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as children get older, between third and eighth grade, their intrinsic motivation to study decreases considerably. The more they’re in school, the less they enjoy it.

A recent, large-scale study by Harvard economist Roland Fryer, a 2011 MacArthur grant recipient, has yielded some promising results on this front. In the fall of 2007, Fryer set up cash incentive programs in Chicago, Dallas, D.C., and New York. The twelve million dollar, 38,000-student study (half of it funded by Fryer’s organization, EdLabs; half by the school districts) was the largest ever conducted on the effects of incentives on academic achievement in the US. The results were released last May

Paying second-graders to read about six books per year (again, two dollars per book) Fryer found that standardized test scores in reading among students comfortable with English increased at a rate that would typically suggest three extra months of schooling

Intrinsic motivation, Fryer was surprised to find, was not affected significantly, and one year after the study's conclusion, 60 percent of the gains made by the sample group had been retained. Incentivized reading, it seemed, worked for certain students. Observing such sustained increases in reading proficiency led Fryer to his most important finding: effort, or “inputs,” could be incentivized, while improved scores, or “outputs,” could not. (Another study conducted by Fryer, released as a working paper last month, found that a combination of similar “input” incentives—involving parents, teachers, and students—yielded even more impressive results.) 

Adam Smith argued forcefully that we would do better to trust in the pursuit of self-interest than in the good intentions of those who pursue the general interest. If everyone looked out for just himself, we would reach an equilibrium that was not just comfortable but also productive, in which the economy was fully efficient. To the morally uninspired, it’s an appealing idea: selfishness as the ultimate form of selflessness. (Elsewhere, in particular in his “Theory of Moral Sentiments,” Smith took a much more balanced view, though most of his latter-day adherents have not followed suit.)

This cascade of trust destruction was unrelenting. One of the reasons that the bubble’s bursting in 2007 led to such an enormous crisis was that no bank could trust another. Each bank knew the shenanigans it had been engaged in — the movement of liabilities off its balance sheets, the predatory and reckless lending — and so knew that it could not trust any other bank

Things didn’t turn out well for our economy or our society. As millions lost their homes during and after the crisis, median wealth declined nearly 40 percent in three years. Banks would have done badly, too, were it not for the Bush-Obama mega-bailouts.

bankers used their political influence to eviscerate regulations and install regulators who didn’t believe in them. Officials and academics assured lawmakers and the public that banks could self-regulate. But it all turned out to be a scam. We had created a system of rewards that encouraged shortsighted behavior and excessive risk-taking. In fact, we had entered an era in which moral values were given short shrift and trust itself was discounted.

THE banking industry is only one example of what amounts to a broad agenda, promoted by some politicians and theoreticians on the right, to undermine the role of trust in our economy. This movement promotes policies based on the view that trust should never be relied on as motivation, for any kind of behavior, in any context. Incentives, in this scheme, are all that matter.

So C.E.O.’s must be given stock options to induce them to work hard. I find this puzzling: If a firm pays someone $10 million to run a company, he should give his all to ensure its success. He shouldn’t do so only if he is promised a big chunk of any increase in the company’s stock market value

Of course, incentives are an important component of human behavior. But the incentive movement has made them into a sort of religion, blind to all the other factors — social ties, moral impulses, compassion — that influence our conduct.

Similarly, teachers must be given incentive pay to induce them to exert themselves. But teachers already work hard for low wages because they are dedicated to improving the lives of their students. Do we really believe that giving them $50 more, or even $500 more, as incentive pay will induce them to work harder? What we should do is increase teacher salaries generally because we recognize the value of their contributions and trust in their professionalism. According to the advocates of an incentive-based culture, though, this would be akin to giving something for nothing.

This is not just a coldhearted vision of human nature. It is also implausible. It is simply impossible to pay for trust every time it is required. Without trust, life would be absurdly expensive; good information would be nearly unobtainable; fraud would be even more rampant than it is; and transaction and litigation costs would soar.

When 1 percent of the population takes home more than 22 percent of the country’s income — and 95 percent of the increase in income in the post-crisis recovery — some pretty basic things are at stake. Reasonable people, even those ignorant of the maze of unfair policies that created this reality, can look at this absurd distribution and be pretty certain that the game is rigged.

Trust between individuals is usually reciprocal. But if I think that you are cheating me, it is more likely that I will retaliate, and try to cheat you. (These notions have been well developed in a branch of economics called the “theory of repeated games.”) When Americans see a tax system that taxes the wealthiest at a fraction of what they pay, they feel that they are fools to play along.

a deeper rot takes hold: Attitudes and norms begin to change. When no one is trustworthy, it will be only fools who trust. The concept of fairness itself is eroded. A study published last year by the National Academy of Sciences suggests that the upper classes are more likely to engage in what has traditionally been considered unethical behavior. Perhaps this is the only way for some to reconcile their worldview with their outlandish financial success, often achieved through actions that reveal a kind of moral deprivation.

As always, it is the poor and the unconnected who suffer most from this, and who are the most repeatedly deceived. Nowhere was this more evident than in the foreclosure crisis.

The banks figured out how to get court affidavits signed by the thousands (in what came to be called robo-signing), certifying that they had examined their records and that these particular individuals owed money — and so should be booted out of their homes. The banks were lying on a grand scale, but they knew that if they didn’t get caught, they would walk off with huge profits, their officials’ pockets stuffed with bonuses. And if they did get caught, their shareholders would be left paying the tab

But perhaps even more than opportunity, Americans cherish equality before the law. Here, inequality has infected the heart of our ideals.

I suspect there is only one way to really get trust back. We need to pass strong regulations, embodying norms of good behavior, and appoint bold regulators to enforce them.

But events — and economic research — over the past 30 years have shown not only that we cannot rely on self-interest, but also that no economy, not even a modern, market-based economy like America’s, can function well without a modicum of trust — and that unmitigated selfishness inevitably diminishes trust.

THE banking industry is only one example of what amounts to a broad agenda, promoted by some politicians and theoreticians on the right, to undermine the role of trust in our economy. This movement promotes policies based on the view that trust should never be relied on as motivation, for any kind of behavior, in any context. Incentives, in this scheme, are all that matter.

This cascade of trust destruction was unrelenting. One of the reasons that the bubble’s bursting in 2007 led to such an enormous crisis was that no bank could trust another. Each bank knew the shenanigans it had been engaged in — the movement of liabilities off its balance sheets, the predatory and reckless lending — and so knew that it could not trust any other bank

bankers used their political influence to eviscerate regulations and install regulators who didn’t believe in them. Officials and academics assured lawmakers and the public that banks could self-regulate. But it all turned out to be a scam. We had created a system of rewards that encouraged shortsighted behavior and excessive risk-taking. In fact, we had entered an era in which moral values were given short shrift and trust itself was discounted.

Things didn’t turn out well for our economy or our society. As millions lost their homes during and after the crisis, median wealth declined nearly 40 percent in three years. Banks would have done badly, too, were it not for the Bush-Obama mega-bailouts.

So C.E.O.’s must be given stock options to induce them to work hard. I find this puzzling: If a firm pays someone $10 million to run a company, he should give his all to ensure its success. He shouldn’t do so only if he is promised a big chunk of any increase in the company’s stock market value

Similarly, teachers must be given incentive pay to induce them to exert themselves. But teachers already work hard for low wages because they are dedicated to improving the lives of their students. Do we really believe that giving them $50 more, or even $500 more, as incentive pay will induce them to work harder? What we should do is increase teacher salaries generally because we recognize the value of their contributions and trust in their professionalism. According to the advocates of an incentive-based culture, though, this would be akin to giving something for nothing.

Of course, incentives are an important component of human behavior. But the incentive movement has made them into a sort of religion, blind to all the other factors — social ties, moral impulses, compassion — that influence our conduct.

This is not just a coldhearted vision of human nature. It is also implausible. It is simply impossible to pay for trust every time it is required. Without trust, life would be absurdly expensive; good information would be nearly unobtainable; fraud would be even more rampant than it is; and transaction and litigation costs would soar.

When 1 percent of the population takes home more than 22 percent of the country’s income — and 95 percent of the increase in income in the post-crisis recovery — some pretty basic things are at stake. Reasonable people, even those ignorant of the maze of unfair policies that created this reality, can look at this absurd distribution and be pretty certain that the game is rigged.

Trust between individuals is usually reciprocal. But if I think that you are cheating me, it is more likely that I will retaliate, and try to cheat you. (These notions have been well developed in a branch of economics called the “theory of repeated games.”) When Americans see a tax system that taxes the wealthiest at a fraction of what they pay, they feel that they are fools to play along.

a deeper rot takes hold: Attitudes and norms begin to change. When no one is trustworthy, it will be only fools who trust. The concept of fairness itself is eroded. A study published last year by the National Academy of Sciences suggests that the upper classes are more likely to engage in what has traditionally been considered unethical behavior. Perhaps this is the only way for some to reconcile their worldview with their outlandish financial success, often achieved through actions that reveal a kind of moral deprivation.

As always, it is the poor and the unconnected who suffer most from this, and who are the most repeatedly deceived. Nowhere was this more evident than in the foreclosure crisis.

The banks figured out how to get court affidavits signed by the thousands (in what came to be called robo-signing), certifying that they had examined their records and that these particular individuals owed money — and so should be booted out of their homes. The banks were lying on a grand scale, but they knew that if they didn’t get caught, they would walk off with huge profits, their officials’ pockets stuffed with bonuses. And if they did get caught, their shareholders would be left paying the tab

But perhaps even more than opportunity, Americans cherish equality before the law. Here, inequality has infected the heart of our ideals.

I suspect there is only one way to really get trust back. We need to pass strong regulations, embodying norms of good behavior, and appoint bold regulators to enforce them.

that’s particularly true on the I.R.A., which has to build all these things in the real world.

we’re trying to do industrial physical transformation at a speed and scale unheralded in American history. This is bigger than anything we have done at this speed ever.

