4 ms·

Interesting that this was published in January 2008, and likely written before that. Rightly or wrongly, economic globalization's image didn't end that year un

by limist 16y ago

Interesting that this was published in January 2008, and likely written before that. Rightly or wrongly, economic globalization's image didn't end that year untarnished. The world's a really complex system, even limited to just the human-systems part of it, and the <50 miles from satellite orbits down to deep-sea drilling that concerns said humans. So in forecasting and speculating on the future, we can't help but project our own fears and hopes - in this case, Thiel is a capitalist/investor who makes a long case for going long on the world economy, with some Biblical quotes and economic history to make it interesting, if not quite convincing. Too many false dichotomies are given - I think it's a good bet the future will not run like a decision tree. In particular, Thiel wrestles with the fairly old internal contradictions of capitalism that many other thinkers have, some much more in depth. To use one more Biblical reference, the Rapture for globalization is a totally "flat" world of complete freedom for labor and capital (and technology, but presumably not land). Global capitalism runs, shuffles, or stumbles towards that end, with much of its participants heedless of the journey, never mind its destination. For example, since capitalism's purpose is to accumulate capital for its own sake, it cannot help but be global (early on, slave trade/colonialism), and it cannot help but work against itself in the long run (We'll up profit margins by outsourcing! But wait, then those outsourcers will get richer, and compete to squeeze our own profit margins. Yah, but then they'll outsource too! But wait, the planet is finite...). While it is a very resilient economic system, what might follow it as its contradictions come fully into play is far from clear. As an aside, here's someone else who's view on the current globalization situation is, I've found, comprehensive and coherent: http://www.iwallerstein.com/ http://www.iwallerstein.com/

