When Mass Outrage is Cheap: TC Origins of Cancel Culture

We trace a straight line from a 1697 blasphemy execution to modern cancel culture by focusing on one variable: the cost of turning speech into coordinated punishment. We break down how social media creates common knowledge at near-zero cost, making outrage faster, bigger, and harder to control. 
• Thomas Aikenhead’s case as a story about information and enforcement costs 
• Transaction costs as the hidden limiter on persecution and social punishment 
• The First Amendment limiting state coercion while leaving private sanctions intact 
• Social media as a collapse in the cost of broadcasting accusations 
• Common knowledge as the trigger for coordinated action by strangers 
• Justine Sacco as the early template for modern cancellation dynamics 
• Brendan Eich, Emmanuel Cafferty, James Damore, and PyCon “donglegate” as repeating patterns 
• John Cleese on offense and the urge to control others’ behavior 
• Listener letters on healthcare markets, consolidation, and transaction costs 
• Certificate of need laws and price systems that shape competition

• Amy Poehler's super bowl ad (Dongle!):
• John Cleese on cancel culture

Letters:

• Dr. Anthony Digiorgio, UCSF, Graphic Novel Claim Denied, Off Label Ideas
• Surgery Center of Oklahoma

Book-o-da-week:

• Steven Pinker’s When Everyone Knows That Everyone Knows . . .: Common Knowledge and the Mysteries of Money, Power, and Everyday Life  Scribner, 2025. 

If you have questions or comments, or want to suggest a future topic, email the show at taitc.email@gmail.com !

You can follow Mike Munger on Twitter at @mungowitz 

Transcript

A Teen Executed For Talking

Michael Munger 0:00

This is Mike Munger, the knower of important things, from Duke University. On the morning of January eighth, sixteen ninety-seven, a twenty-year-old former divinity student named Thomas Aikenhead was marched from the Tollbooth prison in Edinburgh, along the road to Leith, to a patch of ground called the Gallow Lee. He'd been convicted of blasphemy. He was the last person ever executed for that crime in Great Britain. His offense? Talking. That's it. Over about a year Aikenhead had been arguing with friends and fellow students, the kind of late night half showing off conversations twenty year olds have always had, about theology. He said he thought the world was eternal, not created. He mocked the idea of the Trinity. He joked that Jesus had learned magic in Egypt. And this is the detail that gets me. One cold night walking home, he said he wished he were in hell because at least it would be warm. Well, somebody reported him. The Privy Council had him arrested that November. Two ministers and two privy counselors pleaded for mercy, citing his youth and the fact that this was a first offense under the 1695 Blasphemy Act. Execution was technically supposed to be reserved for a third conviction. But he'd said three different things. That Trinity will get you every time. The council said it would grant clemency, but only if the Church interceded. The Church of Scotland's General Assembly instead formally urged vigorous execution to check, quoting, the abounding of impiety and profanity in this land. And so they hanged him. I guess they hanged him vigorously. This story is often told as if it were about religious fanaticism, and it is. But underneath, it's a story about transaction costs. A new twedge, some letters, book it a week, and more. Straight out of Creedmore, this is Tidy C.

SPEAKER_03 2:11

I thought they talk about a system where there were no transaction costs.

SPEAKER_00 2:20

When it is costly to transact, institutions matter, and it is costly to transact.

Michael Munger 2:32

Here's the thing about

Why Transaction Costs Limit Punishment

Michael Munger 2:33

Aikenhead's case that actually matters for our purposes. His words were heard by someone else. That's the whole mechanism. A handful of acquaintances heard him say something blasphemous over the course of a year, and one of them, not even certain who, repeated it to someone else. But that someone else that it was repeated to was someone in authority, and that matters for our story. The state's entire case rested on a small number of witnesses who were compelled to testify to conversations that it happened in real time, in person, with no recording device, no permanent record, nothing but human memory. Now that's worth dwelling on. Most of human history, that was the only way opinions got published, and of course, punished. Authorities, kings, churches, town councils, whoever had a monopoly on legitimate coercion, absolutely did persecute people, often brutally for unpopular or heretical opinions. Aikenhead is among is just one among thousands, going back centuries. Heresy trials, sedition trials, blasphemy trials, the will to punish wrong opinion is not new. What was expensive, historically, was the information about what was said and the organization required to act. Those are both transaction cost. Finding out what someone believed, proving it in a way a court would accept, doing it before the person could recant or flee or just deny it. All of that took real resources. You needed informants, you needed witnesses willing to testify, sometimes at real risk to themselves. They needed the state to care enough about one blasphemous undergraduate to bother with all of those transaction costs. Now, the punishment technology, execution, imprisonment, exile, was always available and it's always horrifying. What was limited was how often it got used depended on the cost of acquiring and transmitting the information that would trigger it.

