Chinese and American flags flying together.
A while back, Haydar Khan wrote an excellent article on American economic and technological decline, focusing on the diagnosis and differing solutions offered by economist James Galbraith and by Peter Thiel (the founder of Palantir, who made his initial fortune with PayPal and who is famous for his libertarianism, despite running a surveillance company).
The US is riven by divisions, split into two factions, who mutually hate, fear, and distrust each other. It has been in relative economic decline since the 70s, and this decline shows up in productivity statistics and in other ways like corruption and inequality. China is now, by some measures, the larger economy, and still growing faster than the US. While still somewhat behind technologically, in some areas, like 5G wireless, China is ahead.
So how does one fix this decline? We’ll skip Galbraith’s plan and move to Thiel’s.
Khan thinks that Thiel’s solution is more likely to work, because unlike Galbraith, Thiel has found scapegoats: The PC Left, parts of Silicon Valley (Google in particular), and China.
This is a standard policy. When a country is cracking up with internal divisions, it is common to find enemies to focus on. The German Nazis found socialists, Jews, and other “mongrel” races like Gypsies (whom everyone seems to forget), and the nations who had taken what they saw as German land, in particular France, Poland, and Czechoslovakia.
Obviously, any country that is “great” can’t “fail” and if it does, it must be because of “traitors and enemies.”
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The pivot against China began with Obama, ramped up with Trump, and despite some fears among China hawks, seems likely to continue under Biden. The PC left includes all the usual scapegoats, people who violate “purity” ethics: transsexuals, gays, blacks, and so on. The people the US and, indeed, many nations, love to beat down. Its core includes a LOT of Jews. These are groups many people live to hate and hurt.
As for Silicon Valley, it’s a neat trick for Thiel to pretend he doesn’t belong, but also it’s smart: He’s picking a part of Silicon Valley (his enemies) to be taken out, hoping to avoid the backlash himself. Silicon Valley isn’t loved, everyone believes that tech companies took and take away the good jobs, leaving people driving cars for Uber and doing odd jobs for Task Rabbit, and so on. There’s no dignity to these jobs, and definitely no money to speak of.
The political classes have bought in, big time, to the China part of this pivot, and there is a lot of hatred among both Democrats and Republicans of big tech, though more Facebook than Google. The PC left is a harder question; the liberal core of the Democratic party loves PC politics because they treat it as weaponized tokenism. It doesn’t matter how blacks are doing, what matters is that a black man was President. It doesn’t matter how women are doing, what matters is that a woman is going to be vice-President. Liberals want the glass ceiling shattered for minorities and women, not for the majority of minorities to have a good income and good health care, say. Plus, PC politics is easy weaponized against the Left: claim someone is racist, sexist, or anti-semitic (or is 30-years old and dares to date a 20-year old) and by the time it’s shown they aren’t, they’ve already lost.
Still, there’s a deep contempt in the liberal class whenever identity politics are taken truly seriously. Joe Biden may make noises about Black Lives Matter, but his plan is to give the police more money, after all. He doesn’t actually believe in it.
Thiel’s trying to package up all his personal hatreds and enemies into one bundle and get them chosen as the scapegoats. This may or may not work, but that’s what he’s doing. The problem is that, even if he doesn’t get everyone he wants in, the basic strategy is working. The US is moving towards a cold, and perhaps hot war with the rising superpower and the last superpower (China and Russia, respectively). At home, passions are hot and, at some point, some groups are going to be chosen as the “bad Americans.” The traitors. Some part of the elite (a small part) will be thrown to the dogs and so will many of the powerless.
This doesn’t happen in all great powers in decline, to be sure. But it’s a common play, and it has powerful people other than Thiel pushing it. They see US decline and its disunity, and they are looking for a way to turn the decline around or at least distract Americans from the actual authors of the decline (that would be people like Thiel) towards scapegoats.
Given how angry the American people are, this seems like a good odds bet. It’s not a sure thing, but it’s one of the high probability outcomes, especially with regards to China.
If you’re in one of these groups, or if you have ties to China or Russia or countries which will fall into the Chinese bloc, you should be keeping a very careful eye on how this develops. These are people who don’t blink at mass casualties to keep their power and wealth, and they won’t blink if you become a statistic.