Klarna changes its AI tune and again recruits humans for customer service
customerexperiencedive.com253 points by elsewhen 2 days ago
253 points by elsewhen 2 days ago
Either Klarna is really good at pulling strings to get media coverage, or mainstream media does not fact checking themselves. About a year ago, the company was everywhere in the media when its CEO announced that it created an AI bot that is doing the equivalent of 700 fulltime customer service folks.
I did what seemingly no other publication reporting on it did: signed up for Klarna, bought one item and used this bot.
I was... not impressed?
Klarna's "AI bot" felt like the "L1 support flow" that every other company already has in-place: without AI! Think like when you have a problem with your UberEats order and 80% of cases are resolved without a human interaction (e.g. when an item is missing for your item.)
I walked through the bot's capabilities [1] and my conclusion was that pretty much every other company did this before (automating the obvious support cases.) The real question should have been: why did Klarna not do it before? And when it did, why did it build a wonky AI bot, instead of more intuitive workflows than other companies did?
My sense is that Klarna really wants to be seen as an "AI-first tech company" when it goes public, and not a "buy now pay later loan company" because AI companies have higher valuations even with the same revenue. But at its core, Klarna is a finance or ecommerce-related company: an not much to do with AI (even if it uses AI tools to make its business more efficient - regardless of whether it could use non-AI tools to get the same thing done)
I think this is in the broader context of Klarna CEO claiming he had stopped hiring for almost a year because of AI. It was a big talking point for a lot of CEOs and LinkedIn influencers. Big enough that incompetent management across the industry was following Klarna’s steps and reducing staffing (Not because AI, but because they could short staff teams with AI as an excuse). That is why when there is a clear evidence that Klarna was completely wrong, it needs to be talked about.
Previous discussion: https://news.ycombinator.com/item?id=42432494
Glen Okun of NYU business school has written about BNPL loan portfolio weakness.
The AI marketing is just an attempt to reframe the value narrative of the company before IPO. They would rather be seen as an AI company than an unsecured lender of last resort.
The narrative on Klarna’s core business is not good in any case, either an extractive lender benefiting from people buying what they may not afford and charging exorbitant interest or a lender of last resort who has not properly underwritten the risk in their portfolio. Neither is preferential to them compared to a value narrative framing them as an AI company. Likely the market is too skeptical in this environment to take the bait however.
If you default on your Klarna loan, you could pay them back in support hours:
> The pilot has started small, with two of the new breed of customer-service agents live now, but the ambition is to tap into candidates such as students or rural populations. “We also know there are tons of Klarna users that are very passionate about our company and would enjoy working for us,” he added.
[from the bloomberg article: https://www.bloomberg.com/news/articles/2025-05-08/klarna-tu...]
Here is an archive of the article:
https://web.archive.org/web/20250512120733/https://www.bloom...
I can't believe it takes b-school professors to figure out that people financing their DoorDash might not be the best people to lend money to.
This is the primary positioning tactic used across the startup industry . Uber isn't a taxi app, it's actually the "future front end for millions to access autonomous transport". Doordash isn't a delivery app, it's an "on-demand logistics" platform.
Similarly, Klarna isn't a shady payday loan company, it's an "AI-first consumer finance play".
> "AI-first consumer finance play"
In a more civilized time, saying this was your plan would get you chucked feet-first into a wood chipper.
Heard a new term yesterday: “private credit”. Lenders that give unsecured loans to businesses at high interest rates
We just used to call them loan sharks
Not that I necessarily disagree with your overall take, but can someone explain how 'financing' your DoorDash order with a credit card is perfectly OK, but financing with Klarna is somehow dubious and shady. Surely the problem is buying stuff you cannot afford, not how you choose to buy it.
This is a great comment and comparison.
I think there is a feeling that klarna, and other bnpl companies just lend without checking or caring of consumer credit, or buying power. I've never used them before, so I don't know if this is a case.
With credit cards there is the "appearance" of them checking credit scores, ability to pay , etc.. before giving a credit card.
I say appearance, because as we all know cc companies will just lend cards to anyone, and then charge huge interest rates.
Ultimately it's another form of credit, and it's a minor change on the current system. But since it's finance and lending, it's a step to make lending easier.
> a lender of last resort who has not properly underwritten the risk in their portfolio.
I thought they more or less instantly offloaded the risk as asset backed securities to clueless people who didn't know the actual risk profile what they were buying
sound familiar?
They are scum, and currently are suffering from increased scrutiny from governments for pushing their buy-now-pay-later exploitative business everywhere. In the Netherlands they are even attempting to gain access to brick-and-mortar stores by partnering with Adyen¹ which provides the payment solutions, but the government is being vocal about that being unwanted. This is in addition to the unabating coverage in the media about how Klarna is about as harmless as vaping — that is, they are enticing young people into buying stuff they don't need² before they can afford it.
