War is a negative sum game. Peace is a positive sum game.
The reality is China is now the top trading partner for most of the world. China is producing 50% of the world's steel. China has 200x the shipbuilding capacity of the United States, etc etc. Cooperation with China is positive sum for nearly the whole world, but China as the preeminent geopolitical power is incompatible with the unipolar moment where America led the world and decided the rules of the road, and could force dissenters to comply at gunpoint. China is far more relatively powerful than the USSR ever was, much less China+Russia+Iran+North Korea combined.
This is what we're seeing play out in microcosm in Ukraine, where Russia is to a large degree being backstopped by Chinese industrial and economic and diplomatic power. Hard choices are required, and there can be a lot of productive debate on the specifics of those choices. But much of "the west" seems stuck in the 1990s, where America can simply will the world it wants into existence by believing in it enough.
If America and the EU had started dumping 10% of GDP into the military 5 or 15 years ago things would likely look very different now, but we didn't and no one wants to do that now either because it would be incredibly painful for millions of people who in a democracy could vote out the leaders who enacted that policy. Hard choices are required, but we're getting mainly empty rhetoric and wishcasting, by those who wish things were otherwise. I also wish things were otherwise - but that and $5 will get me a cup of Starbucks coffee.
"The era of procrastination, of half-measures, of soothing and baffling expedients, of delays is coming to its close. In its place we are entering a period of consequences." - Winston Churchill
And what is striking is that, so far, China is effectively defeating the USA as the world leader, piece by piece, without firing a shot.
Or at least, has a golden opportunity window to do so within the next 2/3 years, while Trump/Musk & co are dismantling the country capacity to function.
China has done that by ruling internally with an iron fist and ruling externally with financial influence.
The U.S. is actually trying a play from the same playbook by abstaining from deploying troops.
When was the last time you saw China getting torn apart in the media for failing to prop up a failed state? They're doing "greenfield" diplomacy without historical baggage.
Free trade as implemented in the past seems to have been the opposite of democratic cooperation. Non-elected appointees making free trade agreements behind locked doors, which effect ignore the citizens interest and makes industry regulation irrelevant. It was free trade that enshrined current copyright laws world wide with 90 years after the authors death, which few people in the world voted for.
Free trade only reflect cooperation if done transparently, chosen by the people, and which does not bypass industry regulation that people voted on. If that is not possible then the trade agreement need to reflect the different national views on things like minimum wage, environmental issues, safety standard, animal well fare, justice system, trade marks, and so on.
Further to this point, what people call "free trade" is in many cases actually not free at all. A good example of this is the bilateral relationship with Thailand, they put tons of tariffs on US imports, and the US puts very few tariffs on Thailand. Why? The rationale for this is ostensibly that the US would like to have more political influence in Southeast Asia, or hasn't totally internalized that the Cold War is over, or something.
(It also so happens that Thailand places very low tariffs on Chinese goods - and their government has been currying political favor with Beijing for a long time - they are happy to enjoy unrestricted access to US markets and seem quite confident that the status quo will endure so if we are trying to buy political influence with them, we seemingly have been so toothless that it isn't even working!)
The US has deals like this all over the planet where it gives other countries unrestricted access to its markets, in return for what is not clear. A lot of these deals contributed to the movement of US manufacturing to places like Thailand, which hit the US working class in the wallet very directly. Sure there are also good deals that we should preserve as-is but it doesn't seem unreasonable at all to me that some of these be subjected to scrutiny and revision.
That’s why Trump saying he’ll normalize tariffs is popular:
Many Americans feel cheated, whereby they give better terms to other parties and don’t even get respect in return. So they now support a movement to mirror that behavior.
This is an example of the iterated prisoner’s dilemma: one side defected on a partnership for their benefit, trust collapsed, and now the originally cooperative partner is acting selfishly as well. Reciprocation is a fundamental part of relationships.
The US isn’t the entity that needs to hear “cooperating is better than a zero sum mindset”.
Edit to respond:
Most of those people are upset about that as well:
- foreign owned farmland and corporations;
- foreign owned condos, etc;
- inflated stock prices enriching Wall St relative to Main St;
…and so on. What you’re describing is the concerns of the petite bourgeoisie who have benefitted from inflated stock prices, housing prices, and land prices.
For Trump supporters, ending that distortion in the market while boosting domestic labor is a win-win.
Americans will “feel cheated” again when reality arrives and learn that a huge part of their economic power is based on the world dumping trillions of dollars of their savings into us stocks, bonds and real estate, thus making the US dollar artificially strong, making it possible for Americans to buy stuff and being rich. Wait until foreign money and trust starts leaving the US to see how “betrayed” you really get, now it has been la la land, let’s wait for the next act..
I assume the intended audience for the tariff talk is rust belt workers (who swung the election) who feel cheated for more dramatic reasons like their company folding while foreign suppliers thrive.
