Money Quote Jan. 17 2018
A fresh study offers concerning data about the strength of democracy in the United States and beyond
What a week for news — I suppose we say that every week these days. Facebook again finds itself in the center of the storm, but is at least attempting to lead the coverage, as opposed to be the brunt of it. Democracy is found to be in peril (we’ve an entire track on that at the Shift Forum this year), open banking starts in the UK, blockchain continues to be debated (and crypto currencies crashed, again), and again, capitalism is seen as the root of many evils — even by the CEO of the largest manager of capital on the planet. Read on for the stories dominating my newsfeed these days (and not Facebook’s News Feed…)
This annual survey from Freedom House sparked a mini deluge of coverage, with the US ranking slipping for the seventh straight year, and Trump getting the lion’s share of blame. Money quote: “While Freedom House has tracked a slow trend of decline in the US over the last seven years, that decline accelerated in 2017 due to “growing evidence of Russian interference in the 2016 elections, violations of basic ethical standards by the new administration, and a reduction in government transparency.”
A good overview of the recent Facebook moves (I covered them here). MQ: “One media executive expressed dismay with a perceived lack of transparency on the part of the social network. “Facebook says: ‘If you don’t have meaningful interactions, you’re going to be downranked,’” the executive said. “So we ask Facebook, ‘explain what a meaningful interaction is.’ And they say, ‘we can’t tell you that.’”
This is an example of what regulation can do — take an opaque industry that has feasted on hidden fees and force it to open up and give consumers insight and portability. It might just be a model we transplant from banking to, say, social media… MQ: “The main idea is that individuals can allow apps and online services to analyse their spending and find better deals on everything from loans and mortgages to shopping and broadband. Customers can give, and withdraw, permission at any time.”
Bitcoin and other crytocurrencies crashed again this week, but author Steven Johnson takes a deeper look at the real disruption inherent in the blockchain technology underpinning the crypto craze. MQ: “ If there’s one thing we’ve learned from the recent history of the internet, it’s that seemingly esoteric decisions about software architecture can unleash profound global forces once the technology moves into wider circulation.”
I linked to this because I was shocked by it, but should not be. Beyond all the ridiculous tweets and senseless political posturing, we are hollowing out the very public commons we’ve labored centuries to build. Terrifying. MQ: “In an email earlier this month inquiring about the status of the more than 200 boards that had come under review, Interior spokeswoman Heather Swift said, “Boards have restarted.” She did not provide any further details and did not respond to an inquiry Tuesday. Some advisory bodies apparently are operating. But others are still frozen because the department has yet to approve their updated charters, as is legally required under the Federal Advisory Committee Act. Other panels, such as the Cape Cod National Seashore Advisory Commission, have been reinstated but are still awaiting department approval for their agendas.”
So many companies making hay from the new tax law. Add Apple to the list.
Speaking of which, this essay is worth a read. MQ: “In a very brief period of time, Americans agreed upon a set of opinions which explained “how an economy works” without necessarily understanding the consequences of their choices.”
And for some good news, though one might be forgiven for seeing it as cynical:
This is the largest financial manager in the world, going all in on the NewCo vibe. MQ: “Society is demanding that companies, both public and private, serve a social purpose,” he wrote in a draft of the letter that was shared with me. “To prosper over time, every company must not only deliver financial performance, but also show how it makes a positive contribution to society.” Amen. (Blackrock will be at the Shift Forum next month.)