Jun 6, 2018

Axios Future

By Bryan Walsh
Bryan Walsh

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I'd love to hear your ideas of what we ought to cover, are getting wrong, or anything else you care to share. Just hit reply to this email or shoot me a message at steve@axios.com. Let's start with ...

1 big thing: An open trade war

November 1930, five months after Smoot-Hawley: a soup kitchen funded by gangster Al Capone. Photo: Bettmann/Getty.

Days ahead of a G-7 meeting this weekend in Quebec, many analysts say the U.S. is in an open trade war with its most steadfast allies.

Be smart: President Trump still appears to be winging it, throwing out one extreme idea after another. His latest threat — to do away with NAFTA — may merely be his maximalist negotiating strategy at work. No one — perhaps not even Trump himself — knows.

Why it matters: The EU, Mexico and Canada appear to be drawing a hard line in the sand, creating an atmosphere of brinksmanship. And, that comes on top of Trump's rising conflict with China over trade.


  • The EU today slapped tariffs on $3.4 billion in U.S. exports of peanut butter, boats and Harleys, aimed at congressional leaders' districts.
  • Canada is targeting $12.8 billion in pens, orange juice, maple syrup, mattresses and toilet paper, also aimed at powerful congressman.
  • Yesterday, Mexico imposed tariffs on $3 billion of U.S. pork, cheese and steel, aimed at farmers.
"An open trade war has finally erupted in the backyard of the U.S., with potentially dire repercussions for the survival of NAFTA," Eswar Prasad, a Cornell University professor, tells the FT.

Quick take: Until now, this has been a one-way war declared by Trump, who for decades has railed against the supposed negotiating incompetence of U.S. trade officials. Now, as president, he has lurched from crisis to impasse, and yesterday threatened to tear up the quarter-century-old NAFTA treaty, saying that he prefers to negotiate separately with Mexico and Canada. Both U.S. neighbors rejected the idea.

The data are not aiding Trump's case:

  • The Commerce Department today reported that the U.S. trade deficit fell to a seven-month low in April, to $46.2 billion, reports Reuters' Lucia Mutikani.
  • In addition, Commerce revised the March numbers to a lower figure than previously reported — $47.2 billion, down from $49 billion.

Bill Reinsch, at the Center for Strategic and International Studies, tells Axios that Canada and Mexico will maintain a united front against Trump. He said:

"Remember the Benjamin Franklin quote:  'We must all hang together or most assuredly we will all hang separately.'”

Go deeper: Read the whole post.

2. The longer looming peril

Illustration: Rebecca Zisser/Axios

When thinkers predict misery and danger as the new wave of automation unfolds, their evidence is often the jobs chaos, flat wages, and hellbent industrialization of the 19th century. Last year, Alibaba CEO Jack Ma said that technological revolution, after all, "caused World War I."

What's going on: The 19th century may provide clues for our roboticized future, but Joel Mokyr, a foremost 19th century scholar at Northwestern University, suggests that it's less of a lens than people often presume.

An indisputable lesson of the Second Industrial Revolution, just preceding World War I, is that technology can be much more powerful than expected in a combat setting, and seriously amplify and extend a conflict.

  • The tech breakout in steel, mass-production, chemicals, engines and barbed wire "changed the nature of war between 1871 and 1914," Mokyr, author of "A Culture of Growth," tells Axios.
  • The pace of change happened "faster than ever before, and people had not internalized that fact."

But where historians and other analysts go too far, Mokyr says, is relating the century's dizzying tech boom and war.

