Tag: capitalism

Comrade Bezos

On By phulsrojIn UncategorizedLeave a comment

Jeff Bezos is a capitalist. Jeff Bezos is a communist. Two seemingly irreconcilable statements, but nevertheless both true. Few doubt that the God of Amazon is an arch-capitalist, but many would refute the assertion that he is a communist – Bezos himself certainly included.

He is obviously not a communist because he is spreading wealth around as communism was supposed to do. Bezos likes to keep workers at a subsistence minimum as communism ended up doing as well. But still, that is not where the most striking similarity lies. Where Bezos and communism overlap is in the attachment to planned economy. To be fair to Bezos and Amazon, they are not the only sworn capitalists who are de facto communists. All the trillion-dollar companies and their leaders are.

It should be unnecessary to explain why we have this paradox, because John Kenneth Galbraith already did so fifty-five years ago in his splendid The Industrial State, but fact is that the wisdom of Galbraith is largely forgotten in the debates about Big Tech and the trillion-dollar companies. The giant companies shield themselves from competition by virtue of their economic might, and government, wittingly and unwittingly, aides and abets. The abundance of riches and the benevolence of policy makers and policy planners allow the trillion-dollar companies to plan long-term and accept risks that no company in an Adam Smith liberal economy could. Facebook’s venture into the metaverse is a casebook example. It is exactly the kind of thing that could have happened in a communist planned economy, had the leaders been cleverer managers. One thing that sets Bezos apart from red secretary-generals is that he and his ilk undoubtedly are much, much better at identifying potential needs and using their economic toolboxes for their satisfaction.

There is more afoot than competition being replaced by economic plan, however. The historically unparalleled wealth of the giant companies brings power that does not only work hand-in-hand with the state but is starting to eclipse it. The leaders of the giant firms may not yet see it in quite that way, but still, this is the reality.  The tools deployed include time-honoured ones, such as picking up stray politicians, see the acquisition of the disgraced former chancellor of Austria by an extreme right-wing tech tycoon and, before that, of the former deputy prime minister of Britain by Facebook. Although there is a depressingly large number of historical precedents, such relationships are now married to corporate wealth that rivals that of states and that is unprecedented at least since the East India Company became a virtual state itself.

If the litany would stop here, the leaders of the trillion-dollar companies would still be communist yet risks for society could be contained. But consider now the horizonal expansion of the companies and the associated activities of their principals. Elon Musk’s avowed attempt to save democracy by buying Twitter and release all its right-wing demagoguery potential is something to behold in this respect! But let us stay on Bezos, because he even better exemplifies how much the moguls can spread their wings. Apart from his stake in Amazon and its subsidiary Whole Foods, Bezos owns Washington Post (to his credit he has not yet turned it into his private Pravda), and the Blue Origin space company. Amazon itself is dabbling in telemedicine and is a leading cloud computing company through AWS and experiments with drone delivery systems. As we know from Facebook, there is only a short reach to an own cryptocurrency (I propose to name it the Bezo), and security, robotics, virtual education, general health care and health insurance beckon. The trillion-dollar company can easily become a ten-trillion-company (Apple reached the three-trillion mark a while ago, before falling back). Most worrisome, the ten-trillion company will then constitute a rival to the state itself but will not have its solidarity and common welfare mandate.

Fact is that the current trillion-dollar companies in the end may be able to offer all the services the state offers – and more. And in undermining state authority, the trillion-dollar companies will deploy the siren song of ‘small government’, the pre-eminence of private initiative, all the libertarian slogans that the companies themselves know are hogwash. What will not be said is that once in the hands of giant companies, citizens will have exchanged a state that, however, imperfectly, tried to foster commercial competition with planned economy mastodons that will feel no responsibility towards those human beings who hold no commercial attraction. Bezos will become the better communist because he can choose his citizens and leave all others behind, where the communist state made almost everybody equally miserable.

The replacement of the state by giant companies is not yet inevitable, but the end is nigh unfortunately. The state is still strong enough to reign in the horizontal power of the mastodons, but we need to force it to act now – not only in order to protect consumers but in order to save the state itself. It is urgent to torpedo commercial communism!

