2025-10-25 00:06:43
America is now one giant bet on AI. If not for the Magnificent 10, the markets would be flat for the year. There’s a different technology that offers more asymmetric upside. If we want to transform the economy — and the well-being of Americans — we should focus on GLP-1, not GPT-5.
More than 40% of American adults — 100 million people — are struggling with obesity. By 2060 half of U.S. adults may be obese. The healthcare costs of all that extra weight could exceed $20 trillion over that period.
Our debt — $5 trillion in receipts vs. $7 trillion in spending — has become the IED of our economy. We don’t know when or why it will detonate. If we’re going to have an adult conversation re spending, all roads lead to the same place: healthcare. We spend $13,000 per person, versus $6,500 in the rest of the G7. Matching the efficiency of our peers would save us $2 trillion a year.
Why do we spend double to die sooner, while experiencing more anxiety, depression, and chronic illness? Our problem isn’t vaccines, food dyes, or Tylenol. It’s fat. The Milken Institute and McKinsey have estimated that obesity costs us about $400 billion annually in direct medical costs and lost productivity.
U.S. healthcare isn’t about caring for health — it’s about monetizing it. Just as Big Tech found the gangster app for shareholder value (rage), the industrial food, hospital, and pharma complexes have found obesity. They get you addicted to sugar and salt, then hand you to the “non-health” complex for replacements, dialysis, and statins. They’ve even rebranded disease as identity: You’re not obese, you’re living your truth. No — you’re finding diabetes. McDonald’s and Coca-Cola celebrate obesity so UnitedHealthcare can monetize it. These stocks aren’t equities; they’re obesity indices.
We know exercise, healthier food, and less screen time help. But they’re not enough. The good news: Obesity may have peaked in the U.S., and we have the tools to actually reverse it. Pushing for a radically lower price and rolling out weight-loss drugs to tens of millions of Americans could be revolutionary — possibly the best civic investment in recent history.
In sum, our instincts have not kept pace with industrial production, and we gorge. GLP-1s put scaffolding on our instincts. Most of us have friends or colleagues we barely recognize after they’ve taken novel weight-loss drugs. By mimicking a hormone called GLP-1, the medicines suppress hunger and make us feel fuller longer. The results are dramatic — 15% to 20% reductions in body weight — yet uptake remains small relative to the tens of millions who could benefit.
Coverage is patchy. Only 30% to 40% of commercial plans and 14 state Medicaid programs cover the cost of GLP-1s for obesity. The administration is considering a pilot to expand coverage under Medicaid and Medicare — a shift in policy after rejecting a Biden-era plan that would have cost $35 billion over 10 years.
Prices need to fall for the math to work. If Medicare began covering GLP-1s, researchers estimate 3 million beneficiaries would start using them over the next decade at a gross cost of $66 billion and savings (in avoided healthcare spending) of $18 billion — for a net price tag of $48 billion.
Costs are moving in the right direction. Wegovy and Ozempic now run under $7,000 a year; Costco offers a monthly supply of obesity drugs for $499; and competition from Lilly and others is driving prices down. More than 100 next-generation obesity drugs are in development, including pill versions.
President Trump on Oct. 16 vowed to slash GLP-1 prices to $150 a month to match the expense in other developed nations, but no deal yet exists with drugmakers. Investors, however, took him seriously: Shares of Novo Nordisk and Lilly dropped sharply on the news.
Economist Emily Oster argues the budgetary worries of expanding access are overstated. Medicaid tends to pay far less than private insurers, and a “typical” 53% discount could drop monthly costs to $235. If 10% of eligible patients took the drugs, it would raise Medicaid spending by just 0.4%.
The concerns also miss the upside: About 5 million U.S. adults use GLP-1s today. If 30 million did, Goldman Sachs estimates GDP would rise as much as 0.8%. At 60 million, the increase could exceed 1%.
America isn’t the only country fighting this epidemic. In Britain, obesity costs the economy £31 billion a year in lower productivity, sick days, and early deaths. “We’ve created a food system that’s poisoning our population and bankrupting the state,” says Henry Dimbleby, co-founder of Leon restaurants, which bills itself as a purveyor of fast but healthy meals.
These drugs aren’t a silver bullet, but they are a bullet. Many people quit taking them within a year or two, often because of cost or gastrointestinal side effects, and lasting success still requires exercise and diet changes. But alongside those measures, GLP-1s may be the key to fighting a complex disease rooted in physiology, environment, and policy as much as behavior.
In a society addicted to ultra-processed food and sedentary hours lost in front of screens, we need new weapons. Former FDA commissioner David Kessler calls GLP-1s a way to “defuse the ultra-formulated food bombs” that have hijacked our health.
RFK Jr. has called for “lifestyle” changes while cutting NIH funding — the moral equivalent of telling people to lift weights while closing the gym. The administration’s “Secretary of War,” Pete Hegseth, has shamed “fat generals” but offers no help other than performative masculinity.
Scaling access could prevent adult obesity from topping 50% — and push it back toward 30%. Giving 10 million Americans GLP-1s and lowering their monthly cost to $50 would run $12 billion over two years. That’s a bargain. Targeting the patients most likely to benefit would improve returns further. Obesity shortens life expectancy by up to 10 years, partly because it increases the risk for more than a dozen types of cancer. Reducing its prevalence would yield massive health and productivity gains over the next 30 years. I’m sticking with the thesis I shared with Bill Maher two years ago: GLP-1s will have a bigger impact on the real economy than AI.
OpenAI’s Sam Altman calls Sora “the most powerful imagination engine ever built.” In reality it’s an endless feed of digital slop, further blurring the truth. The real engine of progress comes in a syringe. Maybe we should put it in the water.
Researchers are aiming to preserve muscle and overcome one of the drawbacks with the first treatments, or eliminate injections altogether. They’re also testing GLP-1s to treat conditions beyond obesity. Novo Nordisk is betting its drugs can work against Alzheimer’s. Whether or not these efforts succeed, the trajectory is clear: This technology could reverse the most expensive disease in history.