The money is beginning to move out the door now, but we’re on a clock. Climate change is not like some other issues where if you don’t solve it this year, it is exactly the same to solve it next year. This is an issue where every year you don’t solve it, the amount of greenhouse gases in the atmosphere builds, warming builds, the effects compound

Solve, frankly, isn’t the right word there because all we can do is abate, a lot of the problems now baked in. So how is it going, and who can actually walk us through that?

Robinson Meyer is the founding executive editor of heatmap.news

why do all these numbers differ so much? How big is this thing?

in electric vehicles and in the effort, kind of this dual effort in the law, to both encourage Americans to buy and use electric vehicles and then also to build a domestic manufacturing base for electric vehicles.

on both counts, the data’s really good on electric vehicles. And that’s where we’re getting the fastest response from industry and the clearest response from industry to the law.

ROBINSON MEYER: Factories are getting planned. Steel’s going in the ground. The financing for those factories is locked down. It seems like they’re definitely going to happen. They’re permitted. Companies are excited about them. Large Fortune 500 automakers are confidently and with certainty planning for an electric vehicle future, and they’re building the factories to do that in the United States. They’re also building the factories to do that not just in blue states. And so to some degree, we can see the political certainty for electric vehicles going forward.

in other parts of the law, partially due to just vagaries of how the law is being implemented, tax credits where the fine print hasn’t worked out yet, it’s too early to say whether the law is working and how it’s going and whether it’s going to accomplish its goal

EZRA KLEIN: I always find this very funny in a way. The Congressional Budget Office scored it. They thought it would make about $380 billion in climate investments over a decade. So then you have all these other analyses coming out.

But there’s actually this huge range of outcomes in between where the thing passes, and maybe what you wanted to have happen happens. Maybe it doesn’t. Implementation is where all this rubber meets the road

the Rhodium Group, which is a consulting firm, they think it could be as high as $522 billion, which is a big difference. Then there’s this Goldman Sachs estimate, which the administration loves, where they say they’re projecting $1.2 trillion in incentives —

ROBINSON MEYER: All the numbers differ because most of the important incentives, most of the important tax credits and subsidies in the I.R.A., are uncapped. There’s no limit to how much the government might spend on them. All that matters is that some private citizen or firm or organization come to the government and is like, hey, we did this. You said you’d give us money for it. Give us the money.

because of that, different banks have their own energy system models, their own models of the economy. Different research groups have their own models.

we know it’s going to be wrong because the Congressional Budget Office is actually quite constrained in how it can predict how these tax credits are taken up. And it’s constrained by the technology that’s out there in the country right now.

The C.B.O. can only look at the number of electrolyzers, kind of the existing hydrogen infrastructure in the country, and be like, well, they’re probably all going to use these tax credits. And so I think they said that there would be about $5 billion of take up for the hydrogen tax credits.

But sometimes money gets allocated, and then costs overrun, and there delays, and you can’t get the permits, and so on, and the thing never gets built

the fact that the estimates are going up is to them early evidence that this is going well. There is a lot of applications. People want the tax credits. They want to build these new factories, et cetera.

a huge fallacy that we make in policy all the time is assuming that once money is allocated for something, you get the thing you’re allocating the money for. Noah Smith, the economics writer, likes to call this checkism, that money equals stuff.

EZRA KLEIN: They do not want that, and not wanting that and putting every application through a level of scrutiny high enough to try and make sure you don’t have another one

I don’t think people think a lot about who is cutting these checks, but a lot of it is happening in this very obscure office of the Department of Energy, the Loan Program Office, which has gone from having $40 billion in lending authority, which is already a big boost over it not existing a couple decades ago, to $400 billion in loan authority,

the Loan Program Office as one of the best places we have data on how this is going right now and one of the offices that’s responded fastest to the I.R.A.

the Loan Program Office is basically the Department of Energy’s in-house bank, and it’s kind of the closest thing we have in the US to what exists in other countries, like Germany, which is a State development bank that funds projects that are eventually going to be profitable.

It has existed for some time. I mean, at first, it kind of was first to play after the Recovery Act of 2009. And in fact, early in its life, it gave a very important loan to Tesla. It gave this almost bridge loan to Tesla that helped Tesla build up manufacturing capacity, and it got Tesla to where it is today.

EZRA KLEIN: It’s because one of the questions I have about that office and that you see in some of the coverage of them is they’re very afraid of having another Solyndra.

Now, depending on other numbers, including the D.O.E., it’s potentially as high as $100 billion, but that’s because the whole thing about the I.R.A. is it’s meant to encourage the build-out of this hydrogen infrastructure.

EZRA KLEIN: I’m never that excited when I see a government loans program turning a profit because I think that tends to mean they’re not making risky enough loans. The point of the government should be to bear quite a bit of risk —

And to some degree, Ford now has to compete, and US automakers are trying to catch up with Chinese EV automakers. And its firms have EV battery technology especially, but just have kind of comprehensive understanding of the EV supply chain that no other countries’ companies have

ROBINSON MEYER: You’re absolutely right that this is the key question. They gave this $9.2 billion loan to Ford to build these EV battery plants in Kentucky and Tennessee. It’s the largest loan in the office’s history. It actually means that the investment in these factories is going to be entirely covered by the government, which is great for Ford and great for our build-out of EVs

And to some degree, I should say, one of the roles of L.P.O. and one of the roles of any kind of State development bank, right, is to loan to these big factory projects that, yes, may eventually be profitable, may, in fact, assuredly be profitable, but just aren’t there yet or need financing that the private market can’t provide. That being said, they have moved very slowly, I think.

And they feel like they’re moving quickly. They just got out new guidelines that are supposed to streamline a lot of this. Their core programs, they just redefined and streamlined in the name of speeding them up

However, so far, L.P.O. has been quite slow in getting out new loans

I want to say that the pressure they’re under is very real. Solyndra was a disaster for the Department of Energy. Whether that was fair or not fair, there’s a real fear that if you make a couple bad loans that go bad in a big way, you will destroy the political support for this program, and the money will be clawed back, a future Republican administration will wreck the office, whatever it might be. So this is not an easy call.

when you tell me they just made the biggest loan in their history to Ford, I’m not saying you shouldn’t lend any money to Ford, but when I think of what is the kind of company that cannot raise money on the capital markets, the one that comes to mind is not Ford

They have made loans to a number of more risky companies than Ford, but in addition to speed, do you think they are taking bets on the kinds of companies that need bets? It’s a little bit hard for me to believe that it would have been impossible for Ford to figure out how to finance factorie

ROBINSON MEYER: Now, I guess what I would say about that is that Ford is — let’s go back to why Solyndra failed, right? Solyndra failed because Chinese solar deluged the market. Now, why did Chinese solar deluge the market? Because there’s such support of Chinese financing from the state for massive solar factories and massive scale.

EZRA KLEIN: — the private market can’t. So that’s the meta question I’m asking here. In your view, because you’re tracking this much closer than I am, are they too much under the shadow of Solyndra? Are they being too cautious? Are they getting money out fast enough?

ROBINSON MEYER: I think that’s right; that basically, if we think the US should stay competitive and stay as close as it can and not even stay competitive, but catch up with Chinese companies, it is going to require large-scale state support of manufacturing.

EZRA KLEIN: OK, that’s fair. I will say, in general, there’s a constant thing you find reporting on government that people in government feel like they are moving very quickly

EZRA KLEIN: — given the procedural work they have to go through. And they often are moving very quickly compared to what has been done in that respect before, compared to what they have to get over. They are working weekends, they are working nights, and they are still not actually moving that quickly compared to what a VC firm can do or an investment bank or someone else who doesn’t have the weight of congressional oversight committees potentially calling you in and government procurement rules and all the rest of it.

ROBINSON MEYER: I think that’s a theme across the government’s implementation of the I.R.A. right now, is that generally the government feels like it’s moving as fast as it can. And if you look at the Department of Treasury, they feel like we are publishing — basically, the way that most of the I.R.A. subsidies work is that they will eventually be administered by the I.R.S., but first the Department of the Treasury has to write the guidebook for all these subsidies, right?

the law says there’s a very general kind of “here’s thousands of dollars for EVs under this circumstance.” Someone still has to go in and write all the fine print. The Department of Treasury is doing that right now for each tax credit, and they have to do that before anyone can claim that tax credit to the I.R.S. Treasury feels like it’s moving extremely quickly. It basically feels like it’s completely at capacity with these, and it’s sequenced these so it feels like it’s getting out the most important tax credits first.

Private industry feels like we need certainty. It’s almost a year since the law passed, and you haven’t gotten us the domestic content bonus. You haven’t gotten us the community solar bonus. You haven’t gotten us all these things yet.

a theme across the government right now is that the I.R.A. passed. Agencies have to write the regulations for all these tax credits. They feel like they’re moving very quickly, and yet companies feel like they’re not moving fast enough.

that’s how we get to this point where we’re 311 days out from the I.R.A. passing, and you’re like, well, has it made a big difference? And I’m like, well, frankly, wind and solar developers broadly don’t feel like they have the full understanding of all the subsidies they need yet to begin making the massive investments

I think it’s fair to say maybe the biggest bet on that is green hydrogen, if you’re looking in the bill.

We think it’s going to be an important tool in industry. It may be an important tool for storing energy in the power grid. It may be an important tool for anything that needs combustion.

ROBINSON MEYER: Yeah, absolutely. So green hydrogen — and let’s just actually talk about hydrogen broadly as this potential tool in the decarbonization tool kit.

It’s a molecule. It is a very light element, and you can burn it, but it’s not a fossil fuel. And a lot of the importance of hydrogen kind of comes back to that attribute of it.

So when we look at sectors of the economy that are going to be quite hard to decarbonize — and that’s because there is something about fossil fuels chemically that is essential to how that sector works either because they provide combustion heat and steelmaking or because fossil fuels are actually a chemical feedstock where the molecules in the fossil fuel are going into the product or because fossil fuels are so energy dense that you can carry a lot of energy while actually not carrying that much mass — any of those places, that’s where we look at hydrogen as going.

green hydrogen is something new, and the size of the bet is huge. So can you talk about first just what is green hydrogen? Because my understanding of it is spotty.

