Peter Thiel: There Are No Good Bets Against Globalization(hoover.org)
hoover.org
Peter Thiel: There Are No Good Bets Against Globalization
http://www.hoover.org/publications/policy-review/article/5646
50 comments
Well, I'm glad that I forced you to read the article, because I really enjoyed reading your comments. :)
Although I agree with you, I did enjoy Theil's essay. I think it really captures and explains the desperate and almost suicidal mindset that is so common. You put it well. His is a dark world of little imagination and not much faith in humanity.
Although I agree with you, I did enjoy Theil's essay. I think it really captures and explains the desperate and almost suicidal mindset that is so common. You put it well. His is a dark world of little imagination and not much faith in humanity.
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/
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/
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.
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.
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.
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.
>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.
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.
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.
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.
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.
> 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.
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.
* 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.*
I don't disagree with your general arguments, but this bit is factually wrong. IBM's problems in the late 80's and early 90's were to do with the rise of the PC industry, not the Unix workstation. Yes, IBM had a dysfunctional Unix strategy during that period, and yes it lost sales (some to Sun) but it wasn't Sun that was killing it, it was the rise of client server computing. If Sun hadn't been there then Apollo (remember them?) or HP or maybe even SGI
I don't disagree with your general arguments, but this bit is factually wrong. IBM's problems in the late 80's and early 90's were to do with the rise of the PC industry, not the Unix workstation. Yes, IBM had a dysfunctional Unix strategy during that period, and yes it lost sales (some to Sun) but it wasn't Sun that was killing it, it was the rise of client server computing. If Sun hadn't been there then Apollo (remember them?) or HP or maybe even SGI
Thanks for the clarification. Are there any good sources (books, articles) on this period and what happened to IBM? I've read about it from IBM's point of view, but when your business is selling Big Iron, you figure you fail because of something Big Iron-related, not something external.
"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.
Nah, the best way is to prey on vice. Weight loss pills, get rich quick schemes, porn, 0 interest ARM loans, etc.
One would think so, but the Forbes 400 is not dominated by people who cater to vices. In fact, folks who bet against at least some of those (the 0% ARM loans) are well-represented among hedgies.
when he said, "the best way to make a lot of money", I was thinking a few million and that by best he meant easiest. It surely is easier to get rich tacking advantage of someone than trying to start the next microsoft.
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.
Capitalism works because of increasing productivity and because it is a more efficient method of allocating resources than a planned economy.
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.
Wonderful! So this means I and other Americans will soon legally be able to purchase prescription drugs from other countries where drug companies sell them for much less money? Oh, I forgot; "globalization," as meant by multinational corporations and policy makers, doesn't work that way.
Globalization is not a two-way street, and while it would certainly be foolish to bet against it when it means American jobs being shipped to other countries where labor is cheaper and the cost of living is lower, betting against consumers being able to import goods from those same countries where multinationals sell their products for cheaper seems, for the time being anyway, to be a pretty safe bet.
Globalization is not a two-way street, and while it would certainly be foolish to bet against it when it means American jobs being shipped to other countries where labor is cheaper and the cost of living is lower, betting against consumers being able to import goods from those same countries where multinationals sell their products for cheaper seems, for the time being anyway, to be a pretty safe bet.
The only problem with globalization is the lack of truly free trade. If countries didn't have to subsidize nonproductive sectors of the economy then the costs of living would equalize much quicker - see farm subsidies, tariffs, and the ban on imports of certain goods.
I don't think it's the only problem with globalization, but having recently paid out-of-pocket for an expensive, patented prescription drug, I think it's one of the biggest, and much of the hollow pro-globalization, pro-free trade rhetoric I hear from government and big business never addresses it.
I am curious about why others downvoted my original post; do people here really think this sort of protectionist price discrimination is OK?
I am curious about why others downvoted my original post; do people here really think this sort of protectionist price discrimination is OK?
I voted it down because I didn't think the tone was constructive. It seemed to be accusing Thiel of not considering the big picture, when in fact Thiel is considering something much, much larger. You're asking about differential pricing of prescription drugs, while he's wondering about the impact of a spot market on human organs. What did you think of that part?
Thiel isn't arguing that globalization is a done deal. If anything, he agrees that what we have is astonishingly incomplete: "we stand at a level of globalization that compares with the previous peak year of 1913". Rather, he's asking whether the economic world as we know it could withstand true globalization.