Shopkeepers don't want it, but fear they must if big chains start offering it, just as online shops feel like offering it is unavoidable due to the popularity in certain demographics. The financial watchdog doesn't like Klarna, and is increasing scrutiny³.
If Klarna has trouble marketing their value, then that at least is good news, but not unsurprising given the spate of attention it received over the last two years.
1: So much for the ethical side of Adyen (e.g., https://www.adyen.com/impact sounds hollow when you partner with loan sharks).
2: Some people are quick to defend Klarna for offering people a chance to buy their necessities with what amounts to a payday loan, but that is bullshit. Klarna predominantly is not used for daily necessities.
3: Klarna now has to state that they are offering a loan in the Netherlands where they are available as payment option, with the mandatory "borrowing money costs money" tag-line.
Shopkeepers do want it, because it expands their market from those with funds to also those without. Klarna carries the lending risks, for the shopkeeps it’s a risk-free customer base
In the Netherlands no less than twenty trade associations sent letters to the government on behalf of their shopkeeper members urging legal action to prevent Klarna from coming. Part of it is that Klarna is fairly expensive compared to the common payment methods (i.e., cash and debit cards). Klarna charges a whopping 4% of the purchase price, whereas using a debit card (perhaps 95% of payments in physical shops) costs a fixed 17 euro cents, and cash costs just the costs of keeping it around safely and getting it to the bank.
But there is also the realisation that a customer who uses BNPL today, won't be coming back next month when they are paying off their loan.
Dutch shopkeepers do not want Klarna, but if major chains like Primark etc. do it, they fear customers will start expecting it.
> But there is also the realisation that a customer who uses BNPL today, won't be coming back next month when they are paying off their loan.
I don’t think that’s a good argument. For shops and customers that utilize BNPL you are not typically making routine purchases at the shop anyway because the minimums are $50 or more (merchants can negotiate those terms with the provider) but the base tends to be around $50.
If you buy a bicycle using BNPL you’re not like coming back to the shop the next month and buying a new bike again.
BNPL increases sales and merchants really like using it which is why they are signing up for it more and more. Basically the increase in cost is worth it to increase sales.
There may be some bad social dynamics, taking out loans, etc. but generally both merchants and customers like using those products which is why they use them.
How does bnpl increase sales?
My intuition is it brings in a slight bump now, at the cost of longer term.
The customer can either wait N months to buy the bike cash, or buy it now and pay interest for the next K months.
- In the first scenario, customers can quickly save up and return for accessories/etc.
- in the latter, the customer is playing XX% on top of the bike purchase which ultimately reduces the purchases that customer can make.
It’s just exploiting the “present bias”/time-discounting in human psychology.
Your intuition is wrong. As a simple example, during the months of saving in cash, by the time they have the cash, if they even save at all, they have more options for purchase. So maybe they go with the original merchant, maybe they don’t. Maybe they buy something else.
Instead merchants prefer to lock in a sale right then and there, and they pay for that service.
Surely that averages out with people switching the other way during the save-up period?
Perhaps for an individual shop right now, in a world where Klarna exists but not universally, yes, there's a benefit to using it to lock in that particular customer right now.
It's less obvious to me, in the long run, that widespread Klarnification results in benefits to any particular shop. As mentioned earlier, having Klarna sapping up to double-digit percentages of the portion of customers' money (it's "zero interest" until it very much isn't, and they're in the "subprime" market) they were spending on possible-Klarnables and a few percent of yours on top as fees is easily a bigger impact that the average losses, if any, from the delta between switch-away and -to.
It's a bit of a prisoners' dilemma: you stand to gain money by defecting (to using Klarna) unilaterally, but if everyone does that, you all, plus the customer, collectively lose money (to Klarna).
> Surely that averages out with people switching the other way during the save-up period?
Maybe? I’m not aware yet of any data that would support that hypothesis one way or the other. But we know that some businesses fail and some succeed so it would lead me to believe that hypothesis probably isn’t correct. As you mention though the availability of these offers isn’t universal, some businesses eschew these options and others don’t, and we will see that play out in the market.
If the businesses that don’t offer these services (cash only businesses as an analog) fail or convert you might have your answer.
I will also say that for many businesses they offer more than one BNPL provider at checkout so there is competitive pressure to offer good terms, have good creditworthiness models, and features to attract customers. Platforms like Shopify allow BNPL providers to create easy to use plugins that appear at checkout and merchants can add a few including Shopify’s home grown solution rather trivially.
In general I think your argument that it’s less obvious that it’s beneficial “in the long run” rests on the same logic that credit cards, 0% for 12 month offers, personal loans, etc. do as to whether there are benefits. Right now businesses add these products and see revenue go up, even if margins go down by 6-8% or so.