The I.R.A. is extremely generous — like extremely, extremely generous — in its hydrogen subsidies

The first is for what’s called blue hydrogen, which is hydrogen made from natural gas, where we then capture the carbon dioxide that was released from that process and pump it back into the ground. That’s one thing that’s subsidized. It’s basically subsidized as part of this broader set of packages targeted at carbon capture

green hydrogen, which is where we take water, use electrolyzers on it, basically zap it apart, take the hydrogen from the water, and then use that as a fue

The I.R.A. subsidies for green hydrogen specifically, which is the one with water and electricity, are so generous that relatively immediately, it’s going to have a negative cost to make green hydrogen. It will cost less than $0 to make green hydrogen. The government’s going to fully cover the cost of producing it.

That is intentional because what needs to happen now is that green hydrogen moves into places where we’re using natural gas, other places in the industrial economy, and it needs to be price competitive with those things, with natural gas, for instance. And so as it kind of is transported, it’s going to cost money

As you make the investment to replace the technology, it’s going to cost money. And so as the hydrogen moves through the system, it’s going to wind up being price competitive with natural gas, but the subsidies in the bill are so generous that hydrogen will cost less than $0 to make a kilogram of it

There seems to be a sense that hydrogen, green hydrogen, is something we sort of know how to make, but we don’t know how to make it cost competitive yet. We don’t know how to infuse it into all the processes that we need to be infused into. And so a place where the I.R.A. is trying to create a reality that does not yet exist is a reality where green hydrogen is widely used, we have to know how to use it, et cetera.

And they just seem to think we don’t. And so you need all these factories. You need all this innovation. Like, they have to create a whole innovation and supply chain almost from scratch. Is that right?

ROBINSON MEYER: That’s exactly right. There’s a great Department of Energy report that I would actually recommend anyone interested in this read called “The Liftoff Report for Clean Hydrogen.” They made it for a few other technologies. It’s a hundred-page book that’s basically how the D.O.E. believes we’re going to build out a clean hydrogen economy.

And, of course, that is policy in its own right because the D.O.E. is saying, here is the years we’re going to invest to have certain infrastructure come online. Here’s what we think we need. That’s kind of a signal to industry that everyone should plan around those years as well.

It’s a great book. It’s like the best piece of industrial policy I’ve actually seen from the government at all. But one of the points it makes is that you’re going to make green hydrogen. You’re then going to need to move it. You’re going to need to move it in a pipeline or maybe a truck or maybe in storage tanks that you then cart around.

Once it gets to a facility that uses green hydrogen, you’re going to need to store some green hydrogen there in storage tanks on site because you basically need kind of a backup supply in case your main supply fails. All of those things are going to add cost to hydrogen. And not only are they going to add cost, we don’t really know how to do them. We have very few pipelines that are hydrogen ready.

All of that investment needs to happen as a result to make the green hydrogen economy come alive. And why it’s so lavishly subsidized is to kind of fund all that downstream investment that’s eventually going to make the economy come true.

But a lot of what has to happen here, including once the money is given out, is that things we do know how to build get built, and they get built really fast, and they get built at this crazy scale.

So I’ve been reading this paper on what they call “The Greens’ Dilemma” by J.B. Ruhl and James Salzman, who also wrote this paper called “Old Green Laws, New Green Deal,” or something like that. And I think they get at the scale problem here really well.

“The largest solar facility currently online in the US is capable of generating 585 megawatts. To meet even a middle-road renewable energy scenario would require bringing online two new 400-megawatt solar power facilities, each taking up at least 2,000 acres of land every week for the next 30 years.”

And that’s just solar. We’re not talking wind there. We’re not talking any of the other stuff we’ve discussed here, transmission lines. Can we do that? Do we have that capacity?

ROBINSON MEYER: No, we do not. We absolutely do not. I think we’re going to build a ton of wind and solar. We do not right now have the system set up to use that much land to build that much new solar and wind by the time that we need to build it. I think it is partially because of permitting laws, and I think it’s also partially because right now there is no master plan

There’s no overarching strategic entity in the government that’s saying, how do we get from all these subsidies in the I.R.A. to net zero? What is our actual plan to get from where we are right now to where we’re emitting zero carbon as an economy? And without that function, no project is essential. No activity that we do absolutely needs to happen, and so therefore everything just kind of proceeds along at a convenient pace.

given the scale of what’s being attempted here, you might think that something the I.R.A. does is to have some entity in the government, as you’re saying, say, OK, we need this many solar farms. This is where we think we should put them. Let’s find some people to build them, or let’s build them ourselves.

what it actually does is there’s an office somewhere waiting for private companies to send in an application for a tax credit for solar that they say they’re going to build, and then we hope they build it

it’s an almost entirely passive process on the part of the government. Entirely would be going too far because I do think they talk to people, and they’re having conversations

the builder applies, not the government plans. Is that accurate?

ROBINSON MEYER: That’s correct. Yes.

ROBINSON MEYER: I think here’s what I would say, and this gets back to what do we want the I.R.A. to do and what are our expectations for the I.R.A

If the I.R.A. exists to build out a ton of green capacity and shift the political economy of the country toward being less dominated by fossil fuels and more dominated by the clean energy industry, frankly, then it is working

If the I.R.A. is meant to get us all the way to net zero, then it is not capable of that.

in 2022, right, we had no way to see how we were going to reduce emissions. We did not know if we were going to get a climate bill at all. Now, we have this really aggressive climate bill, and we’re like, oh, is this going to get us to net zero?

But getting to net zero was not even a possibility in 2022.

The issue is that the I.R.A. requires, ultimately, private actors to come forward and do these things. And as more and more renewables get onto the grid, almost mechanically, there’s going to be less interest in bringing the final pieces of decarbonized electricity infrastructure onto the grid as well.

EZRA KLEIN: Because the first things that get applied for are the ones that are more obviously profitable

The issue is when you talk to solar developers, they don’t see it like, “Am I going to make a ton of money, yes or no?” They see it like they have a capital stack, and they have certain incentives and certain ways to make money based off certain things they can do. And as more and more solar gets on the grid, building solar at all becomes less profitable

also, just generally, there’s less people willing to buy the solar.

as we get closer to a zero-carbon grid, there is this risk that basically less and less gets built because it will become less and less profitable

EZRA KLEIN: Let’s call that the last 20 percent risk

EZRA KLEIN: — or the last 40 percent. I mean, you can probably attach different numbers to that

ROBINSON MEYER: Permitting is the primary thing that is going to hold back any construction basically, especially out West,

right now permitting fights, the process under the National Environmental Policy Act just at the federal level, can take 4.5 years

let’s say every single project we need to do was applied for today, which is not true — those projects have not yet been applied for — they would be approved under the current permitting schedule in 2027.

ROBINSON MEYER: That’s before they get built.

Basically nobody on the left talked about permitting five years ago. I don’t want to say literally nobody, but you weren’t hearing it, including in the climate discussion.

people have moved to saying we do not have the laws, right, the permitting laws, the procurement laws to do this at the speed we’re promising, and we need to fix that. And then what you’re seeing them propose is kind of tweak oriented,

Permitting reform could mean a lot of different things, and Democrats and Republicans have different ideas about what it could mean. Environmental groups, within themselves, have different ideas about what it could mean.

for many environmental groups, the permitting process is their main tool. It is how they do the good that they see themselves doing in the world. They use the permitting process to slow down fossil fuel projects, to slow down projects that they see as harming local communities or the local environment.

ROBINSON MEYER: So we talk about the National Environmental Policy Act or NEPA. Let’s just start calling it NEPA. We talk about the NEPA process

NEPA requires the government basically study any environmental impact from a project or from a decision or from a big rule that could occur.

Any giant project in the United States goes through this NEPA process. The federal government studies what the environmental impact of the project will be. Then it makes a decision about whether to approve the project. That decision has nothing to do with the study. Now, notionally, the study is supposed to inform the project.

the decision the federal government makes, the actual “can you build this, yes or no,” legally has no connection to the study. But it must conduct the study in order to make that decision.

that permitting reform is so tough for the Democratic coalition specifically is that this process of forcing the government to amend its studies of the environmental impact of various decisions is the main tool that environmental litigation groups like Earthjustice use to slow down fossil fuel projects and use to slow down large-scale chemical or industrial projects that they don’t think should happen.

when we talk about making this program faster, and when we talk about making it more immune to litigation, they see it as we’re going to take away their main tools to fight fossil fuel infrastructure

why there’s this gap between rhetoric and what’s actually being proposed is that the same tool that is slowing down the green build-out is also what’s slowing down the fossil fuel build-out

ROBINSON MEYER: They’re the classic conflict here between the environmental movement classic, let’s call it, which was “think globally, act locally,” which said “we’re going to do everything we can to preserve the local environment,” and what the environmental movement and the climate movement, let’s say, needs to do today, which is think globally, act with an eye to what we need globally as well, which is, in some cases, maybe welcome projects that may slightly reduce local environmental quality or may seem to reduce local environmental quality in the name of a decarbonized world.

Because if we fill the atmosphere with carbon, nobody’s going to get a good environment.