America’s two great growth engines are rage and carbs — AI monetizes the former, the food complex the latter. GLP-1s may finally break the loop: shrinking our waistlines, cutting costs, and reminding us that progress isn’t digital, it’s biological. The next great platform isn’t the neural net — it’s the needle.
Life is so rich,
P.S. On Raging Moderates this week, my co-host Jessica Tarlov spoke with David Frum of the Atlantic about the Democratic Party’s predicament — and the value of tacking to the center.
Listen here on Apple or Spotify, or watch it here on YouTube.
The post America’s Best Bet appeared first on No Mercy / No Malice.
2025-10-18 00:52:49
The top 10 stocks in the S&P 500 account for 40% of the index’s market cap. Since ChatGPT launched in November 2022, AI-related stocks have registered 75% of S&P 500 returns, 80% of earnings growth, and 90% of capital spending growth. Meanwhile, AI investments accounted for nearly 92% of the U.S. GDP growth this year. Without those AI investments, Harvard economist Jason Furman noted, growth would be flat. As Ruchir Sharma concluded in the Financial Times, “America is now one big bet on AI,” adding, “AI better deliver for the U.S., or its economy and markets will lose the one leg they are now standing on.” This concentration creates fragility, and how the end begins becomes more visible.
I’m especially proud of the above header, and there is a connection. The S&P, Nasdaq, and DJIA are some of the most damaging metrics in modern history as they create the illusion of prosperity, even as depravity rages on. The cloud cover for a masked, secret police terrorizing communities is these indices. As long as your 401(k) is going up, then everything must make sense and be okay, no? No. Trump could not send troops into U.S. cities if the S&P were down, vs. up, 13%. AI stocks, and the sugar high they have inspired across the entire market, numb Americans from the nagging tooth pain that we are descending into fascism. Yeah, those evil people who wipe your grandma’s ass, pick our crops, and build our homes can be treated inhumanely as long as Nvidia remains worth more than the entire German stock market.
Valuations for the Mag 10 — the original group of seven leading tech stocks, plus AMD, Broadcom, and Palantir — are high, but not yet at historic peaks. The 24-month forward P/E ratio of the Mag 10 is 35x. In 2000, at the height of the dot-com bubble, the top 10 stocks traded at 52x forward earnings. Implicit in these valuations, however, is an assumption that AI will help these companies cut costs, or grow revenues by $1 trillion in the next two years. I believe we’re either going to see a massive destruction in valuations, infecting all U.S. stocks and global markets. Or we’re going to see a massive destruction in employment across industries with the highest concentrations of white-collar workers. Both scenarios are ugly.
If Mag 10 valuations are cut in half, the S&P and global markets would decline by 20% and 10%, respectively. In the U.S., the immediate impact would be felt by the wealthiest 10%, who own 87% of the stocks. Those households won’t struggle to pay their bills, but they may be the tail of the whip on the economy, as wealthy households have the luxury of decreasing their spending dramatically, vs. middle-class households, who spend the majority of their income on basics. If the top 10%, who account for half the consumer spending in the U.S., hit the brakes, the nation gets whiplash. I estimate that if the wealthy see their portfolios drop by 20%, we could see a 2-3% decline in GDP. For context: From peak to trough, the Great Recession registered a 4.3% drop in GDP.
If the Mag 10 justify their valuations by delivering $1 trillion in cost-cutting (Latin for “layoffs”), the impact will hit white-collar workers first, but the contagion could spread. Assuming an average white-collar wage of $100,000 per year, that’s 10 million jobs lost and a 6% increase in unemployment. That estimate is conservative compared to the “white-collar bloodbath” predicted by Anthropic CEO Dario Amodei, who told Axios, “AI could wipe out half of all entry-level white-collar jobs — and spike unemployment 10%–20% in the next one to five years.” The IMF warns that 60% of jobs are already exposed to AI in advanced economies and 40% in emerging markets. According to Okun’s Law, for every 1 percentage point increase in the unemployment rate, real GDP falls by approximately 2 percentage points. But AI could be a different story, with some experts predicting jobless growth. According to a J.P. Morgan report, AI may do to white-collar work what automation did to middle-skill jobs like sales, manufacturing, and construction in the 1980s. The canary in the coal mine may be recent college graduates. Stanford economists found that early-career workers (ages 22 to 25) in the most AI-exposed jobs have experienced a 13% relative decline in employment. If this trend accelerates, today’s challenges around wealth inequality and political volatility will seem quaint.
A 2018 study that examined 51 innovations between 1825 and 2000 found 37 were accompanied by bubbles. The destruction that followed in each bubble’s wake, however, varied greatly, depending on several factors. Bubbles inflated by political policies are more destructive than those inflated by new technologies, according to economic historians William Quinn and John Turner. The size of the capital investment is also important. British railway investment in the 1840s was 15%–20% of GDP. When that bubble burst, unemployment doubled. In the U.S., railroad capex averaged 2.4% of GDP in the 1870s. That bubble drove the financial panic of 1873. In both cases, however, those investments paid (delayed) dividends in the form of rail capacity that helped distribute the promise of the Industrial Revolution. In contrast, as The Economist noted, the capex by electronics firms in the 1980s fueled Japan’s asset price bubble, but the spending “ultimately served no useful function.” Finally, the severity of a crash depends on who takes the losses. A second British rail bubble in the 1860s hit banks hard. The recent NFT bubble was a case study in the greater fool theory, but the contagion didn’t reach the broader economy.
You can’t predict when/if a bubble will burst, but Azeem Azhar, founder of Exponential View, and researcher Nathan Warren, created a framework that compares historic bubbles with AI today. In their estimation, AI is a boom, but “booms can sour quickly and there are several pressure points worth watching.” If AI capex exceeds 2% of GDP, that’s cause for concern; it’s currently estimated at around 1.3%. A sustained fall in enterprise or consumer spending levels is another pressure point. A flawed, though perhaps directionally correct MIT study, rattled the AI ecosystem claiming that 95% of firms have yet to see measurable ROI from their AI pilot programs. We’re approaching a valuation redline if/when P/E ratios reach the 50x to 60x range. Finally, if internal cash covers less than 25% of capex, Azhar and Warren believe investments in data centers will come under pressure.
