The Pacific Thread.

Over the past week I have been writing about the Pacific: Admiral Paparo and INDOPACOM, the fall of Singapore, the Japanese occupation, the Tokyo war crimes tribunal, and the danger of believing your own propaganda. These are different subjects with different time horizons, but they share a common thread, and the thread is about institutions.

The question running through all of it is whether the strategic architecture of the Pacific depends on institutions or on individuals. The answer should be institutions. The alliances, the command structures, the diplomatic relationships, the trade frameworks, these are supposed to be durable enough to survive changes in leadership, shifts in political attention, and the ordinary friction of democratic governance. The whole point of institutional design is that the system works even when the individuals running it are imperfect, distracted, or replaced.

The historical record suggests that the Pacific has not always worked this way. The fall of Singapore was an institutional failure, not a personal one. Lieutenant-General Percival has been debated for eighty years, and his generalship was certainly not distinguished. But the museum at the Former Ford Factory makes clear that the problem was systemic. The Colonial Office, the Admiralty, and the War Cabinet had all allowed the narrative of "Fortress Singapore" to substitute for the reality of adequate forces, current equipment, and a strategic concept matched to the adversary's actual capabilities. Percival was given contradictory orders, inadequate resources, and a strategy that had already been overtaken by events. He was left to manage the consequences of institutional failure, and the fortress fell in 55 days.

The Fall of Singapore.

The Tokyo tribunal was an attempt to build an institution after the fact, to create a legal and factual record that would serve as the foundation for a new order. In many ways it succeeded: it established principles of command responsibility, compiled an evidentiary record of genuine value, and demonstrated that aggressive war could be subjected to legal accountability. But the institution's legacy has been eroded by the very narratives it was meant to settle. The tribunal's work has been simplified by partisans on all sides, and the common factual ground it established has largely fragmented into national narratives that contradict each other. The institution did its work; the political commitment to sustain that work did not hold.

The Paparo story is the present-tense version of the same problem. The Economist describes him as "a rare instance of consistency" in American engagement with the Pacific. That is a compliment to Paparo. It is also, read carefully, an indictment of the system. If the consistency of American strategy in the most consequential theater on earth depends on the personal relationships and political skill of one four-star admiral, then the institutional architecture is more fragile than it appears. Paparo's predecessors built relationships too, and those relationships mattered. But the current situation is different in degree if not in kind, as the diplomatic corps has been hollowed out, the defense strategy has formally deprioritized Asia, and the president's attention is elsewhere. The institutional support structure that is supposed to surround and sustain the INDOPACOM commander has thinned considerably, and what remains rests heavily on Paparo's individual competence.

Tokyo Tower

The danger of believing your own propaganda is the thread that ties all of this together. The British believed "Fortress Singapore" and did not invest in the actual defenses the fortress required. The Japanese believed the Co-Prosperity Sphere and could not distinguish ideology from interest until the distinction no longer mattered. The contested memory of the Tokyo tribunal has produced national narratives that shape present-day alliances in ways that often bear little resemblance to the tribunal's actual findings. In each case, a narrative that began as a useful simplification became a substitute for reality, and the gap between the two only became visible when it was tested.

The present-day Pacific has its own narratives, and they deserve scrutiny. The "unmanned hellscape" is a deterrence concept with real technological substance behind it, but it is also a story, and stories can become assumptions. The presumed US defense of Taiwan is a pillar of the regional order, but pillars require maintenance, and the question of whether the political will exists to honor that commitment under fire has not been tested. The Philippines reef confrontations test alliance credibility in slow motion, one water cannon incident at a time, and the results so far are ambiguous. China's assertion that Taiwan's return is inevitable is a narrative commitment that constrains Beijing's own options in ways that may not serve its interests.