But to answer your question: yes, I think it's only to be expected that corporations will seek to maximize their profits through price discrimination. And also to be expected that true globalization will make this more difficult to do. But while it's clear that those paying the higher price would benefit in the short-term from paying a lower price, it's not clear to me who would benefit in the long-term from forcing companies to choose a single set price somewhere in the middle. It probably depends on how this would be enforced.
Thiel isn't arguing that globalization is a done deal. If anything, he agrees that what we have is astonishingly incomplete: "we stand at a level of globalization that compares with the previous peak year of 1913". Rather, he's asking whether the economic world as we know it could withstand true globalization.
But to answer your question: yes, I think it's only to be expected that corporations will seek to maximize their profits through price discrimination. And also to be expected that true globalization will make this more difficult to do. But while it's clear that those paying the higher price would benefit in the short-term from paying a lower price, it's not clear to me who would benefit in the long-term from forcing companies to choose a single set price somewhere in the middle. It probably depends on how this would be enforced.
I think it's only okay in certain circumstances. Many governments participate directly in their healthcare markets, which affects the prices at which pharmaceuticals can be sold in such a country. If goods with manipulated prices are allowed to be traded freely, the prices in other countries will be affected as well. Companies that produce the goods in question will either have to accept lower profit margins or refuse to sell their goods in manipulated markets. Regardless, such a policy would lower the expected value of future technological advances in the field, which would result in less effort being directed to such advances.
It is undesirable for technology to advance at a slower pace than would be possible if people were expected to pay market prices for the products the technology would help to improve or create. If you value future advances in technology, you should want your government to minimize manipulation of the markets for such technologies. If, on the other hand, you'd like as many people to benefit from current technology as cheaply as possible, you should want your government to force prices down as much as possible.
It is undesirable for technology to advance at a slower pace than would be possible if people were expected to pay market prices for the products the technology would help to improve or create. If you value future advances in technology, you should want your government to minimize manipulation of the markets for such technologies. If, on the other hand, you'd like as many people to benefit from current technology as cheaply as possible, you should want your government to force prices down as much as possible.
If they dislike the price controls and monopsonies that exist in other countries, they can avoid those markets entirely. Once they agree to participate and begin exporting their drugs, we should have every right to import them back at a discount. As large corporations have shown in the past, they have no issue with planned economies, as long as the planning is done in their favor (China, Dubai).
It is horribly unjust for Americans, many of whom have no or poor health insurance, to be forced to pay more money than anyone else on earth for prescription drugs. If Big Pharma, which spends disproportionate amounts of money on direct marketing to consumers, can't produce the medications we need cheaply and efficiently, that represents a market failure, and the government should step in and take the lead role in drug development. Research could be done through the NIH grant system and the results could be given away, unpatented, to the entire world. We could get the same results for less money, as the NIH doesn't need to make a profit and has no stock holders to answer to. It could even serve to improve our global reputation, showing the US to be a force for good in the world.
It is horribly unjust for Americans, many of whom have no or poor health insurance, to be forced to pay more money than anyone else on earth for prescription drugs. If Big Pharma, which spends disproportionate amounts of money on direct marketing to consumers, can't produce the medications we need cheaply and efficiently, that represents a market failure, and the government should step in and take the lead role in drug development. Research could be done through the NIH grant system and the results could be given away, unpatented, to the entire world. We could get the same results for less money, as the NIH doesn't need to make a profit and has no stock holders to answer to. It could even serve to improve our global reputation, showing the US to be a force for good in the world.
> If they dislike the price controls and monopsonies that exist in other countries, they can avoid those markets entirely. Once they agree to participate and begin exporting their drugs, we should have every right to import them back at a discount.
As I mentioned, both of those options would make drugs less profitable, which would lead to fewer advances in technology. Prohibiting the reimportation of drugs can be a sensible policy.
> It is horribly unjust for Americans, many of whom have no or poor health insurance, to be forced to pay more money than anyone else on earth for prescription drugs.
Unfair, perhaps, but unjust? Fixing this problem would either require selling to everyone at American prices (which could also be described as unjust), or selling to everyone at the lowest prices available. Both options would be less profitable that the current system, which would slow the rate of advancement in drug development.