Michael Gerrard, who is professor at Columbia Law School. He’s a founder of the Sabin Center for Climate Change Law there. It’s called “A Time for Triage,” and he has this sort of interesting argument that the environmental movement in general, in his view, is engaged in something he calls trade-off denial.

his view and the view of some people is that, look, the climate crisis is so bad that we just have to make those choices. We have to do things we would not have wanted to do to preserve something like the climate in which not just human civilization, but this sort of animal ecosystem, has emerged. But that’s hard, and who gets to decide which trade-offs to make?

what you’re not really seeing — not really, I would say, from the administration, even though they have some principles now; not really from California, though Gavin Newsom has a set of early things — is “this is what we think we need to make the I.R.A. happen on time, and this is how we’re going to decide what is a kind of project that gets this speedway through,” w

there’s a failure on the part of, let’s say, the environmental coalition writ large to have the courage to have this conversation and to sit down at a table and be like, “OK, we know that certain projects aren’t happening fast enough. We know that we need to build out faster. What could we actually do to the laws to be able to construct things faster and to meet our net-zero targets and to let the I.R.A. kind achieve what it could achieve?”

part of the issue is that we’re in this environment where Democrats control the Senate, Republicans control the House, and it feels very unlikely that you could just get “we are going to accelerate projects, but only those that are good for climate change,” into the law given that Republicans control the House.

part of the progressive fear here is that the right solutions must recognize climate change. Progressives are very skeptical that there are reforms that are neutral on the existence of climate change and whether we need to build faster to meet those demands that can pass through a Republican-controlled House.

one of the implications of that piece was it was maybe a huge mistake for progressives not to have figured out what they wanted here and could accept here, back when the negotiating partner was Joe Manchin.

Manchin’s bill is basically a set of moderate NEPA reforms and transmission reforms. Democrats, progressives refuse to move on it. Now, I do want to be fair here because I think Democrats absolutely should have seized on that opportunity, because it was the only moment when — we could tell already that Democrats — I mean, Democrats actually, by that moment, had lost the House.

I do want to be fair here that Manchin’s own account of what happened with this bill is that Senate Republicans killed it and that once McConnell failed to negotiate on the bill in December, Manchin’s bill was dead.

EZRA KLEIN: It died in both places.ROBINSON MEYER: It died in both places. I think that’s right.

Republicans already knew they were going to get the House, too, so they had less incentive to play along. Probably the time for this was October.

EZRA KLEIN: But it wasn’t like Democrats were trying to get this one done.

EZRA KLEIN: To your point about this was all coming down to the wire, Manchin could have let the I.R.A. pass many months before this, and they would have had more time to negotiate together, right? The fact that it was associated with Manchin in the way it was was also what made it toxic to progressives, who didn’t want to be held up by him anymore.

What becomes clear by the winter of this year, February, March of this year, is that as Democrats and Republicans begin to talk through this debt-ceiling process where, again, permitting was not the main focus. It was the federal budget. It was an entirely separate political process, basically.

EZRA KLEIN: I would say the core weirdness of the debt-ceiling fight was there was no main focus to it.

EZRA KLEIN: It wasn’t like past ones where it was about the debt. Republicans did some stuff to cut spending. They also wanted to cut spending on the I.R.S., which would increase the debt, right? It was a total mishmash of stuff happening in there.

That alchemy goes into the final debt-ceiling negotiations, which are between principals in Congress and the White House, and what we get is a set of basically the NEPA reforms in Joe Manchin’s bill from last year and the Mountain Valley pipeline, the thing that environmentalists were focused on blocking, and effectively no transmission reforms.

the set of NEPA reforms that were just enacted, that are now in the law, include — basically, the word reasonable has been inserted many times into NEPA. [LAUGHS] So the law, instead of saying the government has to study all environmental impacts, now it has to study reasonable environmental impacts.

this is a kind of climate win — has to study the environmental impacts that could result from not doing a project. The kind of average NEPA environmental impact study today is 500 pages and takes 4.5 years to produce. Under the law now, the government is supposed to hit a page limit of 150 to 300 pages.

there’s a study that’s very well cited by progressives from three professors in Utah who basically say, well, when you look at the National Forest Service, and you look at this 40,000 NEPA decisions, what mostly holds up these NEPA decisions is not like, oh, there’s too many requirements or they had to study too many things that don’t matter. It’s just there wasn’t enough staff and that staffing is primarily the big impediment. And so on the one hand, I think that’s probably accurate in that these are, in some cases — the beast has been starved, and these are very poorly staffed departments

The main progressive demand was just “we must staff it better.”

But if it’s taking you this much staffing and that much time to say something doesn’t apply to you, maybe you have a process problem —ROBINSON MEYER: Yes.EZRA KLEIN: — and you shouldn’t just throw endless resources at a broken process, which brings me — because, again, you can fall into this and never get out — I think, to the bigger critique her

these bills are almost symbolic because there’s so much else happening, and it’s really the way all this interlocks and the number of possible choke points, that if you touch one of them or even you streamline one of them, it doesn’t necessarily get you that f

“All told, over 60 federal permitting programs operate in the infrastructure approval regime, and that is just the federal system. State and local approvals and impact assessments could also apply to any project.”

their view is that under this system, it’s simply not possible to build the amount of decarbonization infrastructure we need at the pace we need it; that no amount of streamlining NEPA or streamlining, in California, CEQA will get you there; that we basically have been operating under what they call an environmental grand bargain dating back to the ’70s, where we built all of these processes to slow things down and to clean up the air and clean up the water.

we accepted this trade-off of slower building, quite a bit slower building, for a cleaner environment. And that was a good trade. It was addressing the problems of that era

now we have the problems of this era, which is we need to unbelievably, rapidly build out decarbonization infrastructure to keep the climate from warming more than we can handle and that we just don’t have a legal regime or anything.

You would need to do a whole new grand bargain for this era. And I’ve not seen that many people say that, but it seems true to me

the role that America had played in the global economy in the ’50s and ’60s where we had a ton of manufacturing, where we were kind of the factory to a world rebuilding from World War II, was no longer tenable and that, also, we wanted to focus on more of these kind of high-wage, what we would now call knowledge economy jobs.That was a large economic transition happening in the ’70s and ’80s, and it dovetailed really nicely with the environmental grand bargain.

At some point, the I.R.A. recognizes that that environmental grand bargain is no longer operative, right, because it says, we’re going to build all this big fiscal fixed infrastructure in the United States, we’re going to become a manufacturing giant again, but there has not been a recognition among either party of what exactly that will mean and what will be required to have it take hold.

It must require a form of on-the-ground, inside-the-fenceline, “at the site of the power plant” pollution control technology. The only way to do that, really, is by requiring carbon capture and requiring the large construction of major industrial infrastructure at many, many coal plants and natural gas plants around the country in order to capture carbon so it doesn’t enter the atmosphere, and so we don’t contribute to climate change. That is what the Supreme Court has ruled. Until that body changes, that is going to be the law.

So the E.P.A. has now, last month, proposed a new rule under the Clean Air Act that is going to require coal plants and some natural gas plants to install carbon capture technology to do basically what the Supreme Court has all but kind of required the E.P.A. to do

the E.P.A. has to demonstrate, in order to kind of make this rule the law and in order to make this rule pass muster with the Supreme Court, that this is tenable, that this is the best available and technologically feasible option

that means you actually have to allow carbon capture facilities to get built and you have to create a legal process that will allow carbon capture facilities to get built. And that means you need to be able to tell a power plant operator that if they capture carbon, there’s a way they can inject it back into the ground, the thing that they’re supposed to do with it.

Well, E.P.A. simultaneously has only approved the kind of well that you need to inject carbon that you’ve captured from a coal factory or a natural gas line back into the ground. It’s called a Class 6 well. The E.P.A. has only ever approved two Class 6 wells. It takes years for the E.P.A. to approve a Class 6 well.

And environmental justice groups really, really oppose these Class 6 wells because they see any carbon capture as an effort to extend the life of the fossil fuel infrastructure

The issue here is that it seems like C.C.S., carbon capture, is going to be essential to how the U.S. decarbonizes. Legally, we have no other choice because of the constraints the Supreme Court has placed on the E.P.A.. At the same time, environmental justice groups, and big green groups to some extent, oppose building out any C.C.S.

to be fair to them, right, they would say there are other ways to decarbonize. That may not be the way we’ve chosen because the politics weren’t there for it, but there are a lot of these groups that believe you could have 100 percent renewables, do not use all that much carbon capture, right? They would have liked to see a different decarbonization path taken too. I’m not sure that path is realistic.

what you do see are environmental groups opposing making it possible to build C.C.S. anywhere in the country at all.

EZRA KLEIN: The only point I’m making here is I think this is where you see a compromise a lot of them didn’t want to make —ROBINSON MEYER: Exactly, yeah.EZRA KLEIN: — which is a decarbonization strategy that actually does extend the life cycle of a lot of fossil fuel infrastructure using carbon capture. And because they never bought onto it, they’re still using the pathway they have to try to block it. The problem is that’s part of the path that’s now been chosen. So if you block it, you just don’t decarbonize. It’s not like you get the 100 percent renewable strategy.

ROBINSON MEYER: Exactly. The bargain that will emerge from that set of actions and that set of coalitional trade-offs is we will simply keep running this, and we will not cap it.

What could be possible is that progressives and Democrats and the E.P.A. turns around and says, “Oh, that’s fine. You can do C.C.S. You just have to cap every single stationary source in the country.” Like, “You want to do C.C.S.? We totally agree. Essential. You must put CSS infrastructure on every power plant, on every factory that burns fossil fuels, on everything.”

If progressives were to do that and were to get it into the law — and there’s nothing the Supreme Court has said, by the way, that would limit progressives from doing that — the upshot would be we shut down a ton more stationary sources and a ton more petrochemical refineries and these bad facilities that groups don’t want than we would under the current plan.

what is effectively going to happen is that way more factories and power plants stay open and uncapped than would be otherwise.

EZRA KLEIN: So Republican-controlled states are just on track to get a lot more of it. So the Rocky Mountain Institute estimates that red states will get $623 billion in investments by 2030 compared to $354 billion for blue states.

why are red states getting so much more of this money?

ROBINSON MEYER: I think there’s two reasons. I think, first of all, red states have been more enthusiastic about getting the money. They’re the ones giving away the tax credits. They have a business-friendly environment. And ultimately, the way many, many of these red-state governors see it is that these are just businesses.