The First Amendment Shifts The Target

Michael Munger 4:40

Now later in places like the young United States, something else got added on top, a legal limit on what the state itself could do. The First Amendment doesn't stop your neighbors from thinking you're a heretic and a jerk. First Amendment stops Congress from hanging you for it. So in a First Amendment world, the state's hands are tied. But the underlying human impulse to punish bad opinions doesn't go away. It just gets rerouted into private action, shunning, gossip, boycott, social exclusion, the disapproving look across the church pew. Your neighbors can make your life miserable for what you believe. They just can't, at least in the United States, have you executed for it. And here's the important part. Private punishment has the same transaction cost problem that the state faced. If my neighbor wants to organize the town against me for something I said, he has to find out what I said, tell other people about it in a way they believe, and coordinate enough of them to actually make my life difficult. Before mass media, like newspapers and television and radio, that coordination was slow, local, and leaky. An opinion expressed in one drawing room might never reach the next town over. The cost of transmitting look what this guy said, and coordinating a punitive response were real, they were large, and they capped how often and how severely private sanction could be applied. But then, after mass media, came

Social Media Collapses Coordination Costs

Michael Munger 6:12

social media. Cancel culture is not a thing of the political left or the political right. It's a dramatic fall in the transaction cost of mobilizing outrage across the ideological spectrum. And it's not going away anytime soon, people. So let's fast forward three hundred and some years. I can have an opinion, I can post it, you can see it and react to it instantly, publicly, for free. I can see your reaction and I can react to that. And here's the part that changes everything. Hundreds or thousands, millions of other people can watch this whole exchange unfold in real time, from anywhere in the world, on their phone, for nothing. Economists and game theorists have a specific term for what's happening here, and it's worth being precise about it, because it's not just lots of people saw it. Common knowledge means something stronger. I know it, you know it, I know that you know it, you know that I know that you know it, and so on. Shared and mutually understood across a whole audience simultaneously. That recursive shared awareness is what makes coordinated action possible. A crowd doesn't act on private information, it acts on common knowledge, everyone seeing that everyone else is seeing the same thing at the same time and drawing the conclusion that a response is now expected, even required. Before social media, you almost never got common knowledge about a stranger's minor private opinion. You might hear a rumor, you might not believe it. You have no way of knowing where any whether anyone else believed it either. Coordinating a boycott, a firing, a shaming, some kind of campaign against an ordinary person required someone to do a lot of expensive legwork, write letters, make calls, organize a meeting. Today, a screenshot does all that in about four seconds. The transaction cost of expressing an opinion, reacting to someone else's opinion, and broadcasting both of those to a self-selecting mob of the offended have fallen somewhere very close to zero, and when the cost of producing common knowledge collapses, you should expect a lot more of whatever common knowledge makes possible. In this case, fast, large scale, low accountability, social punishment. The modern cancellation. Now note the parallel with Akenhead. The Kirk, the church, in sixteen ninety six, wanted in its own words, an example to the terror of others. The point was never really about Akenhead, they were making an example of him. It was about everyone else who might be tempted to talk the same way. Public shaming has always been at least partly about deterrence through visibility. What's new isn't the motive, it's that the visibility is now instantaneous, global, and essentially costless.