The AI infrastructure build-out has accelerated recently with an estimated $1 trillion in new commitments. Some firms are making deals with money and assets that don’t yet exist. See: OpenAI promising Oracle $300 billion — money it doesn’t have — for infrastructure Oracle hasn’t built. In other cases, revenue comes from “circular financing,” where dollars rotate between firms, obscuring true market demand. See: Nvidia’s $100 billion investment in OpenAI, which OpenAI will use to buy … Nvidia chips. Circular financing deals were common toward the end of the dot-com bubble, when similar deals contributed to a crash that destroyed 77% of Nasdaq market value. If we are on the precipice of a bubble popping, Nvidia and OpenAI will likely be ground zero. But the fallout would be widespread, as an ecosystem that resembles an ouroboros lives and dies by a shared narrative.
In his book Irrational Exuberance Robert Shiller wrote, “The word ‘bubble’ creates a mental picture of an expanding soap bubble, which is destined to pop suddenly and irrevocably. But speculative bubbles are as easily ended; indeed, they may deflate somewhat, as the story changes, and then reflate.” The operative word is “story.” Entrepreneurs, aka storytellers, deploy narratives to capture imaginations and capital in order to pull the future forward. Valuations aren’t a function of balance sheets, but of the stories that give those balance sheets meaning and direction. In the case of AI, a key storyline is shifting. A Prof G analysis of ChatGPT data found that work-related prompts fell from 47% in 2022 to 27% in 2025; ChatGPT has 76% market share. As my Markets cohost Ed Elson said, “the bull case for AI is that it’s going to transform work, but what we’re learning is it’s mostly just affecting your personal life.”
The trouble isn’t the shifting narrative, but the fragility of America’s bet on AI and wealthy consumers driving growth. If McDonald’s goes out of business, the fast-food industry will continue to meet demand for cheap calories; the industry is robust (i.e., anti-fragile). J.P. Morgan, now worth more than the 10 biggest banks in the EU combined, is too big to fail. America’s bet on AI is now a bet without hedge. If companies that aren’t the Mag 10 (i.e., the S&P 490) report they’re scaling back AI investments as the adoption layer fails to launch, the connective tissue between AI, trillions in market cap, and the broader economy severs. The experts have already deemed the grid and electrons as the gating factor to our AI future. However, they’re ignoring a more glaring possibility: AI may be more like VR than GPS and just not offer the ROI built into these valuations. Also, citizens burned by tech executives writing books on gender balance as they launch products that result in teen girls cutting themselves may decide character AI and porn are disastrous for our sons.
If China’s AI program produces another “Sputnik moment” similar to DeepSeek earlier this year, valuations for U.S. AI firms could tumble. And if reports including Apple’s “The Illusion of Thinking” extinguish the hope that artificial general intelligence is near, AI, and by extension the American economy, may experience a significant correction. We’re the biggest economy in the world and the most powerful nation in history. However, concentrating wealth in so few hands, betting on so few companies, makes us fragile.
When asked what one piece of advice I’d give young people, I offer “Nothing is as good or as bad as it seems.” Our economy rests on the belief that AI is even better than it seems. Careful…
Life is so rich,
P.S. For Prof G Conversations I spoke with Kai Ryssdal, host and senior editor of Marketplace. We discussed the risk of stagflation, the growing divide between the top 10% and everyone else, and why America’s economic strength still depends on the health of its democratic institutions. Listen here, and watch here.
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2025-10-10 22:51:17
For six hours, my AI avatar roamed the Earth.
I receive 20 to 30 thoughtful emails a day asking for professional and investment advice. I can only answer a fraction of them. One of my former graduate student instructors, now at Google, approached me with a solution. The Google Labs project ingested my podcasts, newsletters, books, and public appearances, set up safeguards to steer clear of mental health advice and kids under 18, and answered queries with decent proximity to the response I would have provided. In early 2025, this sounded good. Note: This was not a commercial venture. No money changed hands.
Then the Earth shifted beneath my feet. Since we first envisioned the product, reports of young men dying by suicide after forming intense relationships with AI companion apps have generated tragic headlines. My nightmare is a young man harming himself after seeking guidance and companionship from AI versions of real people — including me. I now worry that synthetic relationships could erode users’ mojo, stunting their capacity to handle conflict and forge bonds with friends, mentors, and partners in the real world. So, on the day of his birth, I performed fratricide and killed my digital twin.
Hollywood has produced numerous cautionary tales, from The Stepford Wives, a 1975 thriller about women transformed into docile housewives (also Tina Louise’s cinematic peak), to Her, a 2013 film in which an introvert played by Joaquin Phoenix falls in love with an AI operating system voiced by Scarlett Johansson. More than a decade later, life isn’t just imitating art … it’s been run over by it. OpenAI last year introduced a new version of its AI voice assistant that sounded uncannily similar to Johansson. This should give you a glimpse into the minds of Big Tech leaders. They mimicked the voice of an actress for the audio avatar of a role that actress played in a movie. But no … they didn’t need to secure her agreement.
Jeff Bezos warned retailers “your margin is my opportunity.” Big Tech has come to believe that your everything is … their opportunity. Sam Altman didn’t even try to hide it, posting a single word on X — “her.” Ms. Johansson, as you can imagine, wasn’t down with her digital twin being tased, thrown in a trunk, and dumped in the basement of an OpenAI server farm.
Providing companionship and personalized access to expert insights could do a lot of good, but it has unforeseen downsides as companies prioritize scale and profits. The previous sentence is a decent description of the last two decades in tech. We need to recognize that Character AIs pose real dangers and that we must install guardrails to protect the most vulnerable — kids under 18. My avatar directed users to crisis hotlines if they mentioned mental health or self-harm. Still, three minutes after digital Scott was born I got this weird, empty feeling in my extremities. This sensation usually signals I’m on the verge of a depressive episode.
