Lambert here: That Silicon Valley catchphrase “Move fast and break things” has always made my back teeth itch. So, what Eskow says here most definitely needs to be said. I see no reason whatever to give Silicon Valley squillionaires deference. We should stop doing that.
By RJ Eskow, a blogger and writer, a former Wall Street executive, a consultant, and a former musician. Originally published at Alternet.
Nowadays the Silicon Valley is either celebrated as a hotbed of creativity or condemned as a cauldron of greed and wealth inequality.
While there are certainly some talented and even idealistic people in the Valley, there’s also an excess of shallow libertarianism, from people who have enriched themselves with government-created technology who then decide they’re being held back by government. That’s shortsighted and vain. And yes, there are serious problems with sexism and age discrimination – problems which manifest themselves with some ugly behavior.
But such ethical problems aren’t solely, or even primarily, the product of individual character defects. They’re the result of self-reinforcing cultural norms at work. Anthropologists and sociologists could do worse than study the tech culture of the Silicon Valley. It would be important work, in fact, because this insular culture is having a deep and lasting impact on our economy and society.
Here, to star them off, are five socially destructive aspects of Silicon Valley culture:
1. Tech products become the byproducts of a money-making scheme rather than an end unto themselves.
It’s almost inevitable when big money enters the picture: Smart or talented people are drawn to a field for the chance to get rich, not necessarily because it’s where their greatest talents or dreams lie. The same thing has happened to fields as diverse as film, pop music, and the financial sector. There’s nothing wrong with getting rich, but it should be the byproduct of a happy marriage between talent and inspiration.
But here’s how it works instead: The goal of entrepreneurs and innovators was once summed up in the cliched phrase, “build a better mousetrap.” But for many Silicon Valley products and services, including services like Uber and AirBnB, the goal now is to build a product which can be hyped into a multi-billion-dollar valuation – preferably by winning as much market share as possible, and then using that market position to engage in the kinds of practices usually reserved for monopolies and monopsonies (markets in which there is only one buyer). This process is described in more detail here.
Instead of building a better mousetrap, the new Silicon Valley business model works like this:
i. Give your “mousetrap” away for free, or as close to free as you can make it. (Since you’re working with digital signals transmitted over a government-invented network, that can usually be done at minimal cost. In other cases it pays to benefit from a government tax loophole (see Amazon) or make an end run around the regulations your competitors must follow (see Uber, Lyft, and AirBnB).
ii. Use these government-conferred advantages, along with your own aggressive market moves, to gain a large or decisive marketshare. (See Amazon, Facebook, etc.) In exceptional cases, actually build brilliant and superior software to win your market share. (See Google.)
iii. Use your newfound market share to a) bend government to your will wherever possible, b) screw down your suppliers’ prices, c) hit your customers with increased prices and/or new ads or other profit-making devices, and d) manipulate your customers without their knowledge. (See Uber, Amazon, Google, Facebook, et al.)
This business model has directed much of the Valley’s efforts away from inventing genuinely creative new products – and toward the kinds of aggressive tactics that, as we’ve written before, would be very familiar to the Robber Barons of the 19th century.
2. Even inspired leaders internalize a worldview which places profits over humane behavior.
Steve Jobs is a prime example of this phenomenon. As an early innovator in the tech field, Jobs – however interested he was in making money – was not drawn to the field for the sake of money alone. Nor was he following in the footsteps of others, seeking to replicate the successes of a Zuckerberg or a Sergey Brin, as newcomers to the field are now. Jobs possessed a genuinely inspired design vision, from the earliest days of his career to his last.
And yet, for all his gifts, the pursuit of wealth led Jobs to commit some morally reprehensible deeds. As “white collar criminologist” William K. Black Jr. told me in a 2012 radio interview, Jobs’ drive to maximize profits – and his craving to get new products to market as quickly as possible – almost certainly led him to knowingly ignore abuses and safety threats to the Chinese workers who built his products. That, in turn, led to dormitory-based workers being forced to work under extreme conditions. These unheeded warnings also led to the horrific burning deaths of several workers.
Amazon’s Jeff Bezos is also unquestionably an innovator. But the working conditions which Amazon’s warehouse workers endure would seem familiar to their Apple counterparts in China. As documented by Simon Head in his book “Mindless: Why Smarter Machines Are Making Dumber Humans” (excerpt here), Amazon’s American warehouse workers are subjected to ever-harsher production expectations and invasive measurement techniques. Head documents the case of a Pennsylvania employee who worked 11-hour shifts and was ultimately fired for “unproductive periods” which lasted only minutes. GPS devices in an England warehouse tell workers which routes they must travel – inside the warehouse – and their expected travel time.