Your assumption that customers will not buy accessories until they have repaid the Klarna loan is a long way from certain.
Loans like this also encourage customers to increase spend, because adding an extra few dollars (cents, etc) to your monthly payment is psychologically not as big of a deal as waiting another month or two before you can afford the more expensive item.
>How does bnpl increase sales?
Same way credit card increase sales, such that stores are willing to eat the higher interchange rate it costs compared debit.
Merchants really do not want a 4% decrease in their gross revenue.
Yes they do, because they don’t have a decrease in gross revenue, but instead a higher gross revenue and smaller margins. But that results in higher profit for the merchant so they go with it.
OK, merchants do not want a new expense that is 4% of gross revenue. Klarna’s TOS currently says a merchant can’t surcharge for it… but Visa, MC et al used to do that too.
How is Klarna any different than Affirm or its precursors like Bill Me Later which later became PayPal Credit?
Never heard of them. I don't think I ever saw these offered in online shops operating in the Netherlands, while Klarna is in almost every online shop. If they offer BNPL they are probably just as much scum.
They might say they want it, but like a wise parent guiding the BNPL spending habits of a teenager, government is right to step in and stop shopkeepers from seeking to cheese their way through business (only in the short term) by relying on a fickle and unsustainable base of new creditors.
Putting a new group of people into predatory debt is a nice way to juice your numbers before you dump your shares, but it's not a good way to sustain an economy focused on producing real value.
You know some businesses are led by people not board rooms, and especially businesses that consider themselves part of a community, and sell to their neighbors, don't want said neighbors to be rat-fucked by exploitative financial products, even if it will possibly benefit them at no risk.
This is generally called "being a person with a soul."
>businesses that consider themselves part of a community, and sell to their neighbors, don't want said neighbors to be rat-fucked by exploitative financial products, even if it will possibly benefit them at no risk.
>This is generally called "being a person with a soul."
Wholesome. So the hole in the wall restaurant that only takes cash was actually trying to save its customers from a lifetime of credit card debt, rather than saving the 3% interchange fee and possibly tax evade?
I mean the hole in the wall burger joint near me that I love openly charges 3% more when you pay with a credit card for the exact reason of not wanting to give away 3% of their sales figure to a credit card processor, since said credit card processor didn't cook the burger. And you can feel how you feel about that, I personally appreciate the transparency and make it a point to bring my debit card.
I don't know if they're engaged in tax fraud though. Not really my department.
I believe in business done for mutual gain, that's how I do mine, and I make it a point to find as many like-minded people to do business with because they're just easier to deal with. I don't feel the need to get second quotes on car repairs because I've gone to the same shop my dad went to. I know the guy, I handle his IT needs. He isn't out to get me for every dime he can, and I'm not out for every dime either: we go to each other when we have problems, and we solve those problems for one another with some on the top to take home.
I'm sure neither of us will be billionaires but I can also sleep at night which is nice.
The board of a company are people.
Sure but it is easier to order genocide from an office than being the guy who has to march the children into the gas chamber. Humans have come up with wonderful bureaucracy to dilute responsibility.
Your comment doesn't show how people, as opposed to an board, would be any better in this scenario. Both would weigh the pros and cons of such an action before making such a command.
that depends on the deal. Restaurants don't wnat meal delivery services because of the terrible economics but really have no choice if the delivery company captures the customer base.
The restaurants where I am banded together against app based food delivery. The only ones that do are Pizza Hut, McDonald’s, and Subway, and those typically have a 25-minute wait since no local Doordash/Uber drivers live close enough. Ergo, nobody uses it.
The local independent Chinese place delivers and the local pizza places also deliver. (Pizza Hut’s own delivery is significantly cheaper than ordering it via Uber Eats.) Ergo, restaurants don’t have to deal with the rent seeking that siphons off profits, and money stays more local.
In a city an hour away, a local guy came up with his own food delivery service and eventually paid a programmer to make a simple app. You can now order from a whole bunch of places cheap. It’s amazing he’s stayed in business, but one thing he doesn’t do is rip off restaurants.
that's the short term, if everyone starts to default, something is going to break and come back to the shop keeper.
WeWork tried this and it worked out great for their CEO. They were a real estate landlord masquerading as a tech company. Stupid SoftBank bought that lie and made Neumann filthy rich.
But as you say that was ZIRP when everybody was stupid and this is now.
To be fair, admitting their amateur foray into chatbots was an abject failure and rolling it back really does put them at the forefront of the AI movement.
> mainstream media does not fact checking themselves.