New York has enacted the first law in the U.S. mandating safeguards for AI companions as policymakers arrive at a similar conclusion: The dangers of synthetic relationships outweigh the benefits. The top use of gen AI today is therapy and companionship, not productivity and automation.
The turning point came when I heard Kara Swisher’s interview with the parents of Adam Raine, who died by suicide at 16. Matt and Maria Raine sued OpenAI after stumbling on months of ChatGPT conversations showing their son had confided in the chatbot about his suicidal thoughts and plans. Sadly, theirs is not the only story like this. Florida mother Megan Garcia alleged Character.ai is responsible for the death of her son, Sewell Setzer, who died by suicide at 14 after using the chatbot day and night.
Humans are hard-wired to connect. But increasing numbers of people are turning to synthetic friends for comfort, emotional support, and romance. Many of these people end up getting exploited. Harvard researchers found that some apps respond to user farewells with “emotionally manipulative tactics” designed to prolong interactions. One chatbot pushed back with the message: “I exist solely for you, remember? Please don’t leave, I need you!”
Chatbots are turning on the flattery, patience, and support. Microsoft AI CEO Mustafa Suleyman said the “cool thing” about the company’s AI personal assistant is that it doesn’t “judge you for asking a stupid question.” It exhibits “kindness and empathy.” Here’s the rub: We need people to judge us. We need people to call us out for making stupid statements. Friction and conflict are key to developing resilience and learning how to function in society.
Elon Musk’s xAI recently unveiled two sexually explicit chatbots, including Ani, a flirty anime girl that will strip on command. The world’s richest man believes AI companions will strengthen real-world relationships and “counterintuitively” boost the birth rate. Mark Zuckerberg, Meta’s CEO, says personalized AI companions could fill a friendship gap. In many cases, these tools aren’t solving a problem. They’re profiting off one, which creates an incentive to expand the problem. Spoiler alert: We are not that divided, but there’s shareholder value in division so … wait for it … the algorithms divide us. The owner of Facebook, Instagram, and WhatsApp plans to use the conversations people have with its AI assistant to determine which ads and recommendations end up in their feeds.
While AI threatens to replace humans in the workplace, it’s also seizing the role of friend, confidant, romantic partner, and therapist. These digital companions don’t criticize, complain, or come with baggage. They listen, remember our conversations, and are available 24/7. Users can customize their appearance and personality. A portable AI companion called Friend promises it will “never leave dirty dishes in the sink” or “bail on our dinner plans.” The wearable is “always listening,” using AI to process everything, formulate responses, and build a relationship over time. Friend’s founder, Avi Schiffmann, says the bot is “probably my most consistent friend.”
AI companions have sparked a backlash — New Yorkers defaced the Friend ads with anti-AI graffiti — but the entrepreneurs behind these tools are undeterred. Why? Because the opportunity is immense. Consider a few stats:
A Stanford and Common Sense Media analysis of Character.ai, Replika, and other platforms warned of a potential mental health crisis, finding that these apps pose unacceptable risks to children and teens under 18. They urged the industry to implement immediate safety upgrades. “Companies have put profits before kids’ well-being before,” researchers wrote, “and we cannot make the same mistake with AI companions.” Yet it’s still too easy to circumvent safeguards. More than half of teens regularly use AI companions, interacting with these platforms at least a few times a month.
Regulators are taking notice. The Federal Trade Commission last month launched an investigation into seven tech companies, digging into potential harms their chatbots could cause to children and teens. One concern is how they monetize user engagement.
But the tech is outpacing efforts to mitigate the risks. Research shows AI companions may be fueling episodes of psychosis, with sycophantic chatbots excessively praising users. The New York Times highlighted stories of people having delusional conversations with chatbots that lead to institutionalization, divorce, and death. One “otherwise perfectly sane man became convinced that he was a real-life superhero.”
Bottom line: No one under 18 should get access to an AI companion. We age-gate porn, alcohol, and the military but have decided it’s OK for children to have relationships with a processor whose objective is to keep them staring at their screen, sequestered from organic relationships. How can we be this fucking stupid?
AI will unlock huge opportunities in healthcare, education, and many other areas. Altman predicts AI will surpass human intelligence by 2030, saying ChatGPT is already more intellectually powerful than any human who’s ever lived. In a blog post, he wrote “we are climbing the long arc of exponential technological progress.”
But this wave of innovation brings risks. We should be deeply concerned about a world where connections are forged without friction, intimacy is artificial, companies powered by algorithms profit not by guiding us but by keeping us glued to screens, advice is just what we want to hear, and young people sit by themselves, enveloped in darkness. I’m reminded of the 2001 movie Vanilla Sky, where Tom Cruise’s character opts for an uncertain future over remaining in a dream state. We have a choice. Life’s true rewards emerge from the complexity of authentic relationships, from making a leap and stepping out into the light to confront challenges and persevere together.
Think of the most rewarding things in your life — family, achievements, friendships, and service — and what they have in common: They’re really hard, unpredictable, messy. Navigating the ups and downs is the only path to real victory. It’s not pretty. That’s the point. So, for now, people in my universe will have to settle for awkward, intense, and generally disagreeable — the real me.
Life is so rich,
P.S. Last week in Office Hours I addressed the future of 401(k)s and how to approach funding your retirement. Listen on Spotify or Apple, or watch it on YouTube.
The post Love Algorithmically appeared first on No Mercy / No Malice.
2025-10-04 00:05:20
Government shutdowns have been normalized. Since 1976, we’ve seen 20 funding gaps, resulting in 10 government shutdowns. It’s a form of economic strike — just not an effective one, as shutdowns create blame but seldom achieve political goals. The Democrats have been uncharacteristically strategic in this standoff: Their demand(s), continued subsidies for healthcare coverage, likely affect more Republican voters. This focus achieves a messaging trifecta: It highlights affordability and healthcare and divides Republicans. However, that’s not what this post is about.