None of this means the Pacific order is about to collapse. The alliances are real, the military capabilities are substantial, and the people doing the work, the officers, the diplomats, the analysts in windowless rooms near Waikiki Beach, are serious and competent. But seriousness and competence at the working level are not sufficient if the institutional and political commitments above them are thin. The former Ford Factory in Singapore is a quiet building on a quiet road, and the story it tells is a quiet story: how a great power allowed a narrative to substitute for substance, how the gap between the two widened without anyone noticing until it was too late, and how the individual left holding the position was given an impossible task. The parallels to the present are not exact, and they do not need to be. The question is not whether Paparo is Percival. The question is whether the system behind Paparo is stronger than the system behind Percival, and whether the people responsible for that system are paying attention. The fortress fell in 55 days.

Believing Your Own Propaganda.

At a Japan America Affairs Council event in Cupertino last year, hosted by NTT, I spoke with Kenneth Faulve-Montojo, a professor from Santa Clara University who described the Philippines' ongoing confrontation with China over contested reefs in the South China Sea. The details were specific: Chinese coast guard vessels harassing Philippine resupply missions to Second Thomas Shoal, water cannons deployed against wooden boats, collisions at low speed, a Philippine sailor losing a thumb to shrapnel from a water cannon blast. Each incident falls below the threshold of armed conflict. Taken together, they represent a sustained challenge to Philippine sovereignty and, more importantly, a slow-motion test of the US mutual defense treaty. The professor's point was sharp: this is the real confrontation in the Pacific right now, and it is happening every week.

He then drew a contrast with Taiwan. The Taiwan scenario is the most consequential military contingency in the world: a Chinese amphibious invasion of a democratic island of 23 million people, with the potential to draw in the United States, Japan, and possibly others. It is also, for the moment, theoretical. It has not materialized, and there are reasonable arguments that it may never. The gap between the tangible, daily friction over Philippine reefs and the theoretical, catastrophic scenario over Taiwan is not just a difference of scale. It is a difference of kind, and it creates a particular problem for strategic planning: how do you prepare for the hypothetical without neglecting the actual?

That question has historical precedent, and the answer is not encouraging. The British Empire spent decades preparing for a theoretical defense of Singapore as an impregnable fortress, the "Gibraltar of the East." The strategy assumed the fortress would hold until the fleet arrived. The fleet never came. When the Japanese attacked in December 1941, they did not assault the fortress directly. They came through the Malay Peninsula, moving quickly through terrain the British had assumed was impassable, and took Singapore from the landward side in 55 days. The British had prepared for one scenario and encountered another. The fortress narrative had become so embedded in doctrine that it crowded out the capacity to recognize a different kind of threat.

This is a pattern in Asian foreign affairs, and it transcends any single nation or era. Propaganda warps the thinking of decision-makers, and in the Pacific this problem is unusually persistent. The British believed "Fortress Singapore." The Japanese believed the Greater East Asia Co-Prosperity Sphere, a narrative that combined genuine anti-colonial sentiment with strategic resource extraction so seamlessly that even the Japanese leadership had difficulty distinguishing ideology from interest. In both cases, the narrative was not simply a lie told to the public. It was a framework that shaped how leaders understood their own strategic position. When the narrative diverged from reality, the leaders adjusted reality to fit the narrative rather than the other way around.

The present-day Pacific has its own narratives, and some of them deserve the same scrutiny. China's assertion that Taiwan is a "core interest" whose resolution is inevitable functions as a narrative commitment that constrains Beijing's own decision-making. The more often it is repeated, the harder it becomes to walk back without loss of face, which is why many analysts worry that the narrative itself could become a driver of conflict even if the underlying strategic calculus does not support an invasion. On the American side, the concept of the "unmanned hellscape," Admiral Paparo's vivid description of how autonomous drones would turn the Taiwan Strait into an impassable killing zone, is both a deterrence concept and a narrative. It is meant to convince Beijing that an invasion would fail. But deterrence narratives have a way of becoming assumptions: if we believe the hellscape will work, do we invest enough in the alliance relationships, the logistics networks, and the political commitments that deterrence also requires? The British believed the coastal batteries would hold Singapore. The batteries pointed the wrong way.

