The worst thing about Silicon Valley techno-libertarianism – even worse than the willful ignorance of the essential role played by public investment, infrastructure, and research in the development of the industries booming there today – is the insistence that the Valley uses technology to solve society's problems. This is true only inasmuch as Silicon Valley solves the problems of its own society: the problems of being a young, rich white guy who wants to be waited on by servants like the rich of the Gilded Age but doesn't want to hire (or pay) servants. After all, that would be tacky and inconsistent with the Bohemian-meets-Randian ethos of the Valley. Silicon Valley "empowers" and "frees" and all that other delightful prattle, it doesn't have maids and butlers!
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This is the kind of problem they solve, and from their perspective it is a complicated one.
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It's tricky to meet so many conflicting goals at once: being waited on hand and foot by peons without having to pay servants and while somehow making it seems like paying the peons to serve him is Empowering them or Freedom or something. The perfect solution is to create ways for people with money to take advantage of people who can no longer make ends meet while putting a slick, happy face on the whole arrangement.
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And that's why Wired, the official newsletter of the breathless bullshit industry, has a cover story this month about "The Trust Economy."
Things like airbnb and Uber (a car sharing service, for those of us who don't live in a city large enough to make the prospect of paying a stranger to drive you somewhere viable) are "building trust" among Americans, bringing them together and facilitating economic activity. Plus, they make the economy more efficient, partially eliminating the dead airtime in daily life. Why leave your house empty when you can get someone else to pay you to stay in it? Why sit around watching TV all evening when you could make money driving people around?
It all sounds great, at least according to the fawning sycophants who provide all of us out here in the provinces with such worshipful coverage of the amazing achievements of the Techno-Demigods. And it is great as long as you don't bother to ask (or care) why people are suddenly employing themselves as improvised innkeepers and taxi drivers. After all, does anyone really want to let some strangers stay in their home for a few bucks? To drive some trust fund asshole to the airport on Saturday after a 45 hour week? I doubt it. People turn to the "Trust Economy" because they're somewhere between financially stressed and desperate. They don't make enough or they're without any steady source of income at all.
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They do it for the same reason that people go to work at a temp agency or loiter in a Home Depot parking lot to do day labor: because they have no better options.
The tech media work hand in hand with the mainstream media to put the brightest and prettiest coats of paint on economic developments of this kind, but who really benefits from this kind of arrangement? Hold on to your hats, kids, but it isn't you. The beneficiary is the guy who can get people like you to perform for pennies on the dollar all of the tasks that a driver, personal secretary, and butler would do. It's remarkable how many of the recent Big Developments from the omniscient men of the Valley have managed to make the lives of the well-off easier without actually creating any jobs that pay a livable salary or have benefits. Oh, and they convince the media to cover these breakthroughs in a way that makes it sound like they're doing you a favor. You're free at last, free at last. Say goodbye to the chains of full time employment and hello to the boundless freedom of working piecemeal, making phone calls on Mechanical Turk for a quarter and driving Damon the Junior Content Developer to the airport so he can spend the weekend in Cozumel with his frat bros.
The future is here, and it blows.
Heywood J. says:
Ordinarily, you'd figure that these SV jerkoffs simply forgot the notion that if everyone else is just a poorly-paid intern/dogsbody for them, who's gonna buy their products? But since they only have two revenue models: 1) sell a zillion apps for $1 each, or until one of the bigs spots you and buys you out; 2) sell software packages to the gubmint, which is just a fat wad of money to purchase the package, then an annual fee to rent the licensing and support.
It's a pretty neat racket. I knew I shoulda gotten a CS degree instead of an MBA, the latter of which should come in two-ply at this point.
Pat says:
"It's remarkable how many of the recent Big Developments from the omniscient men of the Valley have managed to make the lives of the well-off easier without actually creating any jobs that pay a livable salary or have benefits."