Amazon’s German operations employed “a security firm with alleged neo-Nazi connections that … intimidated temporary workers lodged in a company dormitory … with guards entering their rooms without permission at all times of the day and night.” An Allentown facility which lacked air conditioning repeatedly reached temperatures of more than 100 degrees one summer. More than fifteen workers collapsed, but supervisors refused to open garage doors. Reports Head: “Calls to the local ambulance service became so frequent that for five hot days in June and July, ambulances and paramedics were stationed all day at the depot.”
A number of Silicon Valley CEOs were also implicated in a widespread conspiracy to illegally suppress wages and prevent job-seeking from engineers and other key employees. Mark Ames, who has reported extensively on the conspiracy, wrote that “confidential internal Google and Apple memos … clearly show that what began as a secret cartel agreement between Apple’s Steve Jobs and Google’s Eric Schmidt to illegally fix the labor market for hi-tech workers, expanded within a few years to include companies ranging from Dell, IBM, eBay and Microsoft, to Comcast, Clear Channel, Dreamworks, and London-based public relations behemoth WPP.”
These incidents are by no means exceptions in the Silicon Valley culture. The most generous way to interpret behavior like this is to assume that Steve Jobs and operated in a culture whose worldview downplayed the human impact of business practices. That, in fact, is reinforced by other aspects of Silicon Valley’s leadership society.
3. The culture encourages a solipsistic detachment from reality, even as its brute economic strength colonizes everything it touches.
A dispassionate observer might be tempted to wonder how a culture filled with so many smart people can remain so unaware of, and/or disinterested in, their effect on other people’s lives?
For many of them, the evidence is literally right before their eyes: San Francisco’s richness and diversity is being drained away, as the city becomes unaffordable for more and more of its citizens. They are all good with numbers, so the statistics on growing wealth inequality should not be hard for them to understand. And their arguments – e.g., that the “sharing economy” will benefit struggling Americans – are easily punctured by even a superficial look at US demographics. (Are struggling Milwaukee residents going to get rich driving tourists around their battered town, or renting out their inner-city apartments on AirBnB?)
Most of the tech executives I’ve known aren’t bad guys. (To be clear, I haven’t met Uber’s leadership – with the exception of a brief encounter with former Obama advisor David Plouffe – and they certainly appear to be an exception.) But even many of the “good” ones seem oblivious to the effect of their own behavior.
To a certain extent that’s an occupational hazard. I’ve spent just enough time hammering out software in the glow of a computer screen to see how easily a synthetic world can replace the one inhabited by other human beings.
But there are correctives for that: reading, contemplation, speaking with human beings from different walks of life. The Valley’s tech culture doesn’t seem to encourage that – to its detriment, and that of society as a whole.
4. The Valley gets fixated on lame (and sometimes antisocial) buzzwords.
“Move fast and break things,” said Mark Zuckerberg in a much-repeated quotation. Other tech types prattle on about “the next Big Idea.” And almost everyone wants to “disrupt” an existing industry.
Why is it good to “move fast and break things”? Isn’t it usually wiser to move carefully and build things? There may be times when it’s wise to act rapidly, or break with conventional ways of doing things. But there are also times when a hastily-executed rollout dooms a product. Sometimes it makes sense to improve the established ways of doing things, rather than upend them altogether.
When you think about it, what does this expression even mean? It’s only repeated because a) it sounds smart, and b) it was spoken by someone who is extremely wealthy, and such people are to be imitated whenever possible in the hope that some of their magic will rub off.
As for “Big Ideas”: do they really correlate with tech success? Google was a smarter search engine, but search engines were no longer a new or “big” idea by the time it came along. Craigslist? It’s online classified ads. Facebook was originally conceived as the online version of the printed “facebooks” traditionally given to incoming freshmen so they could get to know their classmates. Neither Zuckerberg nor those Harvard twins knew what it would someday become. There is surprisingly little correlation between tech success and actual “Big Ideas.”
Disruption’s overrated, too. Sure, it can work. Instagram disrupted home photography, for example. But Twitter, one of the smarter ideas to come from the Valley in recent years, didn’t disrupt anything. Instead it created a new market and a new medium. Sometimes “disruption” is a euphemism, whose real meaning is “use tax loopholes to undercut law-abiding vendors” or “employ Robber Baron business practices to cut suppliers prices.”
Sometimes it means nothing at all.
5. Silicon Valley’s culture is hurting our economy.
Politicians like to celebrate the tech industry as a boon to the economy, but for most Americans the opposite is true. As economist Joseph Stiglitz and others have documented, monopoly practices exert a significant drag on the economy. The economy becomes increasingly capital-driven, rather than labor-driven. Monopolies suppress wages, overcharge consumers, mistreat suppliers, and drive the economy increasingly off-course.
There’s also a price to be paid for product inefficiency. Monopolies can sometimes squander human capital – that is, waste people’s time – by forcing them to struggle with inefficient products like Microsoft’s operating system or Facebook’s user interfaces. (More on this topic here.) Multiply every minute wasted on a Windows inefficiency or Facebook’s privacy settings by millions of users, and the cost begins to add up.