The Philippines reef confrontations test this in real time. The narrative framework says the US commitment is ironclad, but the daily reality is more ambiguous: water cannons, diplomatic protests, carefully calibrated responses that keep the temperature below armed conflict. If the US cannot deter Chinese coast guard vessels from harassing Philippine fishermen, what does that say about the credibility of deterrence against a much larger contingency?

The most dangerous moment in any strategic competition is when the people making the decisions start believing their own slogans. The British did this in Singapore. The Japanese did it with the Co-Prosperity Sphere. The risk today is not that any single actor in the Pacific is lying to the public about its strategic position. The risk is that the narratives become so familiar, so institutionally embedded, that they substitute for the harder work of assessing actual capabilities, actual alliances, and actual political will. The fortress narrative felt comfortable until the fortress fell. The question for everyone operating in the Pacific today is whether their narrative would survive contact with reality, and whether they have the institutional honesty to find out before reality forces the issue.

Judgment at Tokyo.

Last year I read Gary Bass' "Judgment at Tokyo," and it changed how I think about the institutional foundations of the Pacific order. The book is a detailed, often granular account of the International Military Tribunal for the Far East, the Pacific counterpart to Nuremberg. Bass spent years in the archives, and the result is a work that takes the tribunal seriously as an institution rather than treating it as a foregone conclusion or a historical footnote.

The tribunal tried 28 defendants, convicted 25, and sentenced seven to death by hanging, including former Prime Minister Tojo Hideki. It sat for over two and a half years, heard testimony from more than 400 witnesses, and compiled a documentary record that ran to tens of thousands of pages. The majority opinion alone was over a thousand pages long. Bass documents all of this with the patience of a historian who believes the details matter, and the details do matter, because the gap between what the tribunal actually did and what most people think it did is one of the more consequential distortions in the postwar historical record.

The tribunal's work was serious. It engaged with questions of command responsibility, aggressive war, and the legal boundaries of state violence in ways that were genuinely novel for the time. The prosecution built cases linking individual defendants to systematic atrocities across the Pacific: the Bataan Death March, the Rape of Nanking, the treatment of prisoners of war, the forced labor programs. The evidence was extensive, and much of it was drawn from Japanese military records that the occupation authorities had seized before they could be destroyed. Bass argues that the tribunal, for all its flaws, produced a factual record of the war that remains valuable precisely because it was compiled under conditions of institutional rigor, with defense counsel, cross-examination, and dissenting opinions.

The dissents are where the book becomes most interesting. Justice Radhabinod Pal of India wrote a lengthy dissent arguing that the tribunal lacked jurisdiction, that the charges of aggressive war were retroactive, and that the Allied powers' own conduct (including the atomic bombings of Hiroshima and Nagasaki) should have been subject to the same legal standards. Justice Bert Roling of the Netherlands dissented on narrower grounds but also raised questions about the selectivity of prosecution. Bass does not dismiss these arguments. He takes them seriously as legal and moral positions while also documenting the political contexts in which they were made. Pal's dissent, in particular, has had a long afterlife: it has been embraced by Japanese nationalists as vindication, by postcolonial scholars as a critique of Western hypocrisy, and by international lawyers as an early articulation of principles that later found broader acceptance.

The point Bass makes, and the one that stayed with me, is that the tribunal's actual work has been overtaken by simplified narratives. On one side, the tribunal is dismissed as victor's justice: a show trial in which the outcome was predetermined and the legal reasoning was retroactive. On the other side, it is treated as settled moral vindication: the moment when the civilized world held Japan accountable. Neither narrative does justice to what actually happened in the courtroom. The proceedings were messier, more substantive, and more legally ambitious than either summary allows. The dissents were genuine, the legal questions were hard, and the evidentiary record was real. Reducing the tribunal to "victor's justice" erases the substantive work. Treating it as unambiguous vindication ignores the legitimate questions the dissenters raised.

