This morning I woke to claims that the U. S. had invaded Venezuela, captured its president, and flown him out of the country.

I don’t know much more about it. The primary source seems to be a Truth Social post from President Trump. Here is its text:

The United States of America has successfully carried out a large scale strike against Venezuela and its leader, President Nicolas Maduro, who has been, along with his wife, captured and flown out of the Country. This operation was done in conjunction with U.S. Law Enforcement. Details to follow. There will be a News Conference today at 11 A.M., at Mar-a-Lago. Thank you for your attention to this matter! President DONALD J. TRUMP

The statement is notable both for its scale and for the absence of any corroboration.

The only source for it is, apparently, President Trump’s post. Assuming it’s true, I oppose such extrajudicial action. It would be illegal under international law, immoral, and a strategic mistake, substituting spectacle for policy.

I doubt it will solve much, because Venezuela’s collapse is institutional and social, not personal. Unless it is President Trump’s intention to rule Venezuela from Mar-a-Lago, the problem there is not a single individual or even a regime.

In that regard it is similar to Burma, Iran, Russia, and China or any other state whose problems are embedded in durable institutions rather than removable leaders. We cannot solve our foreign policy problems with military force. We need to learn, even uncomfortably, to live with them without pretending every problem has a kinetic solution.

Update

The Associated Press has confirmed the strikes with photographs taken by onsite photographers. Meanwhile, although I was getting a haircut when it took place, President Trump has given a press conference in which he repeated the statements from his Truth Social post above, said the U. S. would “run” Venezuela until a peaceful transition could take place, and that U. S. oil companies would work to restore Venezuela’s oil infrastructure.

I wonder if he’s aware of how bad our track record on those last two things have been.

So, what’s next? How do we “run” Venezuela?

For our first dinner of the New Year I made red beans and rice. I adapted my recipe to use Carolina red peas rather than red beans on the theory that something like those may have been what were originally used in the dish.

My recipe is pretty simple. Cajum Holy Trinity (onions, celery, bell pepper), red beans, ham stock, Worchestershire sauce, dash of bitters, hot sauce, black pepper. I threw in some chopped ham to up the protein level a bit.

It was delicious.

As I read Scott Sumner’s most recent Substack post, I couldn’t help but think that the worries he talked about were about the wrong things. Here’s a snippet:

There’s a great deal of recent discussion about how AI will affect the economy. Too often, the debate centers around the issue of who will profit from AI. I am much more interested in the question of what AI will do to output.

Suppose you are applying for a job at Google, and they ask you to estimate the number of washing machines in America. You might think to yourself that the vast majority of American households have one washing machine, a much smaller number have either zero or more than one. So perhaps the number of washing machines is similar to the total number of households. You might recall that America has 340 million people, and guesstimate that we have somewhere around 130 million households, assuming an average of 2.6 people per household. (AI Overview says 132.5 million households and an unknown number of washing machines.)

He continues by citing examples of calorie consumption and big yachts. He closes in on this point:

The key to higher living standards for average people is to produce lots more output, which requires more automation. When I was born back in 1955, there were about 300,000 people working as telephone operators. At the same time, the restaurant industry was fairly small, people tended to eat at home. Many of the telephone operator jobs were done by single women. Was that demographic hurt by the automation of phone switching? I’d say no, as the decline in operator positions was offset by rapid growth of waitressing jobs in the restaurant industry. Indeed, the decline in jobs working as telephone operators actually enabled the growth of the restaurant industry, by freeing up labor.

Now I tend to agree with him. I think we need to increase production considerably and I don’t mean nominal production I mean real production. That’s one of the challenges of a transition to a “service economy”. Raising the prices you charge for your services doesn’t mean that you can provide more services. It may even motivate you to provide fewer services. And for many services it won’t impel the market to produce more service-providers. For some services the cost of entry and lead times are just too great to respond that way and there are regulatory barriers as well. And I think that removing all regulatory barriers on providing services is a very bad idea. Some regulations exist to protect quality, safety, or trust, and eliminating them may increase nominal output while degrading real welfare much like standardized food.

