Nick Eberstadt – Growing Up Years (NE-1)

Nick Eberstadt:

So I was born into a well to-do and privileged [inaudible 00:03:18]. My grandfather on my father’s side was a banker and government policy maker in World War II and after. My mother’s father was a poet, Ogden Nash. My parents were literary and creative, obviously that was all formative. Not terror… there wasn’t much religiosity in my upbringing, but there were very strong family values. There was a very strong emphasis on the importance of family, which always stuck. Exeter was a sort of an awakening for me, because there were so many smart and talented kids there from… maybe we wouldn’t say all walks of life, but from an awful lot of walks of life. And certainly a lot of people who I’ve never would’ve known otherwise, people who’ve stayed lifelong friends, and the importance of talent and excellence I think was impossible not to imbue in the Phillips Exeter Academy of the very early 1970s when I was there.

Nick Eberstadt – Experience at Harvard (NE-2)

Nick Eberstadt:

Harvard was a different sort of situation. There was phenomenal talent there as well. I mean, I had the great, good fortune throughout my education, thanks to watchful parents, to be exposed to a succession of teachers who changed my life. And most people are pretty lucky if they get one, I must have had a dozen over those years, and a lot of them were at Harvard. And so the opportunities there were probably unparalleled. That said, it was not a unalloyed gift. There was a sort of a pompousness to Harvard, which I think anybody who didn’t go to Harvard is kind of aware of, the self-satisfaction of having been admitted is seen by some as a sort of a lifelong dining out story. And that wears thin, I think, pretty quickly. In that time, I guess I kind of gravitated also to very fashionable leftism, which prevailed in the quarters of Harvard University at that time.

And it was prestigious, in addition to being fun. And so I went very far left in my teens and my early 20s. You can probably still look up something that published in New York Review in about ’76, extolling the developmental economic genius Mount Zedong. It hasn’t been ripped out of the libraries the way the communists ripped out the [inaudible 00:07:23] when it was defending the invasion of Poland. But then probably over the course of about three or four years, I left all of that behind. And it was a gradual process, but it was accelerated by a sojourn for a year at the London School of Economics. Two important things there for me, number one, I realized that I never wanted the United States of America to end up like the Britain of 1977, ’78 that I saw. Just the year before that, the UK of all countries had applied for a loan to the IMF as if it were a third world state.

I didn’t want to see a America walked down the path of a sort of a little England-ism. So that was kind of important education for me apart from school. In school, I had a number of wonderful professors, and above all I’d have to mention P T Bauer, Peter Thomas Bauer, and later Lord Bauer, who was a… suppose he’d now be called a conservative. He’s a skeptic about foreign aid, a skeptic about central economic planning. He’d give these intentionally provocative lectures, and at the end of them… I won’t do his accent. At the end of them, he’d say, “I will now take any questions, no matter how hostile.” And I exhausted some of this pretty early on. And after a month or so of this, I said, “Well Nick, you are that you’re going to have to either get some new facts, or look at your opinions.” And I never had an epiphany, a road to Damascus, but he was certainly also instrumental in my course correction. Grateful him for many things, of which that is one.

Nick Eberstadt – What life events influenced your worldview? (NE-3)

Nick Eberstadt:

Oh, okay. Well, in the many decades since then, obviously starting a family, marrying Mary, it was the central, pivotal blessing and springboard for everything else. Raising kids, now having blessing of grandchildren adds a dimension and a new kind of technicolor nature to life that you can describe to somebody who hasn’t experienced this, but it’s like trying to tell somebody how to ride a bike. It’s not the same, it’s something you can only really know. So probably not unrelated to that is an appreciation of the importance of building institutions. Family is an institution, but there are other institutions, many other institutions in civil life, the little platoons of civil society. And as the appreciation through sad experience and life observation of how hard institutions are to build, and how very easy they are to destroy. And I suppose that appreciation brings a cautionary impulse that would be called conservatism in the modern usage of the term. So those would be some of the most fundamental differences that happen when you grow up.

Nick Eberstadt – Who are some economists that inspire you? (NE-4)

Nick Eberstadt:

Well, I’ve got an appreciation for a whole range of economic thinkers [inaudible 00:13:06] a kind of reasoning and philosophy, and then techniques, application of, kind of understanding aspects of the world. And not to sound like the Marxist I once was, but how to improve it if it’s possible, contribute to betterment. If I think about that now, some of the names that I’d have to mention, and there are many that I can’t given our limited time together, I’d have to mention Simon Kuznets, who was one of the early Nobel economics laureates, who did the difficult work of quantifying the economic performance of mid-century economies.

He was one of the founding thinkers in putting together the concept of GMP, GDP, but he also quantified the performance of economies all around the world on bringing together numbers to kind of describe how economies were working. And did that also for countries in 19th century, and on the basis of this work he was able to make some very profound observations about how economies modernize, how modern economic growth changes the structure and performance of economies and the way that people work, and how this spreads around the world.