> [Maybe] the government should step in and take the lead role in drug development.
That can also be a sensible policy, and the American government already does fund a considerable amount of drug development.
As I mentioned, both of those options would make drugs less profitable, which would lead to fewer advances in technology. Prohibiting the reimportation of drugs can be a sensible policy.
> It is horribly unjust for Americans, many of whom have no or poor health insurance, to be forced to pay more money than anyone else on earth for prescription drugs.
Unfair, perhaps, but unjust? Fixing this problem would either require selling to everyone at American prices (which could also be described as unjust), or selling to everyone at the lowest prices available. Both options would be less profitable that the current system, which would slow the rate of advancement in drug development.
> [Maybe] the government should step in and take the lead role in drug development.
That can also be a sensible policy, and the American government already does fund a considerable amount of drug development.
Prohibiting the importation of drugs cannot and is not something anyone should be for. It is highly immoral and it says that your own government wants to deprive you of things that others have. Now if the governments that get the discounts are forced to ban the export of drugs, well then that is completely different story.
> It is horribly unjust for Americans, many of whom have no or poor health insurance
They do, however, have free health care. You do understand the difference, right?
No, it isn't as good as most paid care. So what?
> Pharma, which spends disproportionate amounts of money on direct marketing to consumers,
What's "disproportionate"? You do know that marketing includes free drugs for poor people, MD education, and the ads that tell people that there are treatments for their illnesses/conditions, right? Which of those do you find objectionable?
> can't produce the medications we need cheaply and efficiently, that represents a market failure,
Does it? I'd like a pony, but the fact there isn't one in my front yard isn't actually a market failure.
If you think that you can develop anti-biotics for less, go for it. You'll get rich, you'll save people's lives, and you'll drive those evil drug companies out of biz.
You were planning to go through the FDA right? (Of course, if you can fix the FDA, then all new drugs become cheaper.)
> and the government should step in and take the lead role in drug development.
What rational govt that has pension/retirement obligations would spend money on a drug that significantly increased lifespan?
> the NIH doesn't need to make a profit
The NIH has no skin in the game. If it screws up, no big deal. In the rare cases where someone finds out, NIH defenders will swing into action. If Merck screws up, folks lose their jobs, stock value goes down, etc.
The NIH is driven by interest groups. Pharma is driven by what folks will actually spend money on. I know which one I think accurately represents what people value....
They do, however, have free health care. You do understand the difference, right?
No, it isn't as good as most paid care. So what?
> Pharma, which spends disproportionate amounts of money on direct marketing to consumers,
What's "disproportionate"? You do know that marketing includes free drugs for poor people, MD education, and the ads that tell people that there are treatments for their illnesses/conditions, right? Which of those do you find objectionable?
> can't produce the medications we need cheaply and efficiently, that represents a market failure,
Does it? I'd like a pony, but the fact there isn't one in my front yard isn't actually a market failure.
If you think that you can develop anti-biotics for less, go for it. You'll get rich, you'll save people's lives, and you'll drive those evil drug companies out of biz.
You were planning to go through the FDA right? (Of course, if you can fix the FDA, then all new drugs become cheaper.)
> and the government should step in and take the lead role in drug development.
What rational govt that has pension/retirement obligations would spend money on a drug that significantly increased lifespan?
> the NIH doesn't need to make a profit
The NIH has no skin in the game. If it screws up, no big deal. In the rare cases where someone finds out, NIH defenders will swing into action. If Merck screws up, folks lose their jobs, stock value goes down, etc.
The NIH is driven by interest groups. Pharma is driven by what folks will actually spend money on. I know which one I think accurately represents what people value....
Since money is predominantly allocated by insurance companies, not individuals, I would say that Pharma knows what insurance companies will spend money on.
> Since money is predominantly allocated by insurance companies, not individuals, I would say that Pharma knows what insurance companies will spend money on.
Insurance companies are somewhat driven by what their customers want. If 20% want something, it tends to happen. Govt bureaucrats, not so much, and Congress rarely passes laws for 20% of the population.
Insurance companies are somewhat driven by what their customers want. If 20% want something, it tends to happen. Govt bureaucrats, not so much, and Congress rarely passes laws for 20% of the population.