This matters beyond legal history because the contested memory of the tribunal shapes the political space within which Pacific alliances operate today. Japan's relationship with its wartime history is not a matter of academic interest to the commanders and diplomats who manage the US-Japan alliance. When Japanese politicians visit the Yasukuni Shrine, which enshrines convicted war criminals alongside ordinary war dead, the reaction from China and South Korea is not performative; it reflects genuine grievance rooted in living memory and national narrative. When China invokes the "century of humiliation" to justify its military buildup and its territorial claims, it is drawing on a historical narrative that the Tokyo tribunal was supposed to have settled but did not. When the Philippines weighs the costs and benefits of its alliance with the United States, it does so against a backdrop of remembered liberation, remembered occupation, and remembered abandonment.

Bass's book made me think differently about what it means to manage alliances in a theater where the parties remember the same history differently. The Pacific is not like NATO, where the founding narrative (collective defense against Soviet aggression) is shared by all members. In the Pacific, the foundational events of the postwar order, the war, the occupation, the tribunals, the peace treaties, are remembered through national lenses that often contradict each other. A military commander or diplomat working in this theater is not operating on shared historical ground. The ground itself is contested, and the contest is not over. The tribunal was supposed to establish a common factual record. In many ways it did. But the record has been interpreted so differently by the nations that participated in it that the common ground it established has largely eroded. That erosion has consequences for every conversation happening in the Pacific today.

The Light of the South.

The Former Ford Factory museum in Singapore tells the story of the Japanese occupation from the Singaporean point of view, and one of the things that makes the museum effective is how carefully it handles the Japanese narrative without endorsing it. The exhibits present the Greater East Asia Co-Prosperity Sphere not as a historical curiosity but as a functioning propaganda system, one that combined ideological purpose with hard strategic calculation in ways that made it durable and, for a time, genuinely persuasive.

The museum displays a Japanese world map titled "Greater East Asian Warfare: A Current Map of the Change in the World Order," published in 1942 and deliberately backdated to February 15, the date of the British surrender. The backdating is itself a propaganda choice: it fixes the fall of Singapore as the hinge moment in a new global order. The map presents the Co-Prosperity Sphere as a fait accompli, a redrawn world in which Western colonial empires have been replaced by a Japanese-led Asian order. Singapore is renamed Syonan-to, which translates roughly as "Light of the South." The name was not ornamental. It was an administrative act: a renaming that signaled a change of sovereignty, language, and institutional control. The museum treats this renaming as a subject for analysis rather than outrage, which gives the exhibit a precision that more polemical treatments of the occupation tend to lack.

Alongside the world map, the museum shows Japanese resource maps of Southeast Asia with comparative bar charts of mineral wealth across the region. Oil from the Dutch East Indies. Rubber and tin from Malaya. Rice from Burma and Indochina. The maps make the strategic logic of the southern advance legible at a glance, and they are striking because they do not pretend. The Co-Prosperity Sphere was sold to occupied populations as a liberation from Western colonialism, and there were elements of that narrative that resonated (the speed of the British collapse, in particular, shattered the myth of Western invincibility). But the resource maps show that the Japanese high command understood exactly what the occupation was for. The narrative of liberation and the reality of extraction were not in tension; they reinforced each other, and this is what made the narrative especially durable. It offered something to believe in while simultaneously serving a concrete strategic purpose.

The occupation itself is documented through daily-life exhibits: ration cards, currency, propaganda posters, Syonan Times front pages, photographs of forced labor and public discipline. The museum does not dwell on atrocity in the graphic sense but it does not look away from it either. The Sook Ching massacre, in which Japanese forces systematically killed ethnic Chinese civilians in the weeks after the surrender, is presented with documentary evidence and survivor testimony. The estimates of the dead range from the Japanese military's acknowledgment of 5,000 to community claims of 50,000 or more. The museum notes the disparity without resolving it, which is an honest choice, as the historical record is genuinely uncertain, and pretending otherwise would undermine the exhibit's authority on the points where the record is clear.