> Many Americans feel cheated, whereby they give better terms to other parties and don’t even get respect in return
> - foreign owned farmland and corporations;
That's hilarious. Many languages have a specific term for US private equity investors that rush in, buy up entire countries' corporations, then try to squeeze out every cent of profit.
> Many languages have a specific term for US private equity investors that rush in, buy up entire countries' corporations, then try to squeeze out every cent of profit.
Sure — the US bourgeoisie and petite bourgeoisie benefitted. But they’re not the ones supporting Trump or feeling cheated.
> But they’re not the ones supporting Trump or feeling cheated.
One of the groups most benefiting from the US dominance in the past decades were the farmers. Which is one of the larger lobby blocks and voting groups supporting trump.
And the logic doesn't compute either. Average people around the world got exploited by western, but primarily US, billionaires.
So the average people, the proletariat, should unite and revolt against those billionaires.
Instead the US proletariat voted to give billionaires even more power, in the hope that "their" billionaires would exploit foreigners more than themselves?
Free trade is built on top of economic systems which themselves are built on top of zero sum games. The only thing we can put economic value on are goods and services that use finite resources (oil, lumber, human labor, etc).
A forest, for example, has no economic value but lumber does.
Free trade may optimize how goods and services are dispersed but it can't escape the zero sum game that is foundational to economics.
I don't think it is merely a matter of redistribution. It can escape the zero-sum game through productivity gains, technological progress, recycling, and better legislation (for example, policies that regenerate forests). It may even create new industries as replacements. Because of this, I don’t believe it is inherently a zero-sum game.
> The only thing we can put economic value on are goods and services that use finite resources
A software patent does not consume physical resources (aside from the initial human labor) yet holds tremendous economic value. An app can be easily duplicated, making it a virtually infinite resource, while the patent remains attached to its novel functionalities.
There is always the possibility to dig deeper mines, explore further into space or just give people the possibility to live more a comfortable life.
But it is not only about that. Trade is also for comparative advantage. If you ever played settlers boardgame with more than two players you'll soon realize that whoever trades the most wins. And it does not really matter who you trade with, it is just reaping the benefits of trade instead of being stuck with 10 wood that is of low value to you but of high value to someone else.
What you're describing is a zero sum game. The world is limited to the board game, and whoever is best at trading and strategy collects the most finite resources and the others lose.
(Sorry if I lost the thread here. Most here were trying to argue that trade and globalization are a way to escape a zero-sum game).
I get your point, but I don't think a board game is a good abstraction to collapse the real world into. The world is not a fixed, closed system with finite resources. In a board game, expansion and innovation are not possible, only trading and strategy, as you mentioned, can optimise the system to some extent. Moreover, winning in a board game happens solely because of its rules, whereas in the real world, one person's success does not necessarily mean another's loss. Trade can be mutually beneficial, driven by each party's ambitions.
Innovation is an interesting wrinkle in the comparison for sure (I used the comparison only to continue with the previous commentor's point). Innovation only increase the potential usefulness of resources though. Assuming that will always avoid hitting the boundary of the zero sum game assumes perpetual innovation at a good enough pace to keep up.
Trade is an interesting one because it can be mutually beneficial, though it rarely includes everyone. Two countries can trade and both be better off, but other countries excluded may now be worse off. Trade also can't be mutually beneficial with regards to relative gain. Both sides can gain in trade or cooperation but one will always have gained more than the other. That doesn't make my point by the way, but an interesting related dimension to the whole topic.
The first tried to explain that it does not necessarily have to be a zero-sum game.
The second paragraph tried to explain that, even if you do see it as a zero sum game, trade between two parties, or trade in general, can give you benefits over ones who are not part of the trade.
Obviously I am trying to describe this in simple terms without writing a book. But i do think the board game analogy holds even though it is very simple.
That's a very limited (XIXth century?) perspective.
A forest (like, anything) has economic value, as soon as you get people to adopt/believe in it.
A forest may even have a greater economic value than the lumber it could produce, if it would, for instance, help/ensure the prosperity of something else that has economic value (leisure, wildlife, heat protection, soil water retention, etc.).
I completely agree outside of economics. I put much higher value on a forest than lumber. Economically, though, where is the forest ever accounted for?
In your strategic business plan, by IFRS accounting standards (existing and developing).
You have several options, account for it as lumber (but... well), or as a carbon sequestration well (so you could get carbon credits, IAS 38), or as an ecosystem providing services (several frameworks under work here), or as a contingent liability or asset (IAS 37, can be in the balance sheet if the probability of event/impact is high/certain).
Even if you forget to account for it, your insurance likely will remind you about it.
Once someone can "own" the forest, that be a bit of a cheat around the whole idea. I'm thinking out loud here, but I think all of you're examples are actually valuing the financial mechanisms rather than the forest itself.
The carbon credits are given economic value, its just not a physical resource like lumber so its harder to distinguish that the credit holds the value rather than the forest.
That is pretty much the definition of it.
And for example free trade is a flavour of it.