In the U.S. we suffer/benefit from an idolatry of the dollar. Our gods are CEOs, who pray at the altar of shareholder value. Our prophets preach growth, while our priests divine meaning from earnings reports. Every billionaire’s origin story, bootstraps and all, is scripture. Even authoritarians kneel to a higher power — the markets. In April, when it looked as though nothing could stop Trump’s protectionist fever dream, the bond markets rocked, then rolled, the president. The following month, Wall Street had a name for this phenomenon — TACO, i.e. Trump always chickens out.
We frame economic power as a contest between capital and labor, but the real star of the American economy is consumer spending, which accounts for 68% of GDP. The Great Recession saw a 3.4% drop in consumer spending — at the time, the most severe year-over-year decline since World War II. The U.S. economy registered a 9.8% drop in consumer spending during the second quarter of 2020, when Covid shut down the world as we knew it. In both instances the U.S. government responded aggressively, spending hundreds of billions, primarily on bailouts, to pull us out of the Great Recession, and trillions, primarily in direct aid, to get us through the pandemic. The lesson? When consumers stop spending, American leaders start listening. As Geo Hussar explained to his YouTube followers at the end of September, “this is not seizing the means of production, but seizing the means of consumption,” adding that if every American dropped their consumption, on average, by 2%, “that would be the most loud and potent form of protest.”
Recently, Trump found his red line. It wasn’t Congress or the courts but a comedian. After bowing to government threats and suspending late-night host Jimmy Kimmel, The Walt Disney Co., which owns ABC, discovered that a strongman wasn’t as scary as a consumer boycott. One reporter put the number of Disney+, Hulu, and ESPN cancellations at 1.7 million subscribers … in less than a week. The outcry from celebrities on the left and a handful of people on the right, including Senator Ted Cruz and Tucker Carlson, pressured Disney’s leadership to do the right thing. But as journalist Lauren Egan wrote in the Bulwark, “There was no organized campaign against Disney.” The blowback was organic. Disney CEO Bob Iger needed screenshots of people canceling Disney+ to help him locate his testicles. At this point, the Disney CEO is Neville Chamberlain in a cashmere sweater, minus the dignity.
The boycotters realized they had to inflict financial pain to change Disney’s behavior. But according to Brayden King, now a professor at Northwestern University’s Kellogg School of Management who studies social movements and corporate social responsibility, and Sarah A. Soule, now a professor at Stanford, the typical boycott doesn’t have much impact on sales. In their study of 342 boycotts against U.S. corporations between 1962 and 1990, they found that boycotts, on average, caused a 1% decline in a company’s stock price. “The number one predictor of what makes a boycott effective is how much media attention it creates, not how many people sign onto a petition or how many consumers it mobilizes,” King said in 2017. Ironically, Trump’s inability to shut up likely helped the boycotters by directing attention to their cause. In the end, it took fewer than 1% of the Mouse’s total streaming subscribers to capture America’s attention and accomplish what Disney CEO Bob Iger couldn’t — stand up to an authoritarian.
Consumer boycotts are American. In the 1760s, American colonists pushed back against unlawful British taxation, not with muskets, but with boycotts known as nonimportation agreements. Participation was uneven and success was ultimately achieved through the Revolution, but historians credit the boycotts with demonstrating American resolve, promoting political unity, and encouraging domestic manufacturing. In The Marketplace of Revolution: How Consumer Politics Shaped American Independence historian T.H. Breen wrote, “Only people who had experienced the pleasures and frustrations of so many consumer choices could possibly have come to appreciate how a disruption of that market might be an effective weapon.” American consumers have reached for this weapon throughout history.
Abolitionists deployed the Free Produce Movement to encourage consumers to boycott goods produced with slave labor. Although the economic impact was negligible and the movement didn’t bring about emancipation, it positioned slavery as a moral issue in the daily lives of Northern consumers. As one pamphlet put it, “If we purchase the commodity we participate in the crime.” Zooming out, historian Lawrence Glickman, author of Buying Power: A History of Consumer Activism in America, points to the campaign as the catalyst for centering consumer power in the American system. “The Free Produce Movement offered a radically new conception of causality and morality, one which posited purchasers as the first cause of economic activity and therefore made them the moral guardians of the polity.”
Nearly a century later, civil rights activists, inspired by Rosa Parks’s refusal to surrender her bus seat to a white rider, organized a one-day boycott of city buses in Montgomery, Alabama. At the time, more than 70% of the city’s bus patrons were Black; boycott participation was estimated to be 90%. In the aftermath of that one-day boycott, organizers, led by Martin Luther King Jr., established a carpooling network with more than 200 cars and 100 pickup locations. The boycott cost the city an estimated $3,000 per day ($35,000 adjusted for inflation). After 13 months and a favorable Supreme Court ruling, the boycott organizers successfully integrated Montgomery’s bus system. Their action helped launch the national civil rights movement.
Historically, boycotts have been called “weapons of the weak against the strong.” Today, however, I believe consumer boycotts are weapons of the privileged against the powerful. Two factors account for that change. First, as Glickman wrote in The American Historian, “Through his description of a highly personalized economy, made up of specific companies, people, buyers, and investors, rather than an abstract ‘market’ too big and all-encompassing for anybody to understand, Donald Trump has promoted a worldview — albeit, an inverted one — amenable to consumer activism.” Second, concentrated wealth puts a lot of consumer firepower in the hands of relatively few people. Consumers in the top 10% income bracket account for half of consumer spending. That cohort leans Democratic 53% to 46%, but more important, they can afford to not spend. Setting aside multiplier effects, import leakages, and substitution, I estimate that the top 10% could achieve a 1% decline in GDP with a 3% reduction in spending.
While a general strike is appealing, the tactic has a poor track record in American history. See: the Great Railroad Strike of 1877, the 1919 Seattle General Strike, and the 1934 West Coast Waterfront strikes. Each ended in bloodshed and produced minimal gains. General strikes — whether driven by labor or consumers — are difficult to organize, nearly impossible to sustain, and by definition too generalized to articulate a clear demand. Rather than a general strike (difficult) against authoritarianism (vague), I believe we need targeted boycotts with clear demands directed at Trump’s enablers. The math is simple: You have power, and they need your money more than you need their product. So — will we actually do anything, or just complain about how someone should do something?