Theodore W Schultz, who was at the University of Chicago, also a Nobel Laureate. Came up with, among other things, the notion of human capital. The idea that the wealth of modern countries doesn’t lie in the ground, it lies in people, and it’s enhanced by their nutrition, and health, and education, and skills, because what we’ve really seen over the last several centuries is an amazing escape from poverty for most of the world. And I think we can be tentatively confident that this is… we’re not at the final chapter in this.

Joseph Schumpeter. I don’t know how this guy could write so beautifully in his third language. I mean, his insights into the way that a prospering economy creates a class of learned despisers for its own success. This is written three generations ago, but I’m afraid it’s all too pertinent today. Peter Bower, whom I mentioned already, wonderful mind focused upon development economies, a development economics, an immensely learned man who was a great skeptic and a great economic reasoner. Those would be some of the ones that I’d mention. And I have to say that my own teachers were phenomenal. There were some people who maybe wouldn’t be quite as Googleable as the greats I just mentioned, but they were great in their own right. Peter Timmer, an agricultural economist. Dwight Perkins, the dean of analysis of the Chinese economy.

Nick Eberstadt – How would you describe your economics? (NE-5)

Nick Eberstadt:

I don’t think that I would say that I have a particular ism that I’d describe as Eberstadt-ism, but I’d say that the accumulation of learning from those grades and from others made me very attentive to looking for things that were hiding in plain sight, the things that were being overlooked. And despite the explosion of information, and the ever better statistical techniques that we have for describing reality once we got a kind of a dog dish of data, immense problems still somehow managed to hide in plain sight. And I think that those are kind of what excite me a lot in trying to look for.

Nick Eberstadt – What is capitalism? (NE-6)

Nick Eberstadt:

Well, so we have to use the term capitalism because that’s what is out there. I’m not so crazy about it myself. I mean, the thinker who probably had the most to do with formalizing the idea of capitalism was Karl Marx, who was an enemy of it, who despised the notion of such a system. And it’s not always good to have ideas defined by their enemies, but there we are. Maybe what we’d say is a system in which private property and personal decisions are the foundation for economic activity.

If we are going to talk about our modern lives and the real existing world around us, we’d also have to talk about how entrepreneurship, and investment, and private investment is central to this notion of what we have to call capitalism. And we’d be remiss if we didn’t talk about the importance of rule of law and expected order in economic relations, because it… this is central because it has a direct impact upon both uncertainty in economic transactions, decision making investment, and also on the cost of transactions. So rule of law, personal property, of personal choice and economic activity, all of these I think would be central to the market-based order.

Nick Eberstadt – What is the welfare state? (NE-7)

Nick Eberstadt:

With the welfare state? I mean… like capitalism, we get the modern usage of the term from the German, and people have talked about capitalism before Marx, but I don’t think anybody as importantly as he. Welfare state comes from the German, from [inaudible 00:22:33] from Bismark, and from the attempt in continental Europe to have a sort of a release of the pressure cooker for society, in which class tensions were quite evident from the modernization than underway. The welfare state are the government programs in an open society, and I think we’d usually say in an open democratic society, that are put in place to assure that the vulnerable and the weak are protected. And so of course it started off with old age retirement insurance, and extended then to protection for vulnerable mothers and children.

And then of course has expanded completely out of control in most of the Western democracies. If you look at these programs as they have evolved, they started out in the late 1800s accounting for maybe 10% or less of the national output of countries in question. Now in a number of advanced Western democracies, those programs account for over half of economic output. You’d have to say that it’s a luxury good, because the definition of a luxury good is if you increase your income by a hundred percent, you spend 200% on something that you prefer. So the revealed preference would have to suggest that the welfare state is something that modern voters wish to have. And so far as we can tell, this preference has been absolutely unstoppable in our lifetimes.

Nick Eberstadt – American Exceptionalism (NE-8)

Nick Eberstadt:

But we… I don’t mock the term American exceptionalism. I think there is a real tradition that rightly can be described as American exceptionalism, there’s a reason people moved here from the old world. Some of what animates us are myths, but myths matter. And one of the important myths had to do with our independence, and our freedom from government, and the proposition that you can make yourself into anything with grit and determination and persistence. That myth did not play well in post-feudal Europe, and class ridden Europe, there may have been more mobility in Europe than their myths allowed for. But the origins of the welfare state clearly had to do with European attempts to compensate for perceived class barriers, and bringing the European style welfare estate to the United States was kind of transplanting an organ that didn’t really belong here. Certainly didn’t have the same historical genesis.

