Yascha Mounk at his own Substack:
Yascha Mounk: Larry, we’re recording a couple of weeks after Liberation Day. Are you feeling liberated?
Larry Summers: No, I’m feeling like I’m part of some kind of Kafkaesque economic tragedy. I think the master narrative, the big picture here, Yascha, is that the United States is turning itself into an emerging or a submerging market. There are set patterns that we associate with mature democracies. There are set patterns that we associate with developing countries, for which some people would use the term “banana republic.”
In mature democracies, it’s institutions that dominate; in banana republics, it’s personalities that dominate. In mature democracies, it’s the rule of law that governs interactions between businesses and between business and government; in emerging markets, it’s personalities, personal connection, and loyalty. In mature democracies, the central bank and finance sits with independence relative to politics; in emerging markets, that is much more in question. In mature democracies, the goal is interaction, openness, and prospering along with the world; in immature democracies, in emerging markets, it is nationalist economic policies tied to particular interests.
The United States in a stretch of a few short months is transforming from being the United States to being something much more like Juan Perón’s Argentina—and that is being recognized by markets. It’s being recognized in the economy. It’s being recognized by people.
More here.
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