The Valley’s hurting our economy in another way, too. Somehow, some of the titans of tech have gotten the misguided idea that they are exemplars of libertarian self-created success. Nothing could be further from the truth. The Silicon Valley runs on government-subsidized technology, from microchips to the Internet itself. Corporations like Amazon used government-created tax breaks to build near-monopoly leverage and turn it against their suppliers.
And now, having enriched themselves through government generosity, some of the Valley’s billionaires are using their publicly-assisted wealth to back political candidates and organizations under a “libertarian” label that is better described, at least economically, as a far-right agenda. These candidates and organizations push our political dialogue in a more conservative direction – which in turn creates a political climate which tends to permit more of the things that have already wounded our economy, like deregulation and lower taxes for the wealthy and corporations.
All of the Valley’s cultural traits, from the profound to the trivial, reflect a culture that is urgently in need of maturation and change. One thing’s for sure: If I hear another tech titan say he plans to “disrupt” an industry, I’m going to move fast and break something.
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*applause* Great article, and as a dotcom bubble 1.0 veteran, much of it was true then and I can only imagine now. A shame there is no Marx in high school, or some of the better students might have recognized primitive accumulation in software.
As for Big Ideas and pioneering inventions failing to be rewarded in the market while some evolutionary improvement on it eventually gets legs, “The early bird gets the worm, but the second mouse gets the cheese.”
Yes, Thomas Frank was writing about this 15 years ago when he composed One Market Under God. Nothing seems to have changed. It’s the same song and dance, the same self-serving, self-justifying platitudes and propaganda. The 2000 and 2008 crashes seem to have not penetrated the tech bubble. Because the ethos is “make a killing and cash out young” the place probably has no institutional memory.
But my cranky thesis is that these products are all overhyped. Nothing Silicon Valley has produced seems remotely as important as the sewing machine or the light bulb or the diesel engine. It all seems to be repackaging earlier inventions that had nothing to do with the current “tech” industry (the phone, the internet, the digital camera, GPS).
I wouldn’t be too quick to blame it on the move-fast-and-cash-out ethic among the rank and file, which is a fallacy of composition that holds by virtue of being continually fed by the Stanford boys, the MSM, the ambient gladiatoral imperative to competition, and the rare and spectacularly inflated/celebrated success.
“We” “need” more fresh STEM workers mainly because the institutional memory of those of us in technical fields is a danger to labor discipline and to the credibility of the corporations selling us whole new ways to love what are little more than toys. Mind over matter, ergo matter doesn’t matter.
“Nothing Silicon Valley has produced seems remotely as important as the sewing machine or the light bulb or the diesel engine.”
Did you type that on a personal computer?
“The Programma 101 was the first commercial “desktop personal computer”, produced by the Italian company Olivetti and invented by the Italian engineer Pier Giorgio Perotto, inventor of the magnetic card system. The project started in 1962. It was launched at the 1964 New York World’s Fair, and volume production began in 1965, the computer retailing for $3,200.
NASA bought at least ten Programma 101s and used them for the calculations for the 1969 Apollo 11 Moon landing. Then ABC used the Programma 101 to predict the presidential election of 1969, and the U.S. military used the machine to plan their operations in the Vietnam War. The Programma 101 was also used in schools, hospitals, government offices. This marked the beginning of the era of the personal computer.” – Wikipedia
Sorry, what was that again?
Those interested in seeing these values in action should google “Downtown Project Las Vegas”. Over the last three or so years, Tony Hsieh invested about 1/3 B dollars of his own money in Vegas real estate, 300+ tech startups — and a dozen or so non-tech start-ups (restaurants etc.). Their “Director of Imagination”, Dave Gould resigned loudly when 30 or so key players were fired about 6 months ago.
A month or so they announced that they were going to select successful tech companies called “cannonballs” and were going to give them more publicity and more money. That was all that was said. At the time, I calculated that left 270 “non-cannonballs” out of the 320+ start-ups and I wondered what would happen if 270 start-up companies were thrown under the bus.
No problemo. It was announced a few days ago that 272 startups had just been merged into one mega startup called #vegastech.
Escow’s article is incredibly pertinent in that it outlines the values of Downtown Las Vegas. It shouldn’t matter to the rest of us (those that I have entitled “the Downtown Rejects”) if DTLV doesn’t work out, but one of the things guaranteed by libertarian values is that someone else always pays the price.
Vegastench?
Posted in links yesterday. According to Subsidy Tracker at http://www.goodjobsfirst.org/subsidy-tracker , Amazon received 55 subsidies totaling $434,818,687, Apple received 6 subsidies totaling $446,485,233, Facebook looks politely modest at just a mere $3,000,000+ in subsidies.
