US is now competing for influence in areas where China has traditionally dominated (including the Arab states that Caplan extols). The remnants of the Bretton-woods post-war international order is being shattered. This is the main takeaway from tariff and trade policy, not the myopic economic impact.
A recommendation
Despite my criticisms, I'm glad that there is an anarcho-capitalist whose ideas have purchase in the rationalist community. A very positive change I've observed over the last decade is the steady increase in liberals acknowledging the benefit of the market and the harm of overregulation, and Caplan’s work has contributed to this change. I would like to see Caplan have even more impact.
Caplan correctly notes that the market forces good policy even where that policy has bad optics, while politicians pursue bad policy that has good optics. This provides a potential key to seeing his (good) economic ideas actually gain purchase: fight the battles that you can actually win. There is much political will to create energy abundance (natural gas and nuclear in particular) and to address NIMBYist red tape; once we are allowed to build, other "good" policies (such as mass labor importation) may become more politically viable. Indeed, even in the UAE plentiful energy preceded plentiful immigration.
I'm also a Bryan Caplan fan. I really like his arguments against education, his arguments for having more kids, and, more recently, his arguments against feminism. I also like his thoughts on living as a contrarian in a conformist world; I would have benefited A LOT from reading those when I was younger, and it makes me feel a deep sense of kinship with him. And I enjoy the way he applies economic reasoning everywhere. He's a must-read for any rationalist, in the same tier as Richard Feynman, Carl Sagan, or Richard Dawkins.
The biggest disagreement I have with him is open borders. I mean, I can kind of see it if you are an universalist utilitarian who thinks everyone has equal value, but I still can't understand how he possibly thinks norms and institutions like strong property rights, non-nepotism, etc. would survive. But that's OK, every great thinker is guaranteed to have at least one idea you strongly disagree with, because the kind of mind that looks for heresies in one area looks for heresies everywhere. I can disagree with Caplan about immigration just like I disagree with Scott about polyamory or disagree with the Dreaded Jim about anime. Rule thinkers in, not out.
I think he is sort of viewing everything from 500 feet as though every person acts a as a perfect automaton blindly acting exactly like every other person as a perfectly rational being. TBH I find the same flaws in most theoretical constructions— they ignore that humans are not little Spock’s running about perfectly enacting logical self interest. It also tends to elide the degree to which relationships between people and groups of people tends to totally change how people perceive their self interest and make choices.
The entire conversation about feminism and anti-feminism falls apart if you introduced a single wrinkle— humans tend to form these crazy things called families. And thus a lot of “rights” type arguments don’t work because every right asserted on one member of a family without imposing either a constriction or duty on someone else in that family. So if you say “well, women shouldn’t have to do all the housework, the cooking, the cleaning, the child care, because she is equal to the man,” you immediately have a problem because somebody has to do that stuff. So now you’re putting this on the other adult in the relationship— the man. But then he claps back with his own rights claims “why should I have to do all this? Why is it my job to do the laundry?” She wants to have a career, but someone else has to support her to make that happen. If one person could get a huge promotion by uprooting and moving to New York, you either move everyone or you don’t.
These simple mistakes always floor me because they’re pretty obvious. It’s not possible to ignore the individual choices, nor possible to ignore the relationships between people that inform those choices. The entire edifice is built on two lies — first the notion of an individual without tastes and preferences that don’t lead directly to maximizing utility on every axis, and second the idea that every man exists by himself with no relation to others around him. They’re both absurd. Humans have cultures that shape their preferences, and they have relationships with other people, not just families, but communities, cultures, political systems, and so on.
