A Thielian Eternity: The Liberal End of History
Roughly two weeks before Donald John Trump was to reassume the Office of the President of the United States, Peter Thiel wrote a few words for the Financial Times, calling for “truth and reconciliation.” As much as Thiel desires clarity and resolution, his “unveiling” comment undermines faith that such objectives can ever be achieved:
“Perhaps an exceptional country could have continued to ignore such questions, but as Trump understood in 2016, America is not an exceptional country. It is no longer even a great one.”
The billionaire technology entrepreneur and investor lacks faith in our grand old Republic. For someone who has amassed so much wealth and influence, Thiel is the lone standout among his well-heeled peers to decry the state of America. Once again, he returns to the decades-old problem that he cannot seem to overcome: “the causes of the 50-year slowdown in scientific and technological progress in the US,” of which he has been one of the few, if only, investors to raise the alarm.
Why has Thiel lost faith in a country that has made him unfathomably wealthy under the aegis of its New Colossus? As Stanford-educated elite questions the origins of COVID-19, China’s rise questions America’s presence on the world stage. Where Thiel sees the failure of the American projection in its stagnation is its triumph in reaching its conclusion: the Liberal End of History.
Background on Fukuyama’s Invocation of the End of History
Francis Fukuyama, the Japanese-American political philosopher, coined our modern-day, America-centric rendition of the “end of history.” In his seminal book, The End of History and The Last Man, Fukuyama defines and retraces the evolution of the concept of the end of history. Fukuyama believes not that history had ended when he wrote his original essay in 1989 but that it had reached its end, or its teleological goal, in the form of “modern liberal democracy and technologically driven capitalism.”
The political philosopher asserts that the “ideal of liberal democracy could not be improved on” in the aftermath of the fall of the Union of Soviet Socialist Republics (USSR) in 1991. Communism, in all of its variants, had been permanently discredited with the collapse of the USSR. With America’s liberal capitalistic democracy being the last standing, Fukuyama felt confident to declare the nation’s form of governance the winner, then and for all time after. While liberal democracies were not infallible, they lacked “fundamental internal contradictions” that would lead to their collapse.
Fukuyama relies on distinguished German philosopher George Wilhelm Friedrich Hegel to provide the scaffolding for his argument, arguing that in the end of history is driven by the “struggle for recognition,” that is, human beings most desire the respect and dignity that comes with being recognized as a human being, and such will fight to the death over the right to this recognition. Hegel found the end of history represented within Napoleonic France, as Napoleon extended the law and civil system across all of the French empire in a triumph over the ancien regime that categorically refused to expand rights and privileges of its nobility to the peasantry.
In contrast, Marx provides a materialist conception of history as being driven by class conflict, or the struggle of distinct groups of human beings based on their relations to the “means of production”. Marx believed that the end of history is in Communism, which would be the end of class conflict in the form of a classless, stateless society where “the free development of each is the condition for the free development of all.”
Fukuyama cites a third thinker, Alexander Kojève, the most famous interpreter of Hegel’s philosophy, who argues that the end of history was already reached in the form of 1930s America of consumerism that was accessible to the masses.
Despite Fukuyama leveraging Kojève’s weighty claim on the end of history as an invitation to provide his own answer, the latter had an elegant, sophisticated reason that is grounded in Marx vis-a-vis the great industrialist Henry Ford:
“What Marx had dreamed, Ford achieved.” In the five-dollar day, Ford had seen the “vast role that mechanization can play in emancipating human society.” This French writer concluded that Ford had grasped and acted on the insight that “A man is a customer on the market when he has purchasing power, just as he is a citizen of the republic when he has the power to influence affairs of state. In the last analysis, the customer controls the market and is therefore a free citizen of it. With Ford, the American worker became a customer.”
Yet, Fukuyama discards Marx’s Communism with the terminus of the USSR, and rests his argument upon the Hegelian “struggle for recognition”, as he competes with Kojève’s claim that the end of history has already occurred, but in America of the 1990s, after the Cold War. However, the Japanese-American political philosopher is not one to welcome the end of history with open arms, claiming it will be a sad time as human beings cease to strive for great endeavors.
