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Peter Rogers's Blog
Artist-in-Residence at Chez Firth

Monday (10/10/16) 12:40am - ... wherein Peter posts a Weekly Media Update.

Books:  Throwing Rocks at the Google Bus
Movies:  <none>
TV:  <none>

Throwing Rocks at the Google Bus by Douglas Rushkoff
This is Douglas Rushkoff's book about how we should rethink the basic tenets of capitalism to account for the burgeoning digital economy.

I'm fascinated with the notion that capitalism might be fundamentally broken.

Per capita productivity soars, but more and more people barely scrape by. The financial services industry seems to eat the lion's share of the country's incomes, but one sense that most of them could quit and become fishermen[1] in Perth, and nothing of value would be lost. There are things you expect out of capitalism -- rising productivity lifts all boats; contributions to society get rewarded -- and these days they don't seem to be happening. And meanwhile, some basic ideas from classical economics are being called into question; the most interesting economic research in the 2000s punches holes into revered models, like Daniel Kahneman's work on irrational economic behavior.

There's the sense that something's busted with the economy's basic engine, and if we don't fix it, the economy will fizzle out until we're stuck with one rich, bald, flaulent heir who lives in a golden palace while everyone else dies in their own filth -- at a time when we've established enough productivity to make everyone live like kings.

All of which is to say, Google Bus intrigued me. It makes the argument that, yes, capitalism has some basic ideas dead wrong, and the Digital Age is making them readily apparent -- but worry not, the Digital Age also provides the tools to fix them.

Great! Sign me up.

So: I did not go into this book expecting to hate it.

But here we are.

I think the most basic problem I had was with, of all the high-flown things, rhetorical style. The easiest way to explain this is by hypothetical examples. So: let's say I wanted to present you with a convincing argument that the earth is round.

I might start from an anecdote: I watched a ship sail out to sea, and saw it get smaller and smaller in the distance. I extended a spyglass to keep an eye on it, and finally, impossibly far away, I saw the ship drop down below the horizon. I would point out how current models dont explain that behavior -- if the earth is flat, where did it drop to? -- and then present the revolutionary claim that it did that because the earth is (*gasp*) a *sphere*.

I might go on to adduce information about the phases of the moon, pointing out that *something* round is casting a shadow on that satellite. I could provide data about gravity, pointing out that a "pancake" earth would draw everything powerfully and irresistibly towards a central point. And I would present, and address, sensible counterarguments. "Why doesn't it *look* curved?" Well, because you're viewing very small pieces of it -- in fact, we can calculate the minuscule curvature you would expect to see on human scales.

And so on. You assemble your facts, and your logic, and you show how, even though your conclusion may sound revolutionary, or counterintuitive, or even untenable, those data, together with your reasoning, lead inescapably to your conclusion. In a way, you just let that mountain of convincing evidence speak for itself. You just stand alongside it, in mute witness.

And then there's how you would argue that the world is round if you're a digital futurist.

Yeah. The *Church* says the world is flat. Heh. The Church -- old farts, amirite? They don't know what's up. They don't know the knowledge of the *future*. They're the generation of the past, and they just don't get it. This really cool guy I know, who has a *ton* of money, says that round-earth is the way everything's going. Whoever goes along with that is gonna be *rich* -- and the rest of you will just be left behind.

You see that the argument arrives at a correct conclusion -- yes, the earth *is* round -- but it could just as easily prove that the earth is a cube, or a donut, or a cylinder -- and an argument that can prove anything is an argument that proves nothing. It argues from authority ("I met a smart dude") instead of citing data. It uses ad hominem attacks ("these people just don't *know*, man") instead of presenting the logical counterarguments and picking them apart.

In fact, this latter style of rhetoric is more about the writer -- how much smarter the writer is than the establishment, how much secret knowledge *they and they alone* are privvy to -- than it is about facts or reasoning. And in this hypothetical case, such a smug and sloppy argument would make a flat-earther even *more* resistant to the round-earth idea; a later, evidence-based argument might fall on deaf ears.