I think the other thing is that these states, many of them, are right-to-work states. And so they might pay their workers less. They certainly face much less risk financially from a unionization campaign in their state.

regardless of the I.R.A., that’s where manufacturing and industrial investment goes in the first place. And that’s where it’s been going for 20 years because of the set of business-friendly and local subsidies and right-to-work policies.

I think the administration would say, we want this to be a big union-led effort. We want it to go to the Great Lakes states that are our political firewall.

and it would go to red states, because that’s where private industry has been locating since the ’70s and ’80s, and it would go to the Southeast, right, and the Sunbelt, and that that wouldn’t be so bad because then you would get a dynamic where red-state senators, red-state representatives, red-state governors would want to support the transition further and would certainly not support the repeal of the I.R.A. provisions and the repeal of climate provisions, and that you’d get this kind of nice vortex of the investment goes to red states, red states feel less antagonistic toward climate policies, more investment goes to red states. Red-state governors might even begin to support environmental regulation because that basically locks in benefits and advantages to the companies located in their states already.

I think what you see is that Republicans are increasingly warming to EV investment, and it’s actually building out renewables and actually building out clean electricity generation, where you see them fighting harder.

The other way that permitting matters — and this gets into the broader reason why private investment was generally going to red states and generally going to the Sunbelt — is that the Sunbelt states — Georgia, Texas — it’s easier to be there as a company because housing costs are lower and because the cost of living is lower in those states.

it’s also partially because the Sunbelt and the Southeast, it was like the last part of the country to develop, frankly, and there’s just a ton more land around all the cities, and so you can get away with the sprawling suburban growth model in those citie

It’s just cheaper to keep building suburbs there.

EZRA KLEIN: So how are you seeing the fights over these rare-earth metals and the effort to build a safe and, if not domestic, kind of friend-shored supply chain there?

Are we going to be able to source some of these minerals from the U.S.? That process seems to be proceeding but going slowly. There are some minerals we’re not going to be able to get from the United States at all and are going to have to get from our allies and partners across the world.

The kind of open question there is what exactly is the bargain we’re going to strike with countries that have these critical minerals, and will it be fair to those countries?

it isn’t to say that I think the I.R.A. on net is going to be bad for other countries. I just think we haven’t really figured out what deal and even what mechanisms we can use across the government to strike deals with other countries to mine the minerals in those countries while being fair and just and creating the kind of economic arrangement that those countries want.

, let’s say we get the minerals. Let’s say we learn how to refine them. There is many parts of the battery and many parts of EVs and many, many subcomponents in these green systems that there’s not as strong incentive to produce in the U.S.

at the same time, there’s a ton of technology. One answer to that might be to say, OK, well, what the federal government should do is just make it illegal for any of these battery makers or any of these EV companies to work with Chinese companies, so then we’ll definitely establish this parallel supply chain. We’ll learn how to make cathodes and anodes. We’ll figure it out

The issue is that there’s technology on the frontier that only Chinese companies have, and U.S. automakers need to work with those companies in order to be able to compete with them eventually.

EZRA KLEIN: How much easier would it be to achieve the I.R.A.’s goals if America’s relationship with China was more like its relationship with Germany?

ROBINSON MEYER: It would be significantly easier, and I think we’d view this entire challenge very differently, because China, as you said, not only is a leader in renewable energy. It actually made a lot of the important technological gains over the past 15 years to reducing the cost of solar and wind. It really did play a huge role on the supply side of reducing the cost of these technologies.

If we could approach that, if China were like Germany, if China were like Japan, and we could say, “Oh, this is great. China’s just going to make all these things. Our friend, China, is just going to make all these technologies, and we’re going to import them.

So it refines 75 percent of the polysilicon that you need for solar, but the machines that do the refining, 99 percent of them are made in China. I think it would be reckless for the U.S. to kind of rely on a single country and for the world to rely on a single country to produce the technologies that we need for decarbonization and unwise, regardless of our relationship with that country.

We want to geographically diversify the supply chain more, but it would be significantly easier if we did not have to also factor into this the possibility that the US is going to need to have an entirely separate supply chain to make use of for EVs, solar panels, wind turbines, batteries potentially in the near-term future.

, what are three other books they should read?

The first book is called “The End of the World” by Peter Brannen. It’s a book that’s a history of mass extinctions, the Earth’s five mass extinctions, and, actually, why he doesn’t think we’re currently in a mass extinction or why, at least, things would need to go just as bad as they are right now for thousands and thousands of years for us to be in basically the sixth extinction.

The book’s amazing for two reasons. The first is that it is the first that really got me to understand deep time.

he explains how one kind of triggered the next one. It is also an amazing book for understanding the centrality of carbon to Earth’s geological history going as far back as, basically, we can track.

“Climate Shock” by Gernot Wagner and Marty Weitzman. It’s about the economics of climate change

Marty Weitzman, who I think, until recently, was kind of the also-ran important economist of climate change. Nordhaus was the famous economist. He was the one who got all attention. He’s the one who won the Nobel.

He focuses on risk and that climate change is specifically bad because it will damage the environment, because it will make our lives worse, but it’s really specifically bad because we don’t know how bad it will be

it imposes all these huge, high end-tail risks and that blocking those tail risks is actually the main thing we want to do with climate policy.

That is I think, in some ways, what has become the U.S. approach to climate change and, to some degree, to the underlying economic thinking that drives even the I.R.A., where we want to just cut off these high-end mega warming scenarios. And this is a fantastic explanation of that particular way of thinking and of how to apply that way of thinking to climate change and also to geoengineerin

The third book, a little controversial, is called “Shorting the Grid” by Meredith Angwin

her argument is basically that electricity markets are not the right structure to organize our electricity system, and because we have chosen markets as a structured, organized electricity system in many states, we’re giving preferential treatment to natural gas and renewables, two fuels that I think climate activists may feel very different ways about, instead of coal, which she does think we should phase out, and, really, nuclear

By making it easier for renewables and natural gas to kind of accept these side payments, we made them much more profitable and therefore encouraged people to build more of them and therefore underinvested in the forms of generation, such as nuclear, that actually make most of their money by selling electrons to the grid, where they go to people’s homes.

Individually, these pages have meaningful audiences, but cumulatively, their audience is gigantic: tens of millions of people. On Facebook, they rival the reach of their better-funded counterparts in the political media, whether corporate giants like CNN or The New York Times, or openly ideological web operations like Breitbart or Mic.

these new publishers are happy to live inside the world that Facebook has created. Their pages are accommodated but not actively courted by the company and are not a major part of its public messaging about media. But they are, perhaps, the purest expression of Facebook’s design and of the incentives coded into its algorithm — a system that has already reshaped the web and has now inherited, for better or for worse, a great deal of America’s political discourse.

In 2010, Facebook released widgets that publishers could embed on their sites, reminding readers to share, and these tools were widely deployed. By late 2012, when Facebook passed a billion users, referrals from the social network were sending visitors to publishers’ websites at rates sometimes comparable to Google, the web’s previous de facto distribution hub. Publishers took note of what worked on Facebook and adjusted accordingly.

While web publishers have struggled to figure out how to take advantage of Facebook’s audience, these pages have thrived. Unburdened of any allegiance to old forms of news media and the practice, or performance, of any sort of ideological balance, native Facebook page publishers have a freedom that more traditional publishers don’t: to engage with Facebook purely on its terms.

Rafael Rivero is an acquaintance of Provost’s who, with his twin brother, Omar, runs a page called Occupy Democrats, which passed three million followers in June. This accelerating growth is attributed by Rivero, and by nearly every left-leaning page operator I spoke with, not just to interest in the election but especially to one campaign in particular: “Bernie Sanders is the Facebook candidate,

Now that the nomination contest is over, Rivero has turned to making anti-Trump content. A post from earlier this month got straight to the point: “Donald Trump is unqualified, unstable and unfit to lead. Share if you agree!” More than 40,000 people did.“It’s like a meme war,” Rivero says, “and politics is being won and lost on social media.”

truly Facebook-native political pages have begun to create and refine a new approach to political news: cherry-picking and reconstituting the most effective tactics and tropes from activism, advocacy and journalism into a potent new mixture. This strange new class of media organization slots seamlessly into the news feed and is especially notable in what it asks, or doesn’t ask, of its readers. The point is not to get them to click on more stories or to engage further with a brand. The point is to get them to share the post that’s right in front of them. Everything else is secondary.

The flood of visitors aligned with two core goals of most media companies: to reach people and to make money. But as Facebook’s growth continued, its influence was intensified by broader trends in internet use, primarily the use of smartphones, on which Facebook became more deeply enmeshed with users’ daily routines. Soon, it became clear that Facebook wasn’t just a source of readership; it was, increasingly, where readers lived.

For media companies, the ability to reach an audience is fundamentally altered, made greater in some ways and in others more challenging. For a dedicated Facebook user, a vast array of sources, spanning multiple media and industries, is now processed through the same interface and sorting mechanism, alongside updates from friends, family, brands and celebrities.

All have eventually run up against the same reality: A company that can claim nearly every internet-using adult as a user is less a partner than a context — a self-contained marketplace to which you have been granted access but which functions according to rules and incentives that you cannot control.

It is a framework built around personal connections and sharing, where value is both expressed and conferred through the concept of engagement. Of course, engagement, in one form or another, is what media businesses have always sought, and provocation has always sold news. But now the incentives are literalized in buttons and written into software.

Each day, according to Facebook’s analytics, posts from the Make America Great page are seen by 600,000 to 1.7 million people. In July, articles posted to the page, which has about 450,000 followers, were shared, commented on or liked more than four million times, edging out, for example, the Facebook page of USA Today

Nicoloff’s business model is not dissimilar from the way most publishers use Facebook: build a big following, post links to articles on an outside website covered in ads and then hope the math works out in your favor. For many, it doesn’t: Content is expensive, traffic is unpredictable and website ads are both cheap and alienating to readers.

