In this post, I’d like to draw some comparisons between contemporary political economy and competitive poker. I think it’s useful to see political economy through the lens of poker, since (as I’ll explain further) I think there’s an extraordinary explanatory power in doing so. It also has the (hopeful) advantage of getting more people interested in nerdy though important topics like political economy and activist efforts to improve the political economy and its impact on people’s lives. It’s also somewhat apropos since this weekend marks the start of the World Championship Main Event at the 2006 World Series of Poker. This past week also brought us a positive development that I’d like to discuss — the collapse of the Doha round at the World Trade Organization, When I followed the launch of the round on Indymedia five years ago, the image that came to my mind was: coin flip. It could have gone either way. The round could have collapsed or could have launched, and it just barely launched — getting away from Doha with what amounted to a meaningless rain check. And this week, the check bounced. Many press quotes and opinions about the of have regarded the collapse as being absolutely horrible for the world’s poor majorities, and those who cheer the round’s collapse as heartless brutes who don’t give a damn about the poor. This is coupled with a reflexive rah-rah approach to the WTO talks. For example:
"This [Doha] round was intended to prove that the nations of the world–or at least the 149 members of the WTO — could unite to help lift the most desperate among them out of poverty." — Chicago Tribune op-ed published July 29, 2006 "We think it makes sense for people who are locked in impoverished nations that we open up markets. We think trade helps lift people out of poverty, that’s what we believe. So we’re strongly supportive of the WTO round." — George W. Bush, quoted in the South African business website FIN24
But there was another quote in South African Business Day which I though captured the WTO’s and trade’s role in the issue of poverty and development somewhat more accurately:
"So what now for trade negotiations and the so-called development round? For the poorest countries, the answer is simplest. They can benefit from trading with the rest of the world but unfair trade barriers are not their biggest obstacle. The main obstacles to businesses in the poorest countries are not tariffs but potholes and red tape. That is a job for domestic governments and agencies such as the World Bank. The World Trade Organisation (WTO) is not a development institution."
So what does all of this have to do with competitive poker? Some 8800 people from around the world descended upon Las Vegas this weekend to participate in the World Championship Main Event of the World Series of Poker. They’re each going to pay $10,000 to participate in the biggest poker tournament ever held. About 90% of the participants will walk away with absolutely no money gain to show for their efforts. (As I type this before play resumes on July 29, 2006, about 2800 of those 8800 have already been eliminated.) The remaining 10% of participants will get most of this money, with increasing amounts for those who successfully advance in the tournament, with the top champion expected to win a top prize on the order of $10 million dollars or more. Now, take the quotes above from George W. Bush and the Chicago Tribune, but replace "trade" with "poker", so that "We think [poker] helps lift people out of poverty, that’s what we believe", so therefore we should "unite to help lift the most desperate among them out of poverty". And most people would see those quotes and roll their eyes in response. But hey, some might say, poker isn’t the same as global trade and global economics. Which is true, of course. But I think there are enough similarities between poker and global trade, so that it’s possible to draw valid comparisons between the two, and apply the lessons about analyzing one sphere (poker) into considerations about another sphere (trade and markets). For example:
- Both poker and markets are zero-sum games, where a gain for one player means a loss for someone else.
- Both poker and markets assign value to some rivalrous property, allocated through a zero-sum game, whether it be dollars in global finance or poker chips on the green felt.
- That rivalrous property is potentially immortal (at least theoretically), whereas participants are mortal, so that if a player gained power or strength, another loses strength, or even eliminated entirely.
Sadly, there’ll probably be more than a few people participating in the Main Event who will scrounge up — or borrow, or steal — the money to play in the slim hope of turning ten thousand dollars into ten million dollars. Sadder still, most of those won’t gain any return on their investment, simply given the daunting odds, the whim of the cards, the playing prowess under pressure conditions, or any of a host of other factors. But for those who happen to buck the odds, yeah, a $10 million payday can be an amazing and helpful windfall for pretty much anyone who can get the cash — if they can get the cash. Similarly, free trade advocates promise wealth where there had been none before to those who desperately need it. And everyone interested is allowed (in theory) to participate. So in that sense, there’s this sense of egalitarianism. But whether or not they get it is another story — and the fact that not everyone will makes both poker and markets decidedly inegalitarian. And that money doesn’t materialize out of thin air — it comes from resources drawn from the other participants. Just as in trade, those who "make the money" at the World Series are gaining from those who don’t. I think this is why, curiously enough, the South African Business Day is correct in saying: The World Trade Organisation (WTO) is not a development institution." As dismal as this whole state of affairs can be seen as, at least it provides an underpinning for understanding and positive change. It’s key to try to find, and work towards, institutions which impact people’s lives which don’t rely on zero-sum or other competitive arrangements, and which groups and efforts worldwide — especially those linked on this website — have tried to create and study, and even implement.