Abso-frickin'-lutely. You really can predict what technological innovations (if that's the right word) will really hit the mental g-spot of self-styled entrepreneurs, just by asking if it will allow a business process to be replicated without any labor costs. "You mean I can not pay people to work for me? Callooh callay!" Crowdsourcing of internet content, the fascination with "viral" content, and the list goes on. It seems to be an open secret in the publishing world now that in order to get a book deal, it's more useful to have 5,000 twitter followers whom the publisher can leverage for promotion than it is, you know, actually to have a good book. And I'm sure I'm ignoring another half-dozen highly obvious examples I could include.
Middle Seaman says:
It's the age of the overnight billionaires. You find an operating system, DOS, and you get to be Bill Gates. (He contributed tons of societal benefits later.) You sneak away with facebook and you arrive. Everyone want to invent the billion $ idea. Few do, most don't. This is how you get AirB2B, Uber, etc.
Not a billionaire? Don't worry you can behave like one. Fine with, I am not disturbed by pretenders. Hey, I am one too. Aren't we all?
Major Kong says:
Prior to becoming Gates the philanthropist he was Gates the utterly ruthless businessman who didn't care who he stepped over or stabbed in the back on his way to the top.
HoosierPoli says:
Your complaint, when stripped of the silicon trappings, is that there's no class consciousness in American media. To which I can only say: "Duh".
Hobbes says:
At UW-Madison, the CS degree doesn't require an ethics course. I don't think UW is unique in this regard; it's my understanding that this is pretty much the standard for the big CS powerhouses (UW is tied for 11th in the US News rankings). Of the tied-for-first schools (MIT, Stanford, Berkeley, and CMU), Berkeley is the only one with an ethics requirement. CMU has a "practical applications of CS" course, but that sounds more like an "intro to the industry" course; Stanford requires a "technology in society" course but this can be fulfilled by studying abroad, so who knows what that means.
So yeah. Of students graduating from the top four computer science programs in the country, only the ones from Berkeley have even had their school attempt to beat some sort of ethics into their heads. This… is a problem.
democommie says:
I think this is a wonderful idea, "Virtual serfdom"–hey, it's a $B idea for a video game!
I wonder how the State of CA's Revenue Dept. and IRS weigh in on this? They've never been fond of tax dodges that are this blatant.
c u n d gulag says:
Where's that killer asteroid when you need it?
John Danley says:
But SV gave us the Hangtime and iPaperWeight apps!
Sarah says:
Very timely that you should post this right after "net neutrality" was ended by a former cable and telecom lobbyist who was just appointed commissioner of the Federal Communication Commission.
Verbal says:
I mostly agree with you, but I think Uber isn't quite the fit you want it to be for your argument. Lyft? Definitely. But the main thrust of Uber is an end-run around taxi medallion holders as much as anything else. If you had the choice of being a taxi driver or a livery driver, Uber makes livery driver jobs a lot more appealing. They've gotten to the point that they now have a financing spinoff to help drivers buy their own cars – that way the drivers aren't beholden to livery companies either. Not that it's an entirely innocent process, and I know that there's all kinds of problems with it, but sticking it to the taxi-medallion racket is pretty much a win for everyone except medallion-holders.
Tim H. says:
Things won't change until the system fails so thoroughly that no one can pretend it in any way works, the "Teabaggers" might be doing us a favor in the long run, by hastening that day. Oh, and then it's only fixed for a couple of generations.
Misterben says:
Great column! Thank you very much.
Alan C says:
Don't forget unpaid internships (which a couple other commenters alluded to).
Irrationalnumb3r says:
This is all you need to read from the Wired article to see what a fluff job it is:
"No less an authority than New York Times columnist Thomas Friedman has declared this the age of the sharing economy, which is “producing both new entrepreneurs and a new concept of ownership.”"
ladiesbane says:
Creating a need in order to fill it with the product you make is smart retailing and very old school. Tech execs are like every other modern exec, gaining their reputations on how profitable they can make the company. Their business model involves a lot of high cost fripperies — free beer truck on Friday, high-quality international no-pay cafeterias, lots of concierge services to cater to their brainpower — and creative teams that are very highly compensated. Overhead in SV is also absurdly expensive, and so is compliance. Where, oh where, can they cut corners?
