Yuval Harari - Homo Deus - A Brief History of Tomorrow

Japan’s prime minister, the nationalist Shinzō Abe, came to office in 2012 pledging to jolt the Japanese economy out of two decades of stagnation. His aggressive and somewhat unusual measures to achieve this have been nicknamed Abenomics. Meanwhile in neighbouring China the Communist Party still pays lip service to traditional Marxist–Leninist ideals, but in practice it is guided by Deng Xiaoping’s famous maxims that ‘development is the only hard truth’ and that ‘it doesn’t matter if a cat is black or white, so long as it catches mice’. Which means, in plain language: do anything it takes to promote economic growth, even if Marx and Lenin wouldn’t have been happy with it.

In Singapore, as befits that no-nonsense city state, they followed this line of thinking even further, and pegged ministerial salaries to the national GDP. When the Singaporean economy grows, ministers get a raise, as if that is what their job is all about. 2

This obsession with growth may sound self-evident, but only because we live in the modern world. It wasn’t like this in the past. Indian maharajas, Ottoman sultans, Kamakura shoguns and Han emperors seldom staked their political fortunes on ensuring economic growth. That Modi, Erdoğan, Abe and Chinese president Xi Jinping all bet their careers on economic growth testifies to the almost religious status growth has managed to acquire throughout the world. Indeed, it may not be wrong to call the belief in economic growth a religion, because it now purports to solve many if not most of our ethical dilemmas. Since economic growth is allegedly the source of all good things, it encourages people to bury their ethical disagreements and adopt whichever course of action maximises long-term growth. Thus Modi’s India is home to thousands of sects, parties, movements and gurus, yet though their ultimate aims may differ, they all have to pass through the same bottleneck of economic growth, so why not pull together in the meantime?

The credo of ‘more stuff’ accordingly urges individuals, firms and governments to discount anything that might hamper economic growth, such as preserving social equality, ensuring ecological harmony or honouring your parents. In the Soviet Union, when people thought that state-controlled communism was the fastest way to grow, anything that stood in the way of collectivisation was bulldozed, including millions of kulaks, the freedom of expression and the Aral Sea. Nowadays it is generally accepted that some version of free-market capitalism is a much more efficient way of ensuring long-term growth, hence rich farmers and freedom of expression are protected, but ecological habitats, social structures and traditional values that stand in the way of free-market capitalism are destroyed and dismantled.

Take, for example, a software engineer making $250 per hour working for some hi-tech start-up. One day her elderly father has a stroke. He now needs help with shopping, cooking and even showering. She could move her father to her own house, leave home later in the morning, come back earlier in the evening and take care of her father personally. Both her income and the start-up’s productivity would suffer, but her father would enjoy the care of a respectful and loving daughter. Alternatively, the engineer could hire a Mexican carer who, for $25 per hour, would live with the father and provide for all his needs. That would mean business as usual for the engineer and her start-up, and even the carer and the Mexican economy would benefit. What should the engineer do?

Free-market capitalism has a firm answer. If economic growth demands that we loosen family bonds, encourage people to live away from their parents, and import carers from the other side of the world – so be it. This answer, however, involves an ethical judgement rather than a factual statement. No doubt, when some people specialise in software engineering while others spend their time taking care of the elderly, we can produce more software and give old people more professional care. Yet is economic growth more important than family bonds? By daring to make such ethical judgements, free-market capitalism has crossed the border from the land of science to that of religion.

Most capitalists would probably dislike the title of religion, but as religions go, capitalism can at least hold its head high. Unlike other religions that promise us a pie in the sky, capitalism promises miracles here on earth – and sometimes even provides them. Much of the credit for overcoming famine and plague belongs to the ardent capitalist faith in growth. Capitalism even deserves some kudos for reducing human violence and increasing tolerance and cooperation. As the next chapter explains, there are additional factors at play here, but capitalism did make an important contribution to global harmony by encouraging people to stop viewing the economy as a zero-sum game, in which your profit is my loss, and instead see it as a win–win situation, in which your profit is also my profit. This has probably helped global harmony far more than centuries of Christian preaching about loving your neighbour and turning the other cheek.

From its belief in the supreme value of growth, capitalism deduces its number one commandment: thou shalt invest thy profits in increasing growth. For most of history princes and priests wasted their profits on flamboyant carnivals, sumptuous palaces and unnecessary wars. Alternatively, they put gold coins in an iron chest, sealed it and buried it in a dungeon. Today, devout capitalists use their profits to hire new employees, enlarge the factory or develop a new product.

If they don’t know how to do it themselves, they give their money to somebody who does, such as bankers and venture capitalists. The latter lend the money to various entrepreneurs. Farmers take loans to plant new wheat fields, contractors build new houses, energy corporations explore new oil fields, and arms factories develop new weapons. The profits from all these activities enable the entrepreneurs to repay the loans with interest. We now have not only more wheat, houses, oil and weapons – but also more money, which the banks and funds can again lend. This wheel will never stop, at least not according to capitalism. We will never reach a moment when capitalism says: ‘That’s it. You have grown enough. You can now take it easy.’ If you want to know why the capitalist wheel is unlikely ever to stop, talk for an hour with a friend who has just earned $100,000 and wonders what to do with it.

‘The banks offer such low interest rates,’ he would complain. ‘I don’t want to put my money in a savings account that pays hardly 0.5 per cent a year. You can make perhaps 2 per cent in government bonds. My cousin Richie bought a flat in Seattle last year, and he has already made 20 per cent on his investment! Maybe I should go into real estate too; but everybody is saying there’s a new real-estate bubble. So what do you think about the stock exchange? A friend told me the best deal these days is to buy an ETF that follows emerging economies, like Brazil or China.’ As he stops for a moment to breathe, you ask, ‘Well, why not just be satisfied with your $100,000?’ He will explain to you better than I can why capitalism will never stop.

This lesson is hammered home even to children and teenagers through ubiquitous capitalist games. Premodern games such as chess assumed a stagnant economy. You begin a game of chess with sixteen pieces, and you never finish a game with more. In rare cases a pawn may be transformed into a queen, but you cannot produce new pawns, nor can you upgrade your knights into tanks. So chess players never have to think about investment. In contrast, many modern board games and computer games revolve around investment and growth.

Particularly telling are civilisation-style strategy games, such as Minecraft , The Settlers of Catan or Sid Meier’s Civilization . The game may be set in the Middle Ages, in the Stone Age or in some imaginary fairy land, but the principles always remain the same – and they are always capitalist. Your aim is to establish a city, a kingdom or maybe an entire civilisation. You begin from a very modest base, perhaps just a village and its nearby fields. Your assets provide you with an initial income of wheat, wood, iron or gold. You then have to invest this income wisely. You have to choose between unproductive but still necessary tools such as soldiers, and productive assets such as more villages, fields and mines. The winning strategy is usually to invest the barest minimum in non-productive essentials, while maximising your productive assets. Establishing additional villages means that next turn you will have a larger income that would enable you not only to buy more soldiers (if necessary), but simultaneously to increase your investment in production. Soon you could upgrade your villages to towns, build universities, harbours and factories, explore the seas and oceans, establish your civilisation and win the game.