I did a little research and found that there was no clear, easy way to determine whether his comparison between telephone operators and waitresses actual stood up to scrutiny. I did learn that the average pay for a telephone operator in 1960 (not 1955) was $1.46 while most waitresses earned minimum wage of $1.00 per hour plus tips. Whether or not the analogy holds, it illustrates how easy it is to assume that labor reallocation preserves job quality.

What struck me was several things he talked about. I thought I’d arrange it into some Do’s and Don’ts.

Don’t worry: about AI taking all of the jobs. Do worry: about Fortune 500 CEOs believing that they can reduce payrolls and improve bottom lines with AI. The former won’t happen. The latter is already happening.

Don’t worry: about not enough affordability. Do worry: about administrative capacity. The former is manageable. The latter is unmanageable and renders any attempt at planning for the future impossible. Not only will it make housing unaffordable it will have serious effects on transportation, public health, healthcare, and education, just to name a few. Building roads, sewers, etc. requires a considerable lead time.

Don’t worry: about too many rich people with “mega-yachts”. Do worry: about the U. S. not being able to build “mega-yachts”. Jeff Bezos went to the Netherlands to get his yacht built. Our not being able to build such vessels on a timely basis has run-on effects on our military, shipping, etc.

Don’t worry: about too many ultra-rich people. Do worry: about state and federal governments becoming too dependent on ultra-rich people.

I welcome your own do’s and don’ts in a similar vein.

In conclusion there’s one thing in Dr. Sumner’s post with which I’d like to take exception. I don’t believe that restaurant meals are better quality today than they were in 1955. I ate in restaurants in 1955 and remember. Fast food burgers today do not taste as good as burgers from a diner in 1955. What is true is they are more uniform. Practically everything everywhere is made from mixes today. That wasn’t true 70 years ago.

I realize that old ladies have always claimed that strawberries tasted sweeter when they were girls but there’s another reason that bananas, strawberries, and many other fruits and vegetables don’t taste as good today as they did 70 years ago. The varieties of bananas, strawberries, etc. we ate then really tasted better. Nowadays they ship better and have a longer shelf-life. Furthermore, fresh produce came from truck farms not from thousands of miles away.

I hope all of us and our families have a better year this year than last, however good 2025 was for you and yours.

The good news for 2025 includes

we are not in a major war
AFAICT no new major wars have started
our southern border appears to be under control
gas prices are down which will have run-on effects throughout the economy
the rate of inflation is holding fairly steady

Unfortunately, each piece of good news is accompanied by bad news

the war in Ukraine continues and shows little sign of ending
we are using military force far too frequently and casually
immigration enforcement has been harsh
electricity prices continue to rise which will also have run-on effects
asset prices are continuing to rise faster than inflation

One of the predictions for 2026 I’m running into fairly frequently is for a baby boomlet (possibly in 2027) among Swifties spurred by Taylor Swift becoming pregnant. Considering that I don’t frequent gossip sites or popular music sites running into that prediction so frequently is surprising.

As we near the end of the year I’m seeing quite a few predictions for next year, many of them either unremarkable or preposterous. This morning on a lark I asked ChatGPT what its predictions were for 2026. Here are the results:

1. AI spending hits a credibility wall in the form of pushback from boards of directors and CFOs for immediate measurable results from adopting AI.
2. A visible tiering of AI users emerges among power users, occasional users, or institutional avoiders including government, regulated professions, and unions.
3. White-collar hiring freezes spread, not layoffs
4. One major AI firm retreats from “frontier” scaling away from ever-larger models toward efficiency, specialization, or verticalization.
5. Electricity becomes a binding constraint. It should be noted that will give an edge to China in the adoption of AI.
6. Courts quietly restrict AI use in legal proceedings
7. Medical AI stalls at the liability boundary
8. A backlash against “AI fluency” hiring language
9. The first serious AI-driven outsourcing reversal appears. Work previously offshored will be reshored not to human workers but to AI.
10. Public discourse shifts from “Can AI do X?” to “Who is responsible?”

Some of those are verbatim. Some are paraphrases. If you asked the same question I suspect the answer would vary considerably. After several years of regular use on my part ChatGPT has a pretty fair sampling of how to respond to me. YMMV.

I asked several follow-up questions. I may report on those in the coming year.

