Is There a Scheme of Things Underlying Everything?

In The Thibaults (the novel sequence for which Roger Martin du Gard won the 1937 Nobel Prize in Literature), a fundamental motif is the question of whether the universe is coherent. Roughly speaking, there are three competing schools of coherence—science, religion and art. Antoine Thibault discusses with the Abbé (French title for abbot):

Antoine did not seem to hear him. “Just think,” he exclaimed, “what it means to a youngster, when he’s turned loose, by gradual stages, on mathematics, physics, chemistry! Suddenly he discovers that he has all space, the universe, for his playground. And after that, religion strikes him as not only cramped, but false, illogical. Untrustworthy.”

Roger Martin du Gard, The Thibaults, translated by Philip Thody & Ellen Kennedy, Bantam Modern Classic Edition, Viking Press, 1968. page 762.

The climax of this debate appears when Antoine says:

“…I talked just now about Universal Order and a Scheme of Things; but that was merely to talk like everyone else. Actually it seems to me that we’ve as many reasons to question the existence of a Scheme of Things as to take it for granted. From his actual viewpoint the human animal I am observes an immense tangle of conflicting forces. But do these forces obey a universal law outside themselves, distinct from them? Or do they, rather, obey—so to speak—internal laws, each atom being a law unto itself, that compels it to work out a kind of ‘personal’ destiny? I see these forces obeying laws which do not control them from outside, but join up with them, which do nothing more than in some way stimulate them.…And anyhow, what a jumble it is, the course of natural phenomena! I’d just as soon believe that causes spring from each other ad infinitum, each cause being the effect of another cause, and each effect the cause of other effects. Why should one want to assume at all costs a Scheme of Things?…”

Roger Martin du Gard, The Thibaults, translated by Philip Thody & Ellen Kennedy, Bantam Modern Classic Edition, Viking Press, 1968. page 768.

The topic of an underlying scheme of things is close to the central question of Western civilization. In Plato’s Republic, we have the allegory of the dark cave occupied by humanity. It looks at shadows dancing on the wall, projected by a fire. Liberating humanity requires leaving the cave and climbing to the surface of the earth, glimpsing the sun for the first time. From here, with the help of philosophy, humanity flies off and encounters the Logos and the Eidos. Mathematical truth crowns this journey.

Aristotle, Plato’s star pupil and later rival, takes this quest and focuses on the biological. The Athenian tradition invents theory, a pillar of Western tradition, culminating in modern science. Jerusalem’s competing tradition, the Judeo-Christian worldview, derives its scheme of things from divinity before biology and mathematics. Thus, the novel’s debate is ultimately the struggle between Athens and Jerusalem.

Poetry and Tweaking Our Understanding

Consider the poem “Dover Beach” by Matthew Arnold. In the last stanza, Arnold describes a world that remains very familiar to us, even over 150 years later. The “ignorant armies” of the final line describe today’s warfare just as aptly as the conflicts of his time.

The sea is calm tonight.
The tide is full, the moon lies fair
Upon the straits; on the French coast the light
Gleams and is gone; the cliffs of England stand,
Glimmering and vast, out in the tranquil bay.
Come to the window, sweet is the night-air!
Only, from the long line of spray
Where the sea meets the moon-blanched land,
Listen! you hear the grating roar
Of pebbles which the waves draw back, and fling,
At their return, up the high strand,
Begin, and cease, and then again begin,
With tremulous cadence slow, and bring
The eternal note of sadness in.

Sophocles long ago
Heard it on the Ægean, and it brought
Into his mind the turbid ebb and flow
Of human misery; we
Find also in the sound a thought,
Hearing it by this distant northern sea.

The Sea of Faith
Was once, too, at the full, and round earth’s shore
Lay like the folds of a bright girdle furled.
But now I only hear
Its melancholy, long, withdrawing roar,
Retreating, to the breath
Of the night-wind, down the vast edges drear
And naked shingles of the world.

Ah, love, let us be true
To one another! for the world, which seems
To lie before us like a land of dreams,
So various, so beautiful, so new,
Hath really neither joy, nor love, nor light,
Nor certitude, nor peace, nor help for pain;
And we are here as on a darkling plain
Swept with confused alarms of struggle and flight,
Where ignorant armies clash by night.