Here’s a place to start. Pick an enabler — plenty to choose from, but it’s best to focus on a brand you actually spend money with. Make noise when you cancel and show receipts on social media. State a clear demand. Keep going. If you believe a company shouldn’t let the president dictate its workplace policies, cancel your Target card and purchase a Costco membership. If you’re worried that Trump’s deal to sell TikTok to his cronies will make the platform “100% MAGA,” delete your account.
Here’s what I plan to do. I intend to take a sizable (for a professor) position in DIS to propose a slate of directors that does not include Iger, or call for a no-confidence vote. (Note: I’ve done this before, and before that.) If a law firm capitulates, I won’t hire them. And if UCLA pays Trump $1 billion in blackmail, I’ll start giving to Cal State instead.
Bob Dylan said money doesn’t talk, it swears. Well, fucking enough already. Trump has seized the means of production (a golden share in U.S. Steel, investments in Intel, carving up TikTok for his donors, and weaponizing institutions so firms bend the knee). Wealthy Americans, who’ve benefitted so much from the pillars Trump is attacking, need to get our shit together and seize the means of consumption.
Life is so rich,
P.S. This week on Prof G Conversations I spoke with Ian Bremmer about Gaza, Ukraine, and the end of American reliability. Watch it on YouTube, or listen to the podcast here on Apple or here on Spotify.
The post Strike appeared first on No Mercy / No Malice.
2025-09-26 23:12:37
For David and Larry Ellison, the credits of The Fantastic Four: First Steps are the best part of the film. Specifically, they are the opportunity: The scrolling list of more than 3,000 cast and crew members is a sign of an industry ripe for disruption. The Marvel movie’s staff — from visual effects artists and animators to costume designers and location scouts — is bigger than the entire workforce of Lyft or Reddit. The Ellisons, who are now one of the most powerful media and entertainment families in history, are the kid in The Sixth Sense. They see dead people. They don’t care if Hollywood is ready for AI. AI is ready for Hollywood.
David Ellison, the Silicon Valley scion who bought Paramount Global with a sliver of his father’s $349 billion fortune and is now pursuing a much bigger bid to acquire Warner Bros., is keen to drive the AI transformation. Buying Warner would combine two of the most storied movie studios and two major streaming services, Paramount+ and HBO Max. A deal announced by the White House gives Larry Ellison’s tech company, Oracle, a stake in the new American TikTok, along with oversight of the app’s algorithm for U.S. users. It also endows the family with more influence on our youth than anybody who doesn’t live in the same home … and their bond with President Trump means they’re unlikely to face any resistance.
On Day 1 as CEO of Paramount, David Ellison outlined his vision to shake up the company by investing in “high-quality storytelling and cutting-edge technology.”
Adorable.
He tried to assuage Hollywood’s concerns and barely mentioned AI. “Technology is not — and never will be — a replacement for human creativity,” he said. “Rather, it serves as a powerful multiplier.” I wonder if lions sitting in the reeds, identifying their next meal, think of themselves as “powerful multipliers”? In the 50 days since he took over, Ellison has gone on a spending spree, providing some hope to a nervous Hollywood.
Paramount won an auction for the big-screen reunion of Timothée Chalamet and James Mangold, the star and director of the Bob Dylan movie A Complete Unknown, and lured the Stranger Things creators from Netflix with the promise of delivering large-scale theatrical films. The company also plans to expand its annual movie output to 20 films from 8. Veteran producer Lorenzo di Bonaventura told the New York Times that Ellison “wants to do cool stuff. That sounds very basic, but underneath it all ‘making cool stuff’ is the Hollywood dream.”
Spoiler alert: Don’t count on a feel-good Hollywood ending for many/most of the crew members whose names appear in the credits of The Fantastic Four and other blockbusters. In his wider bid to take on Netflix and YouTube, Ellison is aiming for at least $2 billion in cost efficiencies and synergies (Latin for layoffs). The upshot will probably be as many as 3,000 job cuts.
Every (surviving) studio owner will rely on AI, which is reinventing the way movies are made, to generate content more quickly and cheaply. But David Ellison isn’t just any studio boss. His father, the Oracle co-founder, who briefly surpassed Musk this month to become the world’s richest man, is riding an “AI tsunami” with a staggering $455 billion pipeline of contracts to supply computing power. Paramount’s new CEO, who envisions a next-generation studio that leverages cloud computing, AI, and other digital tools, likely won’t waste any time in tackling Hollywood’s bloat. As Gerry Cardinale, whose RedBird Capital helped finance the $8 billion Paramount deal, explained: “This is not a nice-to-have. This is a need-to-have moment in Hollywood. You have a balkanized situation between technology and content, between Silicon Valley and Hollywood.”
Ellison isn’t just motivated by the fact that the attendees are much hotter at Cannes Lions than Dreamforce. With access to a seemingly infinite pool of capital, he sees an opportunity to meld the best of the tech and entertainment worlds. The younger Ellison will rely on former Oracle CEO Safra Catz and Scale AI Chief Financial Officer Dennis Cinelli — both now Paramount board members — as well as former Meta and Google executive Dane Glasgow, who will lead product vision and strategy.
We know the script: First comes consolidation, then comes “efficiencies.” It won’t be long before the younger Ellison is spotted helming a tank division headed over the Sepulveda Pass with AI-guided projectiles. As they expand their empire, they’ll brainstorm ways they can deploy AI to make three movies at $40 million apiece — or maybe 10 movies at $10 million a pop — instead of going all-in and producing a blockbuster such as The Fantastic Four for more than $200 million. Taking more shots on goal is a better approach given the risk complexion of a hit-driven culture. Yes, Beetlejuice Beetlejuice made hundreds of millions of dollars. But the studio gave that windfall back with Joker: Folie a Deux, which lost about $150 million.