There’s a commentary about the direction of the Democratic Party from Democratic political consultant Brendan Frasier at The Hill:

For years, there has been a debate about where the Democratic Party should go. One side is the wants the party to embrace democratic socialism; the other side supports the neoliberal framework that helped destroy America’s middle class, weakened unions and left rural America feeling abandoned.

What both sides consistently don’t see is that the Democratic Party succeeds when it roots itself in New Dealism.

In America, the term “democratic socialism” has lost its meaning. In Europe, it describes an economic system in which major industries and production are collectively or socially owned, and private capital is reduced, transformed or replaced through democratic processes rather than authoritarian ones.

This matters because saying “democratic socialism” terrifies entire blocs of voters that Democrats desperately need to win back.

and

During my time with the Ohio Progressive Caucus, I had heated arguments with members of the Democratic Socialists of America. Many believed in replacing capitalism and placing major industries under social ownership. Some even support a candidate running for Senate in Ohio named Greg Levy, who said that companies like Kroger or Procter & Gamble should be nationalized.

But these positions have almost no support among rural voters, suburban moderates, small-business owners or the very union families the party once counted as its backbone.

Does anyone else notice how nostalgic his remarks are? Perhaps more seriously, I think that Mr. Frasier is making a category error.

I wonder how Mr. Frasier reconciles his views with the modern American economy and the modern Democratic Party?

I’ll just provide a few examples of that. In 1930 trade constituted about 6% of U. S. GDP. Now it’s around 30%. We produced almost all of what we consumed. U. S. population was around 123 million when the New Deal was first announced. Now it’s nearly three times that high. Estimating household income 90 years ago is a bit tricky but most sources say it was around $2,000. Now it’s around $80,000.

The structure of the U. S. economy was different then, too. The largest economic sectors were agriculture, manufacturing, and services. Now finance, insurance, real estate, and leasing along with professional and business services and government constitute about 50% of the economy with manufacturing, education and healthcare, and other sectors trailing far behind, mostly in single digits.

The ratio of public debt to GDP was around 16% then; now it’s nearly 100%.

These are not merely quantitative changes; they imply a different political economy with different leverage points, constraints, and failure modes.

I think I have a pretty good idea of what the New Deal meant when Franklin Delano Roosevelt proposed it in his acceptance speech for the Democratic nomination for the presidency in 1932. I have no idea what it would mean now or how it could be effected and Mr. Frasier does little to enlighten me in his piece.

George Friedman’s take on Russia is somewhat different from Dr. Michta’s:

There is talk of Russia moving into Belarus, launching attacks on Latvia and Lithuania, and preparing a massive operation in and around the Black Sea. Many fear that if the Russia-Ukraine war ends without Russia being forced out of the relatively small territory it now holds, Moscow will surge into other areas to restore the borders of the former Soviet Union.

What is strange, given the Russian military’s performance in Ukraine, is that it still inspires such fear. Nearly four years since its full-scale invasion of Ukraine, Russia controls only about a fifth of the country and is bogged down in fighting over a handful of towns and villages along the front line. The fact is that Russia failed in its original mission, which was to occupy all of Ukraine, as shown by its failed attempt to capture Kyiv, far from today’s battlefront.

It is true that Ukraine cannot drive the Russians out of the territory they now hold. But it is also true that Russia in four years has failed to break Ukrainian resistance or gain substantial ground. Its inability to achieve its stated goals raises serious questions about Russian military power. Russia expected to take far more territory and did not imagine the war would still be going on today with so little to show for it. This cannot be the war Moscow planned.

concluding:

The dread of Russia arises from the Cold War, when the U.S. and its allies looked at the Soviet Union as an enormously powerful military. Some argued that the Soviet Union was not particularly capable in conventional warfare, even though, with U.S. aid, it defeated German forces in Russia during World War II. But on the whole, fear of Russian power shaped the political culture in the West. Today’s fears that any concession to Russia would unleash more Russian aggression are a product of that legacy.

But it is essential to recognize how weak and damaged Russia actually is, how strained its military is, and how its economic weakness makes rapid rearmament improbable. A settlement would cost Ukraine some territory and save many lives, but it would not empower Russia to strike out in different directions. To its west, east and south, Russia has suffered massive reversals since the Soviet collapse. Yet some outside Russia cannot come to terms with this new reality, and Moscow’s entire strategy in Ukraine is to pretend it does not need to end a war it cannot win.