Matthew Arnold, “Dover Beach”

We can tweak our understanding using poetic tools. In a later poem by Rilke, he begins with an invocation to god before abandoning religious overtones, despairing at the root of modern restlessness.

After the summer’s yield, Lord, it is time
to let your shadow lengthen on the sundials
and in the pastures let the rough winds fly.

As for the final fruits, coax them to roundness.
Direct on them two days of warmer light
to hale them golden toward their term, and harry
the last few drops of sweetness through the wine.

Whoever’s homeless now, will build no shelter;
who lives alone will live indefinitely so,
waking up to read a little, draft long letters,
and, along the city’s avenues,
fitfully wander, when the wild leaves loosen.

Rainer Maria Rilke, “Day in Autumn” (translated by Mary Kinzie)

The first stanza of Bob Dylan’s “The Times They Are A-Changin’” shares the same tone as Matthew Arnold’s “Dover Beach”. The overall intuition of these authors was that the world is coming unstuck and unravelling, leaving the individual metaphorically homeless.

Come gather ’round, people, wherever you roam
And admit that the waters around you have grown
And accept it that soon you’ll be drenched to the bone
If your time to you is worth saving
And you better start swimmin’ or you’ll sink like a stone
For the times, they are a-changin’

Come writers and critics who prophesize with your pen
And keep your eyes wide, the chance won’t come again
And don’t speak too soon, for the wheel’s still in spin
And there’s no tellin’ who that it’s namin’
For the loser now will be later to win
For the times, they are a-changin’

Come senators, congressmen, please heed the call
Don’t stand in the doorway, don’t block up the hall
For he that gets hurt will be he who has stalled
The battle outside ragin’
Will soon shake your windows and rattle your walls
For the times, they are a-changin’

Come mothers and fathers throughout the land
And don’t criticize what you can’t understand
Your sons and your daughters are beyond your command
Your old road is rapidly agin’
Please get out of the new one if you can’t lend your hand
For the times, they are a-changin’

The line, it is drawn, the curse, it is cast
The slow one now will later be fast
As the present now will later be past
The order is rapidly fadin’
And the first one now will later be last
For the times, they are a-changin’

Bob Dylan, “The Times They Are A-Changin’”

Rilke’s metaphorical homelessness is also reflected in Dylan’s “Like a Rolling Stone”, which he expands with “with no direction home.” Rilke wrote about creeping homelessness, where there may or may not be an actual physical home. French philosopher Simone Weil echoes this in her L’Enracinement, prélude à une déclaration des devoirs envers l’être humain (English: The Need for Roots: Prelude to a Declaration of Duties Towards Mankind). There is a need for roots, and in our current world, these roots are often unattainable.

The movie Triumph of the Spirit depicts the life of Salamo Arouch, a Greek-Israeli boxer who survives Auschwitz by fighting in exchange for rations and protection for his family. His German “handler” Rauscher loses his mind and is shown in drunken maudlin hysteria, realizing that the war is lost, stumbling around killing people while reciting Rilke’s poem.

See also: Is Poetry Sometimes Informative in a Special Way? (which also discusses Matthew Arnold’s “Dover Beach”)

Poly-Awareness and the Year 1900

On the way to the year 1900, we encounter the comment, “In 1890 the stock exchanges of London, Paris, Berlin and New York controlled the economic progress of the whole world.” This marriage of geography and the financial world is very striking, culminating with:

The year 1900 was a wonderful one, when men were proud to be middle-class, and to be Europeans. The fate of the whole world was decided around green baize-covered tables in London, Paris or Berlin. Rubber trees from the Amazons were shipped to Malaya, the vast coal seams of the Upper Hwang-Ho were being exploited at the expense of the wretched labourers, and in the north of the Upper Vaal a mining city sprang up in a few short weeks. Mobilized by steam, the planet’s riches were being shifted ‘from one side of the world to the other’, to quote Le Bateau Ivre, on orders flashed by telegraph in two or three minutes. Decisions reached by boards of directors in London, Paris or Berlin affected the lives of millions of human beings who did not suspect that their right to happiness depended on quotations scribbled on blackboards in three noisy exchanges built like temples, in which raged the battles of unbridled financial ambition. Not a single detail escaped the notice of Europe’s financial capitals: they fixed the price of a tram ticket in Rio de Janeiro, and the working hours of a coolie in Hong Kong. So much power had never before been concentrated in so few hands within so small an area of the globe. It was the age of triumph of the European middle classes.