Low-end workers who apply for scut jobs would often rather put Uber (Yahoo, Netflix, whatever) on their resume, even as a janitor, than Lucky (the local supermarket chain). Lucky pays better, but it doesn't have a designer label, which does improve your marketability down the road. And if you manage to impress someone at Lucky, you get a handshake; impress someone at a tech firm and you could move up the line. The same brand power that works on the retail marketplace works on the employment marketplace as well.
Andrew says:
I don't pretend to put a shiny gloss on it, but I like the idea of being able to pay people to do things I don't want to, or can't, do. What the other person's motivation for wanting to participate is not my business.
McDee says:
A good indicator of how the future will look as seen by these techo-visionaries is how they treat the people who work with them and for them.
They would be right at home in 1880s.
Graham says:
The Uber model demonstrates the damage technology can do quite well. Yes cab companies the world over are protected rackets, but those rackets do not benefit the drivers of the cabs.
These guys earn very little (except for London Black cabs). But at least they do earn. A living. An industry does exist in which a person can earn a living.
Nobody will earn a living off Uber and its ilk: the available work will dissipate like piss in a swimming pool. Ten thousand opportunistic knuckleheads will do one job per day and in so doing will destroy an industry whilst not creating one in its place.
Fmguru says:
The piecemeal economy has already arrived in academica, of course, with the elimination of tenure track positions and their replacement with spot hiring adjunct professors for $2000/course.
Skipper says:
Like Andrew, I too like paying people to do things. I also like the security of having a job and not having to stand on the street corner near Home Depot every day waiting for someone to come by and try to bid me down to scab-wage levels.
I've been saying for years that this is the vision of the 0.01 percent was to have us all scrambling for jobs and scratching each other's eyes out for a shit job at shit wages and no benefits. In our area just these last few weeks, there were several big events going on. Uber sent in a ton of cars, undercutting the cab drivers who make their livings here year round.
Since I was "laid off" in 2003, I haven't found full-time employment, despite a long history of successful employment in managerial positions. Like many of my friends, I now subsist on a series of pickup free-lance jobs. While it sounds charming, the reality is there is always someone a little younger, a less qualified, and/or more desperate, who is willing to bid the job down. I was involved in a "reverse auction" for one assignment that was bid so low, had I taken it, it would have paid me the equivalent of $2 an hour.
I know one guy who is in the same boat and who has a family. He told me he hasn't had a vacation or a full weekend off in six years.
But it's not just the trust economy. If you listen to the execs talk, they speak of the "new workforce," which is basically having a series on short-term assignments, for which you are selected based on your online profiles, your LinkedIn accounts, and the number of "lies" you get from your peers.
Major Kong says:
Just wait until self-driving cars become mainstream. Then we won't even be able to get shitty jobs as cab drivers.
Thanks Google.
mothra says:
What I love is that these kiddos seem to think they can get everything for next to free. Where does this idea come from? Is it because Mommy and Daddy gave them everything they wanted?
Nate says:
@mothra Perhaps, but it could also be because of torrent sites where you could download all sorts of stuff for free.
Townsend Harris says:
Chiming in on Fmguru:
Didn't academia *invent* the piecemeal economy back in the 1980s? Silicon Valley's a bunch of Johnny-Come-Latelies inspired by academic labor practices – as per Marc Bousquet's book "How the University Works" and its crucial, critical subtitle "Higher Education and the Low Wage Nation".
Alan C says:
Skipper wrote: . . . the number of "lies" you get from your peers.
I assume you mean "likes," but it might work either way.
Coises says:
Free-market libertarians and Gin and Tacos types can agree: Enterprises like airbnb and Uber exist because there is a need to be filled and there are people willing to fill it.