Russia’s tragedy is that to convince outsiders of its strength, it must keep pretending it is holding back a force that would change the world. There is no such force. After the war, Russians will have to decide what they will do with the leadership that brought them to this place, not pursue more unwinnable wars. A settlement based on the reality of Russia’s failures is the lowest-cost option. But it requires a clear-eyed understanding in the West of the reality of Russia’s weakness.

That’s closer to my view than Dr. Michta’s but not identical to it. My view is that the main threat that Russia poses to Western Europe or the United States is nuclear which is why it is vital to maintain our own deterrence, contrary to the views of some, and our “nuclear umbrella” should extend to Europe including Ukraine but that Russia’s land and naval forces pose no real risk to us or our primary European allies, e.g. the United Kingdom, France, and Germany. To the extent that Russia threatens Europe it is of the essence that our allies maintain their own land and, in the cases of the United Kingdom and France, their naval forces.

In conclusion I would caution Americans that a Putin in danger of losing a war in Ukraine is not the largest looming risk. The larger risk is that Putin may, in structural terms, be a relative moderate within Russian politics—and that a successor emerging from a failed war and a discredited regime is likely to be more nationalist, less constrained, and more willing to rely on nuclear coercion to assert Russian power.

I also wanted to call attention to this post by Andrew Michta at RealClearDefense:

Russia is not and has never been a nation state in the sense of the consolidated societal and institutional framing that has undergirded the foundations of Western democracies. Since the 15th century when the Duchy of Muscovy began to shed the Mongol Yoke – for two centuries Moscow was a vasal state of the Tatar Golden Horde – Russia expanded and formed its civilization as a multinational empire. For centuries, Russia extended its reach across the Eurasian mainland and into Europe, defeating Poland and Sweden and colonizing Central Asia and the Far East. This rapid imperial expansion fueled top-down governance that rested on state-sanctioned violence and absolutism buttressed by ideology – tsarist at first, subsequently communist, and now a mixture of orthodoxy and professed “Eurasianism,” but always resting on the primacy of centralized, top-down governance. As the empire grew, the people shrank. Expansion became the sine qua non of the Russian state’s existence and the foundation of the ruler’s power. The might of the empire and the perennial homage paid to the leader – whether the tsar, the general secretary or now the president – was justified by the glory of the motherland and the Great Russian People (velikiy russkiy narod). Simply put, Russia cannot exist without its expansionist drive, for only continued expansion can generate the requisite centripetal forces to hold together the patchwork of nations imprisoned within the bonds of empire.

I think that Dr. Michta does a real service in trying to educate Americans on the history of Russian imperialism. In general Americans are indifferent to history which I think weakens our foreign policy. Russia’s eastward expansion in the 19th century is reminiscent of American westward expansion in during roughly the same period.

I do have a question for Dr. Michta. Is it actually true that Russia has incessantly tried to expand westward into Europe? Or is it the other way around, that European countries including Poland (in the form of the Polish-Lithuanian Empire) invaded Russia in the 17th century and was ultimately ejected from conquered territories in the 18th century? Germany invaded Russia during World War I and then, again, during World War II, killing millions of Russians.

France and Britain invaded Russia and then the Soviet Union in the 19th and 20th centuries.

I genuinely want to know. I’m trying to distinguish between Russian imperialism and Polish irredentism. There are contemporary political currents in Poland that articulate territorial claims grounded in historical memory, and they deserve to be taken seriously. The question, however, is whether such currents—contested, constrained, and non-hegemonic—are meaningfully comparable to Russia’s long-standing pattern of state-driven imperial expansion. Are we observing symmetrical national impulses, or fundamentally different political structures producing superficially similar rhetoric?

I’m not going to fisk this editorial in the Washington Post, critiquing recent actions by British National Health. Actually, I agree with some of their points.

My point in calling attention to it is to ask can you imagine the editors writing this two years ago? I can’t. It’s a remarkable change of voice on their part. Is their explicit criticism of U. S. progressives a first for the WaPo editorial page?

I’m reminded of one of Samuel Johnson’s witticisms:

Depend upon it, sir, when a man knows he is to be hanged in a fortnight, it concentrates his mind wonderfully.