Snippets of Knowledge
All of us who do what Thomas Frank does—what I do—have failed. Our goal was to persuade the public to move in a liberal direction, and that didn’t happen. In the end, we didn’t persuade much of anyone. It’s natural to want to avoid facing that humiliating truth, and equally natural to look for someone else to blame instead. That’s human nature. So fine. Blame Obama if it makes you feel better. That’s what we elect presidents for: to take the blame. But he only deserves his share. The rest of us, who were unable to take advantage of an epic financial collapse to get the public firmly in favor of pitchforks and universal health care, deserve most of it. The mirror doesn’t lie.
Alternatively, if the heart of our emerging problem is financialization, which enables the secession of the top of the income hierarchy from the society generally, the most potent response might be a broader application of the Rhenish model of capitalism. Germany does not hold to the Anglo-Saxon view that corporations exist solely to serve the interests of shareholders and frequently gives workers an explicit role in corporate governance. That this results in persistently lower market valuations for German relative to comparable British corporations is a feature rather than a bug if the goal is reducing the dominance of global finance over the structure of the domestic economy. Emerging economies, meanwhile, where returns to capital are likely to be higher than in the developed world, may have the most leverage to succeed with protectionist strategies that limit the mobility of capital and compel investors to assist them in climbing the value ladder, thereby dramatically lowering inequality on a global scale.
Is financialization another species of rent-seeking, though? I suspect it is – but this analysis would still hold even if it isn’t. Finance could grow as a percentage of national income if a large percentage of financial services are, effectively, being exported – if we’re capturing a larger and larger percentage of the world’s demand for financial services. If that were true, then the rise of finance would not be evidence of some kind of corruption in the heart of the American economy. But it would still drive inequality in other sectors of the economy in ways unrelated to productivity, as described above.
On November 9, 2016, the day after the presidential election, a YouTube video appears. In the video, uploaded six months earlier, a member of Anonymous holds a leaked memo from the CEO of an electronic voting machine manufacturer. The memo states they’ve been contracted to manipulate the results of the upcoming presidential election, and clearly outlines what those results will be. The memo goes on to say that the chosen presidential nominee will win by a small margin, and detailed state-by-state breakdowns are included in an attached spreadsheet. To prove their claims, the Anonymous whistleblower points to Flickr and Instagram accounts with detailed scans of the memo, a Dropbox with 50 state-separated CSV files with election outcomes for each, and, finally, a Twitter account that details the electoral results for every state, the outcome of several key Senate and House races, and a final electoral tally. Every single timestamp, across four different services, checks out—June 2016, shortly after the Democratic and Republican nominees were chosen. And every single prediction is accurate. The Internet implodes in the biggest conspiracy theory ever. How It’s Done
The scenario above is totally possible, easy to fake, and doesn’t require a nefarious conspiracy and Snowden-level leaker to pull off. All it requires is a little programming knowledge, and six months of patience. Here’s how.
I received a copy of “Who’s Bigger?: Where Historical Figures Really Rank,” by Steven Skiena, a computer scientist at Stony Brook University, and Charles Ward, and engineer at Google. Here’s the blurb I gave the publisher: Skiena and Ward provide a numerical ranking for the every Wikipedia resident who’s ever lived. What a great idea! This book is a guaranteed argument-starter. I found something to argue with on nearly every page. Here’s an argument for you. Their method ranks obscure U.S. president Chester Arthur as the 499th most historically significant figure who has ever lived. William Henry Harrison, who was president for one month, is listed as the 288th most significant person. This seems ridiculous to me. We’re considering all people who have ever lived (who are on Wikipedia), including inventors of drugs, discoverers of physical laws, founders of countries, influential religious leaders, explorers, authors, musicians, newspaper editors, etc etc. Surely there are many thousands of people who are more historically significant than these two minor figures who just happened to be president of the United States for brief periods. How did this happen? I can’t be sure, but think about this: Right now, as you read this, there’s probably a 7th grader somewhere who’s googling Chester Arthur as part of a class project on American presidents (and is not allowed to write about Washington, Jefferson, or Lincoln). And somewhere else there’s a 5th-grade teacher who has assigned a different president to each of the students in his or her class. These kids are all going on Wikipedia, and lots of other pages link to these presidents’ pages.
Bob and Dareda Mueller and their three grown sons are, instead, part of an “elite group” of middle-class nomads who have agreed to an outlandish deal. They can live cheaply in this for-sale luxury home if it looks as if they never lived here at all. The home must remain meticulously cleaned and preserved: the temperature precisely pleasant, the mirrors crystalline clear. If a prospective buyer wants to see the home, they must quickly disappear. And when the home sells, they must be gone for good, off to the next perfect place. That they do everything an owner would do — sleeping, making memories, learning the home’s quirks and secrets — imbues an otherwise-empty home with an unmistakable energy, say executives with Showhomes Tampa, the home-staging firm that moves them in. It also helps the homes sell faster, and for more money.
Read the whole thing. And then remember that this debate was kicked off by the publication of a particular study, but that doesn’t mean we have to confine our debate to this particular study. For example, I would love to see a discussion of the metaphor of ‘news’ in the FB “news feed.” In traditional news agencies – at least in the recent US – the editorial and advertising divisions were organizationally separated. While the walls between these divisions were never absolute, there was at least a pretense of independence. People are rightfully worried about the collapse of such walls with the decline of the newspaper business; I would argue people should be equally interested in building new walls or their analogs in online spaces. If FB is going to purport to provide me ‘news’ – even if it’s just news about my family and friends – I want FB to make some attempt to guarantee that such news is not intentionally manipulated to present me a biased view (of a product, an event, or even the aggregate emotional state of my network). I doubt FB is interested in issuing such a guarantee, and for the moment they don’t have to. They will instead happily rely on size, market power derived from network effects, and the generally low-level of understanding of the background algorithms that serve up the ‘news’ feed. For many people, the debate over this study was the first time they learned that FB does anything other than simply showing them the most recent (or perhaps most popular) of their friends’ updates. Let’s not bog that debate down in concerns over the details of this study.