What I found most interesting, though, was the museum's own narrative stance. The Former Ford Factory does not tell the British version of the fall of Singapore. It does not tell the Japanese version. It tells a Singaporean version, which is something else entirely. The British narrative centers on military failure, strategic overextension, and the loss of imperial prestige. The Japanese narrative centers on liberation, the Co-Prosperity Sphere, and the assertion of Asian power against Western colonialism. The Singaporean narrative centers on civilian survival, communal resilience, and the road from colonial subject to independent nation. The surrender and the occupation are not the point of the story; they are the backdrop against which Singapore's own story begins.

This is not a neutral framing, and the museum does not pretend it is. Every national museum makes choices about what to emphasize, what to contextualize, and what to leave at the margins. Singapore's choice is to treat the war years as a crucible of national identity rather than as a chapter in someone else's imperial history. That framing serves the nation-building project that Lee Kuan Yew and his successors undertook after independence in 1965, and the museum is transparent enough about its own perspective that a careful visitor can see the framing while still learning from the evidence.

The reason this matters beyond Singapore is that every nation in the Pacific has its own version of the war, and these versions do not converge. Japan's narrative of the war years has been a subject of political contestation for eighty years, with the content of school textbooks, the status of the Yasukuni Shrine, and the question of official apologies all functioning as live political issues. China's narrative of the "century of humiliation" frames the entire period from the Opium Wars through the Japanese invasion as a single arc of victimization and recovery, and that narrative is a load-bearing element of the Chinese Communist Party's legitimacy. The Philippines remembers the Japanese occupation and the American liberation in ways that shape its current calculations about the US alliance. These are not abstract historical disagreements. They are the substrate on which present-day alliances and rivalries rest, and anyone operating in the Pacific ignores them at considerable risk.

Fortress Singapore.

About a year ago I visited the Former Ford Factory in Singapore. The building is an unlikely piece of history: completed in 1941 as Ford Motor Company's first automobile assembly plant in Southeast Asia, it served that purpose for less than a year before becoming the site where Lieutenant-General Arthur Percival signed the British surrender to General Tomoyuki Yamashita on February 15, 1942. It is now a museum and national archive, and the exhibits trace the arc from prewar Singapore through the Japanese occupation and into the postwar period. I went because I was in Singapore for other reasons and thought it would be interesting. I stayed for hours. What I found there has shaped how I think about strategic narrative and self-deception in ways I did not expect.

The British had spent decades building Singapore as the linchpin of their Far Eastern strategy. They called it the "Gibraltar of the East," and the phrase was not idle rhetoric. It shaped force structure, deployment planning, naval doctrine, and the assumptions underlying the entire defense of Malaya. Singapore was supposed to be the fortress from which the Royal Navy would project power across the Indian Ocean and the South China Sea. The strategy assumed that the fleet would be available, that the fortress would hold long enough for reinforcements to arrive, and that no adversary could approach through the dense jungle of the Malay Peninsula. Each of these assumptions proved wrong.

When Japan attacked in December 1941, the British sent HMS Prince of Wales and HMS Repulse north without air cover, on the theory that capital ships could operate independently against air attack. These were not minor vessels. The Prince of Wales was one of the newest battleships in the Royal Navy, the ship on which Churchill and Roosevelt had signed the Atlantic Charter just months earlier. Both were sunk on December 10, three days after Pearl Harbor, by Japanese torpedo bombers operating from bases in Indochina. It was the first time in naval history that capital ships underway at sea had been sunk solely by air power. The museum displays a Japanese publication from May 1941, months before the war began, that already mocked the "Gibraltar of the East" conceit. Japanese intelligence had studied British dispositions with care, mapped the coastal batteries, identified the gap in air defenses, and planned their approach through the supposedly impassable jungle. The British appear to have believed their own slogans.

