Wayne O'Leary

The False Promise of Technology

The bloom is off the rose. New technology, the force that was supposed to transform the world for the better (Remember the bridge to the 21st century?), has come up short. As is painfully obvious by now, the force is not with us.

Proliferating digital gadgets — smart phones, smart watches, laptops, tablets, next-generation PCs — have become addictive ends in themselves, expensive status symbols for the young and the restless. More to the point, the information and communication overload thereby imparted (at the cost of shortened attention spans) consists increasingly of the drab, the superficial, and the brain-dead — celebrity news, promotional home movies, political propaganda, pornography, self-indulgent blogs, compulsive tweets, all delivered through websites and chat rooms of dubious repute and accompanied by an avalanche of commercial advertising.

Throw in the fleeting headlines of the 24-hour news cycle, the interminable cellphone calls, the obsessive “selfies,” the habitual “gaming,” the videos of everything that moves, and what we have is cultural white noise and mind-numbing distraction to the nth degree. Marx was wrong; technology, not religion, is the opiate of the masses.

If the end product of digitization is questionable, the means to the end, which was hailed as our economic salvation, has not lived up to expectations. Technology’s New Economy, born in Silicon Valley, was to have ushered in an unprecedented form of civilized and enlightened capitalism, whose captains of industry would be laid-back forty-somethings in khakis and sneakers with minds as open as their shirt collars. Informality and unstructured work environments would replace the top-down corporatism of the gray-flannel past; we would all live (and work) happily ever after in free-flowing, uncompetitive bliss.

The reality is something else. Autocratically led tech companies have become notorious for seeking out cheap labor, looking overseas for “associates” willing to work for less and constantly lobbying for relaxed immigration rules allowing more foreign IT (information technology) workers to be admitted. Simultaneously, they downsize just as avidly as traditional employers to enhance their bottom lines.

This past July, both Microsoft and Cisco announced massive upcoming layoffs — 18,000 and 6,000 employees, respectively, amounting to 14 and 8 percent of their workforces. In Cisco’s case, overall revenues for the fiscal year ending July 26 had fallen an earthshaking 3% (to $47.14 billion), and the company’s share price was down all of 1.4%, so start that austerity ball rolling.

Nathan Heller, writing recently in The New Yorker, sees lack of job creation (despite high productivity and vast capital accumulation) as a chronic problem in the tech industry; he cites the belief of many economists that stagnant employment in the New Economy accounts for flat US job growth since circa 2000. As an example, Heller points to the 250,000 workers at old-line employer Citigroup compared to the mere 6,000 at high-tech icon Facebook, notwithstanding the latter’s substantially higher market value.

One of the sad anomalies of tech employment came to light not long ago in a Harpers magazine exposé by Jessica Bruder of Amazon’s practice of hiring low-income seniors who can’t afford to retire. The online retailer, it seems, maintains something called a “CamperForce,” composed of transient seasonal staff who migrate between the company’s distribution warehouses, living in RVs and working odd shifts on an hourly basis for low wages and no benefits. These senior temps are especially valued by Amazon because they work injured, accept mandatory overtime, and are too short-term to unionize.

Unions are a particular concern to Amazon and its founder Jeff Bezos. George Packer’s insightful examination of the firm’s takeover of book retailing (The New Yorker, Feb 17 & 24, 2014) provides chapter and verse on Amazon’s phobic attitude regarding organized labor. Unions have been actively kept out of the company’s work sites because, according to management, customer service would otherwise be at risk.

This is in keeping with the record of a profit-mongering enterprise that pays its warehouse workers on average a paltry $11 an hour, has been sued for unpaid wages, and resists providing minimal amenities like air conditioning at its Sunbelt distribution centers. Even those second-rate working conditions may shortly become moot; company CEO Bezos has predicted the displacement of human warehouse employees by robots within five years.

So much for the good jobs of the New Economy. Meanwhile, as author Packer relates, the “creative destruction” typified by Amazon may be eliminating more jobs than are being produced. Brick-and-mortar retailers, such as the independent bookstores Amazon is driving under, employ (according to US Census data) 47 workers for every $10 million in revenue; Amazon employs 14 per $10 million. And the bookstores Amazon’s online business is crippling have declined in number from 4,000 to 2,000 in two decades.

Contrary to the self-serving propaganda put out by Amazon, Google, Yahoo, Facebook, and other high-tech firms, and parroted by their sycophants in government and the media, these avatars of the New Economy are offering nothing new except their technology. In all other respects, they are just like predatory corporations past, going back to the age of the robber barons; it’s all about making money and crushing competition, not about building a humane and advanced new world.

Amazon, for instance, regularly exploits the small publishers whose products it markets (e.g. the Hachette Book Group), operating more and more like the book-selling monopolist it is, with 40% of all new titles and 65% of all e-books sold. Meanwhile, software provider Oracle and search-engine giant Google are under scrutiny here and in Europe for suspected antitrust violations.

And all the Silicon Valley tech firms are using campaign contributions to take over northern California’s politics, thereby ensuring officeholders friendly to their interests in Washington. They’ve even gone so far as to literally commandeer an entire city (San Francisco), contributing to inequality by gentrifying neighborhoods, hiking rents, and forcing out long-time residents and the poor — to say nothing of running private commuter bus lines for their employees.

Is there a coherent philosophy behind this insular arrogance? Absolutely. It’s called libertarianism, the fashionable ideological preference of up-and-coming industry entrepreneurs, including both Amazon’s Jeff Bezos and trend-setting tech financier Peter Thiel, lately lionized in the pages of Fortune. Ayn Rand would no doubt be proud of these real-life billionaire Howard Roarks.

Wayne O’Leary is a writer in Orono, Maine, specializing in political economy.

From The Progressive Populist, November 1, 2014