Last Friday’s Irish Times carried a piece by Charlie Taylor based on an an interview I gave in which I argued that a country that had built its identity (and prosperity) largely on a policy of being nice to big multi-national companies might need a new narrative now that some of its more welcome guests turn out to be toxic.
This morning’s Observer column:
The five biggest companies in the world are now all digital giants, each wielding monopolistic power in their markets. We are increasingly aware that some of their activities are socially damaging: they are deepening inequality, avoiding taxation, undermining democratic processes, creating addictive products, eroding privacy and so on. And yet, with the odd exception (mostly represented by the European commission), our societies seem transfixed by them, like rabbits paralysed in the tractor’s headlights. Politicians bleat about the need to do something about the digital giants, but so far it’s been all talk and no action.
This is strange because democracies have extensive legal toolkits for dealing with overweening corporate power. We have antitrust and competition laws, monopolies and merger commissions and federal trade commissions coming out of our ears. And yet – again with the single exception of the European commission – they seem unable to deal with the digital giants. Why?
The answer is partly historical and partly ideological…
Interesting NYT piece by Kevin Roose in which he points out that the key question about regulating Facebook is not that lawmakers know very little about how it works, but whether they have the political will to regulate it. My hunch is that they don’t, but if they did then the first thing to do would be fix on some clear ideas about what’s wrong with the company.
Here’s the list of possibilities cited by Roose:
- Is it that Facebook is too cavalier about sharing user data with outside organizations?
- Is it that Facebook collects too much data about users in the first place?
- Is it that Facebook is promoting addictive messaging products to children?
- Is it that Facebook’s news feed is polarizing society, pushing people to ideological fringes?
- Is it that Facebook is too easy for political operatives to exploit, or that it does not do enough to keep false news and hate speech off users’ feeds?
- Is it that Facebook is simply too big, or a monopoly that needs to be broken up?
How about: all of the above?
Martin Wolf has a brilliant review of Adam Tooze’s Crashed: How a Decade of Financial Crisis Changed the World in Saturday’s FT ($). His review touches on two things in particular that have preoccupied me ever since the crash. One is the failure to hold those responsible to account; the other is about the way the losses run up by capitalist irresponsibility were then socialised — by loading them onto ordinary citizens. (If I remember correctly, the bailing out of the banks dumped a debt of Euro 30,000 on every Irish citizen.). The other was the way politicians conned the public into accepting that it was public excess rather than private greed that caused the crisis.
Two excerpts from Wolf’s review elegantly make these points. Here’s the first:
The scale and nature of the required response had significant political consequences. The public was enraged by the size of support for the banks and, even worse, by the payment of the bonuses apparently due to the bankers. This was made even more infuriating by the fact that hundreds of millions of ordinary people suffered by losing their homes and jobs, or by being the victims of post-crisis austerity. Many were also enraged that so few senior individuals were charged. The trust that must exist in any democracy between elites and everybody else collapsed. With trust gone, conspiracy-mongers and political mountebank had their day.
Yep. And here’s the second gem:
Perhaps most startlingly, conservative politicians in the US, the UK and Germany successfully reframed the crisis as the result of out-of-control fiscal policy rather than the produce of an out-of-control financial sector. Thus, George Osborne, Chancellor of the Exchequer in the UK’s coalition government, shifted the blame for austerity on to alleged Labour profligacy. German politicians shifted the blame for the Greek mess from their banks onto Greek politicians. Transforming a financial crisis into a fiscal crisis confused cause with effect. Yet this political prestidigitation proved a brilliant coup. It diverted attention from the failure of the free-market finance they believed in to the costs of welfare states they disliked.
Osborne’s hypocritical dishonesty made him, for me, the most loathsome politician in Britain. (Boris Johnson runs him close, of course, but whereas Johnson is loathsome-but-chaotic, Osborne is loathsome-but-coherent: he always believed in shrinking the state and was the brains behind Cameron’s leadership.) The idea of a trust-fund baby delightedly imposing economic hardship on poorer citizens turns the stomach. Just about the only good thing about Theresa May’s ascent to the premiership was the cool, calculated cruelty of the way she sacked Osborne.
All of which suggests that the best explanation for the waves of populism now breaking on our shores is simply that they are the long-delayed explosion of rage at the way people have been screwed by neoliberal capitalism. And the storm has some way to go before its force is spent.
This morning’s Observer column:
Thaler and Sunstein describe their philosophy as “libertarian paternalism”. What it involves is a design approach known as “choice architecture” and in particular controlling the default settings at any point where a person has to make a decision.
Funnily enough, this is something that the tech industry has known for decades. In the mid-1990s, for example, Microsoft – which had belatedly realised the significance of the web – set out to destroy Netscape, the first company to create a proper web browser. Microsoft did this by installing its own browser – Internet Explorer – on every copy of the Windows operating system. Users were free to install Netscape, of course, but Microsoft relied on the fact that very few people ever change default settings. For this abuse of its monopoly power, Microsoft was landed with an antitrust suit that nearly resulted in its breakup. But it did succeed in destroying Netscape.
When the EU introduced its General Data Protection Regulation (GDPR) – which seeks to give internet users significant control over uses of their personal data – many of us wondered how data-vampires like Google and Facebook would deal with the implicit threat to their core businesses. Now that the regulation is in force, we’re beginning to find out: they’re using choice architecture to make it as difficult as possible for users to do what is best for them while making it easy to do what is good for the companies.
