The Five-Stage Cascade: How I Watched Economic Nonsense Become Policy in Real-Time
P3.1.1: Part I of The Immune System Series
September 5, 2024. I’m watching the Economic Club of New York event. Former President Trump is speaking to a room full of business leaders—people who understand economics, who’ve built companies, who know how trade works.
Reshma Saujani, founder of Girls Who Code, asks a straightforward question about childcare costs. She cites the numbers: $122 billion annually, costing more than rent for working families, preventing women from joining the workforce. She asks what specific legislation he would prioritize to make childcare affordable.
The answer that follows is... I’m still not sure how to describe it. Something about tariffs. And “taxing foreign nations at levels they’re not used to.” And childcare being “relatively speaking, not very expensive compared to the kind of numbers we’ll be taking in.” And eliminating deficits. And waste and fraud.
I watched it twice to make sure I heard it correctly. (You can watch the full exchange yourself on C-SPAN or read the PBS coverage.)
My immediate thought: “That makes no economic sense whatsoever.”
My second thought: “Of course no one’s going to challenge this. They never do.”
And I was right. But what I didn’t know yet was that I was about to watch something far more disturbing than one unchallenged incoherent answer. I was about to watch a lie become policy in five predictable stages.
A Note on Examples
I’m using the September 5th tariff exchange as my primary example because I watched it happen in real-time and it perfectly demonstrates all five stages. Yes, this involves Trump. The mechanism I’m showing you is nonpartisan—it works regardless of who’s speaking—but you need a clear, documented example to see how it operates. The pattern is the problem, not the person. Once you understand the mechanism, you’ll recognize it everywhere.
Stage 1: Initial Nonsense (No Filter at Point of Origin)
Here’s what happened at the Economic Club forum:
A serious policy question received a two-minute answer that mixed unrelated concepts with no causal mechanism connecting them:
Tariffs (but called “taxing other countries”)
Childcare costs (the actual question)
General prosperity (”it’s relatively speaking, not very expensive compared to the kind of numbers we’ll be taking in”)
Deficit elimination
Waste and fraud reduction
No explanation of how A leads to B. No economic logic. Just... word association. (The Washington Post also covered the exchange and called it a “confusing answer.”)
I understand economics. I’ve spent time learning how trade works, how tariffs function, what tax incidence means. So I knew immediately: tariffs are taxes paid by domestic importers, not foreign countries.[^5] They raise prices for American consumers. They don’t “fund” anything that wouldn’t be better funded by literally any other revenue mechanism.
Here’s what should have happened in that room:
Option 1: Moderator interrupts: “I’m sorry, can you clarify how tariffs would specifically address childcare costs? Can you walk us through the mechanism?”
Option 2: Other panelists challenge: “That’s not how tariffs work. They’re paid by domestic importers, not foreign governments.”
Option 3: Audience pushback: Visible confusion, follow-up questions, someone asking for specifics.
Option 4: Real-time fact-checking: “The candidate has just made a claim that contradicts basic economics.”
Here’s what actually happened:
Polite applause. No challenge. Forum continues. Everyone moves on as if a policy position had been stated.
Reshma Saujani, the questioner, later said the answer “blew my mind” and was “incomprehensible.”[^1] Brian Riedl, a conservative economist at the Manhattan Institute, called it “rambling gibberish” and “incoherent word salad.”[^2]
But in the moment? Silence. The system had no immune response at the point of entry.
This is the critical failure. Our political system has no filter that says “wait, this violates basic economics.” That room full of Economic Club members—typically business leaders and financial professionals—likely included many who recognized the economic problems with the answer. But social norms, media norms, and institutional norms all prevent calling out incoherence in real-time.
The infection began here. And there was no defense.
Stage 2: Media Translation (Nonsense Becomes “News”)
Over the next 24-48 hours, I watched the news coverage evolve.
Journalists had a problem: How do you report on an incoherent answer? If you write “Candidate gives rambling, economically illiterate response to childcare question,” you sound partisan. You sound like you’re editorializing. You risk losing access.
So the media did what it’s trained to do: extract signal from noise. Find the “policy position.” Make sense of the senseless.
