Expert analysis made easy. Breaking down the news with data, charts, and maps.
Edited by Brady Africk and Lexi Baker
Happy Thursday! In today’s newsletter, we examine the world’s declining number of democracies, solutions to America’s housing crisis, and the impacts of pharmaceutical tariffs.
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Topline: From World War II to the early 21st century, democracies grew to be the dominant form of government. Now, AEI’s Hal Brands warns that democracy’s popularity is slipping. In each of the last 19 years, more countries have shifted towards authoritarianism than democracy.
The Numbers: Roughly half of the global population lived in a democracy in 2004, but now three-quarters reside in an autocracy. Globally, autocracies command a larger share of global gross domestic product than democracies, when measured at purchasing power parity.
Looking to the Future: Throughout the course of history, the balance of rival forms of government mirrors that of rival states. Brands argues that President Donald Trump, a frequent ally of strongmen, has created two plausible scenarios—the US retreats from the fight for the world's democracies or becomes an illiberal superpower of its own.
"The world’s ideological complexion changed dramatically, for the better, once democracy’s fortunes were buoyed by US power. It could change dramatically, for the worse, if America gives up on—or switches sides in—the fight.”—Hal Brands
Topline: The US faces an estimated shortage of six million homes, driving up prices and making housing unattainable for many. To confront this issue, AEI’s Edward Pinto, Tobias Peter, and Arthur Gailes—along with the US Chamber of Commerce—designed four key strategies to add an estimated 1.6 million homes each year.
The Four Methods:
Allow for minimum lot sizes of 1,200 square feet in new subdivisions, a size lower than many cities currently permit.
Legalize duplexes, triplexes, and more in existing single-family neighborhoods to create more opportunities for housing.
Provide the flexibility to build homes near jobs, which could transform underused properties into vibrant, walkable communities.
Grant the sale of 0.1 percent of developable Bureau of Land Management land for residential use.
Location, Location, Location: Underlying each method is utilization of smaller lots. The authors have identified areas in all 50 states, including 571 metro areas, 1,058 counties, and 4,643 cities and places, where these strategies would ease the housing crisis.
"Housing is a cornerstone of our nation’s economy and the foundation for family formation and stability, workforce mobility, and long-term growth. But when supply fails to keep pace with demand, families are priced out, homelessness rises, workers are forced into long commutes, and businesses struggle. While the best time to address the housing crisis was 20 years ago, the second best time is today.”—Edward Pinto, Tobias Peter, and Arthur Gailes
Topline: The Trump administration is investigating whether importing pharmaceuticals is a national security threat and may impose tariffs on imported pharmaceuticals as a result. AEI’s Alex Brill and his coauthors caution against this, citing the negative results it could bring: high drug costs, high insurance premiums, and reduced profit for drugmakers.
The Tariffs: President Trump has threatened pharmaceutical tariffs many times, with figures ranging from 15 percent to 250 percent. Last week, he announced a 100 percent tariff on imported brand drugs, unless drug manufacturers increase building capacity in the US.
The Impact: Pharmaceutical imports totaled $250 billion in 2024, made up of $210.8 billion for finished products and $36.2 billion for active pharmaceutical ingredients. A 25 percent tariff would result in prices rising as much as $50.8 billion per year.
"While one of President Trump’s stated objectives for his tariff agenda is moving foreign manufacturing to the United States, it is unlikely that pharmaceutical tariffs will significantly alter US reliance on pharmaceutical trade, except for products that can be re-domiciled for distribution in the United States.”—Alex Brill, Haroon M. Cheema, and Deborah Williams
