Three news items and a lesson

Today, a few small recent economic news items add up to a bigger picture.

California led a group of 12 state attorneys general in a suit to block the Ellisons and Paramount from buying Warner Brothers. In case you haven’t been following, the Ellisons made a big deal of their support for President Trump, in order to get the Federal Trade Commission to approve the merger. Now, the Wall Street Journal’s Holman Jenkins reports, the “Democrats inevitably counterattacked … Ideas are being desperately floated to restore peace—fire Bari Weiss, outreach to Kamala Harris. … a board to guarantee CNN’s independence?” Obviously none of this has anything to do with the supposed anti-trust issue, the “silly claim that the companies are out to monopolize the dying cable TV and theatrical movie businesses.”

The lesson: Anti-trust is now completely a way for politicians to extract political support from businesses, and has nothing to do with protecting consumers from monopoly.

California is also leading four states in a $1.4 trillion suit against Meta, for allegedly misleading the public about the dangers of social media for teen’s mental health. They are piling on to an avalanche of private multimillion dollar suits.

Add up the ideas. Social media is addictive, like heroin and cigarettes, but not like video games and comic books. Social media is a pervasive danger to mental health. And “big corporations” knew this all along and conspired to lie about it.

Everyone is a victim. Dumb teenage behavior is mental health crisis. How 2022. The hysteria bandwagon has moved to young people using AI to cheat on homework, and won’t learn to read and add. But it’s not too late to grab Meta’s cash and spend it on $1 million homeless apartments or high-speed rail consultants rather than data centers.

Hilariously, the attorneys general charge that the company designed Facebook and Instagram “to maximize profits.” Which, of course, they can be sued for not doing.

Phillips 66 announced it wants to build a $6 billion pipeline to export gasoline from Texas to California.

California used to produce and refine oil, and export it. But the state has pretty much shut that down, and now imports 75% of our oil and gasoline. Two refineries closed just last year. Gas averages $5.60 a gallon. With imports from Asia and the Middle East off the table, the only thing keeping California afloat has been imports by sea from Texas. But those are only possible thanks to the Trump Administration’s Jones act waiver. Normally, shipments between US ports have to be on US ships, and there aren’t any. (Say national security industrial policy, and I’ll always answer “Jones Act.”)

So, thanks Phillips, for spending $6 billion pointless dollars save California from self-inflicted wounds. And explain to me, California, just how moving oil extraction and refining from California to Texas does anything to help the climate.

Amazingly, Californias’ governor Gavin Newsom said he won’t block it. We’ll see if it survives the rest of California’s legal and regulatory thicket. The California part of the pipeline just involves making oil flow the other way, a sad commentary on California, but reducing the opportunity for environmental suits.

The point

You might dismiss all this as my three libertarian bar stories about incompetent government for the week.

But put it in the context of the AI debate, whether we should demand that “policy-makers” must “act now” to “steer AI in a direction that complements humans and benefits society.”

There is no such thing as a “policy maker.” I hate that word. There are politicians, lawyers, regulators, legislators, pressure groups, lobbyists. And this is how they “steer” anti-monopoly, social media tech, and energy. Do you really want them to “steer” AI?

You go to war with the army you have. You steer AI with the regulatory state you have. You don’t get to invoke a wise, a-political, benevolent technocratic aristocracy that, like communism, just hasn’t been done right yet.

[This is text for a “grumpy economist rant” that will come out sooner or later. Sorry for the repetition. Some read, some listen, I figure few do both.]