I would say it is being in a state of constant expansion. Kinda hard when you live on earth. Its just so... finite.
Does Thiel address that point, or argue that there should be exceptions for American pharma companies?
Our healthcare industry is psuedo-nationalized, in the sense that we have an inefficient domestic market in order to subsidize our ridiculously expensive regulatory approval process, all of which provides enough excess cash flow to fund lots of good research. Things would be different with fewer trade barriers, but the main result is that either a) the FDA would get weaker, or b) our domestic pharma industry would look a lot like that of e.g. India (cheap stuff derived from other people's research, not as much new stuff). I guess we'd buy the next generation of Lipitor, Prozac, and Viagra from the Swiss.
Our healthcare industry is psuedo-nationalized, in the sense that we have an inefficient domestic market in order to subsidize our ridiculously expensive regulatory approval process, all of which provides enough excess cash flow to fund lots of good research. Things would be different with fewer trade barriers, but the main result is that either a) the FDA would get weaker, or b) our domestic pharma industry would look a lot like that of e.g. India (cheap stuff derived from other people's research, not as much new stuff). I guess we'd buy the next generation of Lipitor, Prozac, and Viagra from the Swiss.
You actually already buy a nice chunk of your meds from the Swiss. Switzerland is a nice place to incorporate.
The entertainment business (MPAA, RIAA, etc) are a very powerful antiglobalization force? They are in fact betting against real globalization. Just consider regional coding for DVDs or the fact that there is not just one Apple iTunes Store but that every nation needs to have its own?
With other words: What does "globalization" really mean?
With other words: What does "globalization" really mean?
"Globalization" is a great newspeak kind of word.
It's meaning in the propaganda domain means breaking down of boundaries between nations, free trade, exchange of knowledge, culture, the world becomes a more connected, and of course, a better place for everyone.
It's actual meaning is that large corporate entities only get to freely move across national boundaries in order to exploit market (consumer or labor) inefficiencies. China was a boom for a cheap labor market. It will become less so as the standards of living rise. So some companies are eying Vietnam. If Africa stabilizes, it might be next.
In fact, in the real sense globalization usually means anti-globalization. In its best form it is using governments in order to set tariffs, international trade restrictions, copyright agreements, immigration policy and so on. The "free trade" is usually the free trade imposed on other, weaker, countries by the corporate of the stronger countries.
The propaganda meaning of globalization is very useful in discrediting any of its opponents. The "antiglobalization" protesters are apparently "anti" friendship among nations, "anti" free trade, "anti" cooperation, how silly of them.
It's meaning in the propaganda domain means breaking down of boundaries between nations, free trade, exchange of knowledge, culture, the world becomes a more connected, and of course, a better place for everyone.
It's actual meaning is that large corporate entities only get to freely move across national boundaries in order to exploit market (consumer or labor) inefficiencies. China was a boom for a cheap labor market. It will become less so as the standards of living rise. So some companies are eying Vietnam. If Africa stabilizes, it might be next.
In fact, in the real sense globalization usually means anti-globalization. In its best form it is using governments in order to set tariffs, international trade restrictions, copyright agreements, immigration policy and so on. The "free trade" is usually the free trade imposed on other, weaker, countries by the corporate of the stronger countries.
The propaganda meaning of globalization is very useful in discrediting any of its opponents. The "antiglobalization" protesters are apparently "anti" friendship among nations, "anti" free trade, "anti" cooperation, how silly of them.
It means that people will fight it kicking and screaming, trying to get politicians to enforce their short sidedness. Eventually they will lose out, perhaps making a fortune in the short run. They will be basically robbing those who have no choice but to purchase their goods due to various lawyerly machinations.
Resilient communities are a good hedge against globalization.
Best case, resilient communities can mitigate the harmful effects of globalization, improve local quality of life and dampen the magnifying network effects (whether financial, political, or natural). They can provide a "monkeysphere" that members can care about and be held accountable to, an excellent alternative to all the divisive, useless rhetoric and posturing in the MSM.
Worst case, they're the ones still eating and recovering ground after the the zombies/terrorists/enemy paratroopers/global pandemic/massive earthquakes strike.
Best case, resilient communities can mitigate the harmful effects of globalization, improve local quality of life and dampen the magnifying network effects (whether financial, political, or natural). They can provide a "monkeysphere" that members can care about and be held accountable to, an excellent alternative to all the divisive, useless rhetoric and posturing in the MSM.