But honestly, you can't really *do* digital futurism by humbly and compellingly presenting your data. First off, if you could reach predictions that reliably, then you'd be busy making all of the money off of out-thinking the market instead of writing popular nonfiction. But also, the world is just too complicated for easy prediction. And frankly, the culture around this field -- the TED talks and the social-media books and the TV appearances -- isn't really about quietly presenting your data. It's more about making big, splashy pronouncements, and couching them in terms of "if you wanna be in the know and ahead of the curve, you listen to me".[2]

So the social-media maven makes his (almost always 'his') gosh-wow predictions. Now, when a doctor makes a bad prediction, people die, and there are uncomfortable morbidity & mortality meetings at the hospital. But when a social-media maven makes bad predictions, he can just cherry-pick the few that come *true* and refer back to them, smugly, in his next TED Talk.

So that's how this book works. Rushkoff says early on that he's not going to use statistics, because "statistics don't tell the story" of what he needs to say. So it's anecdotes, and conclusions averred without proof, and ad hominem attacks, and appeals to authorities. And, in some cases, statistics, on the few times when they suit his points. (I guess *some* statistics are okay?)

He starts off by claiming that some very basic tenets of economic theory are wrong. For instance, he states that, because of externalities (pollution, plus other problems dismissed in a vague, mumbly et cetera), economies of scale don't work. i.e., bigger companies are *not* more efficient or productive than smaller ones.

Now, let me sidebar here: this is a fascinating idea. Again, there's a staggering amount of great research going on today questioning the basic notions of ECON 101. Hell, there was an amazing paper just this year that dismissed one of the basic variables of macroeconomics as "phlebotin", and a good post from a few years back dismissing the datasets used in the field. And treating 'economies of scale' as a fallacy -- I don't think that's entirely wrong. In some cases, externalities such as pollution *and* other factors like work environment, product quality, even (on the largest scales) regulatory capture and monopoly rents probably *do* make some larger companies less productive, and in all cases, economists agree that externalities are notoriously tricky to 'capture' in markets.

But to state that economies of scale *never* work -- to make that stark and absolute claim -- is bizarre. Taken to its extreme, you're saying two people shouldn't work together because they'd be less efficient that way. "Economies of scale never work" is an extraordinary claim, bucking against both classical economic theory and everyday common sense -- and as such, it needs (as Carl Sagan might say) extraordinary evidence.

Rushkoff gamely presents *no* evidence. It's just a quick, glancing, "big companies are bad, because of pollution and stuff, right?", and then on he goes. Soon it becomes clear that you're reading a Mother-Jones-y book, a book designed as agitprop for the people who already agree with it, rather than something designed to convince anybody to reconsider their initial mistrust of the book's ideas.[3]

And then there are cases where he makes absolute claims that are far outside his specialization.[4]

He says it was just the rise of mp3s that destroyed the industry of recording studios -- uh, no, there are still recording studios, and the ability to record *nearly anything in your own bedroom* probably had a lot to do with its precipitous decline. He says that the entire increase in health-care costs comes from increases in pollution. How we then explain health care costs going up since the 70s, while pollution went down, I leave to wiser heads than mine. Apparently neither Google nor Apple contributes to open source. This sent me scurrying, my head pugtilted, to the Internet, to confirm that the Android Open Source Project preceded the publication date of the book.

Frankly, there are enough points, mentioned casually in passing, that are howlingly, provably wrong[5], that it calls everything else into question. By the time he said that pegging the dollar to the gold standard would end all inflation, my bullshit detector was itself pegged. To be clear: I know nothing about the gold standard and vanishingly little about inflation beyond its definition. But his statement is so absolute, and his claim is made without citation or evidence, and there have been so many other logic-stinkbombs, that this one, as we would say in the coding business, 'has a smell'. And sure enough, a ten-second google search confirmed that, hey, we had just a smidgen of inflation leading up to the Great Depression, y'know?

And it's frustrating, because Rushkoff is asking the right questions. If people make billions of dollars producing nothing of value, what has gone wrong? If Wal-Mart can take out local business via predatory pricing and leave a community with a smattering of awful, low-paying jobs, how has capitalism failed us? Even if you're spewing gobbledygook as your answers, just posing the questions is useful.

