It is no secret that I am a fan of Jaron Lanier. I read his work and the works of his critics. Jaron is one of the world’s great polymaths. He’s a computer scientist, composer, visual artist, and the author of a new book, Who Owns the Future?, published last month There are very few people in Silicon Valley with such insight and as captivating and intelligent as Lanier. Not only does he know it all from within, he has been there at all the crucial junctures, cultural and technological, over the last thirty years. His work reassures me that I am not merely a gadget or a revenue unit, and it provides a long view of the possibilities of the effect of big data and the electronic Skinner box social media experiment in which we are all participants.
A barefoot Buddha with dreadlocks, perched in a crazy fun house in the leafy hills of Berkeley, Mr. Lanier is a founding member of the digerati. The 57-year-old computer scientist, musician and writer has been christened the father of virtual reality.
“I’m a professional illusionist,” he says. “In some ways, I might know more about making illusions than anybody.”
Mr. Lanier is one of the few prophets who admits that the spawn of Silicon Valley could become evil, but he tries to stay on the sunny side. It helps that he avoids all social media.
Disruption is revered. But what does it really mean? According to Lanier, it means the destruction of the middle class that the complete turn over of power to Siren networks of big data which replace science and destroy corporations. Professionals in journalism, music, translation, manufacturing and law with the opportunity to save and grow wealth have been relegated to piecemeal earnings. The era of disruption stems from a 1980’s decision to make internet interaction and information free. We’ve embedded into the architecture of the Internet some ideas that are making us collectively poorer instead of richer, or at least less richer than we could be. We’re losing wealth because more and more of our economy involves information, and information is not being bought and sold properly. We are manipulated by social media and trained to engage in addicting regimented behavior with feeds modified to serve our existing views and tribalism.
Jaron does not reject Facebook outright but sees in it a manifestation of regimented expression (not his term). In order to create an identity and fashion oneself on Facebook one must conform to the ways the social network is structured. One must write in certain spaces, must have friends, must like. The choices one is forced to exercise preclude other options. Over time by habit people begin thinking and behaving in certain technologically predetermined ways.
Facebook modifies user behavior and thinking, and it also a new corporate valuation system. Facebook bought Instagram a little over a year ago, a deal that Vanity Fair called “the ultimate Silicon Valley fairy tale,” a billion-dollar sale of a company less than two years old. Maybe even more remarkably, at the time of the sale, Instagram had exactly 13 employees.
How could a billion-dollar company have only 13 employees? It’s not because those employees were so extraordinarily valuable. It’s because much of its value “comes from the millions of users who contribute to the network without being paid for it.” He wants, in brief, “to monetize more of what’s valuable from ordinary people.” The value of the company does not come from any product, it comes from the number of grunts that interact with the company.
Big data disruption destroys industries and jobs. To him the dramatic changes in the music industry and journalism due to stealing of content and “free” digital news are only a preview of things to come. More and more jobs will be lost to digitization. Already it is extremely difficult in this age of smart-phone cameras to make a living as a photographer. Soon enough driverless cars will all but eradicate the profession of drivers. Education and professorial tenure might be next. Why pay indecent tuition when soon Harvard and MIT lectures might be online? 3-D printing is still rudimentary but who can guarantee that in a century we shall not be able to purchase online a software program of a new car and then print it on our 3-D printer in the garage? At its height Kodak employed 140 thousand people, writes Lanier. Instagram, when it was sold to Facebook in 2012 for a billion US dollars, employed thirteen people. One can hardly evoke a more vivid picture of the slimming down of the middle class than this.
Facebook, Google, Amazon and several dozen other companies organized around giant computers-servers in financial services, insurance and a handful of other industries tend to monopolize the market. The precursor to the development was Wal-Mart, which perfected the drive towards extreme efficiency. To some extent innovators always did it. Still Henry Ford tried to price his cars so that his employees at assembly line could afford them. Many Wal-Mart employees on Wal-Mart salaries cannot afford bigger-scale shopping in their department store. The logic of digital economy rewards winners and impoverishes everyone else, believes Lanier. He gives the supercomputers a Homeric name: siren servers. They function as mythical sirens, luring us with cheap or free services.
“We have free music, but soon enough barely anyone will be able to make money as a musician,” warns Lanier in one of his lectures. The same will soon apply to journalists, photographers, drivers and later on perhaps to teachers and professors. A look at Google and others’ business model is sobering. These companies give us free or cheap services and products in exchange for our allowing them to snoop on us. In the meantime they work to perfect cyber profiles of each of us according to our shopping, travel and life habits and then work the information into algorithms for offering information, services and goods.