I found the article over at Angry Bear
Federal Susbisdies at Subsidy Tracker 3.0
http://angrybearblog.com/2015/04/good-jobs-first-reveals-top-federal-subsidy-recipients-subsidy-tracker-3-0.html
…five companies were on all three of the top 50 federal subsidy recipients list, the top 50 bailout list, and the top 50 state & local subsidy list: Boeing, Ford, General Electric, General Motors, and JPMorgan Chase.
I thought the point of privatization was that the private sector could do things cheaper and better than government. Clearly not. In fact, it pretty muchnlooks like American business would fail without government support. And if that’s really the case, and increasingly it sure does look that’s way, then might as well nationalize businesses that require so much help and get on with it.
Wow, that’s a great resource, thanks for the link.
Agree with Pepsi: The AngryBear blog posts a chart of Parent Companies With $100 Billion or More and you will see Goldman Sachs’s name under Face Value of Federal Loans, Loans and Guarantees and Bailouts (excluding repayments) at $911,764,800,000 (p. 9) and further Federal Grants and Allocated Tax Credits of $121,660,000 (p.18). Then if you look at GS’s rap sheet ( http://www.corp-research.org/goldman-sachs ), you will see a further list of subsidies that GS receives.
Oh, it is good to be Goldman!
One wonders why these huge organizations are not broken up into smaller entities. Those huge subsidies tell us that GS isn’t such an on-going concern but rather a feeder at the trough. GS should certainly not be a commercial bank!
More money for the government to spend is not only not risk free, but in fact, quite corrupting.
OMG!!!
CitiGroup (since 1989, http://www.goodjobsfirst.org/subsidy-tracker)
Federal loans, loan guarantees and bailout assistance (not including repayments)
$2,591,415,050,066
That’s trillion, with a T!
It would have been less catastrophic if they were real libertarians.
Instead, we get semi-techno, pseudo-libertarians, not-so-invisible closet supporters of Big Brother.
$2,591,414,050, 066 in government administered boodle: it’s a start.
“Boodle” is such a fine word.
Business managers don’t know how to create value which people will pay for, so they resort to taking government handouts.
I disagree with just the start of the article. There is a lot wrong with getting rich.
+++
+trillions
then by all means, don’t get rich
I wonder if the break things catchphrase didn’t get built on the book by the former HP CEO’s book If it all broke… break things. Ah, the 90s and the era of business re-engineering…
Or maybe it’s from that Meatloaf song.
Be;low is a Wikipedia excerpt from anthropologist Leslie White’s biography. It calls attention to the role of energy in society/culture. What most contemporary social critics omit from their analyses is this critical role of energy and the fact -as I see it- that we are right now at peak energy supply to modern economies. Silicon Valley is taking control of a declining culture; you can only believe in “move fast and break things” if you are utterly clueless -and profligate- about the connections between energy and economy.
White’s argument on the importance of technology goes as follows:[2]
Technology is an attempt to solve the problems of survival.
This attempt ultimately means capturing enough energy and diverting it for human needs.
Societies that capture more energy and use it more efficiently have an advantage over other societies.
Therefore, these different societies are more advanced in an evolutionary sense.
Visit the link above to Subsidy Tracker. Energy has been an enormous recipient of subsidies. Which makes you wonder how they continue to pay their CEOs so much….
Increasingly, it looks to me like American companies are failing across the boards. Too much “success” is relying on subsidies, bailouts, government contracts, etc. Just the fact that Apple feels it needs help is a bad sign. This basic attitude in some ways also explains the proliferation of leveraged buyouts and asset stripping that’s been going on and why short term profit has had so much appeal. In the long term, the companies can’t survive. That leaves very little business to actually invest in. So Wall Street appears to be selling a mirage. And if that’s true, they are running out of time and one helluva correction is coming.
And then maybe this country will go back to making things that matter again.
American companies have in some sense or other been running on government (life) support since WW2 (if not earlier). Damn it, war seems to be the one thing that really spurs “innovation”. Likely because it is the one thing that makes the penny pinchers to shut up.
It’s far worse than this article lets on. The whole information economy is a gigantic sham. Our national infrastructure has collapsed while we declaim on about the supposed riches of the Internet. What baloney.
Wow, you’re bumming me out dude! Here I thought I was going to get rich designing an I-phone app that warns squillionaires that their limo is approaching an unsafe bridge, or other hazards posed by crumbling infrastructure. I was planning on opening up a rapid-response ferry/helicopter service in tandem with this app. launch :(.
Still, Gotta Luv The Concept! Aligns with so much, including Citi’s Plutocracy strategy. Hanging out with a cuppa Joe at City Lights Books, I can envision an entire related family of Apps assuming the 0.1 Percent problem away. The VC’s and Wall Street will be so there. :)
I was planning on opening up a rapid-response ferry/helicopter service in tandem with this app. launch
Better: helicopter in large numbers of the once working poor, you know, the dead beat government teat sucking loosers, and simply toss them onto and under the crumbling bridge so the squillionaire’s limo can drive right over them. They could even get “points” in the app for each dead beat crushed and earn extra points for children caught in the mix.