We know this courtesy of a very useful 43-page report just out from the Norwegian Consumer Council, an organisation funded by the Norwegian government…
Interesting piece in *Slate about the impact of news publishers of Facebook’s new-found desire to escape from news.
Slate — yes, the publication you’re reading right now — got more than 85 million clicks that originated from external sites and apps in January 2017 alone. Almost a third of them — 28 million—came from Facebook. That was more than any other single outside traffic source. Other online publications with a political focus, such as Vox and Politico, posted similarly blockbuster numbers.
It was, in retrospect, the zenith of Facebook’s influence over the news industry. Starting in about 2013, when the social network began prioritizing actual news in users’ news feed rankings—the order in which posts appear when you scroll through its app or site—Facebook had grown increasingly critical to many media outlets’ business, for better or worse. Every visitor the social network sent to an outlet’s pages translated to much-needed ad views. And it sent so many that newsrooms remolded their editorial strategies to maximize clicks, likes, and shares on Facebook. For less scrupulous publishers, that sometimes meant sensationalizing headlines or framing stories in ways that pandered to people’s biases—a trend that Facebook tried to combat algorithmically, with limited success. By August 2016, the New York Timess’ John Herrman wrote that Facebook had “centralized online news consumption in an unprecedented way,” shaping how the public perceived politics by determining which stories they’d see in their feeds. And by 2017, some antitrust thinkers concerned with its centrality to the news business were calling for Facebook to be regulated as a monopoly.
From Bryan Caplan
Leftists are anti-market. On an emotional level, they’re critical of market outcomes. No matter how good market outcomes are, they can’t bear to say, “Markets have done a great job, who could ask for more?”
Rightists are anti-leftist. On an emotional level, they’re critical of leftists. No matter how much they agree with leftists on an issue, they can’t bear to say, “The left is totally right, it would be churlish to criticize them.”
Caplan explicitly calls it a simplistic theory, and it is. But it’s not bad as a first approximation — as George Hawley suggests:
If out-group hostility is more important to party identification than support for particular policies or ideologies, we may not actually place very many ideological demands on our parties. Defeating our enemies may be more important than advancing specific liberal or conservative agendas. According to Groenendyk: “If partisans’ identities are increasingly anchored to hatred of the outparty than affection for their inparty, electoral dynamics are likely much more fluid than many accounts suggest. Thus, insurgent candidates with questionable ideological credentials (e.g., Donald Trump) may be more appealing than one might expect in the age of ideologically sorted parties.”
I agree with Dave Winer:
Senator Lindsey Graham asked Zuck the right question on Tuesday. Who are your competitors? The answer is they have none, though Zuck wouldn’t say that. That is the big problem. Solve it and all the others go away.
Zuck tried to laugh off the question, but the answer was as clear as day and he knew it. In the social-networking business, Facebook is the monopoly to end all monopolies.
This morning’s Observer column:
Here’s your starter for 10. Question: Apple’s website contains the following bold declaration: “At Apple we believe privacy is a fundamental human right.” What ancient English adage does this bring to mind? Answer: “Fine words butter no parsnips.” In other words, what matters is not what you say, but what you do.
What brings this to mind is the announcement that from now on, iCloud data generated by Apple users with a mainland Chinese account will be stored and managed by a Chinese data management firm – Guizhou-Cloud Big Data (GCBD). “With effect from 28 February 2018,” the notice reads, “iCloud services associated with your Apple ID will be operated by GCBD. Use of these services and all the data you store with iCloud – including photos, videos, documents and backups – will be subject to the terms and conditions of iCloud operated by GCBD.”
On Sunday NBC News’ Peter Alexander asked Ivanka Trump a simple question: “Do you believe your father’s accusers?” Trump responded: “I think it’s a pretty inappropriate question to ask a daughter if she believes the accusers of her father when he’s affirmatively stated there’s no truth to it.”
Jack Shafer is (rightly) having none of this evasiveness.
Trump pleads for recusal from the question, though, not because the question itself is wrong to ask. She pleads for recusal because she thinks it’s wrong for the press to ask a daughter such a question after her father has issued his denials. Do daughters of presidents who are also assistants to the president really get to wave such a flag of privilege? No way. No journalists can make any public official answer a question, so if Ivanka Trump wants to say “no comment,” she should help herself. But to declare a question illegitimate requires more explanation that she volunteers.
Having planted her flag, Trump pours some quick-drying cement at the flagpole’s shaft with her next comment.
“I don’t think that’s a question you would ask many other daughters,” she said.
How to unpack?! Obviously the press won’t ask many other daughters the question because not many other daughters have a father whose alleged paramours have been paid hundreds of thousands of dollars for their silence. Not many daughters have a father who was caught bragging about his sexual assaults on a live mic and then publicly apologized. Not many fathers have been accused of sexual misconduct by at least a dozen women. For those fathers who have such a reputation, it would be reasonable to ask their daughters such questions if they worked for their fathers in government.
Yep. One of the curious by-products of the Trump presidency is its illustration of the power of norms in governing behaviour. There are no laws — as far as I know — explicitly prohibiting a president from exploiting his office for private gain. It was just a norm that presidents didn’t do that. Trump’s great advantage is that he doesn’t do norms. As far as he is concerned, they’re there to be flouted. And like father, like daughter.