The observation of this post (and its comments) is that the need is that of financially desperate people to earn a few extra dollars, and the people willing to fill it are those who are happy to employ non-professionals to save a few bucks.
“The future is here, and it blows.”
We shouldn’t get too hung up on the details… the underlying problem is the ubiquity of financially desperate people. (A reserve army of underemployed?) The specific arrangements for connecting blower and blowee are of lesser importance.
Csicopper says:
Yuck!
vegymper says:
I would suggest the commentariat to peruse the ICT Prophet Jaron Lanier in his "Who owns the future", on the rate of destruction of jobs that technology will bring about, the kind of thinking behind the process, and his (at least to me) fairly impracticable alternative. (No, he doesn't recommend unplugging the internet)
Benny Lava says:
I agree with Verbal. Uber is a way to erode the taxi medallion cartel. Why should medallion owners be millionaires? Because their uncle bought one when they were cheap in the 40s? Bah. They are just another rentier class. At least uber lets you do it online without having to call.
marduk says:
I think there are two things being mixed together here that don't belong together.
Using technology to replace jobs with code is a huge net benefit to human well being. But it does often comes with bad distributional consequences that need to be dealt with. (I like guaranteed minimum income, but I'd be happy with more progressive taxes and more spending on social programs to start).
Using technology to divorce business owners from legal and ethical responsibility to their workers is not likely to be a net benefit to human well being- they're just offloading part of the cost of the labor on the state (or on the worker's quality of life), not reducing the labor overall.
A business like Uber does both of these two things but I don't think they're the same at all. There's a lot of technology that falls almost entirely in the first camp. And a lot of business practices that fall into the second with or without technology.
Skipper says:
To expand on marduk's comment. These schemes also divorce business owners from legal and ethical responsibility to their customers. If your Uber driver is on drugs and drives you into a pole, who do you seek redress from? Not Uber. If your spouse is killed in a fire in an Airbnb room because of faulty wiring, who do you sue? Not Airbnb. Everyone involved is a "private contractor." The claim of capitalism is that business owners deserve large profits because they take large risks. Not Uber or Airbnb. They take minimal risks and make large profits. All of the risk is shifted to the customer, who pays for the privilege.
Neal Deesit says:
@vegymper — From a transcript of a podcast, "Will Google and Facebook Destroy the Middle Class?" in which Matt Miller interviews Jaron Lanier:
——————————————————
"Well, 'information should be free' – it sounds so great because you think throughout history every time there’s been some nasty dictator, the first thing the guy does is try to control the TV station, control the flow of information. So if you opened up information, you’d counter the tendency of people to turn into control freaks who oppress each other, right? I mean, that’s the basic theory.
"And it sounds good. And where it falls apart is if you have a bunch of people who are sharing freely on a network, some of those people are going to have access to better computers than others. And better might mean bigger, it might mean better programs, there are all kinds of factors, but the point is, whoever has the best computers can outcompete everybody else, and right now the best computers are spectacularly better than ordinary computers.
"I mean, a big financial, like a high-frequency trading firm or a Google or a national intelligence agency, they have practically, you know, city-sized computers with their own power plants and they have to use rivers to cool them. You know, these giant things. And what they do is they gather data from everybody else in order to calculate subtle moves so that whoever owns the computer can gradually not take risks, gradually gather benefits, and gradually impoverish everybody else. You know? And it happens over and over again."
Khaled says:
@Skipper- our current "market capitalism" is all about removing risk and privatizing profits. IE, "charter schools", private prisons, etc. The biggest scam of the "the private sector does it better!!!" contracting out of government services is that there is no "risk" involved. If you have a government contract for a natural monopoly, you basically can print money. And the Uber, etc, business model is the same- risk, etc, is shipped out to the "others" while the profits are privatized. The costs are shipped out to the "private contractors".
It really is a brilliant scam. Kind of like starting Super PACs that aren't very transparent to funnel money into your political consulting business.
