The Dark Side Of Disruption
Inequality, Silicon Valley’s Ethos, And Our Future
By Professor Zac Cogley (Northern Michigan University)
January 15, 2017 Picture: Shannon Stapleton/Reuters.
This article is part of The Critique’s January/February 2017 Issue “Stick It To The Man: A Year Of Anglo-American Populist Revolt Against A Changing Culture And An Obtuse Political Establishment.”
On January 20, Donald Trump will become the leader of arguably the most powerful country in the world. But today many of the most powerful institutions are corporations, not countries. And no corporations are more important to understanding the next four years than the tech industry. Let’s be clear: tech leaders have Trump’s ear, particularly people like Peter Thiel, who bucked the Silicon Valley consensus to endorse Trump. While Thiel is an outlier for backing Trump, he shares the Valley ethos in many ways. So, to better understand where we’re headed in the near term, we need to understand the tech industry’s implicit value system.
On the one hand, the institutions and people of Silicon Valley value research, exploration, and creativity as foundational life goals. On the other, they believe in efficiency, disruption, and meritocracy. And these latter values are hurdling us toward two radically different possible futures.
Efficiency, the goal of achieving greater production with less work or expense, is deep in the DNA of the tech world. After all, the very first computers weren’t silicon: the use of the term ‘computer’ dates from the 1600s to refer to people making mathematical calculations. Banks of these human calculators used to be indispensable for solving difficult problems. But in the mid-20th century, new, silicon-based computers started to be faster and more efficient at the repetitive application of routine mathematical rules than the old human computers. The things we now call ‘computers’ got their name from the job of the people they surpassed and superseded.
Efficiency gets operationalized in Silicon Valley as coded speed. Being able to code speed is the skill that is most prized, in people, objects, and corporations. The best and fastest programmers get the highest salaries, every new computer or phone is evaluated foremost by its pace, and many of the corporations that are the darlings of Silicon Valley focus on speedier ways of doing something we already do. Uber didn’t invent the idea of hailing cars, for example, but made hailing a car faster and easier than phoning a cab company or standing at the curb. Airbnb didn’t invent renting out homes for short-term periods, but centralized offerings and made them easier to find.
These increases in speed and efficiency have huge societal implications, because many of the things we already do involve rote rules that computers can do faster. Consider these rules: “If the person has an account at this bank with enough money, give her the amount of cash she requests.” (Bank teller replaced by an ATM.) “When the car gets to this point in the assembly line, weld the joint between the frame and the fender.” (Auto plant worker replaced by assembly-line robot.) “Place packages addressed to Ohio in this pile, packages addressed to Michigan here.” (Postal employee replaced by mail-sorting robot.) These are just a few examples of computers again making the vocations of humans obsolete when they can do the work of humans more efficiently. Enormous gains are even being made in new areas of human expertise that can’t be easily operationalized using rigid rules. Amazon is opening stores that eschew cashiers. Autonomous vehicles—which will threaten the jobs of truckers, cab drivers, and chauffeurs—are also being aggressively pursued by Google, Uber, and Tesla. The medical, legal, and business professions will be the next to feel the threat of computing technology.
The potential upside of these developments is the creation of new work that involves less drudgery. Thinking positively, we all gain more time to pursue whatever creative and interesting projects we desire since the number of workers needed for any of these ventures will precipitously decline. Negatively, we will also have fewer paid employment opportunities and more people left out of economic gains.
Whatever the result, increased automation is sure to cause disruption. But disruption isn’t only a side-effect of the Silicon Valley ethos, it’s a principal aim. Silicon Valley types often see our traditional ways of doing things as stagnant, boringly inefficient, and consigned to the scrap heap. One goal of many technological projects is to upend these tired habits and ways of thinking. But it’s not always clear that our old ways will be replaced with something better.
“Disruption isn’t only a side-effect of the Silicon Valley ethos, it’s a principal aim.”
For example, take one of the Silicon Valley disruption movement’s attempts to tackle education: MOOCs. Massive Online Open Courses are educational classes delivered in bulk to anyone who wants to take them (and sometimes, pay a fee). Ideally, these courses would be as interesting and valuable as smaller, face-to-face courses. In practice, they aren’t. I have experience with two MOOCs, one in statistics and the other in computer programming. Neither provided the instructor feedback and sense of belonging necessary to keep me interested and engaged. I stopped participating in both after fewer than 3 weeks. But I’ve enjoyed a smaller, more engaged programming course delivered partly online. My experience isn’t unusual: the vast majority of students never complete MOOCs. Fully replacing our educational system with MOOCS, then, is probably a nonstarter.
The lesson is that we can, and should, only allow the right things to be disrupted. Ride-sharing and short-term renting: yes. But the bedrocks of our society? The parts that everyone needs and must rely on? No. We will probably never be able to ensure that every person gets the very best education. But first we need to try to make sure that everyone gets a minimally decent one. Or imagine if we tried to disrupt transportation infrastructure. Let private corporations funded by venture capital compete to see which can build bridges that get the most traffic! Some existing bridges will be eradicated, most of the new bridges will fail, but that’s just disruption! (Live in fear of enough politicians thinking this way). We have to be smart enough to avoid the negative disruptions while being sharp enough to accept the positive ones.