Worst case, they're the ones still eating and recovering ground after the the zombies/terrorists/enemy paratroopers/global pandemic/massive earthquakes strike.
That is an incredible nice way to pad conservatives on the head for being backwards. Globalization is a good thing, so why would you want to hedge against it?
I only read the first third of this - but did anyone else find it wandering without clear points or thought process? It was fairly confusing, not because of the content, but how it was written. Was surprised to see this come from Peter Thiel, but I haven't read much of his stuff so who knows.
Thiel is still an extreme pessimist with regard to the future and this seems to be his attempt at embracing the views of his intellectual opponents by running the "Optimistic Thought Experiment", which he nonetheless disclaims with "Unlike more rigorous forms of scientific investigation, there are no empirical means to falsify these mental exercises. The optimistic thought experiment exists largely in the mind. The vistas of the mind are not always the same as reality."
Fair enough, Thiel, but aren't your doomsayer projections also a direct form of thought experiment, based on extrapolation just the same?
He goes on to outline what he thinks are three defining markets (or distortions thereof) that could utterly define the future ("China", "Internet" and "hedge funds"), and claims that the markets are woefully out of alignment with reality. I think we have to take his view with a large grain of salt here, considering his bias: he's a global macro hedge fund manager who also invests in Internet startups.
I think he's probably right about a lot of the distortion and possibly right about some of the importance of these markets, but he doesn't even mention any other possible contenders (energy industry transformation? nanotech? biotech? government competition?). I think it's a mistake to assume that any one or three factors will determine the mid-term future when there are literally trillions of factors in play. Then the logical conclusion is that we can't really know or predict anything about the mid-term future, which may be largely right, but I think there is possibility to predict with narrow foci, like "What will happen in transistor design?" or "What will happen in nuclear reactor design?"; though those too will always be hampered by revolutions that we never see coming.
Overall, I hope Thiel is wrong about a lot for the reasons that he so adeptly explains: there's not much else to hope for if the alternative to what you want is total destruction and nonexistence.
Fair enough, Thiel, but aren't your doomsayer projections also a direct form of thought experiment, based on extrapolation just the same?
He goes on to outline what he thinks are three defining markets (or distortions thereof) that could utterly define the future ("China", "Internet" and "hedge funds"), and claims that the markets are woefully out of alignment with reality. I think we have to take his view with a large grain of salt here, considering his bias: he's a global macro hedge fund manager who also invests in Internet startups.
I think he's probably right about a lot of the distortion and possibly right about some of the importance of these markets, but he doesn't even mention any other possible contenders (energy industry transformation? nanotech? biotech? government competition?). I think it's a mistake to assume that any one or three factors will determine the mid-term future when there are literally trillions of factors in play. Then the logical conclusion is that we can't really know or predict anything about the mid-term future, which may be largely right, but I think there is possibility to predict with narrow foci, like "What will happen in transistor design?" or "What will happen in nuclear reactor design?"; though those too will always be hampered by revolutions that we never see coming.
Overall, I hope Thiel is wrong about a lot for the reasons that he so adeptly explains: there's not much else to hope for if the alternative to what you want is total destruction and nonexistence.
I started reading the article with interest due to the topic and the author. However, after getting many paragraphs into it and seeing the repeated references to religion, superstition and apocalypse the author frankly lost me and I aborted. I would have liked to read something actually about globalization, but if that was coming up later in the piece I'll never get to it. Life is too short for some things.
I just posted my thoughts on it here. http://bit.ly/b7tGcm I'd post it as a comment but it's too long.
He's good on the financial advice but bad on everything else. Why would you promote Defense technology if you think the biggest risk in the future is war? Shouldn't you be promoting peace?
He's good on the financial advice but bad on everything else. Why would you promote Defense technology if you think the biggest risk in the future is war? Shouldn't you be promoting peace?
1) That's not too long for a comment. This isn't twitter; we're used to comments that are several paragraphs long.
2) If you do post a link to something, use the full link. Link shorteners like bit.ly are frowned upon at HN. This isn't twitter; characters are not at a premium, and many of us prefer to see the real destination of the link.