In July, visitors arriving to Nicoloff’s website produced a little more than $30,000 in revenue. His costs, he said, total around $8,000, partly split between website hosting fees and advertising buys on Facebook itself.

of course, there’s the content, which, at a few dozen posts a day, Nicoloff is far too busy to produce himself. “I have two people in the Philippines who post for me,” Nicoloff said, “a husband-and-wife combo.” From 9 a.m. Eastern time to midnight, the contractors scour the internet for viral political stories, many explicitly pro-Trump. If something seems to be going viral elsewhere, it is copied to their site and promoted with an urgent headline.

In the end, Nicoloff takes home what he jokingly described as a “doctor’s salary” — in a good month, more than $20,000.

In their angry, cascading comment threads, Make America Great’s followers express no such ambivalence. Nearly every page operator I spoke to was astonished by the tone their commenters took, comparing them to things like torch-wielding mobs and sharks in a feeding frenzy

A dozen or so of the sites are published in-house, but posts from the company’s small team of writers are free to be shared among the entire network. The deal for a would-be Liberty Alliance member is this: You bring the name and the audience, and the company will build you a prefab site, furnish it with ads, help you fill it with content and keep a cut of the revenue. Coca told me the company brought in $12 million in revenue last year.

Because the pages are run independently, the editorial product is varied. But it is almost universally tuned to the cadences and styles that seem to work best on partisan Facebook. It also tracks closely to conservative Facebook media’s big narratives, which, in turn, track with the Trump campaign’s messaging: Hillary Clinton is a crook and possibly mentally unfit; ISIS is winning; Black Lives Matter is the real racist movement; Donald Trump alone can save us; the system — all of it — is rigged.

It’s an environment that’s at best indifferent and at worst hostile to traditional media brands; but for this new breed of page operator, it’s mostly upside. In front of largely hidden and utterly sympathetic audiences, incredible narratives can take shape, before emerging, mostly formed, into the national discourse.

How much of what happens on the platform is a reflection of a political mood and widely held beliefs, simply captured in a new medium, and how much of it might be created, or intensified, by the environment it provides? What is Facebook doing to our politics?

for the page operators, the question is irrelevant to the task at hand. Facebook’s primacy is a foregone conclusion, and the question of Facebook’s relationship to political discourse is absurd — they’re one and the same. As Rafael Rivero put it to me, “Facebook is where it’s all happening.”

Acemoglu and Robinson outline a theory of how economic and political institutions shape the fate of human societies. They reinterpret the rise and fall of civilizations throughout history, showing how differences in institutions interact with changing circumstances to produce development or stagnation.

It also has implications for the contemporary United States, where increasing inequality and the growing influence of money in politics threaten to reshape our political institutions.

In more fortunate countries, pluralistic political institutions prevent any one group from monopolizing resources for itself, while free markets empower a large class of people with an interest in defending the current system against absolutism. This virtuous circle, which first took form in seventeenth-century England, is the secret to economic growth.

Economic institutions are themselves the products of political processes, which depend on political institutions. These can also be extractive, if they enable an elite to maintain its dominance over society, or inclusive, if many groups have access to the political process. Poverty is not an accident: "[P]oor countries are poor because those who have power make choices that create poverty." Therefore, Acemoglu and Robinson argue, it is ultimately politics that matters.

The logic of extractive and inclusive institutions explains why growth is not foreordained. Where a cohesive elite can use its political dominance to get rich at the expense of ordinary people, it has no need for markets and free enterprise, which can create political competitors. In addition, because control of the state can be highly lucrative, infighting among contenders for power produces instability and violence. This vicious circle keeps societies poor

Countries differ in their economic success because of their different institutions, the rules influencing how the economy works, and the incentives that motivate people," write Acemoglu and Robinson. Extractive institutions, whether feudalism in medieval Europe or the use of schoolchildren to harvest cotton in contemporary Uzbekistan, transfer wealth from the masses to elites. In contrast, inclusive institutions -- based on property rights, the rule of law, equal provision of public services, and free economic choices -- create incentives for citizens to gain skills, make capital investments, and pursue technological innovation, all of which increase productivity and generate wealth.

Acemoglu and Robinson differentiate their account from alternatives that they label the "culture," "geography," and "ignorance" hypotheses.

An example of the first is Max Weber's famous argument that Calvinism lay at the roots of capitalist development

the best-known recent example of the second is Jared Diamond's explanation of the Spanish Conquest as the inevitable outcome of geographic differences between Eurasia and the Americas.

Most economists, Acemoglu and Robinson assert, subscribe to the ignorance hypothesis, according to which "poor countries are poor because they have a lot of market failures and because economists and policymakers do not know how to get rid of them." According to this view, development can be engineered through technocratic policies administered by enlightened experts.

this focus on policy obscures the fundamental importance of politics.

Their perspective is informed by New Institutional Economics, an approach developed in the last quarter of the twentieth century, and associated with prominent economists such as Douglass North and Oliver Williamson, that focuses on how economic forces are mediated by institutions such as political systems and legal codes

A state based on extractive institutions, whether the Kuba Kingdom of seventeenth-century Central Africa or more recently the Soviet Union, can generate growth, especially when starting from low levels of development. But in most of these cases, the ruling elite is unwilling to allow inclusive economic institutions because they would threaten its political supremacy; the inevitable result is economic stagnation.

This leaves open the question of why some societies end up with inclusive rather than extractive institutions -- why some are rich and some are poor. The answer, according to Acemoglu and Robinson, is that institutions evolve -- and that history is messy.

Institutions change in subtle ways over time, allowing societies to drift apart. When major shocks occur, small differences in institutions can send societies down vastly different historical paths.

Early modern England, France, and Spain were all feudal societies with power-hungry monarchs. But the English Parliament had slightly more power than its continental relatives; as a result, the crown was unable to monopolize trade with the Americas, which made many merchants rich instead; in turn, this new commercial class became an important part of the coalition that overthrew James II in 1688, successfully fighting off absolutism. In Spain, by contrast, the monarchy controlled overseas trade, quashed internal challenges to its authority, and maintained extractive economic institutions -- and the country went into long-term decline. Crucially, Acemoglu and Robinson remind us that these outcomes were not preordained. James II might have suppressed the Glorious Revolution, or the Spanish Armada might have succeeded a century earlier. History is like that.

In this light, the material prosperity of the modern world, unevenly distributed though it is, is a fortunate historical accident.

But inclusive institutions can also break down. In the late thirteenth and early fourteenth centuries, a small group of families transformed Venice's semi-democratic institutions into a hereditary aristocracy and then monopolized long-distance trade, spelling the end of the city-state's economic expansion

Acemoglu and Robinson, by contrast, examine why nations fail. Societies, in their telling, are like Tolstoy's families: The success stories are similar -- pluralist democracies with regulated capitalist economies -- but failure comes in different forms. There are many ways in which elites can impose extractive institutions that cripple economic development.

The United States is one of the happy families of Why Nations Fail. Although our institutions have often been deeply flawed, Acemoglu and Robinson show how crucial moments in history, from Jamestown to the Progressive Era to the civil-rights movement, have led to the expansion of political democracy and economic opportunity.

Rather than as a series of inevitable triumphs, however, this history can also be seen as a warning -- that our institutions are fragile, always at risk of being subverted by elites seeking to exploit political power for their narrow economic ends. That risk has reappeared today.

The power of the financial sector is only one example of the broader threat to our inclusive political institutions: namely, the ability of the economic elite to translate their enormous fortunes directly into political power. In the wake of the Supreme Court's 2010 decision in Citizens United, super PACs can mobilize unlimited amounts of money--and can accept contributions from 501(c)4 organizations, which do not have to identify their donors.

This may seem like a level playing field. But money is not distributed evenly. American Crossroads, for example, has consistently raised more than 90 percent of its funds from billionaires (with a "b"). The recent, breathtaking rise in inequality has put unprecedented resources at the disposal of the super-rich. With the ability to secretly invest unlimited sums in political activities, they now have the opportunity to swamp all other participants in American politics.

Rising inequality and deregulation of political spending have made possible a new kind of class warfare. The 1 percent can blanket the airwaves, install their chosen representatives, and sway public policy in their favor.

The most direct way to translate political power into cold, hard cash is to advocate for lower taxes. Republican presidential candidates spent the past year competing to offer the most bountiful tax cuts to the super-rich

Showering goodies on the rich would require draconian cuts to Social Security and Medicare -- programs that are popular among the Tea Party rank and file. Republicans' current anti-tax orthodoxy reflects the interests of their wealthy funders rather than their middle-income base.

As Warren Buffett observed, "there's been class warfare going on for the last twenty years, and my class has won." This should be little surprise: "My side has had the nuclear bomb. We've got K Street, we've got lobbyists, we've got money on our side."

Supreme Court justices appointed by Republican presidents were instrumental in unleashing unlimited corporate political spending in Citizens United, accelerating the concentration of political power in the hands of the super-rich.

The most potent bulwark of inclusive institutions is probably the rich variety of influential interest groups that all have the ability to participate in politics. Still, the accumulation of huge fortunes and their deployment for political ends has changed the nature of our political institutions. Funding by the economic elite is a major reason why Republicans advocate transfers from ordinary people to the rich in the form of tax cuts and reductions in government services -- and why Democrats have been dragged to the right along with the GOP

Acemoglu recently said, "We need noisy grassroots movements to deliver a shock to the political system," citing both the Tea Party and Occupy Wall Street as potentially helpful developments. As he recognized, however, the one with more staying power -- the Tea Party -- has been co-opted by well-funded, elite-dominated groups (including Americans for Prosperity). If a popular movement can be bankrolled as easily as an attack ad, it is hard to see what money can't buy in politics. The next test for America will be whether our political system can fend off the power of money and remain something resembling a real democracy -- or whether it will become a playground where a privileged elite works out its internal squabbles.

Indexing has gone big, very big. For nine in 10 companies on the S&P 500, their largest single shareholder is one of the Big Three. For many, the big indexers control 20 percent or more of their shares. Index funds now control 20 to 30 percent of the American equities market, if not more.