Charles Morazé, The Triumph of the Middle Classes: A Political and Social History of Europe in the Nineteenth Century, Anchor Books, 1968, page ix.

Morazé adds the following sentence, “The Europe of 1900 knew nothing of the world catastrophes which were to come.” At the core of this is the rise of modern science and technology. Max Planck published the first paper that gave us quantum mechanics. David Hilbert, at the 1900 Paris conference of the International Congress of Mathematicians, presented a collection of 23 problems (later known as Hilbert’s problems). Mathematicians, including Grigori Perelman (famous for his contributions to Riemannian geometry), are still attempting to solve these problems.

Henry Adams, attending the Exposition Universelle (1900), observed the dynamo and wrote the chapter “The Dynamo and the Virgin” in his book The Education of Henry Adams. He thinks of the dynamos as a moral force, much as the early Christians felt the Cross.

Remember that in the world of 1900, in the background to all of this, we have the Boxer Rebellion in China, part of the Chinese century of humiliation (which angers them to this day).

The quest for meta-intelligent understanding (i.e., poly-awareness) involves comparing then and now and how they are connected.

Science-Watching: From Ignition to Energy

[from Science & Technology Review July/August 2025 Research Highlights, by Noah Pflueger-Peters]

Achieving ignition at the National Ignition Facility (NIF) proved that harnessing the power of the Sun in a laboratory may be possible. The Sun’s extreme temperatures and pressures cause light elements to fuse together to create heavier ones, releasing enormous energy and sustaining conditions for more thermonuclear reactions. NIF replicates these conditions with inertial confinement fusion, in which lasers compress and heat a target capsule filled with deuterium and tritium (DT), “heavy” isotopes of hydrogen that contain extra neutrons. When the isotopes fuse, they create helium and a neutron, and the lost mass is converted into inertial fusion energy (IFE), which can be harnessed for energy production.

Nuclear fusion produces significantly more energy than either nuclear fission or burning fossil fuels for equivalent amounts of fuel. Since the input materials for fusion energy are plentiful on Earth, an IFE power plant could produce safe, abundant, power grid-compatible energy without highly radioactive byproducts.

Although significant work remains to harness fusion energy, pursuing the development and deployment of IFE is crucial for the nation’s energy security, enabling the United States to shape implementation worldwide, avoid technological surprises from adversaries, and influence technical leadership in other energy-intensive technologies such as AI, machine learning (ML), and supercomputing.

IFE research stretches back to the early days of Lawrence Livermore, and today the Laboratory is fostering the overall fusion ecosystem. Livermore’s unique capabilities, expertise, and connections will be critical to laying the technical, logistical, and legal groundwork to make IFE possible. “IFE is a grand scientific and engineering challenge, something that is so incredibly difficult and high-risk and takes enormous expertise,” says Tammy Ma, Livermore’s IFE Institutional Initiative lead. “This challenge makes it the right kind of problem for national laboratories to pursue.”

This artist’s rendering shows the concept for an inertial fusion energy (IFE) power plant design, with a cutaway to show the plant’s target chamber in the center. Livermore researchers are laying the groundwork for private fusion companies to build similar designs. (Illustration by Eric Smith.)

Designing for Viability

NIF is the only facility to date to demonstrate the ignition and burning plasma conditions that are prerequisites for IFE, but it is an experimental facility for stockpile stewardship research, not a power plant. To be commercially viable and produce the energy to offset costs and meet demands (baseload power), IFE plants will need to generate more than 30 times the energy they deliver to the fusion target on every shot while firing 10 or more shots per second, compared to NIF’s rate of one or two shots per day.

The Laser Inertial Fusion Energy (LIFE) study, conducted between 2008 and 2013, aimed to build directly on technology developed for NIF to achieve IFE and took a systematic approach to this requirement by developing the Integrated Process Model (IPM). (See S&TR, April/May 2009 [archived PDF], pp. 6-15.)