The press coverage in the final days before the surrender is the exhibit that stayed with me longest. The museum displays front pages from the Straits Times and Sunday Times published on February 13 and 15, 1942. The headlines read "Japanese Suffer Huge Casualties in Singapore" and "Strong Jap Pressure, Defence Stubbornly Maintained." These were not deliberate lies in the conventional sense. The evidence suggests that the information environment had become so distorted that the people producing and consuming these newspapers genuinely did not understand how close the end was. The museum caption notes that despite the gallant tone, the Japanese already controlled Singapore's reservoirs, and Percival and Governor Thomas were privately discussing surrender.

Alongside these newspapers, the museum displays a "MOST SECRET" British military map of Singapore and southeast Johore. The map shows the actual disposition of forces: unit positions, Japanese divisions, shelling zones. It is honest in the way that classified documents tend to be, because the people who use them need to make real decisions. The gap between the map and the headlines is the exhibit's quiet argument. The map shows a defense in extremis. The newspapers describe stubbornness and Japanese losses. Percival was somewhere in between, reading both, unable to reconcile what the press was telling the public with what his staff was telling him. When leaders build a narrative about their own strategic position and then encounter evidence that contradicts it, the tendency is to adjust the evidence rather than the narrative. The fortress had to be holding, because "Fortress Singapore" was the strategy. Yamashita's forces moved through the Malay Peninsula in 55 days.

The speed of it is worth pausing on. The Japanese used a tactic called kirimomi sakusen, a driving charge that bypassed strongpoints and kept the defenders perpetually off balance. The British had trained and positioned their forces to defend fixed points along roads and coastlines. The Japanese came through the jungle on bicycles and lightweight vehicles, outflanking one position after another. The gap between the war the British expected to fight and the war that actually came was the gap between the narrative and the reality. The "Gibraltar of the East" was a story the British had told themselves for so long that it had calcified into doctrine, and when doctrine met a different adversary with a different approach, doctrine shattered.

I think about this pattern when I read about present-day strategic planning in the Pacific. The language is different, the technology is vastly more sophisticated, and the actors have changed. But the underlying risk is the same: that the people making the decisions start believing their own slogans, that narrative confidence substitutes for operational reality, and that the gap between the two only becomes visible when it is too late to close it. The Former Ford Factory is a quiet building on a quiet road in the Bukit Timah neighborhood of Singapore. It does not announce itself. But what it shows, for those who spend the time, is how a great power can talk itself into catastrophe.

The Admiral at the Edge.

The Economist ran a profile this month of Admiral Sam Paparo, the commander of United States Indo-Pacific Command, and the picture it paints is worth thinking about. Paparo is a career fighter pilot, a TOPGUN graduate with over 6,000 flight hours and roughly 1,100 carrier landings. He now runs the oldest and largest of America's combatant commands, headquartered at Camp Smith in Honolulu, responsible for military operations across half the Earth's surface and more than half its population. INDOPACOM covers 52 percent of the planet. If you have not heard of it, you are not alone.

The article is interesting for several reasons, but the one that stuck with me is the role Paparo is playing that has nothing to do with combat. The Economist describes his quiet diplomacy in the Thailand-Cambodia border conflict last year, where he flew repeatedly to Malaysia to meet with both countries' military chiefs and keep a fragile ceasefire from collapsing. The conflict had flared in July 2025, killing dozens of people and displacing over 300,000. Donald Trump claimed credit for ending it by threatening tariffs, and a deal was eventually signed in October. But the reporting suggests it was Paparo, working behind the scenes with relationships built over decades of Pacific assignments, who kept the guns quiet long enough for the political solution to land. In a normal administration, that kind of sustained diplomatic engagement would be handled by ambassadors, by the State Department, by the National Security Council. But the Trump administration has recalled most of the Biden-era ambassadors without replacing many of them, and the president's senior advisers tend to stay close to Washington. The Economist calls Paparo "a rare instance of consistency." That phrase should be reassuring. Instead, it is a little alarming, because it means America's network of alliances in Asia is being held together in significant part by the personal relationships of one four-star admiral.