Nick Eberstadt – Where did the modern Welfare State come from? (NE-9)

Nick Eberstadt:

Well, Doug, if you just look at that, so where did the modern welfare state come from? Number one from Bismark. And we know the history there. Number two from the Swedes. When did the Swedish third way emerge? After World War II. Excuse me, after World War I. Why? Because Sweden could it and export its impoverished population to the United States anymore so they had to figure out some way of a condominium. Number three, the UK with World War II. The Beveridge Report. Why are we fighting? What’s sort of world do we want to inherit after the end of World War II? It was a promise of benefits for working classes. So each one of these was an answer to a European political problem and really a European class problem. And that’s what we, for better or worse, transplanted to the United States. And we came very late to that party. The European sort of welfare state didn’t really get transplanted to the U.S. until the sixties. Then we made up for lost time real fast.

Nick Eberstadt – Has “true socialism” ever existed? (NE-10)

Nick Eberstadt:

Well, I haven’t been to heaven so I can’t tell you how it looks up there, but I don’t think there’s any earthly version of the socialist paradise or even the early primitive socialist Elysium that one here is described, I’d say, fantasized about. Part of the problem is that human beings are difficult ingredients to throw into a socialist experiment. And almost inevitably a sort of arrangement which promises equality without property rights invites terrible abuse of power. And people who talk about socialism are usually talking about an equality of measured income. They don’t talk about the equality of measured power.

And in earthly modern self-described socialist states, the typical characteristic is absolutist power on steroids. And for all of the discussion and proclamation of people’s rights, the so-called people’s rights are never really divisible into individual portions. And so in most of the self-styled socialist states really have to remember Lenin’s dictum. And right before he was succumbed to his debilitating stroke, he gave a speech to the young communists where he said, “We communist recognize nothing private.” And that was his definition of socialism, I would call it, totalitarianism. And I think that’s absolutely terrifying.

Doug Monroe:

Yes, it definitely is. And it’s the connection of private property to freedom and-

Nick Eberstadt:

And private property protects people and rule of law protects people. And it doesn’t protect the Rockefellers and the Gateses and the Bezoses, it protects the little people who don’t have the means to hire their own battalions of lawyers or squads of personal police. There’s something which is radically pro-poor in the rule of law and that’s often overlooked.

Nick Eberstadt – Should America’s economy be more like the Nordic countries? (NE-11)

Nick Eberstadt:

Well, I have to give the Nordic countries they’re due. The Nordic countries exported an awful lot of wonderful people to the United States. And if you look at the communities in the United States where the original impoverished Scandinavians came, you see really prospering communities in that part of the United States. The tradition and the social capital, if you want to call it that, has lasted for a long time and still flourishes. So, there’s something in the Scandinavian traditions that I think has to be recognized. The Nordic societies I don’t think are exactly the way some of their would-be admirers think they are. I mean, for one thing, they now have very serious problems with integrating their newcomers into society, and they haven’t done that terribly well in some places. And that’s one of the reasons that you have right wing nationalist parties in Finland and Sweden and elsewhere making a large dent.

It’s certainly true that the Scandinavian economies have been able to perform surprisingly, to me, well considering the very high tax burden and the very long reach of the government today. Part of the explanation for this, I think, is that the Swedish economy and some of the other Scandinavian economies are quite strict about encouraging real market principles in their business transactions while also taking a very high tax bite. And in their particular context, given their histories, it’s worked tolerably well. It’s something which it is a consensus which the populations of Scandinavia appreciate. And we should bear in mind that part of the reason for this big welfare state in Scandinavia is the absolutely desperate poverty of the Scandinavians in the 1800s. They have real memories of bitterness that have also informed the construction of this, that we haven’t had quite the same experience in. And so they’re lovely places to visit. If you want to live there, that’s probably great too. I don’t think that it’s a model that’s terribly replicable outside of the history and context of those nations and populations.

Doug Monroe:

You mentioned something, in standard answers to that question, you don’t hear as much that they’re really pretty radically free market when it comes to generating revenue and they turn around and they give it away. I mean, not many people can do that as well as they do. And it’s something about the character maybe.

Nick Eberstadt:

Well, I mean, there are aspects to the ethos that, again, I don’t think are necessarily replicable, much less exportable. I think if one visits some Scandinavian countries in the winter, probably have the experience of seeing people out and about or drinking themselves silly and they wake up at seven o’clock in the morning go right to work. I mean, that’s not for everyone.

Nick Eberstadt – Are we curing poverty worldwide? How? (NE-12)

Nick Eberstadt:

Well, when I started out in university, I was very interested in demographics and population question. I still am. Back then, there was a global scare, at least, among certain quarters of describers and deciders that we were going to head into a human calamity caused by heatless breeding of, they wouldn’t put it this way, but of the lower orders, which is really… There was a eugenic smell to a lot of this, even for the left wingers and the statists who were interested in controlling the growth of human population. And I mean, even when I was a leftist, I thought there was something horribly offensive about this. That the [inaudible 00:41:08] knew better. How many children people should have than they did, really knew better.

