1600 New Economy Avenue

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The White House | Facebook

Hey you kids, get on my lawn. On Monday 10,000 people attended a party in the White House’s yard celebrating tech, art, and changing the world. It was President Obama’s personal edition of a South by Southwest-style festival; called South by South Lawn, it featured virtual reality demos, social-media stars and conversations about climate change (The Daily Dot). Long lines waited to try out The Guardian’s 6×9, a VR creation that simulates the experience of solitary confinement. Slack founder Stewart Butterfield spoke about how to promote a more diverse startup universe and avoid creating a self-perpetuating system of exclusion. Obama himself chatted with Leonardo diCaprio and climate scientist Katharine Hayhoe about accelerating efforts to cut carbon emissions. For a few hours, at least, you could forget that the 2016 presidential election is already a political and cultural train wreck and imagine a more hopeful future.

A man for all startups? Sam Altman took over as head of Y Combinator, the celebrated Silicon Valley startup accelerator, two years ago, and has presided over a period of rapid growth and escalating ambition. A lengthy profile of “startup Yoda” Altman (by Tad Friend, in The New Yorker) makes it clear that he’s sharp and talented. But when it comes to assessing Altman’s aims and ideals, the story offers a cornucopia of ambiguities. On the one hand, Altman wants to “move the world forward”; on the other, the organization he presides over is like a tech-industry version of a college old-boy’s network, filled with socially homogenous 20-something entrepreneurs. On the one hand, he’s pals with Trump supporter Peter Thiel; on the other, he’s brainstorming ways to muster tech-community power to defeat the GOP candidate. He is both a believer in singularity-style AI breakthroughs and a “prepper” who has made elaborate survivalist plans in case of global catastrophe. “Altman’s great strengths are clarity of thought and an intuitive grasp of complex systems,” writes Friend. “His great weakness is his utter lack of interest in ineffective people, which unfortunately includes most of us.” Can you make social progress happen even if you “see people as chess pieces”? Keep an eye on Altman to find out.

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Stop Pretending that an Economy Can Be Controlled

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NAEC Insights into Complexity & Policy

By Angel Gurría, OECD Secretary-General

The recent financial crisis exposed some serious flaws in our economic thinking. It has highlighted the need to look at economic policy with more critical, fresh approaches. It has also revealed the limitations of existing tools for structural analysis in factoring in key linkages, feedbacks and trade-offs — for example between growth, inequality and the environment.

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Monopoly Is Not a Game

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Mike Mozart | Flickr

Antitrust: It’s tanned and ready. A century ago, the progressive movement, reacting against the monopolies of the oil barons, established antitrust law as the government’s chief tool for restoring competition. But from the Reagan era on, we’ve defanged antitrust enforcement, and that allowed a new generation of monopolists to take hold (The Atlantic). The rate of new-business formation has dropped in each decade since. Despite our cultural infatuation with startups, markets are actually concentrating, and competition is evaporating. That’s why leaders like Sen. Elizabeth Warren (D-Mass.) advocate that the government brush off its antitrust arsenal. But today’s tech giants, like Apple and Alphabet/Google, are admired and beloved by consumers. Any newly invigorated antitrust enforcement that goes after them is likely to run into political resistance and face philosophical objections, too. Hasn’t the era of Big Tech also brought new efficiencies and lower prices? As one observer puts it in The Atlantic: “Where do we draw the line between ‘good’ bigness and ‘bad’ bigness?” Tough to say — but it’s useful to try.

It’s all Spotify’s fault. The global economy has behaved in confounding ways since the economic crisis of 2007–8: We have historically low interest rates and we’re awash in cash, but inflation remains vanishingly low, which is exactly the opposite of what conventional economics says should happen. Maybe our whole picture is askew because we’re failing to account for the production of “virtual goods,” like Spotify subscriptions (Business Insider). “What if deflation is not a sign of recession but rather a product of the relentless efficiency of tech services like Uber, Airbnb and Spotify?” In other words: Are we stuck in “a no-growth world” — or do we simply have a “measurement issue”? Sweden, Spotify’s native land, embodies this dilemma: With high growth and no inflation, it’s either an economic utopia or a bubble waiting to bust. A lot hangs on the answer, and no one really knows.

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To Fix Government Tech, Take Off the Headphones and Listen

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USDS staffers Marianne Bellotti, Sabrina Williams, and David Chang on the steps of the USDS “Townhouse” HQ.

The US government is famously slow and bureaucratic, but when it comes to digital transformation, the Feds have outdone themselves. Case in point is healthcare.gov — the original government solution for identity management cost $200 million to build and would have cost $70 million to run each year. Of course, it failed spectacularly — until a small group of Valley engineers recruited by the President re-built the site for just $4mm.

But while it’s easy to poke fun at our government, it’s also the single most impactful organization in our economy — with millions of employees and services that directly and sometimes dramatically impact hundreds of millions of Americans.

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