  • "WWI was an epochal event, but linking it mindlessly to technology is playing post hoc ergo propter hoc (after this, therefore because of this)," he said.
  • "The idea that the technological advances of the age led to 'upheaval' and 'disruption,' and that those somehow led to war, strikes me as basically wrong."
  • "The 'flat' wages were not flat, and certainly the beginning of the 'welfare state' can be discerned in many countries. Moreover, unlike now Europeans left behind had a safety valve: free emigration."
"Yes, economic change of any kind can lead to disruption and the need to adjust, and creative destruction can cause all kind of suffering. But not war."
— Joel Mokyr
3. Forget about the Moon
Expand chart
Reproduced from a Pew Research Center report; Note: Survey conducted March 27 to April 9, 2018. Respondents who did not answer are not shown; Chart: Axios Visuals

Americans think that NASA should prioritize detecting asteroids and other objects that could hit the Earth, and not so much returning astronauts to the Moon or Mars, according to a new Pew survey.

For the future: Half of the Americans surveyed predicted that humans will be routinely traveling to space as tourists in the next 50 years, but most of them — 58% — don't want to be one of these space tourists, reports Axios' Alison Snyder.

  • Against these findings, Congress has allocated $4.8 billion toward developing technologies to send humans to the Moon and Mars, while less than 1% of NASA's budget goes toward planetary defense.

NASA and commercial space companies:

  • 65% of respondents say NASA should still play a primary role in space exploration.
  • Yes, but: One-third say private companies can advance space exploration. That suggests the relationship between NASA and the commercial space industry is being poorly communicated, says Casey Dreier, The Planetary Society's director of space policy.
"The majority of private companies rely on NASA as a customer and, if not, aspire to. NASA right now is playing a critical role in creating a marketplace for commercial space companies."
— Casey Dreier

Go deeper: Read the whole post.

4. Mailbox: Pushback on the singularity

Illustration: Rebecca Zisser/Axios

Last week, we wrote about a perceived turn in artificial intelligence research. Researchers, we reported, have largely paused their work on creating a machine that thinks like a human, and are turning to applications for what's been discovered so far.

We got some pushback from the AI field. Here is a letter from Carlos Perez, co-founder of Intuition Machine:

Your recent article mischaracterizes the current trend in deep learning.

The proper assessment is 

(1) There's sufficient advance in deep learning to invest in faster and more efficient hardware (see DL specific hardware by Nvidia, Google and Microsoft).

(2) There are identified short comings in DL that alternative novel solutions need to be explored.  See Hinton's Capule's network.

To say that researchers are halting work on human-like machines is very far from reality.  This area of work is in fact accelerating.  

Let us know your thoughts too.

5. Worthy of your time

Image: pepifoto via Getty

Alibaba EVP Joseph Tsai: On the U.S. and scale (video) (Jason Del Rey / Recode)

Mary Meeker's Internet Trends 2018, including on China (slides) (Code 2018)

'Hard to say' if AI will or won't cost jobs, says Robert Solow (Rachel Metz - MIT Technology Review)

92 million passwords grabbed on MyHeritage.com (Joe Uchill - Axios)

6. 1 fun thing: Getting paid to move

1901 at Port Huron. Photo: Lake County Discovery Museum/UIG via Getty

Smallish towns and states, hollowed out by demographics and urbanization, are not giving up: they are gathering together local dollars in what amount to signing bonuses to move.

  • If you move to Vermont, the fastest-aging state in the U.S., you can get a $10,000 grant over two years to cover relocation and other moving and settling-in expenses, writes Quartz's Corinne Purtill.
  • And St. Clair County, Mich. (pictured above), is offering $15,000 if you earned a STEM degree in the last 10 years, reports LinkedIn's Chip Cutter.
  • Randy Maiers, who directs the foundation overseeing the St. Clair program, tells Axios that he doesn't feel he is in competition with other places also seeking new residents. "This is a 'come home' award primarily for people with family ties to our region," he said.

Those who have already availed of the St. Clair grants include: "a teacher, a veterinarian, a speech pathologist and a medical laboratory scientist," Cutter writes.

Other places also in the race for newcomers, Cutter says:

  • North Platte, Neb. ($30,000 if you are a diesel electrician)
  • Marne, Iowa (free land for a home)
  • Grant County, Ind. ($5,000 toward a new home)
Bryan Walsh