I think that the experience of the last almost half century has been a sort of a natural experiment. And we kind of see answer at this point. The world’s population has, let’s say, doubled, probably more than doubled. Since the beginning of the 1900s per capita incomes around the world have maybe risen by a factor of 600%. They’re still going up. Measured absolute poverty, may not be measured perfectly, but it’s plummeted. Life expectancy more or less everywhere has surged. Educational attainment has surged. Personal wealth has surged. Despite the current inflation, the long term, real prices of food have gone down substantially. And we know now I think that the real essence of wealth of nations is in human beings.

I mean, you can augment their capabilities and their potential. You can encourage that through education and nutrition and upbringing and so forth. You can unlock the value in human beings by having a more auspicious business climate. But the wealth is in human beings. It’s not in the ground, it’s not in the oil wells, it’s not in the timber. And we’re seeing an escape from poverty which is based upon human creativity, human knowledge, the creation of human knowledge, and then the application of human knowledge. So it’s a remarkable human and humanistic achievement. And appreciating the reasons for the escape from poverty, I think would be a great cautionary for much of the inescapable and always returning statist impulses that one has to contend with now and probably in the future.

Nick Eberstadt – Poverty vs. Misery and the War on Human Dignity in the U.S. (NE-13)

Nick Eberstadt:

So when we talk about poverty in the United States, I think we have an impoverished conception of poverty. We’ve forgotten things that other people before us knew and understood in their bones. I’m thinking immediately of the Victorians in Britain, but they’re not the only ones. I mean, I’m talking about something that was obvious until about the day before yesterday. And that was the distinction between poverty and misery. We’ve done a fantastic job in the United States of mitigating material want. We have probably gotten to the stage that Schumpeter describes in his work where residual material poverty is just of sort of a pathological nature. People who are outside and not included in the system.

Doug Monroe:

There’s something else going on.

Nick Eberstadt:

There’s something. But what we suffer from, I would say, is increasing misery in our society, which is not the result of material shortages or material want. If you look at the sorts of studies that University of Chicago economists, Bruce Meyer, and his colleagues have done about consumption patterns in the United States, we’ve won the war on poverty. It’s been very expensive, but we’ve won that war.

The war that we’ve lost terribly has to do with human dignity. Crime, family breakdown, welfare dependency, pornography, the epidemic of loneliness, the whole lost boy generation of people who were kind of living inside this online existence, [inaudible 00:47:52]. And all of these are manifestations of sort of a social and moral loss that we are afflicted by today. And when we call this poverty we’re not naming the animals by their proper names, and we’re not pointing to the proper part of the person that’s being afflicted. Part of that I think is because it’s seen as being controversial now to talk about obvious stuff and especially to talk about obvious stuff that would seem to have a value judgment basis. But it’s kind of hard to describe misery and degradation apart from the metaphysics and the ethics that people have to swim in. So that’s just what I wanted to say about the poverty versus misery thing. But that kind of gets us to the men without work.

Nick Eberstadt – What has modern day feminism done to men? (NE-14)

Nick Eberstadt:

I’m flipping around from what you asked. So the feminism as an ideology, the campaign that my AEI colleague, Christina Summers, called the war against boys, I mean, all of that’s real. It’s hard for me to see that men are the only losers in this. I think actually, women may be a greater group of casualties than the men because of first generation simpliciter feminism. The kind of the feminism for dummies version. That kind of spread everywhere, left women unprotected. And if a man is unprotected and a woman’s unprotected, I can tell you who’s going to end up getting the better deal of the two. And I think we are as a society dealing with unintended consequences all the time, but the unintended consequences of this notion, I think, have been far more devastating for women than they have for men. But men haven’t come out of the bargain unscathed either.

And what we’ve seen over the postwar era as I mentioned in that study of mine from 2016, the men without work study, is a gradual flight from work by men of the age group that was traditionally always understood to be the providers for society. And so we’ve had this peculiar emergence of a not tiny contingent of men able bodied or working aged men as dependents instead of providers. And there’s something that seems hugely unnatural about that. Back in the depression era, if men didn’t have work, they were unemployed. They’re out of a job and looking for work. Now in this prime working age group of men, that 25 to 54s, for every guy who’s formally unemployed, there are three guys who are neither working or looking for work. And this is something that only immensely affluent modern society could afford to maintain as a problem.

It’s a problem financed by our extraordinary affluence, but it’s incontestably a problem because it, I mean, from the material side, it slows economic growth. It increases wealth gaps and income gaps, but it also has very disturbing implications for family, for civil society and maybe even for politics. The strange thing, Doug, was that this problem seemed to be invisible. When I, when I was writing about it. I mean, I’m an intruder, I’m not a labor economist. There’s some great labor economists who do great work, but there was this tiny little problem there that seemed to be kind of ignored. There were 7 million prime aged guys who were neither working or looking for work and their ranks were increasing in almost a straight line from the sixties up until recently and may still be increasing over the years ahead.