Yes, name one of these companies that do something that anyone actually needs. Hence the reliance on regulatory arbitrage or violating the 4th ammendment to make money. All the while their are problems that need solving but people who work on those are relegated to – I don’t know.
Naked Capitalism. :)
Move fast and break things. Reminds me of Jeff goldblums speech in Jurassic park. They discover genetic power and the first thing they do is build a theme park, start producing toys, and slap it on a lunch box. And we of course know what happens from there.
And this makes total sense to me. The wealthy are slashing and burning the planet to the bare earth for all the wealth and power. And when they are done, we poor ppl are going to be left with an uninhabitable planet that we have to clean up or learn to live with extra irradiated body parts. They are breaking this planet. Yet we can’t slow down to smell what’s left of the noncontaminated roses. If the stock market doesn’t keep going up, we will all suffer some made up apocalypse. Our God, money, will strike down upon us with great vengeance and furious anger if we choose to not follow his bidding.
“They were careless people, Tom and Daisy- they smashed up things and creatures and then retreated back into their money or their vast carelessness or whatever it was that kept them together, and let other people clean up the mess they had made.”
F. Scott Fitzgerald, The Great Gatsby
Brilliant!
You just won the Christmas turkey.
Keep your heads up lads. Steve “Chinese” Jobs is driving an Uber in Hell.
There’s a whole lot wrong with “getting rich—” that’s the genesis and axis of all the stuff complained about here. How to break the cycle, when the positive-feedback functions are so potent? Individuals seek pleasure, individual life spans are short compared to (so far) the species’, IBG-YBG and dying in great comfort after a life of so very satisfying predation that takes the Malefactors beyond consequence means no negative consequences for bad acts (measured by pain and sorrow and fear to others) because the mechanisms of control are dominated and directed by the ever-richer rich (may the Citizens United Supremes rot in hell, but they’re just the Front Four Plus One Horse’s Asses of the Apocalypse), the geographic and “security” separation of the Elysiumists, http://en.wikipedia.org/wiki/Elysium_%28film%29, is vast and growing, and even though a lot of them may know the Geocalamitous Crash is imminent, there’s this great new chef at La Petite whose macaroni-and-cheese is to die for, goes great with a jolly 2008 Domaine Leflaive Puligny-Montrachet Les Folatières 1er Cru, http://www.foodandwine.com/articles/expensive-wine-for-the-wealthy-and-wannabe. Lots of analytical talent focused on this forum. What, if any, are the equivalents to our frail but workable and slave-labor-durable individual bodies’ homeostatic processes and functions in the political-economic realm?
I’ve seen “technocrat” morphed into “technocrack,” a ripe transliteration indeed. Interesting that “Breaking Bad” has such a wide audience – I wonder what numbers of the soulless rulers of Siliconia follow that saga, or find pointers there for their own sagas.
I’m curious – do any of the people who are doing that “move-fast-and-break-things, create-a-new-reality-for-you-to-study-judiciously-as-you-must-because-of-your-weak-gentle-ethics-of-impotence” stuff ever tune in here? For anything other than a quick check to see whether the Mopes are getting too close to a healthier kind of Doing, rather than still more analyzing and talking about the latest hamstringing, http://www.urbandictionary.com/define.php?term=hamstring, (and humorously, “Was God Cruel To Animals?”, https://www.christiancourier.com/articles/215-was-god-cruel-to-animals ) of the ordinary people that still are the base of the Amway-Apple-Lockheed-Uber-Goldman-but-not-gold-bug economy? I doubt Schäuble or Merkle or even Krugman or Varufakis let alone Draghi or Dimon look here for clues about ways to stabilize and extend or make decent lives of a “modest competence” possible for the Mopes and Muppets and Minions. And there’s not much consensus on what “the remedy(ies)” might actually be, or pointers (other than to try and build little resilient communities that already start infected with the viruses of MEism and MOREism) to “what is to be done.”
It’s the Sabbath, for my tradition. Prayers all around, and since “Christian” preachers indicate it’s ok to do so by their example and word and deed, imprecations and invocations of a very angry Old Testament God to smite them all low, hip and shoulder… All we ordinary people seem to have, down here where a dollar is still a little slip of real paper or a symbol on a paycheck that others of us lower order types will still accept as a “medium of exchange” of actual if imaginary and misguided substance for our day’s work and the necessities of life that we create (no Soylent Corp. closed-loop-minus-entropy yet) is words and notions, against the implacable forces of monetization and marketization and all…
The answer is eco-socialism, meaning a political economy organized to produce and deliver goods and services in a genuinely sustainable and socially responsible manner, one which both Jesus and Marx would recognize, i.e., where people contribute in accord with their abilities and receive in accord with their needs.