Perceval 16y ago
I took a graduate seminar in World-System Theory with one of Wallerstein's peers, Giovanni Arrighi, about a year before he passed away. We read a broad selection of WST literature, from Arrighi, Wallerstein, Braudel, Abu-Lughod, A.G. Frank, Wolf, Harvey, and so on. It is fascinating stuff if you ever get the chance to read it. The history alone makes it worth spending the time, regardless of what you think of the post-Leninist gloss placed atop it. That said, I don't find Wallerstein's work to be particularly convincing. A good deal of his theoretical position is predicated upon Braudel's Annales school historical work and Andre Gunder Frank's dependency theory (a kind of warmed over Leninism applied to Latin America). As it turns out, dependency theory is more or less wrong on the facts — it was a plausible sounding theory, but didn't have much of an empirical basis. Wallerstein's work is an expansion of Braudel's work on the Mediterranean-as-an-economic/geographical-system and on A.G. Frank's dependency theory. Wallerstein posits that the entire global economy grew out of the European/Mediterranean system, and that there's a dependent relationship between the core states (First World industrialized countries) and periphery states (Third World raw materials suppliers). This is basically an updating of Lenin's essay "Capitalism: The Highest Stage of Imperialism", buttressed with a great deal of historical narrative. If you read Wallerstein's short introduction to WST, World-Systems Analysis: An Introduction, you'll get an idea of what a theoretical spaghetti his thought is when pressed to put it down simply and briefly on the page. And the last third of the book is devoted to a kind of 1960s-counter-culture burnt-out-hippie wishful-thinking about the potential of anti-globalization movements. If you're really interested in Marxist International Political Economy, I would skip Wallerstein and try Giovanni Arrighi and David Harvey instead. For the more historical stuff, Braudel, Abu-Lughod, and Frank are awesome.
- limist 16y ago
  Very interesting points, thank you for the references. Maybe I'm not so much convinced by Wallerstein as appreciative of the expanded perspective (and willingness to question) he provides. In taking a longer view (centuries), he's at least more interesting to me than the weak attempts at forecasting that are all too common, that try to paint an inevitable future based on one narrow domain, whether economics (e.g. The World is Flat) or technology (singularity worship). I liked the World-Systems Analysis book - compared to most social science, it was at least readable and truly interesting in many parts. He's not so cagey, hedged, and recalcitrant a writer that one can't filter out his opinions, like the "burnt-out-hippie wishful thinking" parts. :) Thanks again for the references. The future will be interesting.
  - Perceval 16y ago
    >economics (e.g. The World is Flat) Don't get me started on Thomas Friedman. As a TA, when I have to teach Friedman, I usually just instruct my students to go into it realizing that everything he says will be so wildly overstated, baselessly enthusiastic, or anecdotal that it will invariably be wrong. I really hate that people feel smarter when they read him.
    - mkramlich 16y ago
      I'd bet he's smart enough to know he's making generalizations and glossing over details. If you consider the medium he often works in (short newspaper articles) it's not conducive to much beyond that. In a book, sure, there's less of an excuse to leave out nuance and complexity.
byrneseyeview 16y ago
You are anthropomorphizing "Capitalism," as a sort of aggregate of all capitalist behavior, but with a single goal. That's not accurate. Individuals certainly try to accumulate wealth, but the best way to make a lot of money is to find a better or cheaper way to do something--a side effect of which is the impoverishment of somebody else. Just look at, e.g., the way Sun nearly killed IBM in the late 80's and early 90's. Sun never made as much as IBM did, but the people who founded Sun made more than they otherwise would have. That, I think, is why you see internal contradictions. You're pointing out that the best capitalists do stuff that harms the average capitalist; if Myspace is making money, there's always a Zuckerberg waiting to ruin things. But of course, there is no "Capitalism" that encompasses all of the goals of Myspace's owners and Facebook's. That also takes care of the apparent contradiction of outsourcing. The capitalists who lose to outsourcing don't like it; the outsourcers do. There's less money made (since the outsourcers charge less), but the economy is more efficient. That's capitalism--the net result of lots of self-interested people, who often act against one another's interests. It's not the vision of capitalism in which the rich, as a group, make consensus decisions to advance their collective interests. Thus, that version of capitalism is wrong. Oh, and slavery and colonialism are much, much older than capitalism as we understand it today. In fact, one can make the case that slaves are the oldest form of property. Certainly, I've never heard of a civilization that advanced at all and never had slaves.
- jbellis 16y ago
  > Sun never made as much as IBM did, but the people who founded Sun made more than they otherwise would have. And of course the startups that became possible because Sun equipment was much cheaper than IBM's thought this was a pretty good thing too.
- jshen 16y ago
  "but the best way to make a lot of money is to find a better or cheaper way to do something" Nah, the best way is to prey on vice. Weight loss pills, get rich quick schemes, porn, 0 interest ARM loans, etc.
  - byrneseyeview 16y ago
Experimentalist 16y ago
Capitalism doesn't work because of accumulation of capital - in fact it might be argued that the more capital is transferred around the better in capitalism, which is why free markets and trade are advocated. Capitalism works because of increasing productivity and because it is a more efficient method of allocating resources than a planned economy.
adamtj 16y ago
Capitalism doesn't have a purpose any more than, say, evolution. Capitalism is, perhaps, best thought of as a description of how the world works, in particular, how wealth is created. It has nothing to say about why wealth is created any more than evolution has something to say about our purpose for being here. Attributing purposes to properties of the universe is the domain of religion. Thus, I think it would be safe to say that everybody is a capitalist; some are also beggars or thieves. To call Thiel a "capitalist/investor" says more about you than him. You seem to be pushing your particular religion and are accusing him of being an atheist who could see the truth, but for the mote in his eye.

by limist 16y ago

Perceval 16y ago

I took a graduate seminar in World-System Theory with one of Wallerstein's peers, Giovanni Arrighi, about a year before he passed away. We read a broad selection of WST literature, from Arrighi, Wallerstein, Braudel, Abu-Lughod, A.G. Frank, Wolf, Harvey, and so on. It is fascinating stuff if you ever get the chance to read it. The history alone makes it worth spending the time, regardless of what you think of the post-Leninist gloss placed atop it. That said, I don't find Wallerstein's work to be particularly convincing. A good deal of his theoretical position is predicated upon Braudel's Annales school historical work and Andre Gunder Frank's dependency theory (a kind of warmed over Leninism applied to Latin America). As it turns out, dependency theory is more or less wrong on the facts — it was a plausible sounding theory, but didn't have much of an empirical basis. Wallerstein's work is an expansion of Braudel's work on the Mediterranean-as-an-economic/geographical-system and on A.G. Frank's dependency theory. Wallerstein posits that the entire global economy grew out of the European/Mediterranean system, and that there's a dependent relationship between the core states (First World industrialized countries) and periphery states (Third World raw materials suppliers). This is basically an updating of Lenin's essay "Capitalism: The Highest Stage of Imperialism", buttressed with a great deal of historical narrative. If you read Wallerstein's short introduction to WST, World-Systems Analysis: An Introduction, you'll get an idea of what a theoretical spaghetti his thought is when pressed to put it down simply and briefly on the page. And the last third of the book is devoted to a kind of 1960s-counter-culture burnt-out-hippie wishful-thinking about the potential of anti-globalization movements. If you're really interested in Marxist International Political Economy, I would skip Wallerstein and try Giovanni Arrighi and David Harvey instead. For the more historical stuff, Braudel, Abu-Lughod, and Frank are awesome.

