Iran Protest Sparks, China Vs India And Russia's Real Economy

It probably doesn't take a genius to figure out why Americans are moving away from (2) and (3) here. The Mississippi Delta (technically the Mississippi Embayment ) is America's poorest region, and thus not a great place to live. The western Great Plains are devoid of thriving big cities, so there aren't so many jobs, and people who want to live interesting urban lives tend to move elsewhere.

California is the real puzzler here - and the real tragedy. The conventional wisdom is that people are moving out of California because of high housing costs. Indeed, the state stands out on a map of house prices relative to income:

This pretty closely mirrors how much rent costs in each state.

What's interesting is that New York, Massachusetts, and New Jersey, where housing is almost as expensive, aren't seeing big outflows right now. Maybe that's because people already moved away in earlier decades, while Californians hung on for a while because of the nice weather.

Another possibility, though, is that something is going deeply wrong with California's economy. Since the pandemic, the state has been bleeding tech jobs:

This could be due to high housing costs driving people out of the state, or it could be due to the rise of remote work. Or it could be due to the tech industry's clustering effect weakening, as clustering effects once weakened in manufacturing. In any case, it's something California's leaders ought to be very concerned about. The days when California could just bomb its residents with high housing costs and high taxes, and depend on sunny weather and clustering effects to keep everyone in the state, might be ending.

Jed Kolko has an interesting thread about hiring. Employment rates are still high, but hiring rates have fallen off a cliff:

Jed argues that this is not due to either Trump or to AI:

I'm not sure either of those conclusions is warranted. It's possible that companies could see how good AI was getting back in 2024, and held off on hiring out of caution about how much better it might get. This is just standard-looking forward expectations. On the other hand, it's also possible that hiring would have rebounded in 2025 if not for Trump's tariffs and immigrant deportations.

But anyway, Jed's theory is that companies over-hired during the latter part of the pandemic - the bubble of 2021:

That's a plausible explanation, but as I said, I wouldn't rule out either AI or Trump.

I've written a lot about Indian development, but I rarely talk about what this means for the people of India themselves, in human terms. But it's really pretty incredible and transformative. Ravi and Penumarty have a new paper summarizing the changes in durable goods ownership in India from 2012 to 2024, which gives a fascinating peek into how economic growth is changing the life of regular Indians. Here's an infographic based on their data:

Even relatively low-income people in India now tend to own a fridge, a motorbike (or car), a mobile phone, and a TV. That was not true a decade ago.

Remember, as much as certain smug intellectuals like to sneer at and dismiss the idea of economic growth and of GDP, for people in poor countries, GDP is everything, and growth is the utterly transformative. India has been doing a good job of transforming its people's lives, and it deserves our praise, encouragement, and support.

I've often written about how nuclear power will be a niche power source in the future - not useless, but not the way we produce most of our electricity. It's also worth mentioning that I think wind power will also be niche. A recent post by X user Cremieux sums up a bullet-pointed list of reasons why wind will probably be marginal in our final energy mix. Key excerpts:

Basically, you don't know when the wind will blow, but you do know more or less when the sun will shine. You also can't cluster windmills too close together, or you use up all the wind. Those are really the key factors that make wind problematic as a power source.

To this I'd add that A) the scaling curve for wind is much shallower than the one for solar, meaning that solar will keep getting better and better relative to wind over time, and B) the total land use requirements for wind farms are huge, which makes siting and permitting difficult, even though you can use the land between the wind turbines for other stuff.

Ramez Naam, my favorite futurist, and the man who predicted the age of solar far in advance, agrees with Cremieux's points, but argues convincingly that wind will retain an important niche role in our future energy mix:

So wind, like nuclear, will still have its uses.

Over the past decade, there has been a lot of work devoted to“metascience” - the idea that in order to re-accelerate scientific progress and make it cheaper, we ought to change the outdated way that we fund scientific research. The Institute for Progress has been at the forefront of documenting and pushing forward that intellectual enterprise.

Now, IFP's Caleb Watney reports on a big initiative to turn some of those ideas into reality. The NSF is shifting some of its funding outside academia:

This is really promising, and I'm excited to see how it plays out.

But I'm also wondering if the rise of AI science will open up another parallel avenue for rapid innovation by lone scientists or small teams working outside the academy - such as when some people used AI to solve some difficult outstanding math problems this past week. Maybe the NSF should also try giving some people grants to see how far they can push ultra-fast small-scale independent research, too.

In any case, I'm just glad to see our institutions taking metascience seriously, and trying new things.

This article was first published on Noah Smith's Noahpinion Substack and is republished with kind permission. Read the original and become a Noahopinion subscriber here.