Is Tim Cook Starting a Rollerball League?
Tags: Economics, Movies, Apple, Cryptocurrency, Geopolitics

There is no doubt 2020 has brought a great deal of upheaval and change to the country and the world. I have felt lucky to have grown up on stories of the great science fiction writers of the twentieth century. Guys like Asimov and Heinlein were a bit more prophetic than I ever thought could be. I surely did not expect to see the rise of the Mule!

In any case, this early immersion in these forward thinking plot lines has made 2020 a bit easier to understand. It also makes me sensitive to trends which follow some of these old plot lines. There are plot lines from back in the day which have begun to seem to become “live” now. Plot lines involving corporate nation states are now extant.

There are trillion dollar corporations now. Wal-Mart and the Walton family have more financial power than half the nations in the United Nations. There are many multi-billionaires on the planet today. Jeff Bezos has more money than Iceland or Azerbaijan! The latter is actually at war with Armenia right now at no small cost.

War is usually about borders which are often about control of economic resources. Historically nation states of diverse populations have been held together by shared economic interests. Their shared interests means they invest in a shared military to defend the borders. Of course, many nations are all about ethnicity and cultural heritage, but not all. The United States really demonstrated the power of a diverse population with shared economic interests.

The 21st century is defining new norms every day. The pandemic has accelerated this but it was always happening. The pandemic has also demonstrated quite clearly that responsible governance matters. This is the greatest gift of the nation state, a peaceful and stable environment within which a company can do business.

An environment of chaos is not good for business. An environment without a stable social foundation will not last. Many a corporation has collapsed due to cultural issues rather than bad business models. When leadership cannot get along the company becomes vulnerable on so many fronts. Responsible governance provides continuity of leadership, a stable customer base, the rule of law and the larger protections of a nation’s military.

The 21st century is changing how a stable environment can be provided for “citizens”. Technology is making the virtual world just as important as the physical world. Enormous power in the virtual world can translate to quite a bit of power in the physical world. I believe Apple may have reached the critical mass necessary to define a virtual nation state.

Not only do I think Apple has achieved this critical mass as the first trillion dollar company, but Tim Cook seems to understand what it means. Apple leadership has been put in a bind by the trade war with China. Tim Cook and his board have been forced to deal with a chaotic economic environment. Corporations need stability and Apple may have the ability to provide their OWN economic stability.

Apple already has a group of very passionate “citizens”. Many people will ONLY use Apple products. Apple of course also works very hard to create a virtual walled garden keeping their user base in all things Apple. On top of this Apple has NEAR unbreakable encryption. Apple famously thumbed its nose at the FBI several years ago when they were asked to unlock an iPhone. The US government went to an Israeli tech firm to get the phone unlocked which puts American tech leadership in question.

Tim Cook has at his disposal the resources of a trillion dollar corporation and millions of passionate “citizens”. As a nation, we have been focused on the pandemic and an upcoming election. That election has been signaling the possibility of civil unrest and more instability in the country. While we have been struggling with these issues, Tim Cook has been putting the pieces in place.

There was very little talk of this, but during the summer Apple issues 40 year bonds. At the time, these bonds were paying twice the US 30 year bond. The Apple corporate bonds were snatched up quickly. Apple received a trillion dollars to do with it as it would as long as it paid the sub 3% interest rate on these bonds annually.

At the time, many wondered why Apple needed the money. Most commented the company was simply taking advantage of shrinking interest rates from sovereign nations. Now there is a new development which really puts the possibility of a corporate nation state on the table.

Apple has now bought Ripple or merged with Ripple or somehow entered into some kind of partnership with the Ripple Foundation. Apple is in the process of absorbing Ripple so the Apple Corporate State will have a national currency? Laughing? No one can say 2020 has shown the United States to be a place of social or economic stability. Sure the stock market is soaring but the rest of the country is really suffering. There is social unrest everywhere. The rule of law is no longer a given.

Apple has the money, the citizenry, the encryption, the currency to create a virtual nation state. All they really need to create a stable economic environment is the will to create one. Apple and Tim Cook are not going to sit back and allow their grand economic paradise of Apple World to be destroyed by a ridiculous and counterproductive trade war.

Once the economic stability is provided, others will look to the Apple model. If nation states cannot provide economic stability for its citizens they will look for “authorities” that can do so. Corporate nation states may just become a necessity if the current nationalism continues to hurt business and threaten global stability.

When Tim Cook starts meeting with the head of Emirates Airlines, Ethiad, Wal-Mart and JPMorgan Chase, rest assured a Rollerball League will be in the offing. I imagine they will build an island off the coast of Dubai and perhaps create some kind of extra national bubble for their league. Maybe they will also include Huawei and Tencent with a second island off the coast of Macau to cool the trade war.

If you have not seen what the Rollerball world looks like Turner Classic Movies periodically trots out the 1975 movie starring James Caan and John Houseman. It is a decent movie. It is also far more prophetic than I would ever have believed when I saw it all those years ago. I recommend watching it…and maybe buying some Ripple.