The Contradiction of the Zero-Sum Game

03/09/2020

There is a contradiction in the way the proponents of capitalism approach the concept of the “zero-sum game”, the notion that wealth created or owned in one place must come at the expense of others. This conversation has taken many different forms, from the power of the British Empire on a global scale to national debates over the merits of immigration and welfare. But one on side of the debate, there appears to be a glaring inconsistency in their logic.

Milton Friedman, the sweetheart of “free market” fundamentalism who brought us such successes as Pinochet’s Chile, did not believe that wealth was a zero-sum game. When confronted with basic historical fact – that the wealth of the British Empire, the modern United States of America, or indeed, any imperialist State power, was mostly stolen or the product of exploitation – he was quick to condemn slavery but then proceeded to downplay its reality, and ignored the accusation of theft. The capitalist West was wealthy because it was industrious and innovative, and the idea that such luxury was at the expense of the colonised peoples was simply untrue.

At least, that is the myth he rattled off fairly often and that still has a fair amount of prominence today. Any reasonable conclusion drawn from the historical record would prove definitively that the exploitation of much of the world by the West greatly increased the wealth of the West, leaving the subjugated peoples of Africa, Asia, Australia, the Americas, etc. worse off not only at the time, but still reeling from those injustices today. Ironically, the successes of the “free market”, both during Empire and now, rely heavily on some form of State involvement to survive, despite Friedman’s fanatical devotion to removing governments entirely.

The zero-sum game, in the context of international extortion to benefit a few at the expense of the majority (usually non-white), does not exist in the above capitalist framing. Those poor people could create wealth too, if only they’d be productive… or born white, who knows.

Interestingly, the way in which these anti-State capitalists – the “libertarians” of the US, or the absurd “anarcho-capitalists” – contradict themselves here is due to their consistency on removing the bothersome State apparatus. As someone whose ideal world does involve the dissolution or collapse of the State system, replacing it with corporate overlords isn’t quite what the original libertarians had in mind.

Today, these “libertarians” and their faithful followers – many misled to act against their own interests – claim that government initiatives that help poor, disadvantaged, or immigrant people are, in fact, a zero-sum game. The money used to boost these people up – because god forbid life outside the womb be considered sacred and worth saving to these people – must obviously be “stolen”, given at the expense of those who “earned” their keep. Taxation is theft, right? I mean, if you disregard the oppression of working people in the corporate system who work for abysmal wages while fewer and fewer people own massive amounts of accumulated wealth.

So wealth stolen from the oppressed is not actually stolen, it is just the “West’s” industrious nature (even if the majority of the West is, in fact, disadvantaged too), but when this obscene imbalance is questioned and attempts are made, either through the State or popular struggle, to remedy this disparity, suddenly it is the masses who are out of line and attempting to swindle. This entire narrative is, by design, simply justifying a broken system in a way that is palatable to those unaware of the deception.

By default, the system results in winners and losers. Joseph E. Stiglitz, an economist and supporter of globalisation, openly admitted this in Globalization and Its Discontents, saying that any “honest” economist mentioned this and advocated for globalisation with protections for those who “lost”. It appears the honest ones just weren’t loud enough, and the last half century has been devastating for massive parts of the population while wealth skyrockets for those at the top. If you ignore the obvious question – that is, if the system is apparently so flawed then why not seek a new, working system – Stiglitz does make a decent case for a (tentatively, in my view) feasible version of capitalism.

People at the top can continue to gain wealth, but with just a few fair regulations, taxes, and oversights, everyone who gets left behind can also benefit from the immense prosperity the world has on hand. And when these people gain – from simply being able to live by buying food or getting adequate medical care to getting an education that will aid their search for a job in the new service economy – the entire country gains. The point isn’t, as some fearmongers screech, to make everyone “equal”, dragging down rich people to live in slums with the rest – just improve the damn slums you privileged bastards. You can still be rich and not let the plebs die of financial stress.

And that’s still just under capitalism. We can have a workable, if still quite imperfect, society under these “New Deal” style policies. Hell, you could slap a measly 50% tax on just Jeff Bezos and he’d still have over $100B, with $100B that might save his slaves from poverty. Australia could cut its current military investments by 50% and not only stop provoking our big neighbour but have more than $100B over the next decade or so to allocate elsewhere in the middle of an exploding recession. This is not radical stuff, this is not “communism” – this is simply making a broken system a little easier on those who fall between the cracks, which is to say a lot of people.

I just thought that was an interesting contradiction where the positions change in favour of the oppressors over the oppressed, whether that is imperialism over the colonised peoples of the world or the corporate giants over basically everyone else today. It is very convenient for them to defend the injustices of history and continue to maintain their stranglehold over the wealth of our world today.

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