Dana Blankenhorn

The Twilight of Nationalism

If mankind still exists in 2119 their historians will write about this era as the Twilight of Nationalism.

Nationalism was essential when economies were based on resources, machines or muscle. In the era of clouds and devices it’s increasingly irrelevant. The global nature of our existential crisis makes nationalism an outright impediment to the survival of mankind.

Thus, it’s no coincidence that nationalism has been a rising force in the decade now ending. Just as it concentrates the mind to know you’re to be executed in the morning, so it is for leaders and political movements. Seeing sunset in the distance you do what you can and ignore the consequences you know are coming.

The Trump election acts as a midpoint and permission slip for all this. Nationalism was already on the march, in Europe, in the Middle East, and in Asia, through the agency of Russia, when Trump came to office. But Trump has given nationalistic impulses around the world permission to act. There is no American opposition to ultra-nationalism anywhere, no alliance worth protecting, no counter example to follow.

Thus, nations push their boundaries outward, fearing any force that might threaten their power, and ignoring the natural internationalism essential to economic growth and climate action.

That’s why Brazil is going after its rain forest. That’s why India is going after Kashmir. It is why China is going after Hong Kong. That’s why England wants to detach from Europe, why Eretz Israel is a thing, why Saudi Arabia seeks dominion over its whole peninsula. If you can afford it, nationalists think, seize the day. The window is closing.

One Nation. At War. With Itself

In August of 2019, the United States is a nation at war with itself.

We are at war with fundamental changes that must occur if the country, and the world, are to be saved from the Industrial Revolution.

We’re also at war with the essentials of economic growth in our time.

As I have written many times, the gating factor in technology is human capital. Trained, eager, free minds, willing to think the previously unthinkable, to model it and make it reality. This is where money is made today.

The more such people you have, the fewer of the other kind, the more money you make. The more freedom these people have, the greater their access to money, to new ideas, and to one another, the more your society prospers. This is Israel’s secret sauce.

Resources don’t matter. Machines don’t matter. Muscle doesn’t matter. Minds matter, more than anything.

The 2020 Game

The Tell on what will happen in 2020 came in late July of 2019.

Trump’s most loyal lieutenants, attorney general William Barr and Treasury Secretary Stephen Mnuchin (far right), issued existential threats against the Cloud Czars. Under Trump’s orders.

The Cloud Czars, for those unfamiliar with my current work at InvestorPlace, are Microsoft, Amazon.Com, Google, Apple and Facebook. As technology has come to dominate the economy, the Czars have come to dominate technology.

They’re the Cloud Czars because the tool which dominates technology is cloud computing. It combines parallel processing with virtual operating systems and open source techniques to hold down costs.

The 1979 Game

An industry’s takeover of politics tends to be defensive.

It happens when that industry seems to be riding high. It acts against leaders whom neutral observers may credit with that rise.

I covered this story 40 years ago. In Houston.

The oil industry did great in 1979, despite Jimmy Carter’s cardigan sweater. Saudi Arabia, more Texas’ ally than America’s, had proven the economic power of resources with its 1973 embargo. Iranian mullahs believed they could use the same economic force against America. Oil understood this as a threat to its interests. Carter saw oil’s profits as leverage he could use against the Iranians.

This Medium Cries Freedom

Throughout the decade now ending there has been a steadily growing drumbeat of elite opinion to the effect that this medium enables tyranny.

I blame Trump. The Russian manipulation of Facebook made Trump possible. Now tech must live down that legacy.

It means every collection of private data, whether by corporations, government or hackers, whatever the motive, is seen as evidence we need to throw our computers out the window. Every new technology meant to thwart abuse, meanwhile, is seen as a threat to human liberty.

Tech can’t win.

Technology can, in the hands of a ruthless dictator, enable terrible abuses. But there’s a limit.

The Political Triumph of Tech

Some 40 years ago, when I was commuting up the West Loop of I-610 for the Houston Business Journal, oil seemed to be in big political trouble.

We know how that turned out.

Today, in 2019, it seems that “Big Tech” is as friendless as “Big Oil” was then. But history sort of rhymes. These only seem to be different days, and you don’t have to be able to rhyme benzodiazepine to figure it out.

Reporters without brains call the reaction against tech their big story. But it’s the reaction to the reaction we need to be looking at.

The Cult of Trump

The most important thing to know about Donald Trump is this.

He’s a cult leader.

There is nothing unAmerican about that. America has been the home to cults since its founding. The first half of the 19^th century was filled with them. The Mormon Church is just one example, but there are many others.

Don’t throw your magic underwear at me for writing that. Most churches begin as cults. Their founders claim to have “special knowledge” and cult leaders pass it to the congregation. The early members gain a special status, because they have the special knowledge. It’s something all western religions have in common. We all want to be the chosen people, because it means that others weren’t chosen, and you’re automatically better than they are.

Decoration Day

The holiday known as Memorial Day was originally called Decoration Day.

It was established in 1868 to memorialize the Union victory over the South and the Slave Power.

The pro-slavery attitudes of the South never died, however. It became the “Noble Cause.” It remains ignoble today.

Jim Crow is one testament to it. So is opposition to the Civil Rights cause, the “duality of the southern thing.” Whites prohibiting “miscegenation” made every mixed-race baby a crime until 1967, six years after our 44^th President was born. I’ll explain why this is funny in a moment.

Human Capital and the 1980 Game

In 2020, we will be 12 years removed from the first political triumph of technology, the generational election of Barack Obama. All his progress is now being undone, much as a generation ago oil’s gains were threatened by Jimmy Carter and his cardigan sweater.

As we prepare to play the 1980 Game the question becomes, who is Ronald Reagan now? (It’s usually phrased, “Who Can Beat Trump?”) The answer lies in what drives our economy today, and in what drove it then.

I remain confident in the ultimate triumph of Democracy because, today, human capital is the gating factor to economic growth.

Where Elizabeth Warren is Wrong

Like a lot of people, I admire Sen. Elizabeth Warren of Massachusetts, or as the great Charlie Pierce calls her Senator Professor Warren (SPW).

But, again like most people, I can’t vote for her for President.

The reason, in my case, is Warren’s attitude to the Cloud Czars. Warren is staking a big part of her candidacy on running against them.

Let’s set aside, for a moment, the fact that the Czars – Microsoft, Apple, Amazon, Google and Facebook – now command a combined market cap of nearly $4.5 TRILLION. Never mind that they dominate the business world, or that democracy always follows the Golden Rule – he who has the gold makes the rules. Democrats aren’t going to win the White House over the objection of the Czars and the bulk of the technology industry.

My beef here has to do with her proposal to break up the Czars, starting with Amazon.

Her argument against Amazon is that the company can see which brands people are buying, then put an Amazon version into the market and wipe out the other seller. It’s like she never heard of store brands.

Store brands have been a feature of American retailing practically since brands. Kroger does it with food. Target does it with clothes. Walmart does it with both. Walmart calls their store brands “Great Value.”