IPM is a technoeconomic model of an IFE power plant with detailed technical and cost breakdowns and interdependencies of key systems and subsystems. “The work done under LIFE was fantastic,” says Ma. “IPM lays out engineering and physics requirements for the entire system to test out different scenarios and see the impact. Now, we not only get to expand on all that but also leverage 15 years of new data from NIF, better codes, and high-performance computing (HPC), as well as new work in AI, ML, advanced manufacturing, diagnostics, and nonproliferation across the Laboratory.”

IPM describes an IFE power plant that requires a solid-state laser driver system to “pump” lasers with optical energy using laser diodes instead of flashlamps as at NIF. The plant will also need to fabricate and fill target capsules onsite and send them into its target chamber at a high enough frequency to produce baseload power. “We will have to repeatedly inject targets into the chamber, so the targets must be able to withstand and survive that process,” explains Ma. “Then, the lasers will track the moving targets, and when one gets to the center of the chamber, they would fire on the centered target, repeating 10 to 20 times per second.”

The facility would convert fusion energy into heat and then electricity via steam turbines, sending most of the electricity to the power grid and recycling the rest to power operations on subsequent shots. Neutrons from the reaction would produce tritium needed for the DT fuel by bombarding lithium isotopes in a “breeding blanket” material lining its target chamber. By closing both the power and fuel cycles, IFE plants are expected to be self-sustaining.

Thanks in part to IFE STARFIRE (IFE Science and Technology Accelerated Research for Fusion Innovation and Reactor Engineering), a Department of Energy (DOE)-funded multi-institutional IFE research and development hub, researchers across the Laboratory are working to meet the new system’s demands. IPM can help identify key challenges, test the viability of new designs, and direct future research. “Many technical models and cost models exist for IFE, but very few, if any, pair systems and cost models together at the same depth as IPM,” says Mackenzie Nelson, a technoeconomic systems analyst in the Computational Engineering Division. “This type of tool offers such an advantage because we can assess design choices from both a technical and economic standpoint and create blueprints for what an IFE plant could look like.”

(left to right) Livermore researchers Bassem El Dasher, Claudio Santiago, and Mackenzie Nelson discuss a 3D model of a proposed IFE power plant design alongside the Integrated Process Model (IPM). IPM has more than 270 potential user inputs that researchers and collaborators can use to assess different IFE design choices to see the technical and cost impact on the entire design.

Operational Demands

NIF’s target capsules are extremely precise, fragile, and can take weeks to fabricate, fill, and position. Researchers are trying to reconcile that factor with the estimated demand of more than 800,000 capsules per day produced at less than $0.50 each to achieve IFE plant viability. To do this, they are examining optimal target designs for IFE and exploring advanced manufacturing methods such as microfluidics, volumetric additive manufacturing, and two-photon polymerization. (See S&TR, April/May 2025 [archived PDF], pp. 16-19.) Additional projects involve developing diagnostic instruments that can collect, analyze, and combine data with other diagnostics at the 10 to 20 shot per second frequency and use it to improve lasers in real time.

Fusion energy systems such as IFE are also a regulatory challenge, as they generate high-energy neutrons capable of breeding plutonium or uranium-233 and rely on large quantities of tritium. “Pure fusion energy systems do not require fissile material, but there are still ways to misuse these technologies that pose proliferation risk,” says Yana Feldman, the associate program leader for international safeguards. Bad actors may only need small amounts of tritium to make nuclear weapons, and some breeding blanket designs may inadvertently produce traces of plutonium that may be diverted for military purposes.

Nuclear fission reactors are regulated through international agreements and export control rules, and the independent International Atomic Energy Agency (IAEA) verifies that nuclear material and facilities are only being used for peaceful purposes. Neither treaties nor the IAEA address fusion energy, and no consensus has been reached on whether fusion energy systems need an international verification program. Verification methods for safeguarding tritium are also far less developed than for plutonium and uranium and focus more on contamination and transfers than analytical accounting for discrepancies. The precise scale of allowable tritium unaccounted for without posing proliferation risk is also unclear.

Fusion systems can be designed for proliferation resistance, but not having an existing design remains a challenge.