The translation process:
Input: Two minutes of word salad mixing tariffs, childcare, deficits, and prosperity with no connecting logic
Media processing: “What was he trying to say? What’s the concrete policy element here?”
Output: “Trump proposes using tariff revenue to address childcare costs”
Watch what happened: The lie became structured.
Headlines across outlets followed a predictable pattern. The Washington Post described it as a “confusing answer,” while other major outlets began framing it as a concrete policy proposal about using tariff revenue for childcare. The incoherence was smoothed away. The economic impossibility was framed as a “controversial proposal” or a “plan that economists debate.”
Why does this happen?
It’s not because journalists are stupid or malicious. It’s because the incentive structure makes this the rational choice:
Calling it incoherent = risky: Seems biased, might lose access, gets you labeled as “in the tank” for one side
Reporting it as policy = safe: Maintains the appearance of neutrality, preserves access, follows professional norms
Controversy = profitable: “Trump’s childcare plan sparks debate” gets more clicks than “Candidate gives incoherent answer”
Here’s the critical insight: By treating nonsense as a legitimate policy position worthy of debate, the media gave it legitimacy.
The word “tariffs” started appearing everywhere. Not “incoherent answer.” Not “economically illiterate response.” Just... tariffs. A thing. A policy. Something real enough to discuss.
Stage 2 complete. The lie now has structure, has legitimacy, has entered the discourse as something real rather than something nonsensical.
Stage 3: Viral Spread (Optimized for Replication, Not Accuracy)
Within days, the soundbite emerged: “Tax other countries to pay for childcare.”
Simple. Emotionally satisfying. Memorable. And completely wrong.
But here’s why it spread:
Simplicity: Fits in a tweet, a chyron, a conversation. No economics degree required to repeat it.
Emotional resonance: Plays on economic anxiety and nationalism. “Make them pay for us.” Feels good.
Social proof: “Everyone’s talking about tariffs.” Must be legitimate.
Zero cost to repeat: Don’t need to understand how tariffs work to say “he wants to tax other countries.”
Tribal signaling: Becomes identity marker, not policy position. Supporting or opposing it signals which team you’re on.
The virality mechanics are brutal:
Each share requires zero verification
Correction requires paragraphs of explanation
Lie moves at speed of social media
Truth moves at speed of careful analysis
This is asymmetric warfare
I started seeing it everywhere. Friends, family, coworkers mentioning “tariffs” as a solution to childcare costs. When I asked “how would that work specifically?” I got blank stares. No one could explain the mechanism. But everyone had heard about it.
We have systems optimized for virality but no immune system for accuracy. The most shareable idea wins, regardless of truth.
Stage 4: Social Proof (Everyone Knows It, Must Be Real)
By this point, something shifts in public consciousness.
“If everyone’s talking about it, it must be a real thing.”
“Smart people wouldn’t all be discussing something that’s nonsense.”
“It’s been in the news for weeks, surely someone checked it.”
This is the social proof cascade. The lie has been repeated so many times, from so many sources, that it acquires legitimacy through sheer volume.
Notice the reasoning: Not “the evidence shows this is true,” but “the consensus assumes this is real.”
Rational ignorance kicks in: Why would I spend hours learning trade economics when everyone who seems informed is already discussing tariffs as viable policy? If there was a problem with it, surely someone would have said something by now.
The system mistake gets mistaken for system validation. The fact that the lie survived and spread becomes evidence of its legitimacy.
Stage 5: Failed Corrections (Truth Too Late, Too Complex, Too Slow)
So I tried. I really did.
I explained to friends, family, coworkers: “Here’s how tariffs actually work. The U.S. importer pays the tariff to the U.S. government when goods enter the country. The importer passes that cost to consumers through higher prices. We’ve seen this pattern repeatedly—Smoot-Hawley in the 1930s,[^6] the 2018-2019 trade war.[^7] There’s near-universal economist consensus on this.”
Here’s what I was asking people to do:
Stop what they’re doing and focus
Understand a multi-step economic mechanism
Question authority (media, politicians, social proof)
Admit they might have been wrong
Accept an uncomfortable truth (economic nationalism doesn’t work like you think)
Trust me over “everyone else”
Why did it fail?
The timing asymmetry: By the time I had formulated my explanation, the lie had already saturated the discourse. I was trying to bail water from a flooded boat.