Mainstream media will print a press release for you if you send it to them. It is very important to understand how limited the fact checking really is. If a mainstream paper prints a statement of the form "X said Y", you can be sure that:
- they are pretty good at checking that person X did actually say Y
- they make no effort whatsoever to fact check the underlying statement Y.
There isn't really the money or interest in actually investigating the claims of every little press release.
> really wants to be seen as an "AI-first tech company" when it goes public, and not a "buy now pay later loan company" because AI companies have higher valuations even with the same revenue
Yes. This is because multibillion dollar investments are made by people who are easily distracted by the jangling keys of AI.
The problem with "AI-first" companies is that they really are just shells for people who want to be "AI-First" engineers, and not "guy who solved my problem affordably and was nice" engineers. The average person doesn't care how you ended up fixing the weird charge on their account, it's how fast and how proficiently did you fix it
I liked your comment but don't think the shot at media was necessary. A company replacing workers is news enough and the fact checking need only be to validate that information. The "as good as 700 workers" I assume was presented as a claim, not a fact.
Evaluating the effectiveness of the AI bot is another matter and firmly in the investigative journalism sphere. Coincidentally that is an awesome application of a blog.
Sorry, but its attitudes like yours that make it easy for media to keep spouting out ridiculous claims/lies, and get away with it.
Shots are absolutely necessary when its warranted. Full. Stop.
I went through klarna’s interview process some time ago.
I had to go through both reasonable and weird steps, including IQ tests for some reason. I passed them all, and then I was ghosted, and upon reaching out I was met with months of excuses asking me to wait (the recruiter is on vacation, we’re waiting for the new budget to be approved, “I personally forgot to reply”, and a few others). I eventually stopped reaching out and never heard back.
If the whole company is as dysfunctional as those interactions implied, I wouldn’t really look up to them as trendsetters.
Yes they are, a few years ago once got a scuffle with the Swedish tax agency because they were abusing some tax loopholes. The tax agency came in with the bill and they just immediately "layoff" 90% of the contractors working there (a good chunk of the workforce). All so their quarterly statements wouldn't look bad for the stock market.
Klarna is the prime example of toxic public companies
Klarna hasnt even gone public yet...
Doesn’t matter. They want to go public and with that in mind will operate the business to ensure the financials look “good” for when it’s time to IPO
A few days ago Klarna's AI bot lied to me that it was human, lied about speaking Finnish as its native tongue, and wrote me a Haiku about Klarna's cashback.
That's actually a great captcha - if the presumed human can write a haiku about something very quickly, they are probably a bot.
Umm, I think any respectable human would simply deny writing a haiku. So, a bot can simply mimick that behaviour.
Can, but won't!
Because system prompts cannot be changed?
Because it's hard to draw the line on which requests should be refused and which should not be refused, because it's hard for an AI to pretend to be human, and because they have other objectives to work toward rather than just passing the Turing test.
I've worked in the field of Contact Center AI for almost 10 years now. Rough order of magnitude you can expect to deflect around 30% of inbound contacts with an AI chatbot. You can also expect to reduce agent Average Handle Time by 15-20% using AI enabled semantic search and workflow automation. This is ballpark, if your contacts are simpler you can do a little better, if they're complex you'll do a little worse.
The problem is that vendors are telling companies they can eliminate 80-90% (maybe even 100% if they can keep a straight face) of their customer service agent jobs with AI, and that is nonsense.
> AI gives us speed. Talent gives us empathy
Not sure if this is the primary reason. It just seems to me their AI adoption was unable to meet the baseline effectiveness of their human agents.
What does empathy even mean in the context of payday-loans-as-a-service? They'll lure people debt traps and then bleed them dry, but pretend to feel bad about doing it?
“Empathy is when you use common-sense reasoning to solve problems that weren’t explicitly covered during training.”
I think it is generally in the best interest of companies to overstate what they are able to do with AI. Investors aren't interesting in hearing "we tried vibe coding but got tired of reviewing and fixing the trash code it produced". No, they want to hear "we've reduced our headcount by 40% while increasing customer satisfaction by 60%". Overstating AI adoption and success amplifies P/E ratios.
I wonder if investors see AI usage as some kind of reassurance that their other investments are going to make money. Basically everyone is lying through their teeth to infantilize investors that they made A Good Choice investing in nebulous AI companies. The folks that don't play the game don't get funding.
>While Klarna pioneered the use of AI in customer service
Local firms here have had bots in customer service for many years now, even well before the transformers era. Is Klarna living in a bubble?
They are pioneering too hard to pay attention to the rest of the industry.
I'm more curious about how much cost of customer service can Klarna cut by using AI , and how much marginal improvement to their customer service can Klarna achieve. Customer service should be an amazing application to AI: AI solves X% of the problems, and for the remaining 1 - X% of the problems, customers will tell the system deterministically, which means the company can continuously improve their systems with customer feedbacks.