International security analyst Anne-Marie Riitsaar and her colleagues are exploring these complexities and starting conversations with international fusion experts and private industry to raise awareness. Riitsaar also plans to collaborate with the IPM team to map tritium diversion vulnerabilities and identify high-risk points where researchers could incorporate surveillance methods into plant designs to detect and prevent potential misuse. “People sometimes ask me why I’m thinking about fusion energy regulations and proliferation risks at this point, but it’s not too early,” says Riitsaar. “Reaching a multinational consensus on regulating sensitive technologies takes considerable time and effort.”

The National Ignition Facility is an experimental facility and not a power plant, so a commercial IFE plant design has vastly different requirements—many of which are being studied by Livermore researchers and their collaborators.

NIFViable IFE plant (estimated)
Repetition rateOne shot per day10 to 20 shots per second
Energy gain4.13 times (as of April 2025)30 times (minimum), 50 times to 100 times (ideal)
How lasers gain energyFlashlampsDiode pumping
Target fabrication and fuel fillingFabricated offsite over several weeks and filled manually in 1 to 5 daysMass-manufactured and filled in a target factory within the facility
Target deliveryPositioned manually within the Target ChamberShot into the plant’s target chamber approximately 10 to 20 times per second
Laser alignmentComputationally in real time, taking up to 8 hoursIn real time
Power cycleOpen, requiring outside energy sourcesClosed, applying reused energy to power laser and ancillary plant operations
Fuel cycle (tritium)Produced offsiteBred onsite

The Laser Driven Fusion Integration Research and Science Test Facility (LD-FIRST) is a proposed blueprint for a proof-of-concept IFE facility that will test all the key IFE subsystems in an integrated fashion. A public-private partnership will likely be necessary to build the facility and will help the IFE community address the main subset of risks and the technological challenges of building a commercial plant.

Converging on a Solution

The team seeks to make IPM as accurate and comprehensive as possible by meeting with subject matter experts across the Laboratory to incorporate the latest research. “We’re trying to evolve the model so it has the same level of high detail across every single functional area to tell us where we can focus research and help us find optimized solutions that we could propose to industry,” says Nelson.

Computer scientist Claudio Santiago and his colleagues also modernized IPM by porting its framework from Microsoft Excel to Python in December 2024, making it compatible with AI, ML, design optimization, and HPC to further inform designs. “Once we think about all the forcing functions such as minimum shot yield and materials requirements pinning us in from every direction, we end up with an optimized solution space. As we sharpen the pencil more with these tools, that optimized solution box gets smaller until eventually we’ve converged on a point design,” says IFE lead systems engineer Justin Galbraith. Galbraith and his team’s point design is called the Laser Driven Fusion Integration Research and Science Test Facility, or LD-FIRST, a proof-of-concept physics demonstration facility for IFE. “That point design, we anticipate, will serve as the foundation for a future public-private partnership that would facilitate building and realizing a physical facility to focus the IFE community in pursuit of fusion power on the grid,” says Galbraith.

Livermore is leading the charge in IFE, helping the United States develop a technological roadmap, growing and coordinating science and technology efforts within the Laboratory, and fostering partnerships across the fusion industry, academia, and government.

Ma chaired DOE’s “Basic Research Needs for IFE” workshop and report in 2022 and co-chairs the subcommittee providing recommendations on the nation’s fusion activities through DOE’s Fusion Energy Sciences Advisory Committee. She and her team travel often to Washington, D.C., working with DOE and legislators to expand fusion energy research and advocacy in the nation. Livermore also leads a “Collaboratory” with other DOE national laboratories to connect research project leads and facilitate public-private partnerships. The Collaboratory has hosted multiple events with industry, and the Laboratory has partnered with three private companies who aim to design pilot IFE plants.

Meanwhile, Galbraith and other IFE leaders have served as technical advisors for engineering design teams at Texas A&M University and given them IFE-relevant problems to solve, including advanced chamber and blanket design. Galbraith is working with Nelson to develop the IFE plant design portion of a high-energy-density science summer school program, which Nelson is leading in 2025 at the University of California at San Diego, and they have developed IFE curriculum that has been deployed at six universities starting in spring 2025. “We’re hoping we can get a group of students really excited about fusion and start to build up the next generation of engineers and scientists that will make fusion a reality,” says Galbraith. The team has led IFE strategic planning exercises at the Laboratory, and Lawrence Livermore will stand up a new fusion institute—named “LIFT,” for Livermore Institute for Fusion Technology—a research and development center that will coordinate and centralize institutional fusion energy research.

