The past week or so has seen a surge in commentary on the role of corporations in society, a theme familiar to readers of this site. While it might be convenient to peg the trend to Senator Elizabeth Warren’s newly minted Accountable Capitalism Act (more on that in a second), I think it’s more likely that – finally – our collective will is turning to our most logical and obvious instrument of social change, namely, the instrument of business.
We humans like to organize ourselves into social units. They range from the informal (pickup basketball games) to the elaborately structured (Senate hearings). Our ability to harness collective will is unsurpassed in the animal kingdom, it’s one of our key evolutionary adaptations, driving the success of our species across the globe.
A spirited conversation on the future of work debates the best policies for a world in significant transition.
There are many “future of work” panels, but none that have featured wealthy capitalist turned activist Nick Hanauer, author, entrepreneur and tech leader Tim O’Reilly, and policy expert and economics professor Laura Tyson. Moderated by Alexandra Suich Bass, U.S. technology editor, The Economist, this panel debates everything from universal basic income to the role of unions in modern corporations. Not to be missed. Full video and edited transcript below.
Alexandra Suich Bass: I would like to start our panel on the Future of Work in an unconventional place. Talking about the future of work can sometimes feel like watching the most depressing movie imaginable in slow motion. I’d like to ask you guys to give me some positive news. What’s something that we can be excited about as it relates to work in the future? Nick, I’ll start with you.
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.”
This series concludes with a hard look at why we need new sources of capital for founders
The final story in our premium Medium series from author (and software company founder) Luke Kanies explores the need for alternatives to our current system of venture capital. In Kanies’ words, our system looks stable, but most companies follow the same playbook: They try to get their investments to the magic number of $1 million in annual recurring revenue (ARR), raise an A round of funding, and keep on the funding train until you go public or go bust. This system forces founders to contort their companies to fit the funding schedule rather than discovering their own destinies. Kaines believes that instead of continuing to fund disruptors, VC will itself be disrupted with a better alternative.
Tech’s big day on Capitol Hill, Trump’s clan under pressure
Even the billionaires are worried about their own intemperate wealth — well, at least the ones who aren’t such massive douchebags that they’re buying gold Ferraris (really, who does that?). I wrote about the new Gilded Age last month, this piece nails the issue. Money quote (literally): “Billionaires’ fortunes increased by 17% on average last year due to the strong performance of their companies and investments, particularly in technology and commodities. The billionaires’ average return was double that achieved by the world’s stock markets and far more than the average interest rates of just 0.35% offered by UK instant-access high street bank accounts.”
This isn’t going to help any of the companies’ case as they present arguments for why they should be allowed to “self regulate.” The approach our most beloved Internet giants have taken to this most fundamental issue of our Democracy — the ability to have a rationale public discourse — has been to ignore, then reluctantly admit, then drag feet, then finally acknowledge. It’s led to a loss of trust and it’s utterly unfortunate, and avoidable. Money quote: “(Facebook) previously reported that an estimated 10 million users had seen ads bought by Russian-controlled accounts and pages. But Facebook has been silent regarding the spread of free content despite independent researchers suggesting that it was seen by far more users than the ads were.”
The recent exits of chief executives at General Electric, Ford, and U.S. Steel are the latest indications that “the American era of the baronial chief executive” is over, writes Nelson Schwartz in The New York Times. That’s the result of massive changes in both the nature of the businesses these leaders run and the shape of the jobs that investors, employees, and the public expect them to tackle.
The landscape is full of new forces that make long-term, high-profile tenures like that of Jeffrey Immelt at GE less and less common. One of them is the rise of “activist investors,” who buy up chunks of stock and then make demands for higher profitability that often put a CEO’s strategy and job in jeopardy. Another is the speed of technological change, with advances in artificial intelligence, sensors, and processing beginning to collapse the boundaries between businesses.
No one ever said that this business of doing business the right way was going to be easy. The “shareholder value uber alles” philosophy of management that took hold in the 1980s remains powerful even as we’ve seen the rise of alternative visions that add other stakeholders’ interests to the equation.
Now there’s a wave of setbacks for idealistic firms like Juno, the ride-hailing platform that scaled back its profit-sharing plans after being acquired, and Etsy, the handmade-goods marketplace that fired its CEO and laid off workers to try to boost its share price.
On Twitter and seemingly everywhere else, the term “late capitalism” has become a shorthand label for products, ideas, and stories that reflect the absurd excesses and ironies of the contemporary marketplace — like Nordstrom’s $400 jeans caked with a patina of mud, or the Bahamas music fest that descended into refugee-camp squalor. But where did “late capitalism” come from, and what does it really mean?
In The Atlantic, Annie Lowrey traces an intellectual biography of the term, which first emerged among theorists of the left in the early 20th century. Originally it applied to the postwar era of dominant megacorporations — the age of “what’s good for General Motors is good for America.” Then the Frankfurt School critics adopted it as a catch-all label for the way modern business co-opts the symbols and ideals of a rebellious culture and recycles them as marketing.
An overview of today’s current (and ageless) debate
Every 20 years or so, the tech industry suffers a spasm of antitrust fever driven by angry accusations and, eventually, intervention by the Justice Department. In the late ’70s and early ’80s it was all about IBM’s mainframe monopoly. In the late ’90s, Microsoft was the evil monopolist, with its PC operating-system dominance. The latest round features Google. Or, wait, maybe it’s Facebook. Or Apple. Amazon, anyone?
One problem with today’s charges of monopolistic behavior is that there are so many monopolists this time around. And they’re all competing with one another! Google battles Apple in mobile operating systems. Amazon vies with Netflix in streaming/TV content. In music, it’s Spotify vs. Apple. In cloud services, it’s Amazon vs. Microsoft vs. Google.
Artificial intelligence is making its entry into our lives right now — and, as with so many other innovations, it isn’t coming in through the door everyone expected. Sure, eventually we’ll all ride in self-driving cars on our permanent vacations from our jobs that are being done by machine intelligences. But for now, the AIs in our lives are going to be very busy with far more mundane work: delivering — and blocking — ads.
You already know that the ads you see in your browser and on your phone are selected via the complex interaction of bidding algorithms working from targeting data. You may also already be running an ad blocker that tries to speed the loading time of pages you want to read by bypassing all of that advertising machinery.