Is the title of a new book by Jaron Lanier, computer scientist, musician, and virtual reality techno-wiz. He’s been up to his neck in the digital revolution for most of his life. The book takes yet another look at our changing economy. Lanier’s hypothesis examines digital technology’s contribution to the shrinking middle class. Along with bank fraud, public policies favoring the one percent, and out of control corporate greed, he cites the internet and information technology as a core culprit in the collapse of the economic bell curve.
Lanier’s explanation is the hyper concentration of personal data collected by giant servers reigning over the internet. He calls them Siren Servers, because of their inescapable allure. Google, Facebook, Amazon are among the top sirens offering us free services or cut throat prices while collecting vast amounts of information about us. That information is power. That power is used to manipulate us and the economic marketplace. Shrinking markets—a soft way of saying creating monopolies—and mounting cyber control over individuals—another way of blurring the lines of privacy—are the price we pay for free and cheap. A price that his strongly supported argument claims is unaffordable. And if we continue, it will destroy free market economies. It’s turning out to be another example of a winner takes all scenario. He suggests the winners need to be saved from themselves. We’re experiencing an information age rerun of the Robber Barron era of a century ago.
In comparison, the success of the 1950s and ’60s was based on the growing wealth of the middle class. It was a time when the middle class could out spend the rich. When the economic power was in the middle, we had a more solid, more stable economy. The Trickle Down theory of the 1980s has betrayed us, for in reality, it’s a trickle up that bleeds wealth from the middle. Middle class jobs are vanishing. The demand for highly skilled, highly educated workers has gone up, but as Siren Servers have exponentially increased in efficiency, mid-skilled jobs have become scarcer. The result is a net loss of jobs. Kodak was used as an example. At its height, Kodak was a multi-billion dollar company, with over 140,000 employees. Digital technology has eviscerated its manufacturing jobs. The remaining high-tech jobs haven’t grown enough to fill in the gaps. In contrast to Kodak, and to highlight this dramatic shift, some of today’s billion dollar internet companies have employee counts in the hundreds, the low hundreds—not tens of thousands, or even a few thousand, just a meager couple of hundred. Is that worthy of an exclamation point? Or two?
He goes into distressing descriptions of how IT companies, and specifically Silicon Valley, are amassing huge amounts of data, power, and wealth, with no means, or intention, for a more equitable distribution. We have been seduced by digital candy—free searches, free music, free shipping, free money (remember mortgages handed out without a job or credit), and lower prices (and lower yet for those who spend more), so low they squeeze out our local businesses—our next door neighbors, you and me, our relatives, our young adults, our friends. Cheap and free has to come from somewhere. As prices get lower, someone has to be sacrificed. The squeeze is on—lower wages, fewer jobs. Eventually, it won’t matter how cheap things get, few will have sufficient income to afford much of anything at any price. We can see further evidence of this with the split in consumer marketing moving either towards the lowest-end of the mass market or the tippy-top of the high-end.
He talks about risk dumping. How servers reap huge benefits while they slough off risk onto their users. One point he appears to have left out, though, is how centralized servers conversely pose a huge risk to themselves. They are the target for hackers, jeopardizing huge sectors of the system. Decentralizing the network, in other words democratizing it, would make impossible attempts at take-over or major disruption.
Here are a few excerpts from the book.
Even the most ambitious outcomes in the most fabulous futures articulated in the moneyed dreamspace of Silicon Valley, those where the world isn’t utterly wrecked by nuclear war or some other disaster, tend to leave people behind. Even the optimism is dismal for people. People will be surpassed and left behind.
And yet Silicon Valley engineers, venture capitalists, and pundits continue to go about their days, zipping up to Napa to frolic in the wine country from time to time, having children, and generally living as if nothing unusual is happening.
. . .
The online space feels a little creepier, a little less under individual control, every time a user is asked to acquiesce to a bunch of fine print no one reads.
The reason people click “yes” is not that they understand what they’re doing, but that it is the only viable option other than boycotting a company in general, which is getting harder to do. It’s yet another example of the way digital modernity resembles soft blackmail.
. . .
The way digital networks have been designed by fashion, though not by necessity, creates ultravaluable [sic] central nodes that spawn temptations for bad actors, whether those actors are traditional legitimate players or not. [legitimate players? I believe he means insiders.]
The best way to reduce temptation to act abusively is to distribute value, power, and clout less centrally. The best way to do that is to enable a more comprehensive commercial sphere than the one in place today.
The irony is that the majority of people, the middle class, are the source of the data and wealth. The redistribution of wealth is going upward at an increasing rate with no levees in sight to stop the flow. His thesis proposes a solution through a new form of exchange for digital data : reciprocity. Instead of a one-way flow of data, wealth, and links, a two-way flow is needed. In the current system, digitized information is infinitely copyable; its value reduced to zero. Networks enable copying by anyone, anywhere, anytime. Instead of allowing free distribution and free copies, everything should be paid for. Every person/creator would be the exclusive owner of his/her information. Each access of one’s information is paid for with tiny payments. Everything would require a payment, even open source software or internet searches. For each contributor/creator, and every time data is accessed, a payment is made. Too costly? Not when all information is paid for reciprocally, including the collection of your personal information, or any other contributions, data, articles, blogs, videos, music, etc., that you make available to others. In a reciprocal system, everyone pays for everything. The more you contribute and the more your contributions are accessed, the more micro-payments you receive. It’s an intriguing proposition.
However, as he gets deeper into his program, it gets more convoluted, and less coherent. Not until the final couple of chapters does he offer a few feasible scenarios. Nevertheless, Lanier’s got a redoubtable argument. One we cannot continue to ignore. The overarching idea of his solution is powerful. This book is a must read. Many topics are covered that I haven’t even touched on, security, privacy, transparency, fraud, intellectual property and copyrights. The great value of this book, and why you need to read it, is in how it ignites an array of critical, interrelated topics that need discussion now, before it’s too late. And it’s nearly too late already.
Who Owns the Future?, Jaron Lanier, Simon & Schuster, 2013