In Fukuyama’s ominous foreboding of the future yet to come, we find Thiel’s pessimism manifest in the present.
The Fukuyama — Thiel Dialogue
In 2012, Fukuyama and Thiel had a wide-ranging conversation about various topics, one of them being the end of history. Thiel agrees with Fukuyama’s provocative thesis: “Even though there have been a lot of bumps in the road, your “End of History” strikes me as very much true today.”
In such agreement we find the truth: Thiel’s technological stagnation is Fukuyama’s “end of history.”
Or, more rigorously, technological stagnation is a necessary outcome and feature of the “end of history.” Technological progress is neither necessary nor needed anymore at the end of history, as America has been able to generate massive amounts of wealth through financialization, globalization and free trade. Technology is merely an input and not an end in of itself under American political economy. The development of technology is not a goal for its own sake, but is subject to political and economic constraints and motivations. Technological advancement is suitable only if it helps support hegemonic dominance or profit maximization.
Marx quipped, “Technology reveals the active relation of man to nature.”
Kojève’s controversial, but illuminating insight into how the American capitalist Ford was “the one great authentic Marxist of the twentieth century” reveals how the relationship between man and technological advancement. As the French philosopher observed, “mechanization,” or the principal innovation of the moving assembly line in Ford’s case, led to material abundance in the form of the mass-produced Model T, “emancipating human society.” The general example stemming from Kojève’s observation is that technological advancement is a means to an end, that end being the development of human capital, and thus, the subsequent emancipation of human society will lead to future technological innovation as humans become more capable of their mastery over nature. The implicit assumption from his observation is that profit maximization driven by market forces is not enough to guarantee that end.
Ford would agree with Kojève, as the former believed, “It is the duty of a manufacturer to lower prices and increase wages constantly.” These lower prices and increased wages increase the American worker’s purchasing power, thus “the customer controls the market,” as opposed to vice versa, and “is therefore a free citizen of it.” The American worker becomes a customer who earns recognition from the market through their purchasing power in the same way the citizen is recognized by the state as a legitimate political entity whose interests must be considered in the affairs of the state.
Technological advancement driving consumer surplus, or an increase in the consumer’s purchasing power, yields the universal and homogenous state where Fukuyama’s “struggle for recognition” resolves itself by material abundance that all human beings can access, earning recognition as consumers through their purchasing power via the market.
Yet, there is no guarantee that History arrives at this outcome on its own. There is an inherent tension between business and industry that preexists in any given political economy. American economist Thorstein Veblen described this relationship as “sabotage,” where business explicitly constricts the development of industry to maximize profits, which can lead to diminished human welfare. Industry, on the other hand, cares about maximizing production as an end in of itself, independent of profit.
“All business sagacity reduces itself in the last analysis to judicious use of sabotage,” argued Veblen.
Technological stagnation is a necessary condition at the end of history because, with the goal of universal recognition of human beings being realized nominally in liberal democracies, technological advancement in service of this goal becomes no longer needed. Under social relations formed within liberal capitalist democracies, technological advancement slowly abolishes itself.
Stagnation becomes self-evident as the US endlessly grows its GDP despite lackluster technological innovation. Thiel has said that we have mistaken the virtual world for the real world, the world of information vs. the world of stuff.
I disagree. America’s capitalists know which is which, and which one generates a higher return on investment. Capital accumulation follows the path of greatest return.
It seems that this is true, as former National Security Advisor to the Biden Administration Jake Sullivan would agree (emphasis added):
“Another embedded assumption was that the type of growth did not matter. All growth was good growth. So, various reforms combined and came together to privilege some sectors of the economy, like finance, while other essential sectors, like semiconductors and infrastructure, atrophied. Our industrial capacity — which is crucial to any country’s ability to continue to innovate — took a real hit.”
Technology directed toward solving the problems of financial capital accumulation has led to stagnation, while technology directed toward solving the problems of human capital development leads to advancement. America’s (neo)liberal capitalist democracy failed to distinguish between the growth yielded from solving for the former category and not the latter.
Thus, technological stagnation (or advancement) becomes a question of which problems a society endeavors to solve.
Do we maximize internal rates of return for a few or seek a lower cost of living for all?