Note: ‘needing’ to be powerful, wealthy or just yer basic a**h*** is taken as given to be the sort of spurious bs all anti-social, anti-ecological, anti-life apologists spew.
Lived in Capitola CA for about 10 years doing Industrial Design/Product development for Silicon Valley. When we began a new project my job was to research the concept and establish precedent and viability. I always looked for exactly what this concept solved for. 99.9% of the time it was solving for a problem that some earlier technology created and the true solution could quite easily be reached by eliminating or modifying the previous technology.
But when I would lay this out to the team and creators they would dismiss it and instead talk about how they have secured second tier funding …oh and also they already had locked in a very catchy dot com.
The beatitudes of Saint Jobs:
It never ceases to amaze me that anyone would admire this creep and/or buy his stupid gadgets.
The main problem with Silicon Valley and tech culture in particular is that is appears to the participants to be divorced from the real world of things, processes, and physicality. “Move fast and break things” doesn’t work when you’re building an actual thing – like a phone, or a building, or plowing a field. I understand the idea is not to be taken literally, but it is just a rework of the tired old “think outside the box” crap we’ve all been forcefed by Bidness Skool.
I often wonder if after we burn up the world we’ll look back from our caves and declare it was the glowing machines that did us in because they made us completely separate from the Real World once and for all.
Perhaps the frame of reference of the founders of the new Silicon Valley companies is so different from the past.
I worked for the Hewlett-Packard company when both founders were alive (Packard died in 1996) and both he and Hewlett were products of the Great Depression.
At the time I worked in the Electronic Instruments part of the company and the concern for the employees was real. One would hear stories of HP opening a new plant in an area and local business leaders asking HP to not pay the hourly workers too much to upset the local workforce hourly rate.
The employee turnover rate was low at both the hourly and salaried level and HP would turn down business if it was a temporary bump that would require them to hire employees now to lay off later.
A co-worker told me of a visit to a supplier who had initially bid too low on a part they supplied, they related how when they informed HP, HP wanted them to be profitable and renegotiated the contract.
When I hired on Hewlett and Packard owned about 40% of the stock, so one suspects they ran the company the way they wanted.
And stories about the founders were retold by employees, for example Dave Packard refilling his own gas after a visit to the plant I worked at, Hewlett flying coach, engineers asking to meet Bill and Dave and Bill apologizing for arriving late because his truck had a flat and he stopped and fixed it.
One can read of HP’s 80% acquisition of the Moseley Company in 1958 for $2 million. Mosley asked for $1.5 million, but HP thought $2 million was a fairer price, so HP willingly paid a higher price.
Perhaps not all know that Packard was tapped by the Nixon Administration to be Deputy Defense Secretary.
He saw it as his duty, so he temporarily left HP. Another story circulated that when he was asked what was his greatest accomplishment while there, he answered that he “quit smoking”.
And after Packard died, the company has been split up numerous ways and is now headed up by a former Bain & Company alumna Meg Whitman.
Former fired CEO Carly Fiorina is now running for US president.
I believe the experiences that Hewlett and Packard had while entering the workforce in the Depression formed much of their concern for others outside their wealth class.
They also organically grew the business, and while the company was founded in 1939 they didn’t IPO until 1957.
Tell new Silicon Valley employees they might have to wait 18 years for their IPO.
You got it, ThePaper.
There’s a whole lot wrong with “getting rich—” that’s the genesis and axis of all the stuff complained about here. How to break the cycle, when the positive-feedback functions are so potent? Individuals seek pleasure, individual life spans are short compared to (so far) the species’, IBG-YBG and dying in great comfort after a life of so very satisfying predation that takes the Malefactors beyond consequence means no negative consequences for bad acts (measured by pain and sorrow and fear to others) because the mechanisms of control are dominated and directed by the ever-richer rich (may the Citizens United Supremes rot in hell, but they’re just the Front Four Plus One Horse’s Asses of the Apocalypse), the geographic and “security” separation of the Elysiumists is vast and growing, and even though a lot of them may know the Geocalamitous Crash is imminent, there’s this great new chef at La Petite whose macaroni-and-cheese is to die for, goes great with a jolly 2008 Domaine Leflaive Puligny-Montrachet Les Folatières 1er Cru, http://www.foodandwine.com/articles/expensive-wine-for-the-wealthy-and-wannabe. Lots of analytical talent focused on this forum. What, if any, are the equivalents to our frail but workable and slave-labor-durable individual bodies’ homeostatic processes and functions in the political-economic realm?
I’ve seen “technocrat” morphed into “technocrack,” a ripe transliteration indeed. Interesting that “Breaking Bad” has such a wide audience – I wonder what numbers of the soulless rulers of Siliconia follow that saga, or find pointers there for their own sagas.