The problem is that the public markets have been cornered by a group of investment managers small enough to fit at a lunch counter, dedicated to quiescence and inertia.

Passively managed investment options do not just outperform actively managed ones in terms of both better returns and lower fees. They eat their lunch.

Let’s imagine that a decade ago you invested $100 in an index fund charging a 0.04 percent fee and $100 in a traditional mutual fund charging a 1.5 percent fee. Let’s also imagine that the index fund tracked the S&P 500, and that the mutual fund ended up returning what the S&P 500 returned. Your passively invested $100 would have turned into $356.66 in 10 years. Your traditionally invested $100 would have turned into $313.37.

Actively managed investment options could make up for their higher fees with higher returns. And some do, some of the time. Yet scores of industry and academic studies stretching over decades show that trying to beat the market tends to result in lower returns than just buying the market. Only a quarter of actively managed mutual funds exceeded the returns of their passively managed cousins in the decade leading up to 2019,

What might be good for retail investors might not be good for the financial markets, public companies, or the American economy writ large, and the passive revolution’s scope has raised all sorts of hand-wringing and red-flagging. Analysts at Bernstein have called passive investing “worse than Marxism.” The investor Michael Burry, of The Big Short fame, has called it a “bubble,” and a co-head of Goldman Sachs’s investment-management division has warned about froth too. Shortly before his death in 2019, Bogle himself warned that index funds’ dominance might not “serve the national interest.”

One primary concern comes from the analysts at Bernstein: “A supposedly capitalist economy where the only investment is passive is worse than either a centrally planned economy or an economy with active, market-led capital management.”

Active managers direct investment dollars to companies on the basis of those companies’ research-and-development prospects, human capital, regulatory outlook, and so on. They take new information and price it into a company’s stock when buying and selling shares.

Passive investors, by contrast, ignore annual reports and market rumors. They do nothing with trading-floor gossip. They make no attempt to research what to invest in and what to skip. Whether holding international or domestic assets, holding stocks or bonds, or using a mutual-fund structure or an ETF structure, they just mirror the market. Big U.S.-stock index funds buy big U.S. stocks just because they’re big U.S. stocks.

At least in a Soviet-type centrally planned economy, apparatchiks would be making some attempt to allocate resources efficiently.

Passive management is merely a giant phenomenon, not an all-encompassing one. Hundreds of actively managed mutual funds are still out there, as are legions of day traders, hedge funds, and private offices buying and selling and buying and selling. Stock prices still move around, sometimes dramatically, on the basis of new data and new ideas.

Still, passive investing may well be degrading the informational content of the markets, messing up price signals and making business decisions harder as a result.

When one of these commodities ends up on an index, the firms that use that commodity in their business see a 6 percent increase in costs and a 40 percent decrease in operating profits, relative to firms without exposure to the commodity, the academics found

Their theory is that ETF trading shifts prices in subtle ways, making it harder for businesses to know when to buy their gold and copper. Corporate executives “are being influenced by what happens in the futures market, and what happens in the futures market is being influenced by ETF trading,”

More broadly, the Bernstein analysts, among others, worry that index-linked investing is increasing correlation, whereby the prices of stocks, bonds, and other assets move up or down or sideways together.

the price fluctuations of a newly indexed stock “magically and quickly” change. A firm’s shares begin to move “more closely with its 499 new neighbors and less closely with the rest of the market. It is as if it has joined a new school of fish.”

A far bigger concern is that the rise of the indexers might be making American firms less competitive, through “common ownership,” in which the mega-asset managers control large stakes in multiple competitors in the same industry. The passive firms control big chunks of the airlines American, Delta, JetBlue, Southwest, and United, for instance

The rise of common ownership might be perverting corporate behavior in weird ways, academics argue. Think about the incentives like this: Let’s imagine that you are a major shareholder in a public widget company. We’d expect you to desire—insist, even—that the company fight for market share and profits. But now imagine that you are a major shareholder in all the important widget companies. You would no longer really care which one succeeded, particularly not if one company doing better meant another company doing worse. You’d just care about the widget sector’s corporate profits, which would go up if the widget companies quit competing with one another and started raising prices to pad their bottom line.

one major paper showed that common ownership of airline stocks had the effect of raising ticket prices by 3 to 7 percent.

A separate study showed that consumers are paying higher prices for prescription medicines because generic-drug makers have less incentive to compete with the companies making name-brand drugs.

Yet another study showed that common ownership is leading retail banks to charge higher prices.

Across firms, executive compensation seems to be more closely linked to a company’s performance when its shareholders are not invested in the company’s rivals, the study found. In other words, firms stop paying managers for performance when owned by the same people who own their rivals.

The market clout of the indexers raises other questions too. The actual owners of the stocks—not the index-fund managers but the people putting money into index funds—have little say over the companies they own. Vanguard, Fidelity, and State Street, not Mom and Dad, vote in shareholder elections

In fact, the Big Three cast roughly 25 percent of the votes in S&P 500 companies.

In an interview with The Wall Street Journal, the chief executive officer of State Street said he thought it was “almost inevitable, when you see this kind of concentration, that it probably will make sense to do something about it.”

But figuring out what the appropriate restrictions are depends on determining just what the problem with the indexers is—are they distorting price signals, raising the cost of consumer goods, posing financial systemic risk, or do they just have the market cornered? Then, what to do about it? Common ownership is not a problem the government is used to handling.

, thanks to the passive revolution, a broad variety and huge number of firms might have less incentive to compete. The effect on the real economy might look a lot like that of rising corporate concentration. And the two phenomena might be catalyzing one another, as index investing increases the number of mergers and makes them more lucrative.

In recent decades, the whole economy has gone on autopilot. Index-fund investment is hyperconcentrated. So is online retail. So are pharmaceuticals. So is broadband. Name an industry, and it is likely dominated by a handful of giant players. That has led to all sorts of deleterious downstream effects: suppressing workers’ wages, raising consumer prices, stifling innovation, stoking inequality, and suffocating business creation

The problem is not just the indexers. It is the public markets they reflect, where more chaos, more speculation, more risk, more innovation, and more competition are desperately needed.

it has become much tougher for either to amass a commanding Senate majority.

The fact that neither side will control more than 52 seats after Tuesday means that either party has held at least 55 Senate seats in only three congressional sessions since 2000.

So I think the closeness of it -- whether it's 52-48 or 50-50 or 51-49 -- is probably good for him and good for the country, because he is going to know how to deal in that type of a Senate."

The narrow majorities have also contributed to a Senate that has grown more rigid, with much more partisan conflict and less of the ad hoc bipartisan deal-making that characterized the body through the second half of the 20th century. The Senate will mark a new high -- or low -- in its rising partisanship on Wednesday when about a quarter or more of Republican senators will vote against recognizing Democrat Joe Biden's election as president

some observers believe that the narrow Senate division certain to emerge from Tuesday's election will encourage a return to bipartisan deal-making, like the agreement between centrist Republican and Democratic senators that helped break the months-long stalemate over Covid economic relief legislation.

almost all of the senators in both parties who had won their split-ticket victories in the 2008 and 2012 presidential races lost their seats in the next midterm elections (2014 and 2018, respectively).

other observers note that the narrow Senate majorities of recent years have, in practice, produced very few bipartisan compromises.

With control constantly at risk, the majority party faces heightened pressure for lockstep unity, while the minority party never has much incentive to help the majority burnish its record with bipartisan accomplishments that could buttress its advantage in the next election.

Whatever the results of Tuesday's Georgia elections between Republicans David Perdue and Kelly Loeffler and Democrats Jon Ossoff and Raphael Warnock, respectively, those polarizing dynamics are guaranteed to remain in force, because the party that falls into the minority now will remain close enough to immediately begin plotting how to recapture the majority in 2022

the meager three majorities of 55 seats or more since 2000 represent the fewest times that any party has accumulated at least 55% of the Senate seats over a 20-year span since the turn of the 20th century, according to official Senate records.

As recently as 2008, six Senate candidates (five Democrats and Republican Sen. Susan Collins of Maine) won election in states that supported the other side's presidential candidate. In 2012, four Democrats and Republican Dean Heller of Nevada won Senate races in states that voted the other way for president.

in 2016, for the first time since the direct election of senators around World War I, the same party won the Senate and the presidential race in every state.

The huge Democratic Senate majorities that persisted from the late 1950s through the mid-1990s were rooted in the party's continued dominance of Senate seats from Southern states that routinely voted Republican for president, notes Sarah Binder, a senior fellow in governance studies at the Brookings Institution. But over the past generation, it has become much more difficult for either party to win Senate seats in states that usually vote the other way in presidential elections.

The "return of GOP South and decline in split-ticket voting and increased nationalization of US politics generally" explains "a good amount of the decline in Senate majority margins in recent decades," notes Binder.

Over the past two presidential elections, 20 states have voted both times against Trump; Democrats now hold fully 39 of their 40 Senate seats, all but Collins' in Maine. But 25 states have voted both times for Trump, and Republicans now hold 47 of their 50 seats, all but Joe Manchin's in West Virginia, Jon Tester's in Montana and Sherrod Brown's in Ohio.

In the five states (Arizona, Georgia, Michigan, Pennsylvania and Wisconsin) that backed Trump in 2016 but switched to Biden in 2020, Democrats now hold six Senate seats and Republicans two, pending the results in Georgia

from 1981 through 2000, Democrats held at least 55 seats in four sessions, while Republicans reached that level of control in three

One party also controlled at least 55% of the Senate seats (which were fewer than 100 at that point because there were fewer states) in eight of the 10 congressional sessions from 1921 through 1940 and seven of the 10 from 1901 through 1920. Only the 1950s saw anything like today's precarious balances: While Democrats controlled at least 55% of the seats four times from 1941 to 1950, neither side reached that level through four consecutive sessions beginning in 1951, until Democrats broke through with big gains in the 1958 election.