Do we seek multiples of invested capital for investors or increased life expectancy for citizens?
Now, China’s rise is causing America to reassess its technological development amid a new “Cold War.”
Does China’s Rise Equal America’s Decline?
China has undergone significant transformation from being a feudal nation amid the Opium War to becoming the leading Communist country on the global stage today. Over the past eight decades, the Middle Kingdom’s stunning development has forced Fukuyama to concede that the red state’s authoritarian, illiberal government is “really the only plausible alternative” to America’s liberal capitalist democracy.
How could this be? Surely, China’s incredible economic growth would have necessitated the transition to a more liberalized government and economy?
Not so fast. The Communist Party of China continues to assume a commanding role in the functioning of its economy despite allowing market forces and private enterprise to increase their role in the nation’s overall development, specifically its human capital.
However, what is more frightening is America’s inability to mount an effective response to China’s rise. Export controls have failed, and diplomatic pressure is ineffective. President Trump’s latest global tariffs leave Chinese President Xi Jinping unbowed and unwilling to negotiate unless America unilaterally reverses its policy (which it has now done so at the time of writing).
America’s paralysis in the face of China’s ascendance suggests not the end of history but its continuation globally. Surprisingly, history never ended outside of the United States.
Its adversaries continued their endeavors in realizing their nation’s historical projects.
America’s stagnation is the conclusion of the development of liberal capitalist democracy.
Thiel finds failure in the American project; we find its success in its completion.
America’s impotent ability to compete on the global stage “unveils” the Liberal End of History. The Liberal End of History is the triumph of the individual over society; the market supplanting the state; and the present succeeding against both the past and the future. The highest form of liberalism we find in neoliberalism, where the state is subservient to the market and its beneficiaries at the expense of all other constituencies. It is not merely the past triumph of capital over labor (made evident in the 1970s), but the present victory of business over industry, made permanent.
The Thielian Eternity Arrives From The Past
In The Straussian Moment, Thiel writes about what kind of country America must become in the wake of 9/11. He asks, “Is there a way to fortify the modern West without destroying it altogether, a way of not throwing the baby out with the bathwater?”
The destruction of the Twin Towers “unveiled” a fundamental vulnerability on the economic and political philosophical foundations and assumptions driving our modern age: the unwillingness to grapple with the hard questions about human nature leaves the door open to irrational violence that is mistakenly assumed not to be an outcome under liberal assumptions of economic rationality. Thiel finds the exception to these liberal assumptions to be found in religion, and more importantly, represented in his dichotomy between Athens and Jerusalem. Athens’s smallest unit is the citizen; Jerusalem, the worshipper. One grounds their reason in duty; the other in faith. These two operate under different logics and motivations, and thus are found to be fundamentally incompatible with each other within the same society.
How can Western society continue to progress by avoiding such a fundamental incompatibility between these types from declining to directly address the question of human nature? In this moment of crisis, Thiel identifies the “Straussian moment” in which the occurrence of 9/11 is “an extreme situation in which the very existence or independence of a society is at stake.”
Under such severe contingencies, a “decent society’s” response is dependent on level of violence their enemies employ against them.
Thiel’s dichotomy can be found in the current US-China rivalry, where two incompatible world views compete for existence. In this rivalry, we find another Straussian moment to consider.
China is Athens and the U.S. is Jerusalem. China’s political system is not flexible, but its policy selection is. From a strong Mao-style command-and-control economy to Deng Xiaoping’s “opening up and reform” leading to a “socialist market economy,” the Communist Party of China (CPC) has demonstrated impressive pragmatism in the application of economic policies to meet key state goals. The CPC’s “atheism” towards a particular approach to develop contravenes America’s liberal “dogmatism.”
The U.S., on the other hand, treats liberal democracy like a religion, leaving less room to explore the full range of policy options to achieve its goals, both foreign and domestic. The U.S.’s dogmatism for its own style of governance leaves it inflexible in the shifting currents of the broader geopolitical ocean.
Similar to Thiel’s original formulation of Athens versus Jerusalem, how can the U.S. tolerate a competing governance system that should have failed long before it could challenge the U.S. on the global stage under the same liberal principles that could not anticipate the violence of religious extremism?