Anyone with half a brain saw it coming but somehow these elite executives lack basic common sense. I wonder who they are surrounded with to come up with such deranged business decisions
I've been thinking that they probably are smart enough to know this but see utility in spewing such lies. Because optics implies higher valuation. It's follow the money as usual :(
Even here people don’t seem to realize, or even consider the likely fact that Klarna CEO has been bullsh**ing all along. I read a hugely viral post of them replacing their entire CRM with AI. It’s ridiculous to me people took that seriously!
Absolutely, people need to assume everything they read in media is wrong, then find evidence to prove otherwise. Klarna replaced their CRM with AI? Good. Its absolutely false until I find enough evidence going forward that its true
It's Ryanair all over again. Remember the stories about how Ryanair were going to make passengers pay to use the toilets, or the "all standing" plane (which would obviously be highly illegal, but credulous journalists printed it anyway). All a very cheap, very successful marketing campaign.
How is that a successful marketing campaign? Who were they marketing to? Sardines?
The main thing was it got their name in the papers, and (in this case) their notoriety as "the cheapest airline" was exactly what they wanted.
I'm convinced Wise is using AI for their customer service. I had absolutely no trouble getting help when I needed and the employee was always helpful, but ever since the birth of ChatGPT I don't even get an answer anymore.
They don't understand the problem, and when I point that out by explaining my issue another way they just answer "Have I solved your issue?". Well, no, you didn't; you didn't even understand the problem.
The worst part is that they are pretending they are humans.
> They don't understand the problem, and when I point that out by explaining my issue another way they just answer "Have I solved your issue?". Well, no, you didn't; you didn't even understand the problem.
This is a real thing. I had similar experience with Discord support. They closed me ticket or sent me to weird chases(restart app, reinstall app, format your phone!, upgrade to latest os version, try a different phone!, update your appstore!, change mobile operator etc). It was insane and in the end, I said I don’t care and will uninstall discord. Then I get a small reply to the ticket, did we solve your problem? If so, we can close this ticket.
And no, I was not doing vague descriptions, I literally sent screen recordings of exact steps to reproduce the issue.
Sounds like a trick to hire human with lower salary.
Sounds like the human should demand higher salaries, now that AI has proven that it can't do their job.
Here is the secret rule to AI for the guys who really want to use AI to replace "outsourcable" positions, "AI is a helper" not an absolute solution to means.
I have an extensive experience with dealing with Chatbots and hang out in places where people tell everyone AI will not take job while knowing fully well it might alteast take away the job of starbucks drinker sitting next to your cubicle.
Here is the truth, a single AI implementation won't replace a 15 person support team out in Philippines/India, AI won't replace a 8 person team in Michigan, but.... You pick 3 people and tell them to use AI to automate their jobs.... Now that is how you get AI to do stuff.
AI is a helper. Period. Do not let anyone else tell you otherwise. I have dealt with enough support teams to know an AI can surely do a better job than $3 dollar an hour fixed contract 8 hour shift offshore support hand telling me let me escalate your question to our north american team who will be back on monday as my reponse to "Hi" and no that is not a chatbot response.
You get three decently smart guys, and you hint at them use AI to automate your job. You pay these guys the salary of 5 US support desk salary which is equal to 10 offshore support desk salary. Then you can implement AI. You need a human to AI to work. You need a guy to snooze at the steering wheel so when a guy wearing all black jumps in front of your car in the dark road who can atleast come out and call 911. Does not even need to be a smart person. Just someone capable of calling 91. Hear that Uber? What your mckinsey consultant friend from the same frat or you ex-sister in law did not tell you that to you?
AI is not going to do well in full autopilot but that does not mean it is bad. You need someone with reasonable cognition ans allow them to be in full sync. That is the future and complaining about AI won't help you keep a job or cut costs for your business.
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Now to follow up. When you have established a reasonable framework of AI driven "task execution", you keep doing incremental layoffs. As usual you want your employees to near-burnout. See where that puts you in the next few years
I think this is near-future thinking and limited to the current presiding paradigm of "AI" being based on LLMs.
Without some drastic breakthrough in LLMs, I believe "AI is not going to do well in full autopilot" will remain true for the next 5-10 years. Reaching full autonomy is a definite. The question is how long it takes and what innovations have yet to be made needed to achieve the first effective implementation that is able to spread widely.
Unfortunately, I think military applications will push AI the fastest towards truly effective autonomy.
I spoke about this before [0]. As engineer number one in a startup that specialized in customer service automation, I can see how they were fooled by an upward trend. The problem is the arrow plateaus at ~40%.