limist 16y ago
Very interesting points, thank you for the references. Maybe I'm not so much convinced by Wallerstein as appreciative of the expanded perspective (and willingness to question) he provides. In taking a longer view (centuries), he's at least more interesting to me than the weak attempts at forecasting that are all too common, that try to paint an inevitable future based on one narrow domain, whether economics (e.g. The World is Flat) or technology (singularity worship). I liked the World-Systems Analysis book - compared to most social science, it was at least readable and truly interesting in many parts. He's not so cagey, hedged, and recalcitrant a writer that one can't filter out his opinions, like the "burnt-out-hippie wishful thinking" parts. :) Thanks again for the references. The future will be interesting.
- Perceval 16y ago
  >economics (e.g. The World is Flat) Don't get me started on Thomas Friedman. As a TA, when I have to teach Friedman, I usually just instruct my students to go into it realizing that everything he says will be so wildly overstated, baselessly enthusiastic, or anecdotal that it will invariably be wrong. I really hate that people feel smarter when they read him.
  - mkramlich 16y ago
    I'd bet he's smart enough to know he's making generalizations and glossing over details. If you consider the medium he often works in (short newspaper articles) it's not conducive to much beyond that. In a book, sure, there's less of an excuse to leave out nuance and complexity.

byrneseyeview 16y ago

You are anthropomorphizing "Capitalism," as a sort of aggregate of all capitalist behavior, but with a single goal. That's not accurate. Individuals certainly try to accumulate wealth, but the best way to make a lot of money is to find a better or cheaper way to do something--a side effect of which is the impoverishment of somebody else. Just look at, e.g., the way Sun nearly killed IBM in the late 80's and early 90's. Sun never made as much as IBM did, but the people who founded Sun made more than they otherwise would have. That, I think, is why you see internal contradictions. You're pointing out that the best capitalists do stuff that harms the average capitalist; if Myspace is making money, there's always a Zuckerberg waiting to ruin things. But of course, there is no "Capitalism" that encompasses all of the goals of Myspace's owners and Facebook's. That also takes care of the apparent contradiction of outsourcing. The capitalists who lose to outsourcing don't like it; the outsourcers do. There's less money made (since the outsourcers charge less), but the economy is more efficient. That's capitalism--the net result of lots of self-interested people, who often act against one another's interests. It's not the vision of capitalism in which the rich, as a group, make consensus decisions to advance their collective interests. Thus, that version of capitalism is wrong. Oh, and slavery and colonialism are much, much older than capitalism as we understand it today. In fact, one can make the case that slaves are the oldest form of property. Certainly, I've never heard of a civilization that advanced at all and never had slaves.

jbellis 16y ago
> Sun never made as much as IBM did, but the people who founded Sun made more than they otherwise would have. And of course the startups that became possible because Sun equipment was much cheaper than IBM's thought this was a pretty good thing too.
jshen 16y ago
"but the best way to make a lot of money is to find a better or cheaper way to do something" Nah, the best way is to prey on vice. Weight loss pills, get rich quick schemes, porn, 0 interest ARM loans, etc.
- byrneseyeview 16y ago

Experimentalist 16y ago

Capitalism doesn't work because of accumulation of capital - in fact it might be argued that the more capital is transferred around the better in capitalism, which is why free markets and trade are advocated. Capitalism works because of increasing productivity and because it is a more efficient method of allocating resources than a planned economy.

adamtj 16y ago

Capitalism doesn't have a purpose any more than, say, evolution. Capitalism is, perhaps, best thought of as a description of how the world works, in particular, how wealth is created. It has nothing to say about why wealth is created any more than evolution has something to say about our purpose for being here. Attributing purposes to properties of the universe is the domain of religion. Thus, I think it would be safe to say that everybody is a capitalist; some are also beggars or thieves. To call Thiel a "capitalist/investor" says more about you than him. You seem to be pushing your particular religion and are accusing him of being an atheist who could see the truth, but for the mote in his eye.