Common Knowledge Makes Mobs Possible

Michael Munger 8:52

If you want a single moment that historians of the internet point to is the template for the origins of cancel culture, it's Justine Sacco in December of 2013. Sacco was the director of corporate communications for IAC, the media company behind Vimeo, Match.com, and a bunch of other websites, a PR person by trade. She had about 170 Twitter followers, what we now call X. 170 is basically nobody. On december twentieth, twenty thirteen, waiting to board a twelve hour flight from London to Cape Town to visit family in South Africa, she tweeted, quote, going to Africa, hope I don't get AIDS, just kidding, I'm white. Now she meant it by her own later account as a clumsy jab at white obliviousness, the kind of person who assumes tragedy only happens to other people, especially to black people. It read, though, to everyone who saw it, as a joke about black Africans and AIDS made by a white American. She hit sand, got on the plane, and this is the detail that makes the story so interesting. This flight had no Wi-Fi, most flights had no Wi-Fi in twenty thirteen. She went completely offline for eleven hours with no in flight ability to check Twitter. That meant that she had no idea what was happening, but boy was something happening. One of her hundred seventy followers flagged the tweet to a Gawker Media Editor at Valley Wag, who had about fifteen thousand followers of his own. He reposted it. From there it detonated. The hashtag has Justine Landed Yet, that's the hash has Justine Landed Yet, all one word, started trending worldwide. Strangers for hours gleefully speculating in real time about the moment a woman with no internet access would land and discover her entire life had been rearranged while she slept

Justine Sacco And The Viral Template

Michael Munger 10:55

and probably had a glass of white wine. Tens of thousands of replies poured in, people dug through her old tweets looking for more ammunition. Her employer, IAC, publicly disowned her and fired her before the plane had ever touched down. By the time she landed, she was, in the words of one of the journalists who covered it, the number one worldwide trend on Twitter. A person that no one had heard of the day before, now globally infamous, unemployed, unable to explain herself, she still didn't know that any of it had happened. What makes Sacco the first cancellation isn't that she said something offensive online, people had done that said dumb things for centuries. Millennia. It's that her case in miniature has every structural feature that we would talk about for cancel culture. Private opinion expressed cheaply, a reaction cheaply, but amply amplified. A third party's reaction to the reaction, and an audience of total strangers, with zero personal stake, achieving common knowledge, a shared opinion fast enough and enough scale to end someone's career before she had even landed, literally before she knew there was anything to defend herself against. The transaction cost of the entire process, from tweet to firing, was close to nothing, and the elapsed time was half a day. Well, Sacco's case set the template, but it's been run again and again since, with variations worth noticing, because the mechanism is the same even when the politics point in different directions.

Four Modern Cancellations In Fast Motion

Michael Munger 12:30

We have an example of Brendan Ike. So in March twenty fourteen, Mozilla, the nonprofit behind the Firefox browser, appointed its co founder and longtime chief technical officer, Brendan Ike as CEO. Within a day it came out that Ike had personally donated a thousand dollars back in 2008 to California's Proposition 8, which was a proposition that would have denied same-sex marriage. Donation itself wasn't new information, it had been publicly known and reported since 2012. What was new was the common knowledge event. It recirculated widely all at once, right as he took the top job. The dating site OKCupid started showing Firefox users a message urging them to switch browsers. An advocacy group gathered over 50,000 signatures demanding his resignation. Employees posted their objections on social media. Eleven days after becoming CEO, Ike resigned, saying he could no longer be an effective leader under the present circumstances. Another example is Emmanuel Cafferty. In June 2020, Cafferty, a utility line locator for San Diego Gas and Electric, was driving a company truck near a Black Lives Matter demonstration in Poway, California. With his arm out the window, a driver in the next lane photographed him making what looked like the okay hand gesture, thumb and forefinger circled, three fingers extended, which in recent years had also been adopted in some corners of the internet as an ironic white power symbol. Photo went up on Twitter with an accusation attached. Cafferty, who's of Mexican ascent, said he was cracking his knuckles, something he'd done for years. Well, San Diego Gas and Electric suspended him within days and fired him. The man who posted the original photo later said he had overreacted. He deleted his account, saying he never wanted Cafferty fired. The company didn't reverse its decision. Cafferty later sued for wrong for wrongful termination and defamation. Notice again, single photo, single tweet, company's decision to fire a six-month employee all inside about five days because tens of thousands of people all conducted an online trial and reached a conclusion. James Daamore Summer of twenty seventeen, Daamore, a Google software engineer, wrote an internal memo meant for an internal feedback channel, arguing that some of the gender gap in tech might be explained by average biological differences between men and women, alongside a critique of Google's diversity programs. It got leaked to the press. Within three days of it becoming public, Google fired him. CEO Sundar Sundar Pachai said the memo crossed a line advancing harmful gender stereotypes. Now, whatever you think of the memo's arguments, and there there was a lot of real scientific pushback on them, striking part is the speed. A document intended and distributed only to a small internal audience achieved company wide and then global common knowledge almost instantly, and the employment decision followed within days. Dongle Gate that makes me think of this.

