The Business of Belief is Chaos

on weaponizing belief, silicon valley as a government model, and more

Weaponization of Belief

The past six weeks have been a hurricane of news. I like to keep up with the times; I’ve never found it more difficult to do so than in the first month of the Trump presidency. Every three hours I see a headline that leave me utterly confused or shocked or asking “is this even allowed?” and the answer may very well be “no”.

Maria Popova has a quote in her piece on How to Unbreak the World —

“Politics, after all, is just the weaponized business of belief.”

That’s what these past six weeks have been — the weaponized business of belief — and this time around the ammunition for that weapon is chaos. It is rooted in throwing as many breaking news headlines at the world as possible such that one cannot keep track of any of them.

It is saying that you will enact 25% tariffs onto our biggest allies and then you will un-enact said tariffs once XYZ conditions are met and then maybe you will enact them again in 30 days. It is stating that you will freeze all federal grants and loans, and then two days later walking the policy back. It is opening up two dams in California to Make Los Angeles Wet Again (MLAWA), not knowing that the dam water will never reach Los Angeles to begin with. It is giving the world’s richest man the keys to the Treasury Payment System.

The weaponized business of belief is chaos.

How Expensive is it to Make America Great Again

Tariff Games

In Trump’s first term, he placed tariffs on China. This was more symbolic than anything else because the tariffs weren’t all that high and also because China ended up rerouting a lot of exports through other countries. Ultimately, there was no great effect that came from these tariffs, aside from the optics of course.

This time is different. There are 25% blanket tariffs on two allies, Canada (with energy at 10%) and Mexico, as well as 10% tariffs on all Chinese imports.

A big idea here is to Make America Great Again — to bring jobs back to the United States, to have the “Made in USA” tag on your jeans, to establish the United States as a self-servicing country with little reliance on anyone else. Isolationism is the end game. After all, we are great, we don’t need help, or even trade for that matter.

But supply chains are logistical nightmares. Jobs won’t magically be created in America from the introduction of tariffs. Factories will have to be built, infrastructure will need to be invested in, labor will have to be trained, raw materials for the production of whatever good it is that the United States is producing will STILL have to be imported.

Cost to the People

And if all you’re doing is pushing tariffs in order to fund income tax reductions, then that’s just a transfer of taxes from the very wealthy to everyone else — given that taxation through tariffs ends up being an inflationary tax among the masses.

The Yale Budget Lab has done a lot of math around tariffs and it looks to cost the average American family an additional $1,250 per year.

There is, among all the uncertainty, the chance that Trump does not go through with the tariffs. The uncertainty in and of itself is bad for business. Companies want to plan where they’ll source their products from, which is difficult to do when there are impending trade wars with three of our largest trade partners.

Good Will

The latest update has been that there will be a delay on enacting the tariffs because of concessions that both Canada and Mexico have made to the United States. After a phone call with Mexico’s President Claudia Sheinbaum, where she pledged to mobilization of 10,000 national guard troops to their northern border, Trump decided to delay the 25% tariffs on Mexico. Canada did the same, pledging troops to their border to aid in immigration efforts and to fight drug trafficking into the United States.

At face value, this is great. We have other countries helping us fight our problems. I don’t say that tongue in cheek. This doess seem to be a short term win. The worry is that we spent decades building good will with other sovereign nations, to turn around and in the matter of a few days destroy all that trust.

We think we’re punishing our allies for some seeming harm that they’ve done to us. But as a result, we’re uniting them alongside each other, where we are their common enemy. There have been discussions floating around regarding tariffing some European countries. That would only push them closer to China.

And then there’s the whole theatrics of it. Did we really need 10,000 additional troops at our northern border with Canada? Was it really that big of an issue? Or was it just a power play to say “we are the big bad wolf and we will hurt you if you don’t comply”. That’s where good will is important; that’s where we shouldn’t want to destroy it.

Silicon Valley-ing the Federal Government

Silicon Valley has a lot of “isms” to it.

• Fail early, fail fast, fail often

• Move fast and break things

• Founder mode

It’s a mentality that has proven quite successful for the private sector. My worry is that when you apply “fail often” to Medicare and Medicaid, then millions of people will lose healthcare. Silicon Valley has countless merits — one of the greatest concentrations of wealth and innovation in the world. There’s certainly a lot to learn from many of the processes that it employs. But that’s exactly what we need right now — process.

There are many changes that the executive branch wants to make. Some of them I actually think are great ideas. A full audit of government spending sounds wonderful, enhancing the data models in treasury payment systems such that the payments are easier to track is a necessity, and cutting out programs that have clearly failed over the past decade is a must.

The way that the executive branch is going about this, however, is not right. Usurping the Congressional power of the purse and pausing payments wherever the President deems necessary is not a democratic process. I’ve written about DOGE before, where I walked through the congressional power to spend money.

There are guardrails in the government for a reason. Certainly there are times where there are too many guardrails that impede progress from occurring. But a president that chooses to ignore these guardrails and test the limits of the law is not a president, but rather some sort of king. In Silicon Valley, CEO’s can do their bidding with their companies, the same should not apply to the United States.

And what can we expect from all the chaos? As Lyn Alden writes:

The Department of Government Efficiency is unlikely to make meaningful cuts to federal spending as only 14% of the budget is non-defense discretionary, while 87% of nominal spending growth over the next decade is projected to come from mandatory programs and interest expense.

Gold Bug

The thing about chaos is that it’s not really good for anyone except those who are causing it and likely have something to gain. Predictability is a key component to economic success; chaos is a recipe for societal destruction. If you don’t know what to expect, it becomes really hard to make good decisions about the future.

One measure that people often look to as a hedge against chaos is gold. The idea being that you store you money in a finite resource that holds its value and can be traded almost anywhere in the world. When gold prices spike, it often signals investors fleeing to safety, and most of all it signals uncertainty.

That’s where we’re at. America is this big experiment at the moment in the midst of a changing global order. Perhaps the only haven we have lies in the dollar denominated debt spread across the globe — the infamous Eurodollar — which I plan to write more about.

Thanks for reading and I hope you’re doing well.