Nick Eberstadt – How can we cure America’s misery problem? (NE-15)

Nick Eberstadt:

Well, Ronald Reagan asked the question when he was running for president, are you better off than you were four years ago? That was a winning question for him. If you ask whether we’re better off than we were 40 years ago, which is the question I asked in my 2020 Irving Kristal lecture, you have to give a very qualified answer to that question. On the one hand, we won the Cold War. The Soviet communist threat was eliminated almost without bloodshed. The world headed into decades of unprecedented peace and prosperity. [inaudible 00:56:32] also, but we can get to that later. The United States was able to generate wealth in a way that no country in history had ever done before. If you look at private net worth today, on average, for a notional household of four people, it’d be over a million and a half dollars, sloshing in money. It’s not evenly generated or evenly distributed, so that’s another question all together.

If you look at the headlines, this has been a time of unrivaled, not just success, but really triumph. But at the same time, it was almost as if the termites were eating at the foundations of this great American success, and some of the problems, which we’ve already discussed… The men without work problem was hiding in plain sight. The decay of the American family structure is no state secret. The relentless increase in welfare dependency for the population, which among other things, I’d argue so subversive of the notion of middle class or the myth of the middle class.

People looked at the decline in manufacturing as one of the causes of the crisis of the middle class. They never talk about the increase in accepting means tested benefits as something that affects peoples’ conception. Other things as well, I think all were part of what I called in that lecture, the rise of a new misery. As distinct from poverty, misery. It’s not for-ordained that we should go through unending decline and increasing misery. The prospects for reversing this, I think, are very much at hand. We need to do things. We already know what most of them are. We need to have a resurgence in productivity because a broad based productivity, and broad based growth can provide the fuel that can help eliminate this new misery. That speaks to research, education, business dynamism, less sclerosis in economic affairs.

But it can’t all be sort of a simplistic libertarian pill for people to take. The rot in the family, the central unit of society, is terribly corrosive. Government isn’t very good at addressing that. The question of immigration is something that government can perhaps address, although it hasn’t done a very good job for most of my lifetime. The enthusiasm, confidence, and courage to deal with these problems depend upon our civil society, I think not so much on our government. Although I don’t think I emphasized this in my lecture, I certainly did say that this may be something which another great awakening could make a great difference in addressing. The thing about great awakenings is that you can’t summon them. They’re there from a higher power, or certainly from a power beyond the reach of the state.

It’s certainly very much within our grasp to revitalize the United States. I have a feeling that such a revitalization is largely going to come from the bottom up rather than from the elites down.

Nick Eberstadt – Have the elites in the U.S. let us down? (NE-16)

Nick Eberstadt:

We had this crackup of America’s establishment, let’s call it of its elites, in the 1960s. I was just barely old enough as a preteen to be aware that something is going on there. We’ve had, I think, a much more profound failure of elites right now. We’re living through this right now. Some of this has to do with the scorn and disdain that many educated Americans have for the American experiment and for our founding principles. They’re not so bad. They offer something for everybody, and I think, really, unlimited promise. They also allow us, as the anthem says, to repair thine every flaw. I think that’s somewhat overlooked by our educated or by at least a large swath of our miseducated elite.

There’s a lack of confidence in our country and in the future, and a lack of empathy and solidarity with other people in this society. It’s sort of class enemies or thought crime committers. I don’t know if we’ve ever had it as acute as this in the post-Civil War era. When I try to think about analogies, I’m sure there are analogies, but I think we have to go back a long way. Bad things happen when you look for analogies on some of those storylines. We also have this…

Doug Monroe:

I totally agree with that, by the way. I think it was not as bad in the Johnson era or in the Jimmy Carter era or whatever you had.

Nick Eberstadt:

No.

Doug Monroe:

You could be a blue or red and you still could drink a beer together.

Nick Eberstadt:

Sure.

Doug Monroe:

Now, you can’t.

Nick Eberstadt:

No.

Doug Monroe:

You have to back to the 1870s or ’80s.

Nick Eberstadt:

You have to go back a very long way. Of course, the corollary of that is we were able to heal after that. I think we’ll be able to heal after this as well. But we have to start by diagnosing the problems and, again, calling the animals by their proper name because one of the immense problems that we confront now, and this is part of the elite failure, has been the death of truth in the public square. We didn’t have this in anything like the same form in the radical ’60s or the convulsed ’70s. But now, the academy has become a censor zone against free speech where there are lots of forbidden thoughts. Our news media has gone from its inveterate bias to active propaganda. Propaganda is a war on truth. We have it in the corporate sector, where we now have the HR departments as kind of like roving Stasi units. [inaudible 01:07:14] nothing about our social media platforms with the overlords and the censorship.

