Roundtable on Global Capitalism
Robinson’s essay on global capitalism is compelling, but perhaps doesn’t go deep enough. He portrays global capitalism, and its wealthy owner/manager class, as all-powerful. But I think his analysis miscasts the source of that power: I believe it lies in the fact that global companies were simply the first to exploit a powerful new generation of tools (the IT revolution). That is particularly true for cloud-based platform companies like Google, Facebook, and Amazon—the wealthiest companies on the planet that break the old model of capitalism by avoiding most of the physical factors of production. They don’t make things; they just connect people to information, to sellers of goods and services, and to each other. Robinson also bemoans the decentralization of production and service delivery among traditional companies, which I actually see as a strength—a benefit—of global capitalism. Yes, sweatshops and call centers are awful, but subsistence farming on tiny plots is worse. So the migration of garment manufacture from the US to China and then to Vietnam and Bangladesh betters the (global) human condition. And finally, I think Robinson mistakes the current extreme concentration of wealth and market power as a permanent condition, rather than an extended market fluctuation perpetuated to a significant degree by the actions of central banks in keeping the cost of capital near zero. I may be wrong, but I think even the most powerful companies respond to markets. So one could rephrase the question he addresses as the following: How can we foster markets that are more beneficial to both people and the planet? And one way may be to hijack the tools that global capitalism—especially the largest and most powerful companies—is creating.
Take an earlier example: the Internet. It provides historically unprecedented access to information and digital services, in part because no single entity—corporate or government—controls it (although China is trying within its borders). Yes, it has made Google and Facebook rich, but it has also empowered billions of people. Within a couple of decades at most, the mobile Internet will reach virtually everyone on Earth. If people use Google for search or Facebook to track their friends or other companies to buy things online, they do so at their own choice; it is a market, and markets change, especially in the face of rapid innovation. Ultimately, they reflect the will of consumers. Already, most consumers seem willing to trade the data about their online activities in return for free or more convenient services: today, search; tomorrow, free individualized learning systems or location-based agricultural advice or Big Data–driven health consultations. Artificial Intelligence–based tools (of which the new Google translate is a forerunner) are likely to do away with language barriers that separate people, as well as enabling people to learn more effectively or to master tasks otherwise beyond their capabilities. Do we really think that the world will be worse off for these tools, brought to us by global capitalism? Can market pressures force even giant companies to change their behavior (see Facebook scramble to halt the tide of fake news on it site)? Might self-driving vehicles and smarter machines of all kinds and the inevitable shift away from fossil fuels (driven by advanced solar cells and the next generations of batteries already in view) reduce the burden of industrial civilization on the global climate—through market forces alone, regardless of what governments do? I think it’s a good bet. Consider how the US government is backing away from the Paris Agreement, while nearly all large US-based companies announce their intent to support the agreement with their actions.
Or consider the newly emerging tool called blockchains, in which both large companies and startups are investing heavily. Blockchains may come to dominate banking, global financial systems, and many administrative systems—land ownership records and transactions, quality control in food supply chains, international trade finance (all already launched), perhaps soon even voting systems. Blockchains, like the Internet, have the feature that no single entity can control them, because the ledgers that record the accounts or transactions or other information are widely distributed. There are huge efficiencies to be gained from conducting global capitalism on blockchains, so they are likely to happen. Will that make global companies even richer? Yes, at least initially. But blockchains will also make it much harder for companies or even individuals to evade taxes or cover up illegal payments, for the records of transaction are permanent and accessible for audit. That’s bad news for drug dealers or illegal arms merchants. Then suppose that a country—perhaps the US or India—introduces a blockchain-based voting system which both registers all citizens with biometric IDs and then records their votes. It would then be much more difficult for states or local jurisdictions to limit access or to stuff the ballot box, or for politicians to claim voter fraud. That might help give rise to more vigorous democracies. Suppose further that people in many countries (including those that are not democracies) decided to use a blockchain across national boundaries to express their opinions on critical global issues, and eventually to “elect” a global government, through a tool that is not controlled by national entities? Might widely shared global views come to prevail? Might they at least provide the foundation for a Transformed (but global) World?
Comparably disruptive tools are sure to emerge from molecular biology, even if it is too early to know what they will be. But when current efforts to compile knowledge about virtually all the molecules found in living organisms are complete in a few decades and the tools to manipulate both genes and proteins or even to make synthetic proteins are commercially available, many new possibilities open up. Not just the ability to prevent or cure most illnesses, but also the potential for far more productive plants that, in turn, could be “tuned” to produce healthier foods. Because there is money to be made—that is to say, there are markets for such products and services—what is possible is likely to happen. Will the knowledge and the tools be so widely available that they cannot be “captured” by a few companies or countries? It is not yet possible to say, but I think it is likely. Could the result be to banish hunger as well as much disease, and to reduce agriculture’s burden on the environment? People who are not sick or hungry, and who are better informed, seem more likely to become change agents for a Transformed World—especially if they buy, or co-opt, tools from global capitalism.
I agree with Robinson that global capitalism can’t create global governance in any sustainable way (I think autocratic systems are not sustainable). And it is hard to envision that national governments will willingly cede power. I think the only hope lies in people, in informed global communities, in leveraging tools that can benefit virtually everyone. And I think the place to start is with markets, not governance. My point is that for most people, most of the time, shopping beats voting, and that’s why markets are powerful. Global capitalism is certainly in large part responsible for the extreme inequities in today’s world, but that may reflect the fact that the tools it employs so skillfully have not widely reached hands capable of co-opting them well—after all, the millennials, the first Internet generation, are still relatively young. And markets evolve. In the meantime, global capitalism is developing and disseminating new tools, many of which will empower markets—that is to say people—even more. Indeed, global capitalism is uniquely efficient at commercializing new knowledge and new tools. Let them. And learn to use the tools to make a better world.