I’m curious – do any of the people who are doing that “move-fast-and-break-things, create-a-new-reality-for-you-to-study-judiciously-as-you-must-because-of-your-weak-gentle-ethics-of-impotence” stuff ever tune in here? For anything other than a quick check to see whether the Mopes are getting too close to a healthier kind of Doing, rather than still more analyzing and talking about the latest hamstringing, http://www.urbandictionary.com/define.php?term=hamstring, (and humorously, “Was God Cruel To Animals?”, https://www.christiancourier.com/articles/215-was-god-cruel-to-animals ) of the ordinary people that still are the base of the Amway-Apple-Lockheed-Uber-Goldman-but-not-gold-bug economy? I doubt Schäuble or Merkle or even Krugman or Varufakis let alone Draghi or Dimon look here for clues about ways to stabilize and extend or make decent lives of a “modest competence” possible for the Mopes and Muppets and Minions.
And there’s not much consensus on what “the remedy(ies)” might actually be, or pointers (other than to try and build little resilient communities that already start infected with the viruses of MEism and MOREism) to “what is to be done.”
It’s the Sabbath, for my tradition. Prayers all around, for the lives and futures of all us ordinary people who need to figure out how to not just be along for the ride and dragging the Juggernaut that’s rolling over us, and since “Christian” preachers indicate it’s ok to do so by their example and word and deed, imprecations and invocations of a very angry Old Testament God to smite them all low, hip and shoulder… All we ordinary people seem to have, down here where a dollar is still a little slip of real paper or a symbol on a paycheck that others of us lower order types will still accept as a “medium of exchange” of actual if imaginary and misguided substance for our day’s work and the necessities of life that we create (no Soylent Corp. closed-loop-minus-entropy yet) is words and notions, against the seemingly implacable but ultimately dead-end forces of monetization and marketization and all…
. . . how a culture filled with so many smart people can remain so unaware of, and/or disinterested in, their effect on other people’s lives?
Narcissism?
Since you’re working with digital signals transmitted over a government-invented network, that can usually be done at minimal cost.
The wet dream of productivity. Data is made as it is sold at practically zero marginal cost. The customer even pays for the delivery structure.
The economy becomes increasingly capital-driven, rather than labor-driven.
Surprise surprise. ZIRP has benefits for the tech titans.
Capital is cheaper than labor, and has driven labor into the ditch in a game of chicken.
The price of shares is forced higher, and as interest rates sink to levels well below zero we will have to change the acronym to NIRP, with the result of DOW 30,000,000 or zero by 2150.
What else can we expect when the banks charge people to keep their declining sum of money, and then use the profits and leverage to put “their” money to “work” in the stawk market, because it’s the only place to get a “return”?
. . . a culture whose worldview downplayed the human impact of business practices.
Tech titans are the poster children for what is going wrong. China is a toxic waste dump, and at least half of it is on their heads. Apple’s crusade of exploitation has no limits, the latest revelation being the lake of black goo somewhere in China where a rare earth mineral to make a polishing compound for their glass, is processed. They should be wearing horns like the devil, for the good they do.
Welcome to the sanctuary of billionaires.
Give me your over-scheming, tired from counting money, your poorly understood, your huddled elite yearning to breathe fresh minted global reserve money.
. . . sanctuary of billionaires
A palatial prison with one view, of black goo lake, with a grand vista of discharge tubes.
“Since you’re working with digital signals transmitted over a government-invented network, that can usually be done at minimal cost. ”
Some good points in the piece, but I have to call BS on that one. In terms of value added, the government contribution to networking pales in comparison with the private sector. The original idea matters less than all of the R&D done by infrastructure companies to make it better, faster and cheaper.
Typical GLibertarian thinking only one befuddled by years of “economic” thinking could agree.
Once infrastructures exist, it disappears from our consideration like the air and water and topsoil we pollute for private profit. All that “R&D done by infrastructure companies to make it better, faster and cheaper” would never have even been conceived outside a Philip Dick novel had it not been for a far sighted government investment program that could look to a longer period of return than any of our vaunted private John Galts.
Always eager to suck un-thanking from the teat of state, taking credit for its successes even while using the gains thus obtained to sabotage its future…
Not just publicly paid infrastructure, but each user pays the whole R&D efforts, directly or indirectly, with their flat rate DSL/Cable monthly rates or wireless plans. 1000M users tines 10-50 $monetary_unit/month is a lot of money flowing upwards through the world…
There is a huge difference between having an idea, or implementing it on a small scale as a prototype, and making it something that people can really use. Maybe you don’t get this – who knows?
I’m not saying that we owe a debt of gratitude to companies like Cisco (they did what they did for money), but nor am I going to fall down and thank the government for “inventing the internet”.
Should I thank the “private” infrastructure companies for creating a second rate internet system? The taxes paid for the services they provide are not reinvested into infrastructure improvements. I don’t know why you think they should get thanked for doing a half assed job. If the companies responsible for maintaining our infrastructure were public utilities with strict reinvestment floors then I may agree with your point.
