2014-03-04 06:45:08
Booming technology firms are now at the centre of worries about inequality
Feb 22nd 2014 | From the print edition
THE barons of high-tech like to think of themselves as very different creatures
from the barons of Wall Street. They create cool devices that let us carry the
world in our pockets. They wear hoodies, not suits. And they owe their success
to their native genius rather than to social connections they are the crazy
ones, the misfits, the rebels, the troublemakers, the round pegs in square
holes , in Steve Jobs s famous formulation.
But for many people in San Francisco this is a distinction without a
difference. For months now protesters have been blockading the fleets of
private buses that Google and other technology giants use to ferry their
employees to and from Silicon Valley 40 miles to the south. They are
particularly incensed that the buses pay almost nothing to use public stops,
often blocking city buses. Protesters are also angry that an influx of
well-paid geeks has pushed up property prices and rents.
This resentment turned a recent awards ceremony the Crunchies, sponsored by a
website called TechCrunch into a festival of tech-bashing. Outside, protesters
held their own mock ceremony, the Crappies, with a golden toilet brush for
tax-evader of the year to Twitter s boss, Dick Costolo (a reference to a legal
but controversial tax break it got from City Hall). Inside, John Oliver, the
comedian hosting the official awards, gave the assembled billionaires a
dressing-down. You already have almost all the money in the world, he said.
Why do you need awards as well? He suggested that the next iteration of Martin
Scorsese s new film, The Wolf of Wall Street , should be set on the West Coast
with all the money, all the opulence and about 10% of the sex .
Last month Tom Perkins, a Silicon Valley venture capitalist, compared critics
of the tech elite to Nazi stormtroopers on Kristallnacht thereby handing
ammunition to those who accuse that elite, of which he is a member, of being
arrogant and out of touch. Nevertheless, much of the criticism is nonsense. San
Francisco has more than its fair share of professional protesters including
those who think they have a right to live in one of the world s most desirable
places even if they can t rub two pennies together. The much-maligned private
buses are providing workers with an energy- and time-efficient alternative to
private cars. The much-abused tech money-tree is scattering riches on
lower-paid industries too. During the gold rush, Levi Strauss made a fortune by
providing the forty-niners with jeans. Modern-day equivalents will
undoubtedly make fortunes providing geeks with organic food, dress-pants sweat
pants (a cross between pyjamas and jeans, apparently), and, if one
Kickstarter-funded venture pays off, ten-year hoodies , made to last a decade.
Tech titans have also suffered from backlashes before: Bill Gates was once
vilified as a modern robber baron before he transformed himself into the world
s greatest philanthropist. Most people outside San Francisco still look on its
tech firms with admiration, not disgust. But it would be a mistake to ignore
the backlash by the bay entirely. It is being driven by two developments which
will eventually reshape attitudes across the world.
The first is the end of tech-exceptionalism. Silicon Valley s elite has always
cherished its roots in the counter-culture in the world of home-brew computer
clubs, Utopian cyber-gurus and damn-the-establishment hackers. But it also had
a conventional side: Hewlett-Packard may have been started in a garage but soon
became a corporate behemoth; tech firms links to the military establishment
were highlighted when Dave Packard became deputy secretary of defence in the
Nixon administration. The current protests symbolise a growing recognition that
tech is an industry like all others: mostly run by corporate stiffs square pegs
in square holes in Jobs s language and driven by the need to maximise profits.
Sheryl Sandberg, Facebook s chief operating officer, has become a billionaire
despite not having founded the company. Apple s success has created huge
numbers of manufacturing jobs, almost all in cheaper places than the United
States.
Some of the most savage criticisms of the tech industry are inspired by the
contrast between its self-image as a haven of hooded nonconformists and the
reality of ruthless capitalism. Valleywag, a website, pokes fun at its
affection for ostentatiously wacky corporate titles: AOL has a digital prophet,
Tumblr has a fashion evangelist and LinkedIn a hacker-in-residence. It also
exposes the Valley s addiction to politically correct consumption and
frictionless capitalism. Tesla electric cars start at $62,000. Google Glass
lets its wearers, Glassholes , consult the internet as they walk down the
street. TaskRabbit, a website, lets geeks contract out domestic chores to the
lowest bidder.
The second development is the triumph of the meritocracy. This is not to say
that tech is entirely merit-based: women and non-Asian minorities are clearly
under-represented. But its logic is nevertheless meritocratic: you can t
program a computer or develop an app without a high IQ and a specialised
education. So the tech industry is heightening the relationship between IQ,
education and reward: young tech geniuses earn many multiples of the service
workers who reply to their ads on TaskRabbit.
Succeed, then secede
Robert Reich, Bill Clinton s labour secretary and now an academic at Berkeley,
once complained about the secession of the successful , as the monied elite
moved into gated suburbs. But today s money-gorged young techies want to enjoy
the perks of city life. Thus they buy up, occupy and gentrify whole urban
districts: they are seceding in plain sight. This inevitably creates tensions
as the service class sees a parallel world being constructed before their eyes.
San Francisco has a history of anticipating cultural earthquakes, from the
hippies of the 1960s to the greenies of the 1980s. The wolves of the world wide
web should beware.