The complexity barrier: My explanation required effort. The lie required none. In the attention economy, effort loses.
The social cost: I was asking people to go against consensus, to be the contrarian. That’s psychologically expensive.
The tribal signal: For some, this had become identity, not policy. Challenging it felt like a personal attack.
The exhaustion factor: This was issue #47 people were supposed to research this week. They were tired.
There’s a pattern here you might recognize. It’s similar to what researchers at the RAND Corporation documented about the Putin/Trump communication strategy: the “firehose of falsehood.”[^3] Vox’s Carlos Maza did an excellent breakdown of this technique[^4] showing how it works in practice.
The mechanism:
Put out a lie
By the time experts formulate a response
And verify their facts
And publish their analysis
It’s old news
The discourse has moved on to lies #2 and #3
By the time your correction publishes, they’re on lie #5
The goal isn’t belief—it’s exhaustion. You don’t need people to believe the lie. You just need them to be too tired to fight it.
By the time truth arrives, the battle is already over.
The tariff example is far from unique. You’ll see this same cascade with “eating dogs” claims[^8] that go viral before verification, crime statistics debates[^9] where perception contradicts data, windmills-and-cancer claims[^10] that get news cycles despite being absurd—across topics and across actors. The mechanism doesn’t care about content or ideology. It cares about virality vs. accuracy, speed vs. truth, social proof vs. verification. That’s why it’s a system problem, not a people problem.
Now You Can See the Pattern
Let me recap the five stages:
Stage 1: Initial Nonsense – No filter at point of origin. Incoherent claims enter the system unchallenged.
Stage 2: Media Translation – Nonsense becomes “news.” Journalists extract “policy positions” from gibberish to maintain neutrality.
Stage 3: Viral Spread – Optimized for replication, not accuracy. Simple lies beat complex truth.
Stage 4: Social Proof – “Everyone knows this.” Social consensus substitutes for verification.
Stage 5: Failed Corrections – Truth too slow, too complex, too late. The lie has already won.
The uncomfortable truth: This isn’t unique to tariffs. This isn’t unique to one politician. This is how the system works now.
You now have a framework. When you see an incoherent claim that gets translated into policy talk, when you see something go viral before it’s verified, when you notice “everyone’s talking about it” substituting for “it’s true,” when you watch corrections arrive after discourse has moved on—you’re watching the five-stage cascade in real-time.
This is why I couldn’t stop the tariff lie alone. This is why smart, well-meaning people repeated economic nonsense. This is why fact-checking failed.
Because it’s not a people problem. It’s a system problem.
What This Means
I understand economics. I do first-principles analysis. I can recognize fundamental truths that others miss. And I couldn’t stop this.
Not because I’m not smart enough. Not because I didn’t try hard enough. But because one person can’t fix a system problem.
You can’t fix what you can’t see. Now you can see it.
That’s step one.
But seeing the pattern raises the question: Why does our system work this way? Why is there no immune response?
Every other high-stakes system has filters, has quality control, has mechanisms to stop bad information at the source. Markets have price signals. Science has peer review. Engineering has safety standards. Medicine has clinical trials.
Why doesn’t our political system have an immune system for lies?
That’s what we’ll explore in Parts 2 and 3.
Part 2 will show you why every obvious fix has failed—why better journalism doesn’t solve it, why fact-checking doesn’t work, why “media literacy” isn’t enough. I’ll show you what systems that work have that politics lacks, and why this is one of the hardest problems in modern governance.
Part 3 will elevate the stakes to where they actually are: If our system can’t handle “tariffs are a sales tax,” what happens when we need it to handle education, AI regulation, healthcare reform, homelessness, or pandemic response? And what can we actually do about it?
Because here’s what I’ve learned: The obvious solutions don’t work. The problem is deeper than you think. And the stakes are higher than you imagine.
But you can’t begin to fix something until you understand why it’s broken.
You’ve seen what’s broken. Next, we’ll figure out why.
Updated Tue Nov 11 2025 - added references #8, #9, #10, and simplified ‘A Note on Examples’ section based on reader feedback.
We will add a link to Part 2: “We Have Virality But No Immune System—Why Every Fix Has Failed” when it is published.