SPEAKER_03 15:46

Can I use a dongle with this? Does it make you uncomfortable when I use the word dongle?

Michael Munger 15:50

At the PyCon software conference, developer evangelist Adria Richards overheard two men behind her making sexual dublantendre jokes about forking and dongles. They weren't talking to her. They were just making dumb jokes. She turned around and photographed them and tweeted it out, tagging the conference's code of conduct. The PyCon staff quietly spoke to the men and considered the matter closed. It wasn't close to being closed. Tweet went viral. One of the photographed men was identified and fired by his employer within a day. And then the backlash swung the other way. Anonymous internet users launched a denial of service attack on Richard's employer, Sandgrid, and demanded her firing, that is the woman who had taken the picture and shared the fact that two men were making dumb jokes. Sandgrid fired her the same day. Two people on opposite sides of the same fifteen second exchange both lost their jobs within seventy two hours, driven by two entirely separate waves of common knowledge, pointed in opposite directions, generated by the same underlying zero transaction cost mechanism. Well, if we look at those four cases next to Thomas Aikenhead, the pattern is obvious. The desire to punish people for what they say or believe isn't new. It's as old as recorded history. What's new is the price. It used to cost something real, informants, witnesses, letters, meeting, a privy council willing to spend its afternoon on you to turn a private opinion into a punished one. Now it costs a phone and a free account. People actually enjoy it. First Amendment solved the problem of the state doing the punishing. No one has solved the problem of the transaction cost of private punishment falling to zero. Whoa, that sound means it's time for the twedge. For the twedge, I have a YouTube from

Offense Culture And A John Cleese Clip

Michael Munger 17:52

John Cleese of Monty Python. It's not funny, but heck, that's true of all my twedges. And John Cleese is funny. So here it is.

SPEAKER_02 18:00

I'm offended every day. For example, the British newspapers every day offend me with their laziness, their nastiness, and their inaccuracy. But I'm not going to expect someone to stop that happening. I should just simply speak out about it. You know, and sometimes when people are offended, they want to somebody just come in and say, right, stop that to whoever is offending them. And of course, as uh former um chairman of the BBC once said, there are some people one would wish to offend. And I think there's truth in that too. So the idea that you have to be protected from any kind of uncomfortable emotion is one I absolutely do not subscribe to. And a fellow that I helped write to books about psychology and psychiatry, he was a renowned psychiatrist in London called Robin Skinner, said something very interesting to me. He said, if people can't control their own emotions, then they have to start trying to control other people's behavior. And when you're around super sensitive people, you cannot relax and be spontaneous because you have no idea what's going to upset them next. And that's why I've been warned recently, don't go to most university campuses, because the political correctness has been taken from being a good idea, which is let's not be mean, particularly to people who are not able to look after themselves very well. That's a good idea, to the point where any kind of criticism of any individual or group can be labeled cruel.

Michael Munger 19:36

I do have a couple of observations on the Twedge line. One is about MySpace, which is during the 20 aughts. Social media is a wild place. Back on MySpace, you could let your friends pick your top eight and play a blaring fallout boy song. Today, if you use the wrong emoji in a post, suddenly the internet is holding a town hall meeting to discuss your termination from society. I wrote a post and accidentally typed pubic instead of public. I didn't bother correcting it. I just threw my phone in the river, bought a flip phone, and moved to a cabin in the woods. It's quiet there. Everyone knows the classic influencer apology video. You sit in an unlit room, sigh deeply, wear a plain gray hoodie without makeup, and you issue tearful statements about a tweet you made when you were eight years old. Two