Unless Republicans win both of Tuesday's runoffs, the party controlling the Senate will hold a majority of two seats or fewer. That would mark the fifth time since 2000 that the majority party held such a narrow advantage.

Again, the growing correlation between presidential and Senate outcomes may be a key factor in the shift. Pending the Georgia results, only three senators in each party represent states that supported the other side's presidential candidate this year. That means the vast majority of Democratic senators have a strong electoral incentive to support Biden --and the vast majority of Republican senators have a comparable incentive to oppose him.

Breaux, the former Democratic senator, believes the narrow balance of power can overcome that centrifugal pressure by providing small groups of relatively centrist deal-makers from each party the leverage to build majority legislative coalitions.

"You can form coalitions starting in the middle and then moving out on each side until you create a majority," he says.

Without the incentive to win elections, Republican elected officials increasingly have no reason to try to make voters happy (or more precisely: The politicians have that incentive, but the party as a whole does not and that’s what matters).

The results are exactly what one would expect. Republicans do fine for the most part in elections as the out-party, because when an incumbent is on the ballot an election is mainly about whether he or she is doing a good job.

As a result, their ability to advance public policy atrophies, and eventually they lose interest in nominating candidates who are equipped to govern — or even interested in doing so. More and more, the party is driven by what their media cares about: Finding the things that most activate their most loyal audience, and repeating them as much as possible.

Everywhere, new investment in green energy generation is being propelled by general concern for the climate, shifting corporate and household demand, the plunging prices for solar and batteries triggered by Chinese policy, and a combination of national and regional interventions

How different would we expect this data to look without the IRA?

The most useful overview of these modeling efforts that I have been able to find is by Bistline et al “Power sector impacts of the Inflation Reduction Act of 2022” in Environmental Research Letters November 2023. If anyone has a better source, please let me know.

The top panel shows the historical trajectory of US generating capacity from 1980 to 2021. The second half of the graphic shows how 11 different models predict that the US electricity system might be expected to develop up to 2035, with and without IRA.

all the models expect the trends of the 2010s to continue through to the 2030s which means that solar, wind and battery storage dominate America’s energy future. Even without the IRA, the low carbon share of electricity generation will likely rise to 50-55% by 2035. Bidenomics bumps that to 70-80 percent.

The question is: “How does the renewable surge of 2022-2024, compare to the model-based expectations, with and without the IRA?”

The answer is either, “so so”, or, more charitably, it is “too early to tell”. In broad terms the current rate of expansion is slightly above the rate the models predict without the provision of additional Bidenomics incentives. But what is also clear is that the current rate of expansion, is far short of the long-run pace that should be expected from the IRA

At this point, defenders of the IRA interject that the IRA has only just come into effect. Cash from the IRA is only beginning to flow. And in an environment of higher costs for renewable energy equipment and higher interest rates, cash matters.

As Yakov Feygin put it: “Maybe the pithiest way to put it is that there are pre-IRA trends and outside IRA trends, but IRA has served to rapidly compress the timeframes for installation in a lot of technologies. So five years has turned into two, for example.”

So, to judge the impact of the IRA to date, the real question is not what has been built in 2022 and 2023, but what is in the pipeline.

Advised by JP Morgan, sophisticated global players like Ørsted are optimizing their use of both the production and investment tax credits offered by the IRA to launch large new renewable schemes. Of course, correlation is not the same as causation

Where the IRA is perhaps doing its most important work may be in incentivizing the middle bracket of projects where green momentum is less certain.

According to Utility Drive: “The 10 largest U.S. developers plan to build 110,364 MW of new wind and solar projects over the next five years, according to S&P Global Market Intelligence, but the majority of these projects remain in early stages of development. Just 15% of planned wind and solar projects are under construction, and 13% are considered to be in advanced stages of development, … ”

The states that I have highlighted in red stand out either for their unusually low existing level of renewable power capacity or their lack of current momentum.

Along with Texas, the pipelines for the PJM, MISO and Southeast regions (which includes Florida) look particularly healthy.

The relatively modest California numbers should not be a surprise. As Yakov Feygin and others pointed out, what is needed in California is not more raw generating capacity, but more battery storage. And that is what we are seeing in the data.

The numbers would be even larger if it were not for the truly surreal logjam in California’s system for authorizing interconnections. According to Hamilton/Brookings data the volume of hybrid solar and batter capacity in the queue for approval is 6.5 times the capacity currently operating in the state. In other words there is an entire energy transition waiting to happen when the overloaded managerial processes of the system catch up

Texas’s less bureaucratic system seems to be one of its key advantages in the extremely rapid roll-out of solar.

though it may be true that globally speaking the United States as a whole is a laggard in renewable energy development,

If California (with an economy roughly comparable to that of Germany at current exchange rates) and Texas (with an economy roughly the size of Italy’s) were countries, they would be #3 and #5 in the world in solar capacity per capita.

the obvious question is, which are the laggards in the US energy system.

So there is a lot to get excited about, at, what we are learning to call, the “meso”-level of the economy (more on this in a future post).

What the state-level data reveal is that there are a significant number of large states in the USA where solar and wind energy have barely made any impact. Pennsylvania, for instance

The relative levels of sunshine between US states is irrelevant. As the global solar atlas shows, the entire United States has far better solar potential than North West Europe. If you can grow corn and tobbaco, you can do utility-scale solar. The fact that Arizona is not a solar giant is mind boggling.

Texas is both big and truly remarkable. California already is a world leader in renewable energy. Meanwhile, the majority of the US electricity system presents a very different picture. There is a huge distance to be traveled and the pace of solar build-out is unremarkable.

This is where national level incentives like the IRA must prove themselves

And these local battles in America matter. Given the extremely high per capita energy consumption in the USA, greening state-level energy systems is significant at the global level. It does not compare to the super-sized levels of emissions in China, but it matters.

Indonesia’s total installed electricity generating capacity is rated at 81 GW. As far as immediate impact on the global carbon balance is concerned, cleaning up the power systems of Pennsylvania and Illinois would make an even bigger impact.

A key test of Biden-era climate and industrial policy will be whether it can untie the local political economy of fossil fuels, which, across many regions of the United States still stands in the way of a green energy transition that now has all the force of economics and technological advantage on its side.

lower costs are going to be about finding ways to get people to take more responsibility for their health — for losing weight, for example, or bringing their blood pressure down.

there are other concerns, such as whether an all-encompassing system like Kaiser’s can really be replicated and whether the limits it places on where patients can seek care will be accepted by enough people to make a difference.

Or whether, as the nation’s flirtation with health maintenance organizations, or H.M.O.’s, in the 1990s showed — people will balk at the concept of not being able to go to any doctor or hospital of their choice.

its integrated model is in favor again. Hospitals across the country are buying physician practices or partnering with doctors and health insurers to form accountable care organizations, or A. C.O.’s, as a way of controlling more aspects of patient care. Doctors are also creating so-called medical homes, where patient care is better coordinated.

The days when doctors, hospitals and other providers are paid separately for each procedure will disappear eventually, health experts say. Instead, providers will have financial incentives to encourage them to keep people healthy, including lump sums to care for patients or provide comprehensive care for a specific condition. “All of care is going to move down this path, and it has to,” Mr. Halvorson said. “Medical homes are doing it; the very best A. C.O’s are going to figure out how to do it.”

there are downsides to the creation of large health care systems that may be motivated by the desire to increase their clout in the market, making it easier to fill beds and charge the insurers more for care. “They become these huge local monopolies,”

“We have all the pieces,” said Philip Fasano, Kaiser’s chief information officer. “Anything a patient needs you get in the four walls of our offices,

its plans are typically at least 10 percent less expensive than others, especially where they control all the providers

Kaiser has also been using the information to identify those doctors or clinics that excel in certain areas, as well as those in need of improvement. The organization has also used the records to change how it delivers care, identifying patients at risk for developing bed sores in the hospital and then sending electronic alerts every two hours to remind the nurses to turn the patients. The percentage of patients with serious pressure ulcers, or bed sores, dropped to well under 1 percent from 3.5 percent.

Washington and Colorado have set out to invent a whole industry from scratch and, in theory, to avoid the shortcomings of other markets in legal vices — tobacco, alcohol, gambling — that lurched into being without much forethought, and have supplied, along with much pleasure, much misery.

the complexities of turning an illicit herb into a regulated, safe, consumer-friendly business. Among the things on the to-do list: certifying labs to test for potency and contamination. (Pot can contain, among other nasty things, pesticides, molds and salmonella.) Devising rules on labeling, so users know what they’re getting. Hiring inspectors, to make sure the sellers comply. Establishing limits on advertising, because you don’t want allowing to become promoting.

there is evidence that pot dealers, like purveyors of alcohol, get the bulk of their profit from those who use the product to excess. “When you get a for-profit producer or distributor industry going, their incentives are to increase sales,

the likely best model is something resembling the wine industry — a fragmented market, many producers, none dominant. This could be done by limiting the size of licensed purveyors. It would help, too, to let individuals grow a few plants at home

One practical challenge facing the legalization pioneers is how to keep the marijuana market from being swallowed by a few big profiteers — the pot equivalent of Big Tobacco, or even the actual tobacco industry — a powerful oligopoly with every incentive to turn us into a nation of stoners.

states can take a cut of what will be, according to estimates, a $35 billion to $45 billion industry and earmark some of these new tax revenues for good causes. It’s the same tactic used to win public approval of lotteries — and with the same danger: that some worthy government function comes to depend on creating more addicts. And how do you divvy up the revenues? How much goes to offset health consequences? How much goes to enforcement? How do you calibrate taxes so the price of pot is high enough to discourage excessive use, but not so high that a cheap black market arises?

no one has come up with a pot version of the breathalyzer to determine quickly whether a driver is impaired.

California demonstrates a different kind of unintended consequences. The state’s medical marijuana law is such a free-for-all that in Los Angeles there are now said to be more pot dispensaries than Starbucks outlets.