Harnessing IFE will be a massive undertaking, but Livermore’s broad and deep expertise, facilities, and capabilities put the Laboratory in a unique position to lead and play an impactful role. “If we can set it up correctly, IFE will be a big piece of the Laboratory’s long-term vision,” says Ma. “IFE plays off of our history and all of our strengths, and it is critical for long-term national security.”

History of Global Antagonisms: China

The famous Yale historian, Paul Kennedy, is well-known for two major works, The Rise and Fall of the Great Powers and The Rise of the Anglo-German Antagonism: 1860–1914. The former starts with a very powerful line:

“Rome fell. Scarsdale will fall.”

This gives us the theme of anxiety over national destiny and trajectory, which currently preoccupies the American mind.

In the second book, this antagonism question involves real and imaginary threats, and all of these anxieties and antagonisms are related. The masterpiece series, Downton Abbey, depicts a scene that takes place in the garden, where the Lord announces that they are at war with Germany, and his audience is perplexed, thinking, “How can we be at war? Germany is our biggest trading partner.” This teaches us that wars and the antagonisms that precede them are not solely based on rational factors like trade volumes.

Let us turn our attention to China. We are all aware, however vaguely, of the Chinese Exclusion Act of 1882. In the recent PBS television series, American Masters, the episode “Tyrus” (season 31, episode 7, aired September 8, 2017) has the artist Tyrus Wong recounting the story of his father, with whom he immigrated to California in 1920 at the age of 9. It is hard for us to believe that, as people of Chinese descent, they were forbidden from owning property outside of Chinatown. He describes his struggle with the hassles of overt racism. He did not gain his American citizenship until 1946, after the act was repealed. He came to fame with Disney’s Bambi, where he was the film’s lead artist.

This anti-China xenophobia was just as virulent in Europe, going back to the 19th century. Germany’s Kaiser Wilhelm II popularized the phrase “yellow peril” to demonize the Chinese and encourage the European empires to invade, conquer and colonize China. Another instance of this sentiment in its European guise was the writing of Theodor Fontane. His classic novel, Effi Briest, can be thematically compared to other novels on 19th-century marriage from a female perspective, such as Anna Karenina and Madame Bovary, which are also adultery tragedies. In the novel, there are discussions of people from all ethnicities crowding into German cities and towns.

“…But all the people who live in the little shipping and trading towns along the coast are immigrants from far away, who care little about the Kashubian hinterland because there’s nothing there for them, their concerns are elsewhere. What concerns them is where their trade is, and since they trade with the whole world and are in communication with the whole world, you find people among them from all corners of the globe. Which goes for Kessin too, backwater though it is.”

“But this is delightful, Geert. You keep calling it a backwater, but now, if you haven’t been exaggerating, I find that it’s a completely new world. All sorts of exotic things. Isn’t that right? That’s what you meant, isn’t it?”

He nodded.

“A whole world, I say, with perhaps a Negro or a Turk, or perhaps even a Chinaman.”

“A Chinaman too. What a good guess. We may still have one, we certainly did have; he’s dead now, buried in a little plot with a railing round it next to the churchyard. If you’re not afraid I’ll show you his grave sometime. It’s in the dunes with just some marram grass round it and a little immortelle here and there, and the sound of the sea all the time. It’s very beautiful and very eerie.”

“Yes, eerie — I would like to know more about it. Or maybe rather not, I invariably start imagining things and then I have dreams, and I don’t want to see a Chinaman approaching my bed tonight when I hope I’ll be sleeping soundly.”

“Well, he won’t.”

“Well, he won’t. Listen to that. How odd it sounds, as if it were somehow possible. You’re trying to make Kessin interesting for me, but you’re rather overdoing it. Are there many foreigners like that in Kessin?”

“A great many. The whole town consists of foreigners like that, people whose parents or grandparents lived somewhere else altogether.”

“How very peculiar. Tell me more, please. But nothing sinister. A Chinaman, I think, is always a bit sinister.”

Theodor Fontane, Effi Briest, Penguin Books, translated from the German by Hugh Rorrison and Helen Chambers, 1967, page 33.