And in fact, there are limited areas where he seems to know exactly what he's talking about. His discussions about Silicon Valley, and about how that environment is designed to produce only the next industry-destroying behemoth instead of another self-sustaining, useful business, are riveting. (Though I sense that Paul Graham would eviscerate every one of his points with gleeful extreme prejudice.)

Rushkoff puts the blame on the growth requirements associated with publicly-traded corporations. If a company has to grow without bounds to satisfy its shareholders, this leads to short-term solutions to satisfy quarterly reports, and it leads to increasing externalities (pollution, etc.), and it leads to more automation and fewer jobs that get worse and worse over time. The solution, as he sees it, is to go back to private corporations (and variations on those) that are stable and self-sustaining.

This is odd, since it seems to presume that CEOs of private corporations are all benevolent overlords. In fact, I could see many executives being very keen on growing their business to take over a vertical, and automating jobs, and making the few remaining jobs lousier and lousier. It seems like, on some level, step one of his plan is "everybody has to act more virtuous", which is a sign of crappy plan that won't survive contact with reality.

And it also leads to the most logical counterargument against this book. Say there's an industry of toilet-cleaners. People get hired to clean the toilets, those people clean the toilets, they make an okay hourly wage. Now say someone invents a toilet-cleaning robot. It works with freakish efficiency, and costs almost nothing, and barely ever requires maintenance. Now all the toilet-cleaners are out of work, yes, and they have to find new jobs. But on the other hand, humanity now gets free clean toilets forever. Much of what Rushkoff denigrates in high-growth corporations is this push towards more efficiency and higher individual productivity. But if we keep automating everything, we eventually hit a point where we have to do very little, and can live in idle luxury. Hell, for some values of "very little" and "luxury", a lot of people live like that now. Would we just throw that away? Is this as good as anything gets?

Now, this is not an unassailable argument. We could reach and try and say that we really lived better as hunter-gatherers tens of thousands of years ago. Or we could say that most companies don't actually increase worker productivity with streamlined workflows or automation. But the telling thing, for me, is that Rushkoff never even *mentions* worker productivity, not even to too-quickly dismiss it as irrelevant.

It's like he's making a book-length flat-earth argument without addressing where that ship went when it dropped over the horizon.

And the book continues like that for hundreds of pages, somewhere in the Venn-Diagram intersection of dingbat, tinfoil hat, and Burning Man. He seems to not know what "externality" means, as an economic term. He claims that nobody competed for wealth before the modern currency system. Throughout the book he keeps talking about 'extractive' companies without ever defining the term[6], continuing the book's cult-y feel of "I've invented my own terms for things." He says video games don't have heroes. And apparently holograms are an artistic innovation on the level of perspective drawing in the Renaissance.

By the time he tells us that the end state of his proposed economic plan is 'a globally networked consciousness', I'm ready to hand him his Kool-Aid and send him off to the mother-ship.

God. Now I'm probably going to have to read Capital in the Twenty-First Century, just to see a discussion of modern wealth inequality that has at least a nodding acquaintance with data. I really, really don't want to do that.

For next week: I'm watching season 8 of Good Eats and season 3 of Last Week Tonight while exercising, and also thoroughly enjoying Adam Ruins Everything. I'm reading a book about randomness in everyday life, and I still need to write something about Master of None.

[1] Almost always men.
[2] I am keenly aware of the irony to my presenting that point without any supporting data.
[3] And I can apply this same objection to his claim that '
the tragedy of the commons' is just a lie invented by people pushing the Enclosure Act in 18th-century Britain.
[4] We could argue back and forth about what fields are *within* the "social media maven" specialty, but we can all agree that certain fields lie outside of it.
[5] And it may be that I'm misinterpreting points that he intended to be more nuanced and specific. But frankly, that just makes him an unclear writer.
[6] Economists use the term 'extractive' to describe entire economies that focus on extracting some natural resource -- say, the Nigerian government pumping up oil -- and shunting all the profits to the cabal that runs the country. There may be a way to draw an analogy between that real definition and whatever Rushkoff intends, but he never clarifies it.

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