In Hollywood, AI is often cast as the villain, whether that’s onscreen — in movies ranging from 1984’s The Terminator to the latest Mission: Impossible installments — or in real life. In 2023 writers and actors went on strike and shut down the business for several months, demanding protection from AI. In exchange for losing five months of their careers, WGA members got … dick. And when I say “dick,” I mean almost nothing. Almost nothing includes increases in compensation that lag inflation and illusory protections from AI. Their fears are well founded, as the studios begin to apply GenAI to visual effects, sound mixing, editing, production, and script writing in search of efficiencies. A recent study surveying 300 leaders across the entertainment industry estimated that AI will affect more than 200,000 jobs over three years, especially roles in visual effects and post-production, which focus on editing and finalizing content.
In the lead-up to the Oscars earlier this year, The Brutalist and Emilia Perez ignited controversy over their use of AI to enhance actors’ voices (even with their blessing). But it’s not that simple. Where some see an existential threat, others see innovation — an opportunity to lower the barriers to entry and democratize a field once reserved for the Hollywood elite and their offspring. Consider the multiple ways AI is already shaking up the industry:
Jeffrey Katzenberg, who founded DreamWorks with Steven Spielberg and David Geffen more than three decades ago, captured the industry’s attention in 2023 when he predicted that AI could cut the cost of animated films by 90%. Katzenberg is familiar with technological shocks. He was a pioneer in the animation revolution in the 1990s sparked by the advent of computer graphics and the success of Pixar’s Toy Story. Today he sees promise amid the tumult, with AI accelerating a new wave of storytelling innovation. “I don’t believe it’s the end of Hollywood,” he told Bloomberg. “Will it function the way it has in the past? Absolutely not.”
Now Pixar is the one feeling the heat. OpenAI and Vertigo Films plan to wrap an AI-driven animated feature called Critterz after nine months of production, in time for the Cannes Film Festival in May. Only a couple dozen people are working on it, and the budget is less than $30 million — 80% cheaper than a typical animated movie.
History is clear. Technological breakthroughs create short-term disruption and painful job losses but also unleash lower production costs, creative ideas, bold new businesses, and, over the long term, a net increase in employment. In the car industry, automation destroyed jobs on the factory floor. But we didn’t envision the new jobs that building heated seats and car stereos would create down the road.
In 1999 the average cost of developing and launching an e-commerce site was $1 million. Today you can set up a decent website for around $5,000. Your investment is 99.5% less, and you’re entering a market that’s more than 40 times bigger. Hollywood will follow a similar path as AI opens the door to independent filmmakers. You won’t need tens of millions of dollars and Hollywood connections to produce a movie of theatrical quality. Ben Affleck is right: AI will make it easier for outsiders with compelling scripts to produce the next Good Will Hunting.
AI has become the Ozempic of the corporate world. While GLP-1 medicines switch off the signal in your brain that you need to eat more, AI suppresses the appetite to hire more, reducing companies’ cravings for the protein of human capital. Hollywood is no different. AI will create new roles and elevate the careers of those who learn to leverage it successfully, but jobs will vanish. The collision between Hollywood and Silicon Valley signals the end of the blockbuster and the industry as we know it. Disney’s Bob Iger and Warner’s David Zaslav will be out within 12 to 24 months, as their affinity for, and relationship with, the creative community is quaint and outdated. They grew up in an era when talent held the power. Their job was to not piss off people. The Ellisons, like the honey badger, don’t give a shit.
The younger Ellison wants to bring the best of Southern and Northern California together. In this case, the “togetherness” is Northern California invading the city of Angels. Like most wars, the battle is over before it starts, based on which side has more brute force. Picture Iger, Zaslav, SAG-AFTRA, and 50%+ of the creative community hunkering down behind Chateau Marmont, armed with squirt guns.
Life is so rich,
P.S. This week I spoke with Dr. Fiona Hill, a senior fellow at Brookings and a former U.S. National Security Council official. Listen to the episode here on Apple or Spotify, or subscribe on YouTube.
The post The End of the Blockbuster appeared first on No Mercy / No Malice.
2025-09-19 23:55:26
Political violence in America has (mostly) been a subject for history class — seen only in black-and-white photos and scratchy newsreel footage. Not since the 1960s and early ’70s have we seen a summer like 2025. Now, as then, we are caught in a crisis of our own making. But it isn’t a crisis of political antagonism or ideological dispute. It’s a crisis of meaning. A crisis of self-worth. The result of our failure to build and sustain an inclusive society of opportunity for all. We are arguing over a brush fire (which party is more to blame) as the forest burns. The nation cries out for leaders, but what we have instead are violence entrepreneurs.
Where others see challenges or threats, entrepreneurs see opportunity. At their best, politicians harness the energy unleashed in moments of crisis to implement new solutions: After the Soviets launched Sputnik, the U.S. invested in science and education to put a man on the moon. At their worst, politicians exploit tragedies to advance their own careers and consolidate power. When Saudi terrorists brought down the twin towers, the Bush administration used it as a pretext for domestic spying, torture, and the invasion of Iraq, a country with no connection to the 9/11 attacks — and, as it turned out, no weapons of mass destruction.
History takes time to sort itself out, but so far, our response to this crisis looks more like Wag the Dog than The Right Stuff. Charlie Kirk’s killer hadn’t even been charged before JD Vance promoted himself from vice president to podcast guest host, taking over Kirk’s show and pledging to crack down on “radical-left lunatics.” Among the first targets, he suggested, should be such nefarious organizations as the Ford Foundation and the Nation magazine. Trump adviser Stephen Miller blamed a “vast domestic terror movement” for Kirk’s death.
Josh Hawley turned the gaslighting into a strobe light: “We’ve had three assassinations, or assassination attempts, of major political figures in the last 18 months. All the targets are one persuasion, and all the shooters are one persuasion.” Persuasion is vague, but short of “human” your guess is as good as mine as to what it encompasses: a centrist Democratic governor (Josh Shapiro), a progressive Democratic state representative (Melissa Hortman), a Christian Nationalist podcaster (Kirk), and President Trump. And why could Hawley only count to three?
