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Join us for a review and preview of Q2 Externalities.


Q2 2023 (Review)

In Q2 2023, the overarching theme that emerges from this collection of Externalities is one of navigating complexity and change in an increasingly interconnected world. The quarter was characterized by a confluence of diverse issues, each with far-reaching implications and potential ripple effects across multiple sectors.

The news headlines space was dominated by Biden, Trump, Russia, Ukraine, and China. The highest frequency of adjacent terms to those names provides us with a sense of ‘what’ was propelling them to the forefront and ‘why’. For instance, Biden and Kevin McCarthy were closely linked due to the debt ceiling debate nearing its resolution and the avoidance of a U.S. default on its debt. Meanwhile, China garnered a disproportionate amount of attention regarding its geopolitical tensions with the U.S., flanked by Taiwan due to Secretary Blinken’s visit to Beijing, and Russia, due to the support it received from China following the Wagner insurrection.

Several topics of particular interest throughout the quarter included the rapid development of emerging technologies, spurred by OpenAI releasing its ChatGPT demo to the public, student loan forgiveness amidst the battle between the White House and Congress over student debt burdens, and how bank collapses at that time and market volatility brought risk management strategies and regulatory responsibilities to the forefront of public discourse.

Q2 2024 (Preview)

Since we’re currently at the beginning of Q2 2024, we’ll need to adopt a more forward-looking perspective. This can be achieved by merging our understanding of what transpired around this time last year with how Q1 of this year concluded. From the standpoint of ‘Invariants’, we recognize this is an election year (thus the frequent mentions of Trump/Biden and their direct associations with one another); from the ‘Variations’ perspective, we are aware that the Federal budget process was delayed (again) but has now reached a resolution, setting the stage for mark-ups; and from an ‘Atmospherics’ viewpoint, the Israel/Gaza conflict has dominated the news headlines more than any other topic so far this year. Less ‘noisy’ (but equally relevant) topics are likely to surface, such as the Federal Reserve’s pivot towards potentially lowering rates, the U.S. economic implications of the US CHIPS Act and the Inflation Reduction Act as more awards are announced, and the interplay between AI advancement and policy/regulation.


Q2 2023 (Review)

In Q2 2023, the externalities landscape was shaped by the dynamics of political transitions, societal opinion shifts, immigration policy, student loan debates, economic fluctuations, risk management imperatives, disaster preparedness challenges and technological innovations. Each of these elements played a distinct role in influencing policy and strategy, necessitating nuanced approaches to decision-making and policy formulation.

Political transitions and the public’s reaction to issues like student loans and immigration highlighted the invariance of governance changes and societal views, respectively, signaling a constant need for adaptability in leadership and policy responsiveness. Immigration policies and economic trends, with their unpredictability and direct impact on the labor market and economic stability, acted as variations, introducing cyclical yet unpredictable challenges. Meanwhile, the rapid evolution of technologies such as AI, and its emerging impact on education, embodied the atmospheric nature of societal and policy responses to emerging challenges, where rapid shifts in public sentiment and technological advancements necessitated a forward-thinking and balanced approach to innovation and societal well-being.

The critical importance of risk management strategies for financial stability and the escalating need for disaster preparedness in response to natural calamities underscored the constant and unpredictable challenges posed by economic, regulatory, security, and environmental factors.

This period illustrated the ongoing interplay between invariants, variations, and atmospherics in shaping the landscape, pointing towards a future that demands strategic foresight, adaptability, and a deep understanding of these dynamics to navigate the uncertainties ahead.

Q2 2024 (Preview)

Q2-Q3 2024 will be shaped by key trends and issues, framed by procedural invariants and variations in budget resolutions, appropriations, and committee markups. The budget resolution period in late April to mid-May will spark debates on funding allocations, influenced by recent events in Gaza and the Red Sea. These events may shift foreign aid and defense spending priorities, impacting appropriations markups from mid-May to mid-June, intensifying the focus on national security and diplomacy, with potential effects on global partnerships and sanctions.

Committee markups in late June to mid-July will intersect with domestic policy debates, particularly around the 2024 elections. Freedom of speech, misinformation, and AI regulation will be prominent issues. The CHIPS Act and the defense industrial base, amid tensions with China over Taiwan, will be crucial in these markups, with implications for the tech industry, national security, and the U.S.’s global technological position.

The mid-session review in July-August will assess progress on legislative priorities against the backdrop of international and domestic events, offering insights into the government’s adaptive strategies in response to global conflicts and technological developments.

AI advancements will drive innovation while raising ethical and regulatory challenges, influencing the tech sector and broader debates around free speech and election integrity.


Q2 2023 (Review)

In Q2 2023, we analyzed public sentiment across various topics, including disaster preparedness, student loan forgiveness, AI in education, risk management in financial institutions, political transitions, economic shifts, immigration, public opinion, emerging technologies, and security sector assistance.

Our analysis revealed that community engagement and personal responsibility were widely supported in disaster preparedness efforts, with calls for increased government funding and resources. Opinions on student loan forgiveness were divided, with proponents highlighting economic benefits and critics raising concerns about moral hazard and taxpayer burden.

The integration of AI in education generated both optimism for personalized learning and concerns about equity, privacy, and ethical considerations. Public sentiment towards failed banks was influenced by economic impact, trust, government response, and media coverage.

Political transitions elicited discomfort due to uncertainty, polarization, lack of trust, policy concerns, and media influence. Economic shifts related to inflation, employment, and the debt limit significantly impacted public sentiment. Immigration opinions varied, with recent surveys indicating majority support for pathways to citizenship and viewing immigrants positively.

Emerging technologies evoked caution, with concerns about ethics, job displacement, safety, environmental impact, and social implications. Security sector assistance sentiment was nuanced, balancing benefits of stability and capacity-building with risks of human rights abuses, corruption, and dependence.

Q2 2024 (Preview)

Looking ahead to 2024, we anticipate continued focus on these topics, with evolving public sentiment shaped by new developments and events.

In disaster preparedness, we expect increased emphasis on climate change adaptation and resilience, as extreme weather events become more frequent. Student loan forgiveness discussions may shift towards broader higher education affordability and accessibility reforms.

As AI adoption accelerates in education, sentiment will likely be influenced by the effectiveness of regulation, transparency, and efforts to mitigate biases. The stability of the financial sector and the adequacy of risk management practices will remain under scrutiny.

Political transitions in 2024, particularly the U.S. presidential election, will be closely watched, with sentiment reflecting the level of trust in the electoral process and the ability of leaders to bridge divides.

Economic recovery from the COVID-19 pandemic, inflation management, and the transition to a green economy will be key drivers of public sentiment. Immigration reform efforts and their impact on public opinion will depend on the balance struck between border security and humanitarian considerations.

Public trust in institutions and the media will continue to shape sentiment on various issues. The responsible development and deployment of emerging technologies, such as AI, biotech, and quantum computing, will be crucial in determining public acceptance. Finally, security sector assistance programs will be evaluated based on their effectiveness in promoting stability, human rights, and sustainable local capacity-building.