The broader West’s commitment to liberal principles has left it unable to effectively contain China’s rise or engage with the country in a way that benefits it.
Fukuyama was right, but for the wrong reasons. History arrived at its goal locally, not globally. The US reached the Liberal End of History, where liberalism arrived at its terminal conclusion of recognizing the merchant but not the citizen or consumer. The beauty of liberalism is that all human beings have the right to strive to join the merchant class. Their reward is to be superior to their fellow man and thus superior to society, giving meaning to their existence by addressing their need for thymos, or self-worth. The tragedy of liberalism is that the problems of the merchant are not the problems of broader society. The reward yielded by the merchant cannot address man’s most fundamental need: to be recognized and exist as an equal in society first.
The Straussian moment gives way to a Thielian eternity, an era where Western society is unable to overcome its social pessimism and technological stagnation to provide the “spiritual vitality” needed to compete in the future against contending illberal, centralized alternatives to liberal, decentralized governance, as well as address the inner problems of its own society.
Liberalism’s success is in its stasis, content with the present accumulation of capital and discarding the future development of man & technology. The merchant finds his endless growth within the sphere of circulation rather than the sphere of production. The derivatives he trades in the market yield more profit than the continued integration of man and technology into a higher form of society.
Yet, the Middle Kingdom chose a different path to development and modernity, elevating industry over business, and thus yielding a level of sovereignty that the merchant cannot control, cannot profit, and cannot restrict.
China’s rise constitutes a violence without violence against the West, for its mere existence and subsequent serious attempts to reach parity with the West raise questions with potential answers more devastating than planes crashing into the twin pillars of centuries of liberal triumph and dominance.
Liberalism, on its own, may not be enough in today’s age to provide meaning to the deepest problems plaguing humanity today.
Has Socialism with Chinese Characteristics outmoded American liberal capitalist democracy?
Overcoming The Liberal End of History: Foreshadowing A Post-Liberal Politics for America
Can the Thielian eternity be overcome?
If so, what comes after the Liberal End of History?
The value of Thiel’s thinking is not in critiquing the questions we attempt to answer, but in illuminating the questions we choose to ignore.
In the same way he found a valuable opportunity in 9/11 to scrutinize the core foundational assumptions in liberal philosophical thought, we must take advantage of China’s ascendence to become a peer country to do the same.
In an age of material abundance, do the assumptions driving traditional liberal thought, chiefly the assumption of scarcity, still apply?
Do all human beings have incompatible, competing desires that can only be mediated through the market?
The sadness that befalls Thiel amid stagnation is the wariness that Fukuyama finds at the end of history.
“The end of history will be a very sad time. The struggle for recognition, the willingness to risk one’s life for a purely abstract goal, the worldwide ideological struggle that called forth daring, courage, imagination, and idealism, will be replaced by economic calculation, the endless solving of technical problems, environmental concerns, and the satisfaction of sophisticated consumer demands.”
In some ways, Thiel is the Last Man Fukuyama envisions at the end of history.
A sad time for him and all.
Thus, a post-liberal politics must emerge to sublate the Liberal End of History.
The question is not whether history has reached its end but whether history can restart within the U.S., with technological development emerging from stasis and becoming dynamic once again.
The problem with liberalism is not that it failed, in Thiel’s eyes, but succeeded beyond anyone’s wildest dreams. The nobles who triumphed over King John in his signing of the Magna Carta would be ever so proud of Thiel and their future progeny.
The future of a post-liberal politics begins with the following question: What kind of civilization does America (and the broader West) want to become?
China knows what it wants to accomplish: the rejuvenation of the Chinese nation.
Does America?
Edward Luce, US national editor and columnist for the Financial Times, asked in April 2023, “Yet it still begs the question: how can China be squeezed into a US-led order in which America itself has stopped believing?”
George Kennan, the great strategist of the Cold War era, provides elusive wisdom that has been discarded in our foolish times:
“It is rather a question of the degree to which the United States can create among the peoples of the world generally the impression of a country which knows what it wants, which is coping successfully with the problem of its internal life and with the responsibilities of a World Power, and which has a spiritual vitality capable of holding its own among the major ideological currents of the time.”
Soda