2) If you do post a link to something, use the full link. Link shorteners like bit.ly are frowned upon at HN. This isn't twitter; characters are not at a premium, and many of us prefer to see the real destination of the link.
Thanks. I'm new here and I'm mostly used to the derp derp stuff, so your comment was helpful. I'm assuming there is no way to embed html here?
Some interesting ideas, but: http://www.imagesjournal.com/issue02/features/groeng1.gif
This is the same Peter Thiel that was recently complaining about women being able to vote.
http://gawker.com/5231390/facebook-backer-wishes-women-could...
http://gawker.com/5231390/facebook-backer-wishes-women-could...
The offending statement is:
"Since 1920, the vast increase in welfare beneficiaries and the extension of the franchise to women — two constituencies that are notoriously tough for libertarians — have rendered the notion of “capitalist democracy” into an oxymoron."
In essence, this appears to be the claim that women are by and large not libertarian voters, and less so than men. This is a mere statement about the world. Believing this statement does not commit you to believing Women Must Not Be Allowed To Vote.
If you object to the statement then you are committed to Women Are Just As Likely To Vote Libertarian As Men; I'm guessing Thiel has some actual empirical data to suggest this isn't so.
"Since 1920, the vast increase in welfare beneficiaries and the extension of the franchise to women — two constituencies that are notoriously tough for libertarians — have rendered the notion of “capitalist democracy” into an oxymoron."
In essence, this appears to be the claim that women are by and large not libertarian voters, and less so than men. This is a mere statement about the world. Believing this statement does not commit you to believing Women Must Not Be Allowed To Vote.
If you object to the statement then you are committed to Women Are Just As Likely To Vote Libertarian As Men; I'm guessing Thiel has some actual empirical data to suggest this isn't so.
Considering that the preceding sentence explains that the 1920s---before those two things happened---were the last decade in which one could be optimistic about politics, and then explains that those two things happening was the reason for the loss of optimism, I don't think it's too much of a stretch to interpret his statement as: the expansion of welfare and the granting of suffrage to women have turned out to be bad for America.
It's possible that he really thinks, instead: while those two things have rendered "capitalist democracy" an oxymoron, which I dislike, I nonetheless must agree that those two things happening was a good idea (for other reasons, presumably). But that certainly isn't the connotation of the words he chose. One could be forgiven for reading him to imply that he was at least not a big fan of either the expansion of welfare or the granting of women's suffrage.
It's possible that he really thinks, instead: while those two things have rendered "capitalist democracy" an oxymoron, which I dislike, I nonetheless must agree that those two things happening was a good idea (for other reasons, presumably). But that certainly isn't the connotation of the words he chose. One could be forgiven for reading him to imply that he was at least not a big fan of either the expansion of welfare or the granting of women's suffrage.
[deleted]
The 1920s were the last decade in American history during which one could be genuinely optimistic about politics. Since 1920, the vast increase in welfare beneficiaries and the extension of the franchise to women — two constituencies that are notoriously tough for libertarians — have rendered the notion of “capitalist democracy” into an oxymoron.
That is definitely complaining about women being able to vote.
That is definitely complaining about women being able to vote.
However, the man seems to have no patience. Jumping from one idea to another like an adolescent trying to figure out what to do with himself. Grand claims, without explanation or elaboration, merely statements. We have lost the way of the ancients. By ancients we are probably led to believe the innocence of Aristotle.
A complete mess. Examples selected. A very narrow argument. Not a person engaging, not really a person communicating, but, possibly, a person with an agenda, someone who is trying to "school" the great ignorant public, to fill the place of the ancient medieval priests.
That is my impressions. Of which I might be entirely wrong. I must however say, his world is dark, made dark by limitations of his imaginations, by loss of hope in the human spirit, by lack of understanding of the human resilience.
Europe has free trade, it has too a fairly similiar ideologies of democracy and capitalism, yet each country in europe is as different as China and America. Globalisation in practice is much different from the globalisation of rhetoric. No need to use the bible. Nor repeat the term apocalyps on and on in the introduction, to present an impression of something really serious, deep and secret being told.
Tell what the world is, we have the brains to understand what it should be.
Though this I should not say - I am frankly disappointed in the consciousness of Hacker News who allowed this article to get sufficient point to make me force myself to read a most ghastly article.