Reader question:

In this sentence – Globalization is not a zero sum game but a great opportunity for all – what does "zero sum game" mean?

My comments:

Sum means total, as in sum total. Zero-sum means it all adds up to naught¹.

A zero-sum game is one in which gains and losses cancel each other out, i.e. someone winning something comes at the expense of somebody else's losing. To make your winning possible, somebody has to lose that something you're winning.

Let's say you're playing Chinese chess and you gain ground by eating, as it were, one of your opponent's pawns³. You gain (an advantage of) a pawn², he loses one. He eats one of your horses – he gains a horse (in advantage), you lose a horse. You win a game, he loses a game. You can't win a game without him losing one. You are good. Better than your opponent is, that is, and you win ten games in a row. He loses ten in a row (to make your winning possible).

You say, hey, that's great, I like this game. I win all the time. I like winning all the time.

Well, if that's what you like, you're on your way to suffer because one, you're not going to win all games in life all the time; two, if you win all the time it's no competition – where's fun of competition when there's no competition?

So, what you do is you shift attention from winning (or losing) to simply playing the game – and not get attached to outcome. Only then are you able to enjoy the fact that you're getting better from the practice – becoming a better player with each game played, win or lose – and keep getting closer to reaching your full potential (which in turn keeps growing of course just to stay out of your reach).

And if your opponent did the same, both of you would escape your karma – the sorry fate of suffering the joy of winning and the pain of losing.

Esoteric? Well, definitely we're drifting – let's get back to, er, globalization.

When globalization is described as a zero-sum game, it means that gains by some countries are cancelled out by losses by other countries. For example, if Nike, the sports gear maker⁴, shifts one of its shoe shops from, say, Mexico to Indonesia, the latter gains an extra business. But gains made by Indonesians are offset⁵ by the loss of the same business in Mexico. That's why globalization becomes a zero-sum game for, say, countries which have little more than cheap labor⁶ to offer (and to be exploited).

But if, say, China exports wheat, supposing we have an excess of it (which we don't, of course – it sometimes seems we, too, only have an excess of cheap labor) to Ecuador and gets bananas back, supposing Ecuador has an excess of bananas, then it becomes what politicians call a win-win situation.

If you listen to politicians these days, you hear they are turning every piece of deal into a win-win situation for all parties involved – all winners and no losers. You hope they know what they are talking about, of course.

Anyways, here are more media examples on "zero-sum game":

1. "Google has records that could help in a cyber-investigation, he said," Wright adds. "Giorgio warned me, 'We have a saying in this business: 'Privacy and security are a zero-sum game.'"

A zero-sum game is one in which gains by one side come at the expense of the other. In other words – McConnell's aide believes greater security can only come at privacy's expense.

- US drafting plan to allow government access to any email or Web search, rawstory.com, January 14, 2008.

2. "We have a saying in this business: 'Privacy and security are a zero-sum game.'" Thus spake security consultant⁷ Ed Giorgio in a widely-quoted New Yorker article on the US intelligence community's plans to vacuum up and sift⁸ through everything that flies across the wires. But Giorgio is wrong—catastrophically wrong. The story of Fidencio Estrada, a drug runner who bribed⁹ Florida Customs agent Rafael Pacheco to (among other things) access multiple federal law enforcement databases on his behalf, suggests that when it comes to the government collecting data on innocent civilians¹⁰ for law enforcement purposes, privacy and security are essentially¹¹ the same thing.

- Analysis: Metcalfe's Law + Real ID = more crime, less safety, arstechnica.com, January 19, 2008.

3. Bush's woefully misguided invasion and occupation of Iraq in 2003, carried out under false pretences¹³, has not only drained the United States treasury¹⁴, but reduced Washington's standing¹⁵ in the Middle East in a way not yet fully¹² grasped by most commentators¹⁶. Whereas Washington once played off Tehran against Baghdad, while involved in a superpower zero-sum game with the Soviet¹⁷ Union, the Bush administration is now engaged in a zero-sum game, as a virtual equal, with Iran. That is, America's loss has become Iran's automatic gain, and vice-versa.

- Bush in a zero-sum Iranian game of his own making, arabamericannews.com, December 9, 2007.

4. Zero-sum game

When the gains made by winners in an economic transaction equal the losses suffered by the losers. It is identified as a special case in GAME THEORY. Most economic transactions are in some sense positive-sum games. But in popular discussion of economic issues, there are often examples of a mistaken zero-sum mentality¹⁸, such as "PROFIT comes at the expense of WAGES", "higher PRODUCTIVITY means fewer jobs", and "IMPORTS mean fewer jobs here".

- economist¹⁹.com