(Inspired by Marco Aliberti’s and my book, Essays on the Optional Society and a Letter Concerning Inclusion,  https://lnkd.in/eYDsHXSs)

Poverty and Choice

On By phulsrojIn Policy, Policy, politics, Uncategorized2 Comments

Self-interest and altruism lead to same results more often than we assume. Because we have not internalised this basic truth we frequently go wrong. Exhibit A in this respect is the Trump administration with its religion of America First. Did that bring America happiness? I think not. 

Fortunately, we are now in a new era. Yet, we continue making the mistake. The competition for vaccines between countries is Exhibit B. Not only are we getting suboptimal results when we compete in the way we do in the rich world, but by leaving the developing world high and dry we are not only inhuman but also undercutting our own efforts. Leaving India and Africa as labs for the corona virus to establish new variants that can defeat our warp speed vaccines is hardly a great idea even if looked at purely from the egoistic perspective.

What we are doing in this situation, as in so many others, is that we are leveraging our wealth of options against the dearth of options of the developing world. The downside of having few options is that you have few possibilities to improve your lot. But a downside of having many options is that that you have a good chance of exercising them wrongly. Given a choice, you would certainly always go with having many options despite the exposure to own stupidity in exercising them. Nevertheless, what is poorly understood is that to achieve best results and most happiness there should be a reasonable balance of options access, be it within a country or between countries. Imbalance is not only a source of tension, but undermines the power of the options of the privileged. There is no point in being able to buy a Bentley if not enough people have the option of buying cars so that proper roads can be built.

Very often the rich and the poor do not compete for the same resources, of course. The poor are nevertheless left in dire straits because of our ignorance, arrogance, neglect. They are left destitute because the rich do not understand that it is in their interest to lift the poor out poverty. It is a wry old Marxist insight that the bourgeoisie is better off with a robust underclass that can produce and consume. Although the recent wealth of the West can be ascribed largely to the empowerment of the lower middle class, the working class, we are racing headlong for disaster because we have again forgotten this truth. The current gaping inequality is testament to our forgetfulness.

Ethical behaviour should be an imperative, but it is shocking that we also ignore a most fundamental win-win. With the number of options increasing exponentially in virtually every domain of human endeavour we risk creating a much larger and more desperate proletariat if we do not make sure that everybody has both the means and the capability to exploit all that choice. 

The idea of a universal basic income has a lot of wind in its sails – hot on the heels of the first inadvertent experiments in this direction in the United States, where coronavirus stimulus cheques were sent to a very broad swath of the population. Universal basic income may not be the only way to ensure that all have the means to benefit from the options revolution, but it is certainly one way, particularly if we are able to achieve such universal basic income on a truly universal scale, that is, in all countries. When the objection comes up in response that this is unaffordable the bourgeoisie should remember the usefulness for capitalism of the above Marxist insight.

As to the capability to benefit from the mass of options, the only way forward is, of course, much better education, both within the rich world and without. Elites have been very complacent in this regard for half a century. They assumed that the education task was achieved with the right to go to school. However, the next step should have been to introduce a process of continuing improvement of the quality of teaching. The rich have, of course, achieved this for themselves but have left the poor to sink. The desolate state of many underprivileged schools has been an important driver of inequality, and will continue being so unless something is done. That ‘something’ should include the revival to former glory of the social status of teachers in the rich world. Accordingly, the starvation wages paid to the teachers of our children at their most impressionable age must become a thing of the past. The professors of Stanford should perhaps be paid less, the teachers in poor East Palo Alto certainly more. 

In the developing world the remedies in this respect are more complicated, yet the optional society has shown how new tools are invented when compelling educational needs so dictate. Zoom teaching is now commonplace in the West because of corona.  If we would understand the needs of developing countries as being equally compelling, the world could, without being patronising, put the same creative mechanisms to use in order to meet their requirements.  Think about the potential of digital avatars as teaching buddies to help overcome teacher shortages.  The result of such efforts would be that we would turn the deprived into effective participants in society. That is not only right but also our self-interest!