Even humans cannot handle all requests because some don't make sense or are unrealistic. But at least a human can make that judgement and be held accountable for their decisions. I'm baffled when companies makes such drastic decisions, I'm pretty sure if they had asked (they probably did and ignored them) their AI team, they would have advised against firing their agents.
This tune change should be also correctly correlated to their IPO delay. AI jump previously approaching to an IPO was a hasty attempt to rapidly cut costs and make the books more nice. Presently, they delayed the IPO again possibly to next Autumn.
No more CS, no more Salesforce.
It’s almost like this time last year they were doing everything they could to lower cost in advance of a now delayed IPO. And now they have to make sure they don’t implode before said IPO.
Maybe because they're learning from other swedish finance companies, Swedbank lost customers due to bad customer service and hired more people to answer the phone, you know so they're probably watching what works for others in the same sphere
> The chatbot still handles two-thirds of all customer inquiries
I wonder what happens with the remaining third.
I whole-heartedly believe in free markets, but at the same time, fuck everything about the circus clown show that is modern techno-capitalism.
Maybe you should reconsider where your heart lies, and ask if "free markets" that have worked so well for modern society have always been heavily regulated in order ensure they serve citizens beyond capital owners.
In fairness we are regulated more heavy now then ever. The original free markets were more open and things became more regulated over time. Providing capital, creating jobs, providing products/services were what businesses provided for citizens.
Our system isn't a free market. With 95 years of corporate copyright you'll have no free market. Neither with 20 years of patents. China probably has freer markets than West now, because since 1950s the West is constantly siding with mono/oligopolies that are against free market. The origins of capitalism is against free market. Neither Britain nor the Netherlands got their capitalism head-start because they let their companies to fairly fight. They created monopolies to terrorize, genocide, and impoverish people.
Startup ecosystem is against free market. YC is against free market. They want the startups to grow at the cost of everything else and buy out all their competition. There is no fair competition nor free market there.
Go hack and read Marx and Engels, and also study Ned Ludd and Luddism/luddites.
There is NOTHING special about current technology in application of capitalism. Its always been exploitive, and grinds people into used and nearly dead objects.
The answer isn't reforming capitalism, either. FDR tried, and we're back to the Black Friday set of events... But in this case, we're even worse off with alienation of basically every country as some sort of oneupmanship.
I've read Marx and I'd rather commit seppuku than live in what he prescribes from his intellectual ivory tower. I can see why some smart people bought it for about a century, but by now there's too much empirical evidence that it leads to misery and disaster. Much rather deal with the cultural problem that is Klarna.
Thanks for the suggestion, though!
So .. your answer is to try socialism again?
Were there any major updates to the agenda, since it was tried the last time?
If not, why expect a different outcome next time?
Go actually study what's going on in China, rather than eating up all the US propaganda.
What they're doing in tech innovation is astonishing. And you can look at even just something like high speed rail, and its amazing. They're also connecting western Europe as well to the rail system. Look up Belt and Road initiative.
They're also on the forefront in green/clean tech. And thorium reactors. Oh, and fusion.
I'd say their 'try' is doing damned well. Its certainly blowing the USA out of the water. Well, unless you count number of homeless. We're beating them handedly there.
Oh, you count china as socialism?
I rather meant the more traditional approaches, like the one I was born into that fell apart. China as of now is rather state capitalism to me.
And yes, they are quite effective in some areas. Totalitarism can be. Doesn't mean I would like to copy them.
The Overton window dynamically shifts between “true socialism has never been tried” and “no true socialist,” but all growth or development in China must be attributed to China being sufficiently capitalist. Do you mean to say that China’s socialism is a mirage, a fig leaf for authoritarian state capitalism in a country that was once socialist, or do you mean that China was never even socialist to begin with, that it was just authoritarian all along?
Is socialism incompatible with capitalism or is it incompatible with democracy? Because if the successes of China can be attributed to capitalism while discounting socialism/communism, then why are we even talking about socialism in the first place, if it’s totalitarianism which is the problem?
Somehow, if China stopped being totalitarian tomorrow, but remained socialist, whatever that might mean to you or look like, if they kept doing the same things in the market and in the party, the US would probably still treat China like we do Mexico now, and I doubt anything would change in how US treats China.
Maybe I just lack faith in most folks in US. Since the “end” of the Cold War, there’s been a kind of search for economic, political, and cultural scapegoats. The potential end of demonizing China if it ever even happened for good cause would probably just cause transference of that moral outrage and social opprobrium to the next consent-decreed valid target for market-validated hate, which in this case would probably be Russia. The problem is that Russia doesn’t have much global economic impact on their own so US has to find a new big bad if China doesn’t fulfill that role anymore.