Paparo's three challenges, as outlined by The Economist, define the scope of the problem. First, reassuring allies that America will not abandon them, even as the White House focuses on Venezuela and Greenland and treats NATO with open contempt. Second, fighting for resources within the Pentagon, where INDOPACOM's carriers and air-defense batteries keep getting dispatched to the Middle East and where the administration's defense strategy has formally prioritized the Western Hemisphere over Asia. Third, keeping American war plans current as China's military modernizes at speed. On that third point, Paparo has spoken publicly about turning the Taiwan Strait into what he calls an "unmanned hellscape" in the event of a Chinese invasion, deploying thousands of low-cost drones to delay and disrupt any amphibious assault while the full weight of the American military mobilizes. The Pentagon's REPLICATOR program, launched in 2023 with a billion dollars in initial funding, is designed to field these systems at scale. A fellow admiral told The Economist that Paparo "goes to sleep every night thinking about winning or losing the next great war."

I have written before about the Sullivan Doctrine and the trade and technology dimensions of the US-China relationship, and years before that about how Japan and other Asian nations view the United States through cultural lenses that Americans rarely consider. The Paparo story is the military and diplomatic face of the same broader question: will the United States continue to maintain the institutional architecture that has kept the Pacific stable since 1945? The trade controls, the military presence, the alliance commitments are not separate policies. They are facets of a single posture, and they depend on each other. A trade war with China that is not backed by credible military deterrence is just noise. A military posture that is not backed by diplomatic relationships and economic partnership is just hardware. Each of Paparo's three challenges is simultaneously a present-tense operational problem and a narrative problem: allies need to believe the commitment is real, the Pentagon needs to believe the Pacific is the priority, and the war plans need to reflect actual Chinese capabilities rather than comfortable assumptions.

The Economist's conference scene at the end of the article is telling. Several hundred officers, bureaucrats, defense analysts, tech executives, and allied representatives spent two days in windowless rooms near Waikiki Beach, discussing how to win a war against "the adversary," universally understood to mean China. The discussion was cerebral but pragmatic. These are the people doing the actual work of deterrence, and they are doing it with focus and professionalism. Whether they will have the political support they need is the question that hangs over everything Paparo does. That Paparo "goes to sleep every night thinking about winning or losing the next great war" is both comforting and sobering. Comforting because the person in charge of deterrence appears singularly focused. Sobering because it suggests how much of America's strategic position in Asia rests on the competence and judgment of individual commanders rather than on robust institutions. The Indo-Pacific Command has existed since 1947. The alliances it supports have endured for decades. But the political commitment to those alliances is always contingent, always dependent on the next election, the next crisis elsewhere, the next shift in presidential attention. With luck, Paparo's wargames will not be needed. But luck is not a strategy, and history suggests the Pacific has a way of punishing leaders who confuse narrative confidence with actual capability.

The Greenspan Question.

This week, San Francisco Fed President Mary Daly gave a speech at the Silicon Valley Leadership Group that deserves attention. The topic was AI and productivity, but the real substance was a story about Alan Greenspan in the mid-1990s, and what that story means for how we should think about technology and economic data right now. The speech is worth reading in full (it is available on the San Francisco Fed's website), but the core of it is a historical parallel that I think cuts against a lot of the conventional wisdom in financial commentary.

Here is the setup. In 1995 and 1996, businesses were pouring money into information technology. PCs, networking, inventory management systems, GPS for trucking fleets. Investment was surging. But the official productivity numbers were flat. Standard macro models said the economy was overheating, the labor market was too tight, and the Fed should raise rates. Greenspan looked at the same economy and reached a different conclusion. He talked to executives. He walked factory floors. He saw firms not just buying computers but reorganizing their operations around them. Wholesale firms were using inventory management to cut warehouse stockpiling. Manufacturers were doing mass customization with computer-aided design. Trucking companies were eliminating deadhead hauling with GPS. Greenspan argued that official productivity data was lagging reality, and that the economy could grow faster than the models suggested without triggering inflation. The FOMC stayed patient. The roaring 1990s followed.