R&D done on government contracts, or don’t you remember DARPA?
Excellent article! Capitalism has gone through many twists and turns, some more equitable to the public at large than others, but the excesses we are in right now echo in scale what is happening to our environment (or is it the other way round?). Eskow makes it look easy to pin point the tech giants in this picture and describe so clearly the underlying negatives they contribute to that collapsing economic system.
Sorry to be ‘picky,’ but re section 2:
I sniff that RJ Eskow is imparting a large human benefit to those who are inspired™ being given near full rein in following their ‘inspiration’; along with the sense that he’s implying that assholes like Jobs end up with so much POWER because they are inspired™.
I will bet that there are millions of far, far more: intelligent, inspired, and – far more important – ETHICAL than Steve Jobs (garage story blah, blah, blah), et al human beings who are homeless; are incarcerated; or, have ‘committed suicide’ (on their own, with much help from THE LAW™; or via THE LAW™).
In other words:
1) Steve Jobs – like so many of his billionaire peers – was only rare in his AMBITION FOR POWER and negligence towards other human beings. He was not rare in his inspiration, nor intelligence.
2) Inspiration is an ethics neutral state of being.
3) Inspiration does not equal Intelligence, which is also ethics neutral.
4) Those intelligent, inspired, and ethical – historically and increasingly – appear to suffer the worst – and most painful – of fates.
If I may, I’d like to add another (and I’m sure there are more than 6 even) destructive aspect which RJ Eskow somehow amazingly neglects to mention above.
That would be the unarguable and indefensible fact that those teeny handful of Techno Libertarian Thought Leader Billionaires who are, and have been, rearranging the lives – for the worst, mostly – of everyone walking the face of the earth (without the humility of even bothering to ask their consent), are all white, or off white, and all males: Gates; Jobs; Ellison; Bezos; Brin; Page; Thiel; Musk; Andreessen; Zuckerberg; Costolo; Kalanick; et al. That should actually be considered the number one worst thing, that connected, power obsessed White and Off White Males are still the only ones who are making decisions for humanity at large.
Enlightenment? I don’t think so. Seems to have been proven by now that non connected (via$, Power, Nepotism) females, non pale males, and non connected white and off white males would have had much inspired benefit to add for a healthy life on earth.
It’s sickening that the undeniable homogeny of the proclaimed inspired™ elite, who have succeeded (to the tune of billion$) in thoroughly commodifying, further impoverishing, and 24/7 tracking humanity, is rarely, if ever, mentioned. Talk about an elephant in the room.
(Hilarious, in an utterly revolting sort of way, Bill Gate’s MS Word 7 Spellcheck (on the original $400 dollar plus Professional MS Office cd which millions who needed employment might have definitely felt the need to purchase (not that it did them any good whatsoever), whether they wanted to or not) is not familiar with the word, Commodify, let alone the word, Commodifying. All is not lost though!, it did suggest the word Commodity, for Commodify.)
People talk about white privilege in Silicon Valley CONSTANTLY.
I hope someone who worked in that environment can chime in.
Ignoring any compensation imbalances, Meg Whitman and Carly Fiorina have shown great facility at exploitation. Can they be called off-males?
I think gender is orthogonal to the ability to assume the authoritative stance of the bourgeois Ferengi alpha — it will take a while for more girls to grow into women who think that the ability to swindle and exploit on par with men (who have had centuries of training and practice) is a skill worth nurturing, but I’m not sure that, nor where gender is the basis for any unfair, arbitrary, circular division of power, are the sorts of worlds we want (?).
I like “Ferengi alpha.” It’s gender neutral!
The fusion of the Tech Titans and Big Finance via the digitization of everything has created a power complex and power elite that has lost itself inside the very system they’ve created. Our ‘best and brightest’ no longer understand the world as it is experienced at a human scale and time. The happy result is that civilization as a whole is now exposed to the catastrophic consequences of purely digital (virtual) breakdown in a way no previous medium/media could possibly effect. The asymmetric power of those who claw their way to the top in this environment is thus mirrored in the scope and scale of potential consequences of a single or multiple, simultaneous or serial, mistake, error, foolish decision etc., resulting in an instant or cascading failure none of them ever considered at all, let alone as a real possibility. Yet Apple et al can think of nothing as perfect as ‘total connectivity’ and Central Banks of infinite credit.
@Michael
I’ve lived and worked in Silicon Valley, as a white female, for over three decades, so you can count my two above comments (oops, left the “s” off of “words,” in that second comment) as a part of that chime in.
“Move fast and break things,”
the motto of a 14 year old vandalist
Who just read The Fountainhead for the very first time!
creative destruction
the words of megalomaniacal sociopaths and the non-pedigreed serial killers on death row.
Only people who squillionaires by the time they’re 30 are worthy of lounge chairs on Mt. Olympus, and you can’t get there unless you move fast and break things.