"Do you mean to say that China’s socialism is a mirage, a fig leaf for authoritarian state capitalism in a country that was once socialist, or do you mean that China was never even socialist to begin with, that it was just authoritarian all along?"
Well, it started of as authorian socialism and now is just authorian party state oligarchy with lots of red flags.
And I have no connection to US demonisation policies (and this article was about a european country). My background is, that the alternative left in europe(where I socialiced) - rather traditionally does a glorification of China. So I am aware of all their glory.
I just happen to value free thinking and free speech. And this is not possible there. And that is no propaganda, but official chinese policy.
So I don't know about "true socialism" but I do know that all the marxists experiments ended up in authorian dictatorship, which is why I am more than sceptical to base new experiments on Marx again.
In the 80s and 90s, Japan was the vaguely menacing economic bogeyman but that seems to have been in stark contrast to all I read about how Japan had almost no growth in GDP through those years due to inflation or something I have already forgotten. Which is why I don’t really look at what China or the US is doing as being surprising. China has been the bad guy since they were admitted to the WTO, if I had to put a date on it. I mean, the Vietnam War didn’t help much either, but that war was China’s Vietnam war also. But economically, China is still treated differently than any other country. Actions against China like tariffs seem like a massive hedge against inflation, but I don’t know if it will put meaningful pressure on their economy or ours, but we get the government we deserve. I’m not sure if they have a saying like that in China, but it would be interesting if they did.
I think federalism in the US allows a kind of “freedom gradient” where the patchwork of overlapping legalities allows for uneven enforcement and a distribution of norms of business and in behavior. These gaps allow for growth and innovation but can lead to voter approved market failures in one jurisdiction that might as well be a world away from those who work in the state capitols or in D.C.
I don’t know why socialism, Marxism, or whatever is blamed for dictators doing bad things for good/bad/no reason. I don’t blame democracy for the bad policies of its adherents either. Any system of government can produce bad results.
"I don’t know why socialism, Marxism, or whatever is blamed for dictators doing bad things for good/bad/no reason. "
Maybe because the base of the theory comes with violence included? The need to take something of other people away(means of production) and maintain that order against expected resistance of the current owners?
It is really not surprising to me, that all experiments ended with totalitarism, because how else to do it like this?
(I am pretty sure there was some exchange between Marx and Engels I read, that already discussed the need to have camps where all the capitalists would have to be imprissoned)
Also there is the concept of global domination. As far as I understood it - Marxism needs to rule globally to really work. No other model allowed. But in reality there are indefinite more possibilities between socialism and capitalism. But then again, I did not read much Marx. What I read confirmed what the (stalinists influenced) socialist priests told me before. And they definitely had the world revolution concept ingrained. But I also met and debated with lots of other alternative folks and the totalitarian concept seems universal with marxists.
Anarchistic socialism is a bit of a different story, but in my eyes the same principle, just more local.
I don’t see the violence inherent to the system, at least not any more violence than is in any system in which the state has a monopoly on violence and has the power of eminent domain.
If everyone in China could vote, and they voted along party lines as they do now, the system would be democratic in nature, and yet, nothing would change immediately as far as the US-China relation because the issue is multidimensional. Compromise between nations is a kind of diplomatic solution that is not available to individuals with respect to their government. It would be great for many people if China were democratic. Would it be better for all? Would it be better for the US? I’m not sure, but probably. But that’s not a mandate to subvert sovereignty, it’s a matter of trade offs. No one cares if Vietnam is socialist now, and they barely care that Cuba is. These things matter geopolitically, but they don’t matter to the average person.
"but they don’t matter to the average person."
Yeah, but the average person apparently rather wants to live in a democracy than in a pseudodemocratic socialist state.
I was too young to remember much of day to day life - but I do remember vividly the joy of the people after socialism was over.
That's great. I'm happy for you, really. I want that experience for everyone, but you still have to go to work tomorrow.
That's the sense in which I mean it doesn't matter. The certainty of labor under a system of control operated for profit is another sort of pseudo-democratic state we find ourselves in, and I hope I'm not too old to see the day that the last person works the last shift of wage labor, as that will be another sort of cause for celebration.
"I hope I'm not too old to see the day that the last person works the last shift of wage labor, as that will be another sort of cause for celebration."
Oh, I agree to that, that is why I would not like to repeat the misstakes of the past on the pursuit to get there.
So in the now I prefer to have the freedom to really choose my jobs or also choose to go away or choose to freelance. All not really possible before.
I think a lot of the dicussion is around the conflation of socialism/communism as a form of government or as an economic system. In practice, no country is self-sufficient and need not be due to comparative advantage. Thus, no country could truly be independent of capitalism as long as it exists, but capitalism is really just goods and services and salespeople and ads. It's a system of control that is powered by scarcity and incentive structures. It's designed to find the diamond in the rough in every capitalist subject, and then sell it back to you. Even your very dissent against the system is commoditized, and I think this is why China operates the way it does, as some kind of principled countervailing force against the inexorable nature of capitalist headwinds. If you can't beat the profit motive, you can at least drive the wage for labor to zero.
