I’m skeptical about this kind of bold prediction but what do I know (via Felix Salmon):
The growing power of state capitalism will have important implications for the politics of globalization — the processes by which ideas, information, people, money, goods and services cross international borders at unprecedented speed. For years many developing countries have welcomed Western companies and investment, in part to build their domestic economies by exposing local businesses to the advanced technology, managerial expertise and marketing techniques that only foreigners could provide. But as local companies mature, state capitalist governments will begin to more openly promote and protect them at the expense of outsiders. As local businesses begin to compete more effectively, some will begin to see foreign partners as commercial rivals — and will begin to use their growing clout with state and local bureaucracies to rig the game in their favor.
It’s an interesting thesis, because it’s not saying that state capitalism is teh awesome (as Tom Friedman and, to a lesser extent, Fareed Zakaria say), but rather that it may dominate in spite of its inefficiencies, because of the governmental structure of China and Russia, political pressures in the west, and risk aversion among investors. Definitely worth a read because it’s an intelligent take on something that pundits generally kick around in a glib, shallow manner. I wish I knew enough to say how deeply the recent “self-inflicted catastrophe of global market capitalism” changed the rules of international economics.
KG
So then, it’s just like everything else?
Daddy-O
Capitalism isn’t awesome. It isn’t a religion. It isn’t a theory. It just…is.
We don’t have capitalism here much. Just on the smallest of scales. The playing field is so tilted, not much grows there any more.
Just sayin’.
BR
He’s wrong. How do I know?
See Tim F.’s post on peak oil from earlier. That is, globalization no longer makes sense when oil is scarce and expensive.
SiubhanDuinne
Kind of like photosynthesis.
DougJ
@Daddy-O:
I sort of agree with you, but I have my doubts about the Chinese model. You know, it was us, baby, way before them. I just don’t see that much evidence that their model will continue to work for that much longer.
CalD
At that point, one has to imagine that re-erecting protectionist tariffs will start to sound like a better and better idea again.
Linda Featheringill
He might be right, for many reasons.
The “free market” is a chaotic monster. Any government that that allows its citizens to be jerked hither and yon by the unregulated market will not be stable for very long. State capitalism is an effort to harness the energy of the market wo being destroyed by its every whim and whimsy.
And some kind of protectionism might be necessary to keep things on an even keel.
BR has a point, though, about reduced oil. Less oil would probably lead to higher shipping costs and a need to produce things closer to the target consumers. Protectionism might arise because of economic reasons rather than for political or philosophical reasons.
@Dogsdoingthings
Dogs kicking around state capitalism in a glib and shallow manner.
lamh32
OT: Via Ben Smith @ Politco:
Shit meet fan!!!
Federal judge overturns ‘Don’t Ask, Don’t Tell’
What does this mean nationally? Or does it mean anything?
Redshift
Back in the days when the idea was seriously promoted that gaining economic freedom drives a demand for personal freedom, I actually really hoped it was true. (And I think there were a lot of people who believed it was, not just looking for a moral argument to be able to do business with repressive governments.)
In retrospect, it’s not surprising that such governments have found a way to use the tools of government to adapt to that strategy, especially when competing with a superpower that has been seized by an ideology that government should never have a role in capitalism. It’s genuinely hard to predict which system will win out in the end.
Mike G
a superpower that has been seized by an ideology
that government should never have a role in capitalismof solipsistic dipshits who refuse to acknowledge the countless ways their lives have been supported and stabilized by government actions, and blindly insist they are rugged individualist market warriors who did it without a lick of help and would’ve done even better if they ‘went Galt’.burnspbesq
@lamh32:
Haven’t read all the way through the opinion, and I’m interested to see how the judge got to a conclusion that the LCR have standing. Even if the government didn’t challenge standing in the district court, because standing is jurisdictional it can be raised at any stage in the proceedings, and can be raised by the court on its own initiative even if not raised by the parties.
Strictly speaking, District Court decisions are binding only in the district in which they are issued, which in this case includes Los Angeles, Orange, Riverside, San Bernardino, Ventura, Santa Barbara, and San Luis Obispo Counties. Not a lot of military facilities in the Central District any more; the biggest are Fort Irwin, the 29 Palms Marine Corps base, and the Point Mugu naval air station. Would have been a lot more interesting if the case had been brought in the Southern District, which includes San Diego County, home to about a gazillion sailors and Marines (including lots of gay ones – ask me sometime about going to a Melissa Etheridge concert in San Diego).
WereBear
It’s not just the transport costs, though that has to kick the legs out from under globalization. It’s also the manufacturing costs, period.