Jaron: Okay, so let us hypothesize that in the future there would be robotic devices that would create bread, or perhaps bread could be 3-D printed, or perhaps bread might go from some tiny seedling on its own, automatically. In a sense, it already does that, of course. But let us just suppose, at any rate, that there are technologies for making bread which require vastly less human labor than in our present times. And this might include the workers in the field who gather the grains and process the grains. The whole thing might become what we call more “automated,” right?
And so then, the usual line of thinking is that, “Well, it’s sad that all the people who might have had jobs making bread before or making the components for bread or transporting the bread, it’s sad that all those jobs went away. But we can count on new jobs coming about, or at least new paths to sustenance, because technology always creates new opportunities.” And that’s something that I think is true. However, it all really depends on how we think about the technologies.
If we think about the technologies purely in the terms of sort of an artificial intelligence framework, where we say, “Well, if the machine does it, then it’s as if nobody has to do anything anymore,” then we create two problems that are utterly unnecessary. There’s a microeconomic problem, and there’s a macroeconomic problem. The microeconomic problem is that we’re pretending that the people who do the real work don’t exist anymore. But then the macroeconomic level also has to be considered. If we are saying that we’re automating the world—which is what happens when you make technology more advanced, and therefore there will be more and more use of these corpora driving artificial intelligence algorithms to do everything, including bread making—if we’re saying that the information that drives all this is supposed to be off the books, if we’re saying that it’s the free stuff, it’s not part of the economy, it’s only the sort of starter material or the promotional material or whatever ancillary thing it might be, if the core value is actually treated as an epiphenomenon, what will happen is the better technology gets, the smaller the economy will get, because more and more of the real value will be forced off the books. So the real economy will start to shrink. And it won’t just shrink uniformly; it’ll shrink around whoever has the biggest routing computers that manage that data.
I think the easiest way to describe this is to set up a little bit of a contrivance, which is a three-act play. So Act I is the 19th century, and the 19th century is completely consumed with anxiety that technology will throw people out of work, with some of the examples being the Luddite riots, early science fiction, the writing of Marx, “The Ballad of John Henry”—many other examples that I’ve gone into elsewhere. And so you have this tremendous anxiety.
Act II is the 20th century, and what happens in the 20th century is that that anxiety is resolved favorably, because it turns out that when there are better technologies, people can actually get better jobs. The transition from horse-driven vehicles to motorized vehicles represented a kind of profound improvement in the experience of the operator, right, because dealing with horses is tremendously smelly, difficult, and somewhat dangerous work, because they kick you. I mean, I love horses, but the truth is that dealing with the feed and the waste from them, and the brushing and dealing with the shoeing, I mean, it’s a lot. It’s a big deal. And operating a motor vehicle is so much easier in comparison that people pay to drive sports cars. I mean, people like driving. So the natural question to ask is, If technology has made operating a vehicle that much easier, why on earth should that person be paid? Why is it still a job worth paying?
And the answer is actually twofold, from two different perspectives, which we could say from below and from above. From below, the reason was that the labor movement said it was and fought really hard to make that the answer.
But from above, there’s another very interesting idea, which is markets can’t thrive without customers, so you need a middle class to be the customers. So, for instance, Henry Ford, who was a complete creep and otherwise, it has to be said, but in this particular way was very enlightened, where he said, you know, I can’t just put a product out there. I have to create a whole ecosystem in which my product will have customers. And that means making sure that my own factory workers can afford to buy the product. So the pricing has to match what wages can handle. And it also means supporting the idea of industries that treat it as a monetized function, because otherwise it’ll never take off. And so there was this understanding at that time that you have to build a monetized ecosystem.
So the 21st century comes along, which will be our third act, and what we decide is, Hey, you know what? We’re going to renege on the wisdom of the 20th century. We’re going to reject it. We’re going to say, sure, maybe it was still okay to pay people when they were driving vehicles, but you know what? At this point it’s ridiculous. Life’s getting so easy, vehicles can drive themselves. It’s time to stop paying people. You know, this is the end of the line. Now things are too good.
And, of course, the problem with that is that the same logic that applied to the 20th century really does still apply to the 21st century. If, in order to bring people the fruits of technology, you have to undo the ecosystem of the economy, well, then that’s what you’re doing. And then even though there might be a heroin-like hit because the initial phases of it feel really good, in the initial phases you can have little tiny companies that become incredibly valuable because they’ve become hubs for data, and people can get free treats online. So you have these benefits, so that feels really good. But in the long term, of course, you’re shrinking markets and, indeed, destroying the market economy without a clear alternative. And so that’s the problem with our third act so far, and we have to figure out a way to resolve it.
The solution is micropayments. Lanier suggests that we institute micropayments for the kind of value we create for siren servers. Ironically, it is difficult to imagine this solution in practice without disruption to digital economy.