Even with regard to education, I think he’s right — in America especially, because the expense of college has made it that way. We have a fairly unique relationship with college. I’d argue we’ve basically turned it into a very expensive career casino in which you bet 4-5 years of your life and hundreds of thousands of dollars (over the course of the loan) on the chance that a given combination of the right school, major, activities, internships, and GPA will grant you a middle class career. And really a lot of his (correct) understanding of education works best in the American system where the entire point of our college system is to get a credential, get a job, and never think about that stuff again. In that context, attending Yale courses, but not getting the credentials is a waste of time and money. But if we’re talking about aristocratic students who for various reasons don’t need college specifically to get a job after college, they aren’t looking at college in the same way. They’d see the education part as more important as a way to impress people, as a sign of prestige, or a way to find a spouse. They would read the readings they are interested in, and maybe wouldn’t care as much about the diploma. Attending a lecture at Yale is much more intrinsically valuable when the diploma doesn’t matter.
Again, the context matters in how this stuff happens in the real world. If you want people to choose the education over the diploma, you need to make the education cheap and the diploma matter less.
This no longer works, and has not for generations. A man making such a complaint -- or worse, pointing out that as the main (or sole) source of external income, he's doing a lot for the household already -- by doing so proves himself a boor and probably a wifebeater. That has been part of the influence of feminism on culture; a man is obligated to do his share of everything, and his share is whatever the woman says it is.
My point is that it like a lot of things are often the result of sloppy thinking. Yes in today’s culture it’s boorish to bring up the unequal division of labor, however humans have lived for thousands of years with numerous such relationships and duties often explicitly defined for each role. They tended to be at least theoretically reciprocal I owe my husband a clean house and a hot meal, he owes me money for the house, protection, and so on. The same would be true of lord and peasant. You work, I will protect the realm and see to the stability of the fiefdom. Or teacher to student, boss to worker. This worked up until we decided that individuals could assert rights without any context of place in wider society. I think it’s a wrong framework because it ignores all the ways we are not atomized individuals without context in wider society.
Your wife isn’t just any old woman, she’s your particular wife with whom you have a long relationship and possibly children. Those children are not random children, they are your children. So when she doesn’t want to do laundry, it’s in the context of your personal relationship, not any other relationship. Naked assertions of rights don’t make sense in that context and it’s really only thought of this way in the modern era.
I think that there's this ahistorical idea floating around about history that the norm is a massively unequal division of labor in one direction or another (either women are overworked and saddled with all sorts of extra stuff due to oppression, or they are locked away and unable to do meaningful work due to oppression), but I think part of this is largely an artifact of how history is largely written by some kind of "noble" class. For the vast majority of people in history, both men and women work very very hard at a wide variety of tasks, because frankly, life has been tough for humans for virtually all of recorded history. You can't afford to be idle, man or woman. There was, like, one weird period in American history in the decades after WW2 where prosperity was weirdly high, tech developments made a noticeable dent in work levels, and so work responsibilities along with labor demand got kind of out of whack. Along with bad history, this had a massive and outsized impact on how people think about division of labor, with some second wave feminist influence mixed in there too. So yes, sloppy thinking to put it bluntly, but also a real and understandable phenomenon. As just one example, the invention of the washing machine and even the vacuum had an absolutely massive impact on housework. I'm not exaggerating - there are only so many hours in the week, and all clothes then and now need to be washed so often; the washing machine alone saved they estimate like 8 or more hours per week, by itself. All this to say that while I wouldn't quite go so far as to call caring about housework division of labor a luxury belief, the fundamental calculus behind division of labor is in a historically weird spot in current-day developed nations even before you get into the belief systems involved.
It wasn’t much of a secret. They wrote it all down. You can read all kinds of writings about various divisions of labor and social roles. We no longer read the stuff but it’s not hard to find. Confucius is pretty specific about the five relationships, and what the role is supposed to be doing. So is the Bible.
I still hold that decontextualizing relationships creates a lot of the problems. It’s weird to think of actual human relationships as though there’s an underlying contract and someone is getting a bad deal. A relationship is between people, and if both do as they are supposed to do, it works even if it looks unequal on paper.
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Note also that, as far as the 20th (and so far, the 21st) century is concerned, I believe there's a strong argument to be made that that noble class is women in general.
Oppression is their origin myth, much like defeating Hitler was for Western powers in general.
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