Notice the quote, “…I don’t want to see a Chinaman approaching my bed tonight when I hope I’ll be sleeping soundly.” This character echoes similar sentiments several more times above.

This “othering” of the Chinese in the novel continues:

Innstetten laughed. “We’re seventy miles further north than Hohen-Cremmen here and you have to wait a while for the first polar bear. I think you’re feeling the strain of the long journey, what with the St. Privat panorama and the story of the Chinaman and everything?”

“You didn’t tell me any story.”

“No, I just referred to him. But the mere mention of a Chinaman is a story in itself…”

Theodor Fontane, Effi Briest, Penguin Books, translated from the German by Hugh Rorrison and Helen Chambers, 1967, page 35.

“What was it all about?”

“Oh, some nonsense: an old ship’s captain with a granddaughter or a niece who disappeared one fine day, and then a Chinaman, who may have been her lover, and in the hallway there was a little shark and a crocodile, both suspended on strings and always in motion. Makes a marvellous story, but not now. There are all kinds of other things flitting through my mind.”

Theodor Fontane, Effi Briest, Penguin Books, translated from the German by Hugh Rorrison and Helen Chambers, 1967, page 177.

All of this global antagonism-watching and paranoia is disconcertingly related to our current situation. Donald Trump and the Republicans are essentially entrepreneurs of hatred. As is widely misattributed to Mark Twain, “history doesn’t repeat itself, but it often rhymes.”

Economics-Watching: Where Could Reshoring Manufacturers Find Workers?

[from the Federal Reserve Bank of Cleveland, 9 October, 2025]

by Stephan D. Whitaker, Senior Policy Economist

The United States has lost millions of manufacturing jobs in recent decades, but a variety of policies have been enacted to incentivize the creation of manufacturing jobs in America. This District Data Brief analyzes where manufacturers might find US workers to fill these roles.

Introduction

The announcement of new tariffs this year has reignited the discussion of whether the United States can expand its manufacturing employment by millions of workers. Reversing decades of manufacturing job losses is one explicit goal of the new higher tariffs. This District Data Brief presents measures of employment and demographics as context around the current and potential employment in US manufacturing. Raising manufacturing employment by 4 to 6 million workers would constitute a large increase relative to current levels. However, an increase of this scale would not be large relative to the global growth of manufacturing employment in recent decades, the current US labor force size, or the number of US adults not engaged in high-paying work.

With different priorities and approaches, policymakers have spent much of the past decade addressing issues related to the loss or absence of manufacturing in the United States. For example, America’s dependence on imported manufactured goods was highlighted at the beginning of the COVID-19 pandemic as supply chain disruptions led to shortages of medical equipment, pharmaceuticals, microchips, and other products. The CHIPS and Science Act and the Inflation Reduction Act featured tax breaks and subsidies to expand US manufacturing capacity for semiconductors, electric vehicles, and renewable energy equipment.

At the same time, economists have been documenting the loss of work opportunities and earning power by workers without college degrees as manufacturing employment has declined. In 2013, David Autor, David Dorn, and Gordon Hanson published a study that estimated the labor market impacts resulting from increased trade competition following China’s entrance into the World Trade Organization, an effect often referred to as the “China shock.” Dozens of studies have since used the regional variation in job and income losses caused by the China shock to measure the adverse impacts of job displacement on family structures, crime, health, and other social indicators. Some supporters of industrial subsidies and higher tariffs have expressed the hope that these dynamics can be put into reverse.

Read the full article [archived PDF].

Economics-Watching: Estimating the Effects of Monetary Policy: An Ongoing Evolution

New monetary policy tools have lengthened the interval over which policy news is transmitted and processed.

[from the Federal Reserve Bank of Kansas City, 2 October 2025]

by Karlye Dilts Stedman, Amaze Lusompa & Phillip An

Disentangling how the economy responds to a monetary policy decision from its response to macroeconomic conditions at the time of the decision is an ongoing challenge. One popular method researchers use to measure the effect of a monetary policy announcement—high-frequency identification—analyzes the reaction of fast-moving financial variables immediately following the policy announcement, using a time window long enough for markets to respond but not so long that the response is contaminated by other information.