We are moving closer to the state where stuff won’t get made unless someone commits to buy it. Look at the wastage we accept in the present system.
Corner Stone
@lamh32: Nothing. It will be appealed by government attorneys and overturned for lack of standing and/or jurisdiction.
El Cid
You’ve also got hundreds of millions of people around the world who just aren’t seeing the benefits of the unbridled capitalism that they were promised. After a while, many of them feel that they’d like some sort of benefit out of the economy now, rather than be told that eventually it would trickle down to them.
burnspbesq
@lamh12:
Ignore Corner Stone’s amazingly thoughtful and detailed analysis of the standing issue. The court made extensive and detailed findings of fact in support of its conclusion that LCR satisfied all of the requirements for associational standing, and the analysis looks to me to be correct.
@ Corner Stone:
Reading is fundamental.
Violet
If Friedman says it’s teh awesome, doesn’t that mean its time in the sun is almost over? Isn’t he wrong about just about everything?
bystander
A corollary?
mclaren
@Daddy-O:
Actually, capitalism is a religion — and a very recent one at that. Capitalism qualifies as the Dianetics of social-historical cults. It became wildly popular around 1790, when the steamm engine plus the Maudslay lathe made modern factory mass production possible.
Capitalism kicked into high gear after Henry Ford invented the assembly line. But now, when computers are increasingly able to perform sophisticated tasks that formerly required highly skilled humans — tasks like spotting tumors on X rays or performing surgery or designing minimum-drag airplane fuselages via genetic algorithms — capitalism is morphing into something else. When you’ve got entire factories with only two humans on the factory floor, society needs to start thinking about the fact that everyone entire needs are someday soon going to be met with a nearly totally automated production system. That includes agricultural robots.
When you get to that point, why do you need money? What use is profit? If robots build your houses out of recyclable materials and robots cultivate and harvest your food and robots build and repair the green energy solar/electric/Bussard fusion (or whatever) generators, what is really the point of jobs and money and trying to acquire a bunch of things? Especially if (as seems likely) we wind up with personal replicators that can build small objects from nanocarbon fibers, so the entire concept of buying anything from a factory starts to seem pointless. You download the crowdsourced design into your personal replicator and the raprep prints it for you. You need a toaster, you print a toaster. You need a chair, you print a chair.
This world we’re heading into has no place for capitalism or money or profit or any of that antique 19th-century shite. Physical objects are increasily going to become information you download into replicators. MIT is already designing replicators that will print entire houses. Why do you care about being rich or having a bunch of things when you can just print whatever you need?
Capitalism was a phase civilization went through, like the worship of god-kings or the ritual sacrifice of the Corn King and the Spring Queen to make sure the harvest was fertile. We grew out of those phases as technology advanced. Now technology is advancing again, and we’re growing out of capitalism.
Capitalism is a form of damage, and society is routing around it. At some point in the foreseeable future, people are going to laugh uproariously if somebody tells ’em there once used to be such a thing as “money” and “billionaires” and “stock markets” and “supermarkets” and “big box stores” and “paychecks.” They’ll laugh the same way people laugh today when someone describe the cargo cults on native islands where South Seas islanders built bamboo control towers and played with radio-set-shaped pieces of driftwood in an effort to entice the white visitors from America to return and land their giant silver birds on the South Sea islands again and pay the islanders to help build airstrips to attack the Empire of Japan.
bjacques
If state capitalism has had any benefit it’s that its success (so far) has knocked away the smug illusion that capitalism can only flourishes in democratic countries or that it forces authoritarian regimes to become freer. If anything, it makes business leaders in, say, the US, salivate over the, um, lack of friction their cousins in China enjoy, and lobby aggressively for the same kinds of corporate freedom (but not any other kinds) at home. It’s cold comfort that every now and then the Chinese government executes an executive (a not well-connected one) for killing a few dozen people. They obviously don’t give a shit about fair trade or what effect their strong currency has on trade. Then again, neither did we back in the day.
And it’s pretty much too late to do much about them, except try to find a way to compete without doing it on their own ground. That and hope the more innovative sectors get tired of China’s government trying to steal their secrets and the Russian government playing favorites with local competitors. Or encourage Brazil and India, the more benign of the new players.
Of the “Seven Ways To Save The World” linked in the article, #’s 1 and 2 are the same old “balance the budget on the backs of workers and retirees” song and most governments are all over that. #7, “don’t resort to protectionism (except where convenient and we can get away with it)” is what we’re doing now. The others, involving responsibility, investment and a bit of international cooperation, are unlikely.