Tuesday, October 4, 2011

Zero Sum Politics

From a fascinating (though somewhat gloomy) op ed by Peter Thiel - founder of Paypal:
The give-and-take of Western democracies depends on the idea that we can craft political solutions that enable most people to win most of the time. But in a world without growth, we can expect a loser for every winner. Many will suspect that the winners are involved in some sort of racket, so we can expect an increasingly nasty edge to our politics. We may be witnessing the beginnings of such a zero-sum system in politics in the U.S. and Western Europe, as the risks shift from winning less to losing more, and as our leaders desperately cast about for macroeconomic solutions to problems that have not been primarily about economics for a long time.
It could be dismissed as the jeremiad of a bitter old man - if he wasn't so young and successful! More importantly, he believes in investing for the future: hence the recent announcement of the first of the 20 under 20 Thiel Fellowships. Politics might be a zero-sum game at present: but the future doesn't have to be. 


  1. "... in a world without growth, we can expect a loser for every winner."

    Depends on what is being produced. Certainly, if we are producing shoe box apartments, shopping centre hell holes, processed muck meant to be edible, disposable gadgetry, then it is a zero sum game. Or worse.

    But if what is produced has a long lasting real human benefit to it, then there is real wealth created, notwithstanding the GDP and GNP figures etc.

    As John Ruskin said, 'The only true wealth is life'.

    Or refer to the economic thinking of EF Schumacher - http://en.wikipedia.org/wiki/Small_Is_Beautiful. His brand of economics was designed towards such ends.

  2. @roc. Absolutely! All growth in nature is balanced by decay. As we are part of nature, why should we believe it must be different for us?

    The mantra of growth has rarely been questioned, but, as you say, why not aim for quality over quantity?

    We built 90,000 housing 'units' in the last year of the bubble. That was growth, it added to GDP, but a great many of those units were so ugly, ill-built and badly located that they are now little more than an awkward problem. We need to do one hell of a re-think on the value of endless growth. In medical terms, that's cancer!


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