The final key aspect of the Silicon Valley outlook is the idea of meritocracy: the most skilled, the best, the brightest, the most creative and capable—in general, the most deserving—get the best jobs. The more skilled you are—the better you are—the more power you get and the more benefits you accrue. This idea has a huge following in the Valley with many great tales to support it, like this one about Max Levchin, a co-founder of PayPal: Levchin moved from the Soviet Union when he was 16 and his family only had $300 to their name. He pulled an old TV set out of a dumpster, repaired it, and used it to learn English. 10 years later, he had created and sold a company for $1.5 billion. You can see why it gets repeated so much: it’s a great story. But the really great parts are details left out of the canonical telling, like the fact that his family knew it was important to find the money to get him a computer. Or the fact that his mother was a computer programmer before they moved and his father, grandfather, and grandmother were all prominent physicists. He had advantages many of us don’t.
Those details matter because they show that Levchin’s achievements aren’t just due to him alone, and don’t arise only because of his determination (pace Paul Graham). Tons of determined people don’t succeed, and most startups fail.
But the ideal of meritocracy might be the most important aspect of the Valley ethos to determining how our next two decades go. If we continue to double down on the idea that the people who end up with the most accomplishments and the most pay are the most deserving, we risk ending up with something ugly, since, by implication, that means people who don’t end up in high-paying and lauded positions aren’t deserving. In this view, they don’t matter much at all.
The meritocratic ideal is deep in all of our mindsets, not just Silicon Valley’s. That’s part of the reason people who end up at the bottom can accept being there. They believe they aren’t as skilled, determined, or creative. They accept their lot.
A more accurate understanding of our trajectories comes from recognizing that everyone’s life is touched by massive luck. Take my story. I was lucky to have two very highly-functioning parents: a physical chemist and a manager for architectural projects. I had great educational opportunities and a supportive family. I was even fortunate in the economic collapse of 2008, ending up with more than 2 years of unemployment benefits that allowed me the time and space to think through and complete my dissertation. My (relative) success wouldn’t have been possible without all these aids. Unfailingly, these little bits of fortune are in the story of every successful person.
Another complication of the meritocracy ideal is that, as Richard Arneson states in somewhat turgid academic prose, “the ensemble of circumstances that determine supply and demand and hence what remuneration anyone gets for her market activity varies capriciously in ways that confront economic agents as sheer luck.” Put in less ponderous style: prices and wages fluctuate in accord with random, noisy factors that are far beyond any human being’s predictive powers. That means you can’t reliably choose what will lead to your good fortune, which means we can’t reliably reward you for choosing the best projects to work on.
If we keep ignoring the problems with the meritocratic ideal, we’ll keep gradually moving toward a more unequal society. In the near term, this increasing inequality may not be obvious. We’ll keep living very close to each other, but in increasingly different worlds. Some will have health clubs to use for free at work, with other amenities like free doctor visits, car maintenance, and chef-prepared food. Those folks will take private shuttles to work, sitting on leather seats with access to high-speed internet. They’ll sit in the same traffic as the rest of us, but they’ll be productive and unbothered by the commute. The rest of us will live fundamentally unequal lives, but side by side with these Silicon Valley successes.
Once in a while we’ll see stark glimpses of the reality of other people’s lives, as when at least 36 people died in a warehouse fire in Oakland, CA in early December. The warehouse was a residence and performance space offering ‘the miracle’ of $700 rent—if you lived there illegally with no heat and sporadic electricity. The miracle, of course, is the possibility that you might be able to live in Oakland after real estate values have skyrocketed due to the technology boom in the San Francisco Bay area. The residents of the building called themselves ‘refugees’ from the stratospheric rents in the area. But on the whole, social inequality will continue to grow until the next great leveler: a war, plague, revolution, or state collapse.
If instead we take seriously the problems with the meritocratic ideal, maybe we can expand educational opportunities and healthcare for everyone or advocate for universal basic income. Perhaps we set a maximum wage in addition to raising minimum wages. But whatever we do, we don’t ignore our fundamental human condition: all of our lives are shaped by forces and people far beyond our control. The better ending comes from acknowledging that fundamental fact and trying to make sure that the forces and people are more, rather than less, fair.
Make no mistake, we’ll have to work hard for a better ending. And we need the tech industry to step up to help ensure benefits go to everyone, not just their limited employees. Just pushing efficiency, disruption, and meritocracy gets us the bad ending. But if the tech ethos expands beyond naïve meritocracy to equal opportunity for all, we have a chance at a happy ending.
Trump was elected President in part because of continuing severe economic worries. He did better in states where the economy was weaker. But the rejection of Clinton didn’t bring us a set of proposals that would actually help improve the economy for everyone. As just one example: Trump’s idea of enacting tariffs on China and Mexico could easily lead to a recession.
Let’s be real: we may be on the cusp of four years of significant missteps. That’s why it’s so important to start telling it like it is: no one is a self-made person. All of us owe our successes (and failures) to luck. Any of our positive contributions are just one part of the whole, complicated picture. If we acknowledge that and build support for policies that will help improve opportunity for everyone, we can ensure a more just economy for everyone. But if we keep accepting the Valley ethos, we’ll just keep efficiently disrupting people’s lives until it’s too late for us all.