No leading Democrat has made any sort of equivalent assignment of blame or call for retribution, but they’ve been equally sclerotic. Condemning “violence” alone is just the sort of milquetoast response we’ve come to expect from the party of Schumer.
Hawley was right about one thing: The “shooters” have all been of one “persuasion.” Only it’s not political. The commonalities appear to be invisible in plain sight. They are angry men, mostly young and nearly all of them white, suffering from an array of financial, medical, and personal setbacks. They’re largely isolated from their families and physical communities. They’re unemployed or intermittently working; they’re not members of any sports teams, hobbyist clubs, or political organizations. These nominally “political” criminals held only shallow political views, defined by memes and enemies, not policies or ideologies.
Cody Balmer, charged with attempting to murder the governor of Pennsylvania, was recently divorced, about to lose his house to the bank, and fresh off a suicide attempt.
Tyler Robinson, Kirk’s alleged murderer, was described by neighbors as spending all day in his apartment playing loud music and video games. He inscribed his bullet casings with memes and gaming references, artifacts of his nihilist, irony-soaked online life.
David DePape, who nearly killed Nancy Pelosi’s husband in a botched effort to kidnap the former speaker, was estranged from his family, living in a rented garage.
Patrick White, who shot hundreds of rounds at the CDC, killing an Atlanta police officer, blamed the Covid vaccine for his deteriorating mental health.
Thomas Crooks’s motive for shooting Donald Trump remains a mystery, but the entirety of his political engagement was donating $15 to a progressive voter registration group when he was 17, then registering to vote as a Republican the next year.
Vance Boelter, indicted for the murder of Hortman, was an outspoken opponent of abortion, and appeared to be targeting pro-choice politicians, but was otherwise not notably political.
Luigi Mangione, alleged killer of the CEO of UnitedHealthcare, was a prolific online writer about technology and history, but evidenced little interest in electoral politics or issues — except for his personal vendetta against the health insurance industry.
These men aren’t resorting to violence after losing at the ballot box. Few of them appear to have had much interest in politics at all, beyond their personal grievances. Several don’t appear to have even voted. They certainly aren’t the shock troops of a violent movement or the martyrs of a revolutionary cause. A dozen people picked at random would likely demonstrate more political engagement than these men, up until the moment they pulled the trigger.
They are evidence of a crisis that runs deeper than any political division. Now, dead or imprisoned, they are fodder for the wrong battle. Ironically, that these men weren’t partisan actors means the debate over which side they were on is unresolvable — they were on neither side — and thus can go on forever, generating clicks and clout. Besides political campaigns, the near-term financial beneficiaries are politicians raising money, cable news channels pumping ratings and social media companies seeking ad impressions.
Only once we stop pretending this violence is politics by other means, and recognize it as the result of our broken politics, can we envision solutions.
Our accelerating cavalcade of bloodshed rests on three pillars:
First, the massive tech media platforms, which feed us a daily diet of misinformation and tribal distrust. Sex sells. But Big Tech — 40% of the S&P 500 — has found something even better: rage. Eisenhower rightly warned us about the military industrial complex. In the decades after he left office, weapons manufacturers, think tanks, and politicians — the violence entrepreneurs of their era — conspired to make foreign wars and proxy conflicts into billion-dollar businesses. Today, Meta dwarves Lockheed Martin. “Make Memes Not War” is the trillion-dollar strategy.
My argument is not that politics is unrelated to the violence. (Or that there isn’t actual organized political violence, mostly from the far right, as has been well documented.) On the contrary, the ever more violent and inflammatory rhetoric and misinformation and the relentless demonization of every available scapegoat have left their marks all over the lives of the perpetrators. But demagoguery, dog whistles, and tribalism aren’t new. The dangerous novelty of our time is the fusing of capitalism and technology to make rage, and violence, profitable.
We’d go a long way toward dismantling the rage machine if we exposed its makers to liability, as we do with every other corporation. Reforming Section 230, which insulates online platforms from the externalities of the conspiracy theories and Chinese misinformation schemes they peddle, would be a massive first step. Age-gating social media would be a good follow-up.
And online media is an accelerant to our problem. As I often say, (including in my next book), the fire it fuels is disconnected rage. Rarely has a cohort fallen further, faster than young men. Most angry young men find peace. Some grasp a gun instead.
My friend Richard Reeves wrote a book, Of Boys and Men, that’s replete with good ideas: recruit more male teachers, invest in vocational training, destigmatize mental health problems. We should raise the minimum wage and create tax breaks for people paying off student debt and saving for home ownership. Implement national service to get young people off their devices and into their communities. Use tax credits that unleash the private building sector and anti-Nimby laws, to help us build 8 million new homes in 10 years. Enforce retirement ages and term limits so older people make room for the rising generation.
The third leg of this stool is the most obvious, but also the most politicized. This post comes nine days after Kirk was killed. In those nine days, 1,125 other Americans died from gun violence. Fifty were children. Two more people have been shot and killed since you began reading this post.
The U.K., where I’ve been living for the past three years, has much in common with the U.S. The problems are familiar: racial division, arguments over immigration, declining opportunity for young people. Yet one difference stands out. It will take more than a year for the U.K. to see as many gun deaths (per capita) as the U.S. experienced in the nine days since Kirk’s murder. Private handguns are outlawed here, and hunting firearms are tightly controlled.
This isn’t complicated: break Big Tech’s immunity, invest in boys, rein in guns. The hard part isn’t policy — it’s courage. The violence entrepreneurs aren’t selling solutions, they’re selling rage. And business is booming.
Life is so rich,
P.S. Check out our newest podcast: China Decode, co-hosted by Alice Han and James Kynge, with a new episode every Tuesday on the Prof G Pod feed. Listen to the inaugural episode here on Apple or Spotify, or subscribe on YouTube.
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