Forget Techno-Optimism: We Can’t Innovate Our Way Out of Inequality

Hillary Clinton’s former ‘senior advisor for innovation’ sees our Uber-ized future through rose-colored glasses

Chris Lehmann January 27, 2016

(Dawid Kasza/Shutterstock)

Toward the end of his 250-page hymn to dig­i­tal-age inno­va­tion, The Indus­tries of the Future, Alec Ross paus­es to offer a rare cau­tion­ary note. Sil­i­con Val­ley may have incu­bat­ed all the won­ders and con­ve­niences one can imag­ine — and oh, so many more! But for the inter­na­tion­al busi­ness elites look­ing to remake their emerg­ing mar­ket economies in the Valley’s gleam­ing, kha­ki-clad image, there’s some bad news: It can no longer be done. A decades-long head start” has grant­ed too great a com­pet­i­tive advan­tage to the charmed penin­su­la along the North­ern Cal­i­for­nia coast.

He offers nothing in the way of policy specifics besides the inarguable yet unactionable truism that if the sharing economy “generates enormous amounts of wealth for the platform owners, then the platform owners can and should help pay for added costs to society.”

Not to wor­ry, though! On-the-make tech glob­al­ists can still make a go of it, pro­vid­ed they’re pre­pared to embrace spe­cif­ic cul­tur­al and labor mar­ket char­ac­ter­is­tics that can con­tra­dict both a society’s norms and the more con­trol­ling impuls­es of gov­ern­ment leaders.”

Stripped of the vague and glow­ing tech­no-bab­ble, this is a pre­scrip­tion for good old-fash­ioned neolib­er­al mar­ket dis­ci­pline. Every­where Ross looks across the rad­i­cal­ly trans­formed world of dig­i­tal com­merce, the benign log­ic of mar­ket tri­umphal­ism wins the day. When Ter­ry Gou — the Tai­wanese CEO of Fox­conn, the vast Chi­nese elec­tron­ics sweat­shop that dou­bles as an incu­ba­tor for work­er sui­cides — plans to elim­i­nate the headache of super­vis­ing an unsta­ble human work­force by replac­ing it with the first ful­ly auto­mat­ed plant” in man­u­fac­tur­ing his­to­ry, why, he’s sim­ply respond­ing to pure mar­ket forces”: i.e., an increase in Chi­nese wages that cuts into Foxconn’s ridicu­lous­ly broad prof­it mar­gins. And you and I might see the so-called shar­ing econ­o­my as a means to casu­al­ize ser­vice work­ers into nonunion, ben­e­fit-free gigs that trans­fer eco­nom­ic val­ue on a mas­sive scale to a ren­tier class of Sil­i­con Val­ley app mar­keters. But boun­cy New Econ­o­my cheer­lead­ers like Ross see a way of mak­ing a mar­ket out of any­thing, and a microen­tre­pre­neur out of anyone.”

When con­front­ed with the spi­ral­ing of income inequal­i­ty in the dig­i­tal age, Ross, like count­less oth­er prophets of bet­ter liv­ing through soft­ware, sage­ly coun­sels that rapid progress often comes with greater insta­bil­i­ty.” Sure, the wealthy gen­er­al­ly ben­e­fit over the short term,” but remem­ber, kids: Inno­va­tions have the poten­tial to become cheap­er over time and spread through­out the greater population.”

Ross first stormed into polit­i­cal promi­nence as an archi­tect of Barack Obama’s tech­nol­o­gy and inno­va­tion plan” dur­ing his 2008 pres­i­den­tial cam­paign, and he has spent four years cap­tain­ing his own charmed, closed cir­cle of tech tri­umphal­ism as the White House’s senior advi­sor for inno­va­tion” under Sec­re­tary of State Hillary Clin­ton. This ren­ders The Indus­tries of the Future some­thing more than anoth­er breath­less, Tom Fried­man-style tour of the won­der­ments being hatched in star­tups, trade con­fabs and gad­get fac­to­ries. Ross’ book is also a tech-pol­i­cy play­book for the like­ly Demo­c­ra­t­ic pres­i­den­tial nom­i­nee, who has spared no effort in solic­it­ing the pol­i­cy input — and land­ing the cam­paign dona­tions — of the Sil­i­con Val­ley mogul set. As such, it should give any Hillary-curi­ous sup­port­er of eco­nom­ic jus­tice con­sid­er­able pause.

To be sure, Ross rais­es some vague con­cerns about how, for exam­ple, the run­away growth of the shar­ing econ­o­my drains work­ers of job secu­ri­ty, health­care ben­e­fits, pen­sions and the like. He avers that as the shar­ing econ­o­my grows … the safe­ty net needs to grow with it,” but, much like his polit­i­cal­ly savvy boss, he offers noth­ing in the way of pol­i­cy specifics besides the inar­guable yet unac­tion­able tru­ism that if the shar­ing econ­o­my gen­er­ates enor­mous amounts of wealth for the plat­form own­ers, then the plat­form own­ers can and should help pay for added costs to society.”

The larg­er point for Ross, in any event, is that the inno­v­a­tive megafirms of tomor­row will come to spon­ta­neous­ly serve the pub­lic good. Not to men­tion that many IPO investors are pen­sion funds,” Ross coos, which man­age the retire­ment funds for peo­ple in the work­ing class like teach­ers, police offi­cers, and oth­er civ­il ser­vants.” Nev­er mind, of course, that the neolib­er­al log­ic of the Uber mod­el means that we’re cre­at­ing a work­force that’s unlike­ly ever to come with­in shout­ing dis­tance of a pen­sion ben­e­fit again.

This kind of ter­mi­nal Sil­i­con Val­ley myopia also accounts for the vast eco­nom­ic and polit­i­cal blindspots that con­tin­u­al­ly under­mine Ross’ relent­less­ly chip­per TED pat­ter. To take just one instruc­tive instance, in a book that devotes con­sid­er­able real estate to the inno­va­tions of fin­tech” (the stream­lin­ing of glob­al dig­i­tal cur­ren­cy exchanges and invest­ment trans­ac­tions) nowhere does the author acknowl­edge the piv­otal role that tech-savvy Wall Street ana­lysts — the quants” as they’re known in Street argot — played in stok­ing the ear­ly-aughts hous­ing bub­ble that led to the near-melt­down of the glob­al economy.

That’s because it’s an axiomat­ic faith for this brand of tech­no-prophe­cy that inno­va­tion can nev­er actu­al­ly make any­thing worse — in just the same fash­ion that the quants were insist­ing, right up until the end, that there could nev­er be a down­turn in the nation­al hous­ing mar­ket. If this is the kind of wis­dom Hillary Clin­ton relied on to pro­mote her glob­al inno­va­tion agen­da at the State Depart­ment, one shud­ders to think of how it might run riot through the White House come next January.

Chris Lehmann, is edi­tor-in-chief at The Baf­fler and a for­mer man­ag­ing edi­tor of In These Times. He is the author of The Mon­ey Cult: Cap­i­tal­ism, Chris­tian­i­ty, and the Unmak­ing of the Amer­i­can Dream (Melville House, 2016).
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