Today, Eyck Freymann reflects on the quieter and lesser-known institutional contributions of American founding-era “operator” Tench Coxe; the GoodFellows assess the state of ongoing conflicts in Iran and Ukraine; and Lanhee Chen and Tom Church argue that Medicare reform efforts should prioritize stabilizing the program’s funding to reduce its burden on the federal budget.
Freedom Frequency
Tench Coxe is an American founder often excluded from the usual Revolutionary pantheon: not an orator but an operator, Eyck Freymann writes for the Founders & Fellows series at Freedom Frequency. Coxe had a vision for the new republic that included industrial independence, born of the realization that a country needed to provide for itself in critical areas to fully realize sovereignty. To that end, Freymann says, Coxe crusaded for financial support for industries and agriculture, at one point even arranging a cloak-and-dagger mission to smuggle in plans for advanced spinning machinery from Britain. He also advocated for bounties for skilled workers, federal investment in canals and roads, and a quality Americans still value highly: innovation. But Freymann points out that Coxe was also an imperfect visionary, given his view that expanding slavery was a necessary cost of economic union among the United States. Coxe died in obscurity, but his ideas for competent government and economic statecraft live on and remain worthy of study, Freymann writes. Read more here.
International Affairs
So far, military strikes have failed to bring the Iranian regime to its knees. Will renewed economic pressure finish the job?
The Big Idea: On the latest episode of GoodFellows, Niall Ferguson, H.R. McMaster, and John Cochrane discuss how the integration of military, economic, and clandestine intelligence actions is likely required to weaken the Iranian regime’s grip on power and change the nature of its behavior internally and across the Middle East. Watch or listen here.
Health Care and Economics
“Many proposals exist to reform Medicare, but these generally focus on efforts to improve quality, ensure continued access for eligible populations, and address overall program outlay levels,” fellows Lanhee Chen and Tom Church write in a new article at JAMA Health Forum. “These are laudable goals,” they continue, “but, moving forward, each proposal should also be viewed through the lens of how it will affect the program’s effects on the general revenue draw.” Why? Because “Medicare’s trustees have issued a determination of excess general revenue Medicare funding for 10 consecutive years and 18 of the last 21 years.” This state of affairs means that “Medicare’s total fiscal draw on the federal budget is growing each year.” Chen and Church conclude that lawmakers should act prudently now “to relieve the funding pressures on Medicare before harsh and drastic cuts—ultimately hurting beneficiaries—are required.” Read more here.
Economics and Artificial Intelligence
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“AI-related job displacement is coming, though no one knows how fast it will proceed, how far it will go, and which sectors it will affect most,” Senior Fellow Raghuram G. Rajan writes at Project Syndicate. He suggests that the pace and scope of AI adoption so far has been moderated by integration frictions within institutions and their existing workflows. Rajan sees several reasons for optimism regarding ongoing AI deployment, including that “firms’ ability to produce more for less will allow them to reduce prices and increase sales.” To address labor displacement concerns, Rajan says, “governments could consider a tax credit for additional training provided to workers,” while corporations could make employee training and AI-adaptation support an attractive recruitment tool. The distinguished economist concludes that the more firms can help to stabilize the future of human employment, “the more we can all look forward to a future of plenty.” Read more here.
Security and Defense
Drones have already changed the battlefield profoundly, and before long, teams of drones will be able to act without constant human control. For this approach to work, however, technologists must develop transformative ways for unmanned systems to communicate and coordinate, argue Distinguished Visiting Fellow Vivek Lall and coauthor Haibo Huang. With every weapon comes a counter weapon, and in the case of drones, adversaries are rapidly inventing ways to find, confuse, and disable them. In response, advances such as space-based optical communication and quantum sensors will help swarms navigate and share information, Lall and Huang write. Rules of engagement and autonomy still need to be developed for drones to operate by themselves on the battlefield, the authors conclude, but scientific and military innovators need to prepare the technology now—before adversary nations seize the technological high ground. Read more here.
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