Graham says:
@Major Kong: exactly about self-driving cars (and when they arrive en masse you can bet that laws will be changed so that the blame any altercation between a drivered car and a driverless one will fall on the driver. I can't see how you could have a mix of the two types of vehicle without a law like this being in place. So, once again, citizens will lose rights and autonomy out of this).
I might point out that in Australia several of the big miners are running driverless haul trucks (a job I used to do), and Rio Tinto will start trialling driverless (270,00 tonnes!) trains later this year. I am feeling rather Luddite these days.
@Mothra: I think the freebie mentality and the destruction of jobs are lined: if your job has been automated/offshored/computerised/vanished/piecemealed then you cannot afford to pay for the cultural content with which you will amuse yourself in your long unemployed hours.
@Skipper: You are quite right about risk- Capital has decided that people are nothing but risk and must be removed from workplaces as quickly as possible and, preferably, removed from the vicinity entirely if possible.
In Brave New World Aldous Huxley envisaged there would be an isolated island on which lived those few who were incapable of living by the precepts of future society. It looks to me like that is going to become a very crowded island indeed, filled with the likes of US.
Graham says:
"linked" Sigh.
Valerie Chism says:
I would not be too sanguine about Gates the philanthropist his charities are a very mixed bag that includes pushing GMO's and collaborating with the movement to privatize schools
whetstone says:
My anecdotal evidence of AirBnB is that a lot of people do it who aren't broke; two friends of mine are lawyers, who either have extra space or reason to be out of the condo a lot. (Nor does it seem to drive down the cost of staying in a place versus a hotel.) Here in Chicago I get the sense that AirBnB is appealing because Chicago has a weird spacial balance of hotels–basically all of them are downtown with a handful north of downtown along the lake. If a 20- or 30-something is visiting friends in the northwest side, staying in a nice apartment in Logan Square (hip neighborhood) is maybe more appealing than staying at Generic Chain Suites next to the ESPN Zone.
Having said that, though, these services do remind me a lot of services that were/are more popular in times or places that are impoverished, like boarding houses and jitney cabs.
Barry says:
Heywood J. Says:
"Ordinarily, you'd figure that these SV jerkoffs simply forgot the notion that if everyone else is just a poorly-paid intern/dogsbody for them, who's gonna buy their products? But since they only have two revenue models: 1) sell a zillion apps for $1 each, or until one of the bigs spots you and buys you out; 2) sell software packages to the gubmint, which is just a fat wad of money to purchase the package, then an annual fee to rent the licensing and support.
It's a pretty neat racket. I knew I shoulda gotten a CS degree instead of an MBA, the latter of which should come in two-ply at this point."
Some consulting firm recently coined the term 'plutonomy', which meant that wealth was so concentrated that there were now vast markets serving the 1%, or the 0.01% or the 0.0001%. These markets don't care about anybody who's not a millionaire (or billionaire).
Heywood J. says:
Barry:
Yes, I remember that, the infamous leaked Citibank memo, advising folks to "binge on bling." They're happy to bathe in Cristall and Ketel One while the rest of the planet rots on the vine.
I've given up wondering if anyone will do anything about any of it. The Occupy movement tried for a hot second, and all our insect corporate media overlords did was send Erin Burnett down to Zuccotti Park to make fun of them.
These six words have become my mantra: I hear Costa Rica is nice.
Barry says:
"These six words have become my mantra: I hear Costa Rica is nice."
Not for long, I fear. The same forces work there just as much as here.
Ursula says:
There is no physical law that says that labor costs have to be in the liability column and physical objects (like technology) are "assets", but our society is incapable (and those with the power unwilling) to make a meaningful change.
Then there is this Twilight Zone episode: https://www.youtube.com/watch?v=vFgLVU-eKRE
When I was learning labor history in school, I never understood what was so hard for companies to understand about a family needing to be able to have enough to eat and enough time to sleep and live outside of their factories.
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