Matt's Thoughts In Between - Issue #36

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Silicon Valley's Saudi dilemma

One of the biggest stories of the week was the disappearance - and presumed murder - of journalist Jamal Khashoggi in the Saudi consulate in Turkey. There is so much to explore in this story that I won't dwell on the broader geopolitical consequences, such as Trump's (belated) threats and Saudi Arabia's counterthreats, nor the potential US domestic repercussions (though all those links are worth a read).

What I want to focus on is Silicon Valley's ethical quandary. Saudi Arabia is the biggest backer of Softbank's Vision Fund (previously discussed in TiB), which has become the most powerful tech investor in the world, with billions at work in Uber, Slack, WeWork and others. And, until this week, Silicon Valley luminaries were lining up to advise the Kingdom on its tech aspirations - not to mention the deep and extensive links between Saudi and Stanford University (fascinating piece from April).

Is that tenable any more if the Khashoggi case breaks the camel's back and Saudi Arabia becomes a pariah? A powerfully argued piece in the NYT argues no, but it's not clear whether Silicon Valley can take the tough choices needed to extricate itself. The Softbank offer is increasingly "take our money or we'll give it to your competitors" - a choice that presumably leaves few founders asking difficult questions about the ultimate source of the funds.

Climate change: can technology save us from politics?

The UN IPCC published a particularly apocalyptic report on climate change this week. The Atlantic has a good summary: the report looks at what it would take for the world to warm by "only" 1.5C over the next 80 years - and lays out a strategy that would require an energy and economic shift that “has no documented historic precedents.” It's not cheery stuff, but neither are any of the proposed solutions, such as dismantling capitalism.

One path that the report emphasises would be required is geo-engineering. Gizmodo has a good overview of the history of the idea (I like the line, “a bad idea whose time has come”). The possible routes are interesting: retrofitting planes to be able to pump out literally millions of tonnes of albedo modification material might actually both work and be fairly cost effective, at least relative to the alternatives.

In fact, it's possibly cheap enough that the private sector could take a stab at it. After all, Silicon Valley has no shortage of climate change warriors and carbon reduction is a luxury good. Perhaps Softbank could even fund it and save the world after all...

Paul Romer, economic growth and private cities

This week the Nobel Prize for Economics was awarded to William Nordhaus and Paul Romer. Marginal Revolution has comprehensive coverage of both winners and Noah Smith has an excellent piece in Bloomberg on why Romer's work on technology and economic growth is so important. If you're interested in this topic, David Warsh's intellectual biography of Romer is superb, as is this short video.

Outside Romer's academic work, he's also fascinating as a policy entrepreneur. I'm particularly interested in his pioneering of the idea of charter cities - essentially new and autonomous cities in developing countries that would have laws and institutions distinct from their surrounding country.

He gave a TED talk on this topic back in 2009, as well as an essay and extended Q&A. In fact, he even got so far as a pilot in the Honduras before things fell apart. Obviously, the idea wasn't popular with everyone, but I believe that on balance it's a fascinating and important idea (discussed briefly before in TiB) - and Romer is a striking example of the fact that a career in academia needn't mean life in an ivory tower.

Quick links

What meritocracy? Is it better to be born rich or talented?

Surprisingly popular. An easy and interesting way to discover the truth.

Nanny state. There's only one country where childcare costs are truly out of control.

Confidence game. The surprising long term impact of your birthday.

Pageturner. Academic paper with 100 years of data on what makes a bestseller.

Your feedback

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Until next week,

Matt