It’s not just there. Because of this elite failure, we’ve got much less freedom in our country than at any time in my life. I at least can remember when America was a lot more free than it is now. If you are 30 years old, you can’t really remember when America had a healthy economy or when you were allowed to have free debate without being punished, when you didn’t have to worry that you’d be hunted or doxed for controversial, heretical ideas. If you talk with young people about what it was like, it’s like Grandpa’s war stories. This is a world that they don’t know. Empathizing with this, I think, is critically important for bringing us out of this current [inaudible 01:08:45].

Nick Eberstadt – What are your thoughts on U.S. foreign policy? (NE-17)

Nick Eberstadt:

Yeah, I know exactly what you mean. I believe the United States is a force for good in the world. I believe the United States has done a great service to humanity by helping to construct what we might call [inaudible 01:09:37] Americana that emerged from the second World War, not just through the United States, but certainly, crucially with the United States, a liberal, international order that included freedom of trade, commerce, and finance, and protection of allies against oppression or aggression from mainly communist attackers. I think this has been a great achievement for the modern world. It’s not one which has come at no cost. It’s involved continuing sacrifice on the part of the American people. Since we, fortunately, live in a country where the consent of the governed is required, this means that our leadership has to justify this incessantly to our population, convince them that this is worth the sacrifice.

Since the end of the Cold War, we’ve had this, to me, very odd spate of seemingly substandard presidential leadership, both parties, where we’ve squandered American predominance in, what seems to me to be, terribly unwise ways. Maybe this is just a modern tragedy, tragic version of a Delphic oracle story. You don’t realize what you can do with all of this power until you don’t have as much of it anymore. One of the things which I certainly notice from my own stumbling around, looking for problems that are hiding in plain sight, is that the bottom half of U.S. households in inflation adjusted terms didn’t have any more net worth in 2019 than they had when the Berlin wall came down. If you’re going to try to explain to half of America’s households why we won the Cold War, exactly who won the Cold War, you’re probably going to have to get out a little bit more than the American elites have done.

This is maybe a roundabout way of saying that Trump voters were not entirely delusional. They were responding to something very real. It was something that the American elites living in their bubbles didn’t really recognize terribly well. It’s another chapter in the failure of the elites’ book that we were just fleshing out a few moments ago.

Nick Eberstadt – Why is there an emphasis on freedom particularly in the U.S.? (NE-18)

Nick Eberstadt:

We have the great good fortune of having been raised in the country that is part of the Anglo-American tradition. The English, American, Canadian, Australian, maybe New Zealand, to some degree, the commonwealth tradition also, traces back to a very special approach to human dignity, individual rights, and imperative of consent for those who are ruled, those who are governed. I tend to think that the prospects are not so bad in other parts of the world. All parts of the world that are influenced by the Judeo-Christian tradition have an appreciation of the ultimate accountability before your Creator and the immortality of the soul. Those concepts have pretty radical political implications when you get around to it.

But even outside of the Anglo-American tradition and the Judeo-Christian tradition, I think there is an appreciation of what we might call liberalism, open society, in other settings. It wasn’t dominant, but we see throughout the 1800’s and 1900’s, the bursts of liberalism in Asia, certainly in Latin America [inaudible 01:17:04] to much of the same tradition that I mentioned. I think there’s a lot of hope for open societies around the world. But, of course, the institutions of the open society are very fragile and very vulnerable. They have to constantly require protection and nurture. It’s nothing that can be taken for granted.

Nick Eberstadt – What is going on in Ukraine? The Holiday from History is Over (NE-19)

Nick Eberstadt:

It’s harder to explain now than it would have been 30 years ago because with the end of Soviet communism and the death of the Soviet empire, the world took this huge, prolonged holiday from history. We’ve lived as if we were in a sort of [inaudible 01:19:16] land fantasy for a generation and more, which means that people under the age of about 50 have a lack of power politics DNA in their system. It seems unnatural. In fact, power politics is the ordinary state of affairs when you have states. What we’re seeing in the Putin/Kremlin’s invasion of Ukraine is the end of our holiday from history, the return to power politics in a pretty ugly way. But welcome back to the world as previous generations had known it and as future generations will likely know it as well.

There are still some people around who are old enough to remember the inter-war period. The reason it was called the inter-war period is because it was punctuated on both sides by wars. It was also a time of terrible illusions. The illusion in Europe, of course, in the inter-war period was that it would be possible to appease an unappeasable dictator. I’m not doing the reductio ad Hitlerum thing, but appeasement can be a good policy. The Brits had a very successful policy of appeasing the United States, which was the basis of the special relationship, which worked pretty well for our two countries and for the rest of the world. But Europeans and Americans spent two decades appeasing an unappeasable dictator in the Kremlin. We, unfortunately, inadvertently helped to create the monster who is there now. He can talk about how the special military operation in Ukraine is a defensive operation to de-Nazify a territory next to his. It’s an especially amusing concept for a government run by a man of Jewish heritage, that it’s going to have to de-Nazify that territory.