Listener Letters On Healthcare Transaction Costs

Michael Munger 20:34

letters this week. The first one is from someone I will actually name because he sent some interesting resources. This is from Anthony DiGiorgio. The letter says, I listened to your recent episode on physician scarcity, the Flexner Report, and subsequent supply restrictions on physicians. I wanted to offer a friendly perspective from the trenches. On background, I'm a neurosurgeon at the University of California, San Francisco, and have testified in Congress about healthcare prices. I'm very much in favor of expanding supply by giving greater scope to nurses, pharmacists, and easier routes for foreign medical grads. I hate when organized medicine continues to act like a protectionist cabal. Your framing of the historical Medical Guild Restrect Supply story captures something real about the early and mid twentieth century AMA, but I don't think it explains today's system nearly as well. The modern picture looks different in a few important ways. First, the old County Medical Society hospital privileges model is not really how most access is governed now. Independent doctors are becoming a rare species. Policies in the post ACA world have favored large hospitals over independent practices, leading to vertical consolidation where hospital systems acquire those practices. The AMA's own benchmark survey shows the share of physicians in hospitals. Holy physician owned practices fell from 60% in 2012 to just over 45% in 2022. The relevant institutional power today is often the integrated hospital system, not the county medical society. Second, the AMA is not the profession in the way it once was. It still has influence, especially through lobbying and organizations, but the physician pipeline is much broader now. Graduates from other kinds of medical schools such as osteopaths and international medical graduates are major parts of the resident workforce. That makes the old AMA monopoly story incomplete. Osteopathic medical schools, which you mentioned in passing, provide a competitive alternative to MD schools, and as to be expected, have seen an explosion in recent decades. Third, the Medicare residency gap is real, but it's often overstated as a hard national freeze. GAO, that is the government accounting office, found that 70% of teaching hospitals trained more residents than Medicare funded in 2018. The CAP distorts where and how training capacity grows, but it has not stopped residency growth. Since the CAP was implemented, residency growth has outpaced population growth. I also think physician income is too small a lever to explain U.S. healthcare costs. Physician take home pay is only about 8% of total healthcare spending, and even a drastic salary cut would not get us close to peer country spending. The more interesting transaction cost story, in my view, is centralized price controls from Medicare and how they've nudged the market towards these large consolidated systems. This is actually the subject of a graphic novel I've been working on. Claim Denied tries to explain modern American healthcare in economic terms, not as a morality play about greedy doctors, but as a centrally priced, heavily intermediated system whose transaction costs consume the doctor patient relationship. I'm attaching a copy, I thought it might be a fun way to show the argument visually. And I'll put up the uh pause the letter. I will put up the link to that graphic novel, which is amazing, um, on the show notes. And back to the letter. I hope this comes across in the spirit intended. I'm a huge fan and thought the episode was worth engaging because your framework is the right one. Well, thank you, Anthony. I really appreciate that. Um that that's quite a letter. It's always good to hear from someone that actually knows what's going on. Um I hope listeners will follow up and take a look at the graphic novel. It's very impressive. Letter number two. I love your podcast. As a retired emergency physician who practiced 40 years from 1972 to 2016, I'm surprised you didn't mention the certificate of need program that prevented competition by requiring government permission to add new services and technology such as CT scans and MRIs. Also, there is a sur there is on there is one surgical center in the U.S. which is advertised global pricing for a variety of procedures such as hip and knee replacement. Keep up the great work. Anonymous. Well, thanks, anonymous. I appreciate that. And there was a there's a very cool econ talk about that uh surgical center that you mentioned, and I'll put up a link to that in show notes also. Um you're absolutely right, of course, about the certificate of need programs uh really is quite remarkable. And that is that kind of approach where we're asking, making it not just possible but uh easy to maintain high prices is well, it's that does seem like a bad idea. So what I think what's interesting is and in Anthony's letter also, uh Dr. DeGiorgio's letter also, um the the this is quite a bit more complicated than salaries to doctors. In my defense, I did say in the previous podcast, I don't think doctors are overpaid. I actually think that they're overworked, and if we can find a way to ease some of that burden, doctors would probably be happy to work at maybe slightly less pay than they get now, but have jobs that remind them of a reason that they wanted to become doctors in the first place.

Book Pick On Common Knowledge

Michael Munger 26:28

Well, the book of the week. This is part of what got me thinking about the problem of common knowledge. This is a book from 2025 written by Steven Pinker. Title is When Everyone Knows That Everyone Knows Common Knowledge and the Mysteries of Money, Power, and Everyday Life, published by Scribner in 2025. Well, thanks. That's it for this week. Until next time.