Since high-frequency identification was introduced in the early 2000s, policymakers have introduced tools such as forward guidance and large-scale asset purchases. Karlye Dilts Stedman, Amaze Lusompa, and Phillip An examine how the evolution of monetary policy has changed high-frequency identification and assess whether additional changes might be necessary to better capture the effect of modern monetary policy surprises. Although researchers have continually updated the asset mix used in high-frequency identification over time, they have not updated the measurement window. Because the timing of monetary policy communication has changed significantly in recent years, refining the length of this measurement window may be necessary going forward.

Read the full article [archived PDF].

Economics-Watching: Tracking the Economy in Real‑Time Through Regional Business Surveys

[from the Federal Reserve Bank of New York’s The Teller Window, 23 September 2025]

by Richard Deitz and Kartik Athreya

Federal Reserve policymakers need current information about economic conditions to make well-informed monetary policy decisions. But hard data, such as GDP and the unemployment rate, is released with a significant lag, making it difficult to get a precise, real-time read on the economy, especially during times of rapid change.

To help fill the gap, the New York Fed conducts two monthly regional business surveys: the Empire State Manufacturing Survey of manufacturers in New York state and the Business Leaders Survey, which covers service sector firms in New York state, northern New Jersey, and Fairfield County, Conn. These surveys provide timely soft data, available well before hard data is released.

Hard data is based on precise quantitative measurements, such as sales figures or the specific prices firms are charging. By contrast, soft data is qualitative, focusing on trends, expectations, and sentiment around economic activity. And while hard data looks backward, soft data from the regional surveys can look forward—providing important information about expectations for the future and emerging trends.

Gathering soft data quickly can be impactful—for example, the Empire State Manufacturing and Business Leaders surveys signaled a sharp downturn in economic activity in early March 2020 [archived PDF], providing a warning weeks before official statistics captured the full extent of the COVID pandemic’s economic impact.  

How the Surveys Work

The New York Fed launched the Empire State Manufacturing Survey in 2001. It was modeled after the Philadelphia Fed’s Business Outlook Survey, a long-running manufacturing survey that has historically been watched by financial markets and policymakers as an early signal about national manufacturing conditions. The Business Leaders Survey was launched later in 2004 and was among the first regional business surveys to target the service sector.

The surveys are sent to over 300 business executives and managers at firms across industries during the first week of every month. While about two-thirds of participating firms have 100 or fewer employees, some have hundreds or thousands of workers.

Leaders at the firms fill out a short questionnaire asking if business activity has increased, decreased, or stayed the same compared to the prior month. The surveys ask about indicators such as prices–yielding insights into inflationary pressures–as well as employment, orders, and capital spending. Respondents answer questions about how they expect these indicators to change over the next six months, offering a forward-looking perspective on the economy’s trajectory.

From the responses, New York Fed researchers construct diffusion indexes by calculating the difference between the percentage of firms reporting increased activity and those reporting decreased activity. Positive values indicate that more firms say activity increased than decreased, suggesting activity expanded over the month. Higher positive values indicate stronger growth, while lower negative values indicate stronger declines.

The surveys include local businesses, like restaurants and car dealerships, as well as firms with national and global reach, such as software manufacturers and shipping enterprises. As a result, the economic indicators derived from the surveys are often early predictors of national economic patterns, frequently aligning with hard data released later.

Getting Answers on Current Issues

The surveys regularly ask supplemental questions about current economic issues to get real-time answers. Over the last few years, the surveys have asked about firms’ experience with tariffs, inflation expectations, if the use of AI is leading to a reduction in employment, how often employees work from home [archived PDF], and whether supply availability was affecting their businesses.

Going Beyond the Indicators

In addition to providing data to track economic conditions, the regional surveys also provide a channel to hear directly from local business leaders. Every month, survey respondents are asked for their comments, offering the opportunity for businesses to share their thoughts, concerns, and experiences with the New York Fed. This helps researchers and policymakers understand how businesses are being affected by economic conditions.

The surveys act as one of the bridges between the New York Fed and the business community, ensuring the voices of regional businesses are considered in economic assessments and policy discussions as well as enhancing the ability of policymakers to make informed decisions to respond effectively to economic challenges.

Executives, owners, or managers of businesses in New York, northern New Jersey, or Fairfield County, Conn., interested in participating in the New York Fed’s monthly business surveys can find more information here. The next survey results will be released on Oct. 15 and 16.