One can put it in terms of great Russian nationalism or one can talk about redressing the great geopolitical catastrophe of the 20th century, which Putin had described as the breakup of the Soviet Union. But what we have in front of us is just a prolonged failure of Western leadership and a refusal to face unpleasant facts about reality and to try to pretend our way out of them. You can’t pretend your way out of them. This is only the latest wake up call to that age old fact.

Nick Eberstadt – How are the Chinese and Russian dictatorships different? (NE-20)

Nick Eberstadt:

We can use approximations by different analogies that we, ourselves, are comfortable with. Mafia is not a useless template, because we kind of get what the mafia’s about. There are big differences between China’s dictatorship and Russia’s dictatorship. Not the least of these have to do with the state power that they possess, and with their capabilities for influencing events beyond their borders. I mean, Russia’s pretty clearly a state in decline, and the dictator there has been taking increasingly risky moves as a way to compensate against long-term decline.

Chinese leadership is pretty confident that they’re a state on the rise. They have had an absolutely extraordinary economic transformation over the last 40 years, nothing like that ever before in history, so short term can be excused for thinking that, although future prospects may be a little bit different. But the sort of the petro-kleptocracy in the Russian Federation is mainly a sort of a rent-seeking, extractive operation. It’s not creating very much. The Chinese economy has created a lot over the last 40 years, and there’s certainly immense corruption there. I’m not saying that it’s anything that Milton Friedman would be delighted to see these days. He had higher hopes for it, I think, 30 years ago, than he’d have today if he were looking at it.

So I mean, China was the original totalitarian state. I mean, the unified Chinese empire under Qin Shi Huangdi was state-of-the-art totalitarianism with second-century-BC technology. And Chinese tradition has for thousands of years been able to marry an absolutist state with a market economy, so this is not a contradiction in the Chinese tradition the way that market technologies and market systems confronted Soviet communism. So the Chinese Communist Party seems to be re-ideologizing, and this has of course come along with the rise of a paramount leader and the shelving, it seems, of collective leadership. But the two dictatorships I think are significantly different, even though they may have a use for each other, even though they may have signed a sort of a particularly poorly-timed league of super-villains packed together in February of 2022. There are, I think, significant differences between the two.

Nick Eberstadt – Do you foresee China invading Taiwan? (NE-21)

Nick Eberstadt:

Well, the Chinese dictatorship has never acceded to the notion of a separate Republic of China across the states, and they’ve always maintained the claim to that territory. And there are increasing signs of preparation for a military settlement of the difference there. Taiwan is really precious in the modern world. It gets back to this question about the bastions of freedom in the world. In Taiwan we’ve got this existence, proof that you can have an open society and a prospering democracy in a population with a Confucian, and maybe a little bit of a Buddhist tradition. Yeah, there were some missionaries thrown in there too, but it’s not all that. And it’s a really remarkable experiment in freedom. So that also, I think, is a direct threat to the dictatorship in China because it shows that there is an alternative possible. It doesn’t have to be another 2,000-plus years of absolutism on the mainland.

And that’s yet another reason for wanting to snuff out Taiwan the way that Hong Kong’s market freedoms and open society are being crushed. The early returns from the Kremlins invasion of Ukraine, with the embarrassing setbacks that Russia’s invasion has encountered, may prompt more thinking in Beijing about the invasion of Taiwan. I’d be surprised if it would vitiate the aspiration or ambition to absorb Taiwan unconditionally, but it may alter the calculations of timeline, if you will. Imagine timeline on such a thing.

Nick Eberstadt – How to handle the rise of the Chinese Communist Party? (NE-22)

Nick Eberstadt:

I think we in the United States and we in the West made a failed bet with China. It was a reasonable bet to wager, and it had potential for great benefits, but it failed and we still haven’t admitted really the full dimensions of this failure. The idea was back in the very late ’70s, early 1980s, that we were going to sort of chaperone post-Maoist China into the world economy, and integrate it into the world economic system and into Pax Americana, into the global governance structure that we’d help to develop. And that the Chinese leadership would reform as the economy was expanding and modernizing and reforming. And we got, some would say, the worst of both worlds in this. We’ve ended up with a Chinese Communist Party that is utterly unreformed, and is Leninist with Chinese characteristics, managing a much bigger and more powerful economy that has infiltrated all of the economies of the Western world and is in a position to leverage from within to influence domestic politics from within the open societies into which it’s now integrated. And we don’t even have the language for understanding how to cope with this.

I mean, the Chinese tradition of imperial absolutism and market order, this is almost second nature for leadership to realize how the opportunities are for manipulating things internationally, whereas we’re almost as helpless as blind kittens yet. And eventually I think we’ll learn how to deal with this, but we haven’t competently begun to. The rise of China economically that we’ve seen was abetted by a lot of demographic tailwinds, and those are pretty much gone now. And this gets to the question of what happens in the next 20 years.