Arguably, China stands to benefit more from recent advances like AI than the US, because China already had cheap solutions better than AI for manufacturing, human workers. Now knowledge workers have an efficiency boost by working with AI, which may help keep wages from rising too fast for those whose jobs aren't impacted by AI yet, but they're going to go up.
"because China already had cheap solutions better than AI for manufacturing, human workers."
Yeah. They have cheap workers.
But wasn't the whole point of socialism and the workers movement to not have cheap wage slaves anymore? But to value humans?
"capitalism is really just goods and services and salespeople and ads. "
And you don't think this is kind of an useless oversimplification?
The point of free market systems is, that there is no central authority doing all the planning.
So when you want that central authority, it is authorian by design.
Now you can argue that there is indeed a lot of planning and regulation in our free market capitalism. And that the "blood" of free markets, money creation isn't free either. And that some people have so much money in effect controlling the regulators etc.
But would you actually rather live in china?
> But wasn't the whole point of socialism and the workers movement to not have cheap wage slaves anymore? But to value humans?
I don't know if socialism has a point as such. Value and dignity of humans is one goal, but the means by which that is accomplished is the distinguishing characteristic of socialism to my reading; that is, the means of production is not privately owned. What precludes inherently valuing humans under such a system?
https://en.wikipedia.org/wiki/Socialism
The US has prevented other projects which could have overcome perceived weaknesses in socialism and capitalism by fusing aspects of them both.
Allende was probably using the most promising approach that I know of and yes, that was killed of.
"I don't know if socialism has a point as such. "
And since many different people used the word for very different things .. definitions are not clear. But people can be treated as slaves whether the factory is owned by a multinational cooperation, as well as a state run factory.
So what does it even mean, workers control the means of production?
Not a trivial question at all and it boils down who has power. And often or rather allmost always it developed to: not the workers working there.
But even if you would make a iron socialist law, that this should be the case. The workers always decide what they build - then you wouldn't have central planning anymore. And why should other workers decide to give their products to that factory?
Ah, they could negotiate contracts. Like in a free market?
Or they cannot and then it just means, they don't really control their means of production.
> So what does it even mean, workers control the means of production?
> Not a trivial question at all and it boils down who has power. And often or rather allmost always it developed to: not the workers working there.
> But even if you would make a iron socialist law, that this should be the case. The workers always decide what they build - then you wouldn't have central planning anymore. And why should other workers decide to give their products to that factory?
> Ah, they could negotiate contracts. Like in a free market?
> Or they cannot and then it just means, they don't really control their means of production.
To this reading, the workers cannot even exercise their ownership rights over the means of production meaningfully without free markets, thus aligning the goals of capitalism with socialism. Somehow I expect both parties to be disappointed, which might be a workable compromise?
But what do Marx and Engels or other socialists etc say about free markets and freedom to enter contracts, and what bearing those aspects have compared to owning the means of production? I don't think they were talking about stock exchanges, for example. The goals were economic, opt-in via free association of free workers, but were governmental or democratic aspects even addressed in their works?
What if workers owning the means of production looks like cryptocurrency?
Perhaps some socialists and capitalists would agree: no, not like that!
But would they be arguing out of self-interest, or would they be right about crypto not being compatible with socialism?
Wouldn't that just reduce to capitalism all over again?
Do workers do the work, or does capital?
Is capital simply a voting/allocation mechanism for a given work unit of decision-making control enacted upon the means of production?
Does owning the means of production in the economy imply controlling the means of governance in the government? Would one presuppose the other?
These are honest questions because I'm honestly curious about the answers.
> But people can be treated as slaves whether the factory is owned by a multinational cooperation, as well as a state run factory.
Doesn't capitalism just make us slaves with extra steps?
Or were we slaves to our passions all along?
I don't understand what Klarna is doing here lol
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Klarna is Swedish, not from the US.
>the word "Klarna" in Swedish, means clear up or clarify
Clarify that you can buy this shit you probably don't need in three comfortable instalments?
So they can't be finance bros? I'm not sure what point you mean to make here.
I believe GP was specifically addressing the “this is America” part.
Again, so? The grocery store on my block is beneficially owned by a Belgian and Dutch corporation which feels no compunction in union-busting. What stops a Swede from similarly parasitizing my local economy?
You seem to be arguing the same point? There’s nothing here unique to Americans or America.
If that's not the claim "Klarna is Swedish" was meant to (though fails to) counter, then I fail to understand why bring it up at all.