The Statecraft Blueprint | Part 1 of The Immune System Series
References
[^1]: Saujani, Reshma. “I Asked Trump the Viral Question About Childcare. What His Answer Tells Us.” TIME, September 10, 2024. https://time.com/7019528/trump-childcare-reshma-saujani-essay/
[^2]: Kapur, Sahil. “’Incoherent word salad’: Trump stumbles when asked how he’d tackle child care.” NBC News, September 6, 2024. https://www.nbcnews.com/politics/2024-election/trump-stumbles-whether-prioritize-child-care-costs-rcna169922
[^3]: Paul, Christopher and Miriam Matthews. “The Russian ‘Firehose of Falsehood’ Propaganda Model: Why It Might Work and Options to Counter It.” RAND Corporation, 2016. https://www.rand.org/pubs/perspectives/PE198.html
[^4]: Maza, Carlos. “Why obvious lies make great propaganda.” Vox Strikethrough, August 30, 2018. While the original Vox video has been removed from YouTube, analyses and discussions of it can be found at: https://propaganda.mediaeducationlab.com/rate/why-obvious-lies-make-great-propaganda
[^5]: For a comprehensive explanation of tariff incidence, see: Amiti, Mary, Stephen J. Redding, and David E. Weinstein. “The Impact of the 2018 Tariffs on Prices and Welfare.” Journal of Economic Perspectives 33, no. 4 (2019): 187-210.
[^6]: Irwin, Douglas A. “The Smoot-Hawley Tariff: A Quantitative Assessment.” Review of Economics and Statistics 80, no. 2 (1998): 326-334.
[^7]: Flaaen, Aaron, and Justin Pierce. “Disentangling the Effects of the 2018-2019 Tariffs on a Globally Connected U.S. Manufacturing Sector.” Federal Reserve Board Finance and Economics Discussion Series 2019-086 (2019).
[^8]: During the September 10, 2024 presidential debate, Trump claimed Haitian immigrants in Springfield, Ohio were “eating the dogs” and “eating the cats.” Springfield City Manager Bryan Heck confirmed no credible reports supported these claims. PolitiFact rated the claim “Pants on Fire” and later named it their 2024 Lie of the Year. See: PolitiFact. “Trump repeats baseless claims that Haitian immigrants in Springfield, Ohio, are eating pets.” September 11, 2024. https://www.politifact.com/factchecks/2024/sep/11/donald-trump/trump-repeats-baseless-claims-that-haitian-immigra/; PolitiFact. “’They’re eating the pets’: Trump and Vance earn PolitiFact’s 2024 Lie of the Year.” December 17, 2024. https://www.politifact.com/article/2024/dec/17/theyre-eating-the-pets-trump-vance-earn-politifact/
[^9]: FBI data showed violent crime decreased 3.0% in 2023, with murder down 11.6%, yet Gallup polling found 77% of Americans believed crime had increased. This perception-reality gap persisted despite continued declines. See: FBI. “FBI Releases 2023 Crime in the Nation Statistics.” September 23, 2024. https://www.fbi.gov/news/press-releases/fbi-releases-2023-crime-in-the-nation-statistics; Gallup. “More Americans See U.S. Crime Problem as Serious.” November 16, 2023. https://news.gallup.com/poll/544442/americans-crime-problem-serious.aspx; Brennan Center for Justice. “Violent Crime Is Falling Nationwide — Here’s How We Know.” https://www.brennancenter.org/our-work/analysis-opinion/violent-crime-falling-nationwide-heres-how-we-know
[^10]: At an April 2, 2019 NRCC dinner, Trump claimed “the noise causes cancer” from wind turbines. The American Cancer Society stated they were “unaware of any credible evidence” for this claim. PolitiFact rated it “Pants on Fire.” See: FactCheck.org. “Trump’s Faulty Wind Power Claims.” April 4, 2019. https://www.factcheck.org/2019/04/trumps-faulty-wind-power-claims/; PolitiFact. “Donald Trump’s ridiculous link between cancer, wind turbines.” April 8, 2019. https://www.politifact.com/factchecks/2019/apr/08/donald-trump/republicans-dismiss-trumps-windmill-and-cancer-cla/