Nick Eberstadt – Where will China be in the next 20 years? (NE-23)

Nick Eberstadt:

The Chinese extended family is very rapidly shrinking, atrophying, imploding? I don’t know what the right words are. And maybe more than any of the headcount stuff about a shrinking labor force, or population aging, or imbalance between men and women of marriageable ages, maybe this revolution in the family which has been so critical to survival and success in Chinese history under an absolutist state, this may have surprising, unexpected influence in the next couple of decades because the government isn’t aware that this is going on except in the most impressionistic manner, because they don’t collect information on the family structure or on extended family, just as we do not. What happens with religious belief and Christianity, or even with other alternatives to absolute government authority like the Falun Gong, things like that, is an intriguing and critical question. I think we can bet that the Chinese authorities or the dictatorship has thought about that a lot more than we have, but it doesn’t mean that they’re competent to cope with it.

I mean, there are original resting ideas that spread like a prairie fire, especially when you live in a setting where the suppression of ideas is kind of the currency of the realm. I mean, one area even where I’ve seen that in reading stuff related to mainland China is in their science fiction. You see a painting of a world that is supposedly far away and in a distant time, which is really about China, and it can be quite devastating in some of the science fiction writing. And of course, this writing is wildly successful within China. So no matter how tentatively the dictatorship works to maintain its control, and it’s got all of these really frightening and imaginative new approaches to totalitarian rule like the social credit system… These things work until they don’t, and we’ll know when they… How to put this? We probably won’t know when it all ends until after it’s begun to end. We’ll be looking in the rear-view mirror because of the information asymmetry. But I don’t think it would be a really good bet to think that this is going to go on forever.

Nick Eberstadt – Is America better off today than during the Cold War? (NE-24)

Nick Eberstadt:

Well, I mean, I’ve got a little bit of memory of the Cold War, and you do, too. The Berlin Wall didn’t fall until I was in my 30s, married, and a father, so I spent a fair amount of my ascension, or youth, aware of that situation. We didn’t understand all of our strengths then in the ’60s, ’70s and ’80s. We didn’t understand how powerful we were. Our enemies did. We’ve squandered a lot of our power over the last 30 years, but we may still underestimate the sources of our power. Obviously there’s the economic aspect of this ledger, and if you put together the open societies, the affluent Western democracies, their economic weight is still preponderant in the world. Much more than everybody else combined. The-

Doug Monroe:

You’re talking about America?

Nick Eberstadt:

We’re talking about U.S., Europe, Japan. Let’s say the affluent OECD countries. Countries that would style themselves as being part of the West. Throw in Israel with that. And the dominance of the dollar is much stronger now than it was in the ’60s, the global dominance. I mean, we’re going to see just how powerful dollar sanctions are in this little experiment that we’re doing with Russia as a consequence of the invasion of Ukraine. Trade influence, much stronger than with think. The astonishing rule of the English language, which is not something that can be weaponized but is part of the… I don’t know what to call it, the greater influence of the U.S. and the Western system. Because all of the culture and science and technology, English is the language for all of that, and that sets the possibilities and the productivity for the future.

We’ve got an enormous amount of power, and probably more than was the case in the 1960s or 1970s. Now, just as in the ’60s and ’70s, we’ve got a deeply divided society, demoralized in many quarters, anti-American in some. That poison has been drained in the past, and I’ve got no doubt that that poison can be drained again. If we look overseas we see analogies that may be instructive. I mean, look at what’s happened in Germany since the invasion of Ukraine by the Kremlin. In about 72 hours, and I really mean in about 72 hours, the German establishment put aside its DAVO streams and the fantasies, self-serving fantasies, that it was living by over the previous couple of decades. And made, let’s say, initial steps. I won’t say that they’re… We don’t know how lasting they are, but cutting off their new oil and gas pipeline, particular to Nordstrom too, with Russia.

Committing to defense buildup, providing offensive weapons to Ukraine, and doing this through a coalition government which wasn’t the conservative establishment, but it was the socialists and the greens. When you’re kind of mugged by reality, you can have an attitude change that’s really fast. I mean, I hope that we can have an attitude change before we are mugged. We seem to do very well when we’re punched in the face and have to respond, but it would be a lot tidier if we didn’t have to wait to take the first blow.

Nick Eberstadt – What advice do you have for the younger generations? (NE-25)

Nick Eberstadt:

I mean, it’s hard to tell people when you only know one thing from your own life experience, that hasn’t always been this way and it isn’t always going to be this way. But it hasn’t always been this way, and it isn’t always going to be this way. Talent’s great, smarts are good. But what we really lack at this moment is courage, courage and truth. And don’t be afraid to call big lies big lies, and don’t be afraid to see where truth takes you. It’ll set you free.

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