As Xerxes' victorious legions triumphantly marched into Attica, panic swept the countryside. An estimated quarter million women, children, and elderly fled the region in one of the largest mass migrations of the ancient world. Themistocles decreed Athens must be abandoned. The entire population of the city and its immediate surroundings, some 100,000 souls, evacuated to the rugged island of Salamis where, as historian Victor Davis Hanson writes: “They were gambling that their own seaman, along with the still unconquered Greek allies from the Peloponnese, could wreck the Persian fleet before they all starved—and before the onset of autumn.” 

Since ancient times, it has always been scary when moral auditors audit their own. Or as the Roman satirist Juvenal put it of male guardians entrusted to shield chaste girls from randy males, Quis custodiet ipsos custodes? (“Who will watch the watchmen?”) When humans sense that there’s neither an earthly nor divine deterrent between them and social acceptance, power, riches, or their appetites, what follows is a foregone conclusion.

The long-standing state system for bringing order to the world is under pressure. The American-led security and economic commons built up over several decades in the twentieth century is at risk everywhere and in many places no longer exists. In order to prepare for the new global arrangement, America needs to return diplomatic responsibility and accountability to the Department of State. It also needs to raise the stature of the Foreign Service Institute, which trains diplomats and foreign affairs professionals. Now more than ever, America needs to maintain its strong diplomatic presence to preserve and ensure stability and peace.

In a recent Economic Synopses essay, we discussed how large changes in economic policy uncertainty (EPU) can affect key macroeconomic indicators like GDP and inflation. In that analysis, we considered only shocks that were large enough to push EPU above the recent historical highs. Thus, changes in the EPU do not necessarily have proportional changes on the economy.