Daly's point is that we may be in a similar moment with AI. Businesses are investing. Use cases are multiplying. Firms in the Twelfth District (the Fed's western region, which includes Silicon Valley, Seattle, and the broader West Coast tech ecosystem) are reporting real savings from AI in consumer research, back-office operations, product development, and more. But the aggregate productivity statistics have not moved. Most macro studies find little evidence of a significant AI effect on economy-wide productivity growth. Daly cites Daron Acemoglu and a recent NBER working paper by Yotzov et al. surveying over 5,000 firm executives, both finding minimal impact so far.

The question Daly poses is whether GenAI is a sufficient catalyst to change the nature of production and business, or whether it is still at the stage of replacing a steam-powered motor with an electric one while leaving the factory floor unchanged. Her answer is honest, that no one knows yet. But her implication is clear: "we won't find all the answers in the aggregate data on productivity, the labor market, or inflation," she says. "Seeing developments before they fully emerge requires digging deeper, relying on disaggregated information that foreshadows transformation." The lesson from the 1990s is that aggregate data will be the last place to see transformation, not the first.

I find this compelling, and I think it highlights a bias that runs through a lot of financial journalism. Robert Solow's 1987 line about seeing the computer age everywhere except in the productivity statistics is one of the most quoted observations in economics. It is clever, it is pithy, and for decades it has been the default frame for skeptics. The Economist ran a piece in late 2024 titled "There will be no immediate productivity boost from AI." Carl Benedikt Frey argued in the Financial Times that "AI alone cannot solve the productivity puzzle," noting that even Microsoft's Satya Nadella acknowledges AI has yet to have its transformative moment. Apollo's chief economist Torsten Slok recently told CNBC that AI is "everywhere except in the incoming macroeconomic data," consciously echoing Solow. Robert Gordon at Northwestern has built a career arguing that the great innovations are behind us and that nothing since indoor plumbing will move the needle the way electrification did.

There is something to this skepticism. Rigor matters. Demanding evidence before declaring a revolution is exactly what serious people should do. But I think the skepticism has an undercurrent that is worth naming. In financial circles, there is a professional incentive to be the person who sees through the hype. Calling a bubble, puncturing enthusiasm, being the grown-up in the room, these are status moves. And they are coupled, I think, to a cultural distance between the people who build technology and the people who trade on it. The nerds are excited, so the sophisticated response is to be unimpressed. This is not analysis. It is posture.

What Daly's speech illustrates is that Greenspan's innovation in the 1990s was not a model or a formula. It was a practice. He looked at data that contradicted his priors and investigated rather than dismissed. He listened to people doing the work instead of relying solely on the aggregate statistics that his own institution produced. That is harder than running a regression, and it is harder than writing a clever headline about the Solow paradox.

Erik Brynjolfsson at Stanford recently pointed to revised 2025 data suggesting U.S. productivity growth may have roughly doubled to 2.7%, nearly twice the prior decade's average, while job creation was minimal. If that holds up, it is the pattern you would expect from technology-driven productivity gains. Fewer workers producing more output. Brynjolfsson calls it the transition from the investment phase to the "harvest phase." It is early, and the data will be revised, but the signal is consistent with what Daly is describing.

The practical takeaway is simple. If Greenspan had listened to the macro models and the skeptics in 1996, the Fed would have raised rates and may have choked off one of the strongest periods of broad-based growth in modern American history. He did not, because he looked past the aggregates. Daly is asking whether we are willing to do the same thing now. The answer will matter for interest rates, for labor markets, and for whether the current wave of AI investment produces widely shared prosperity or just another round of capital returns to the firms that got there first. That is not a question for the nerds or the traders. It is a question for everyone.