Silicon Valley is a Failure

All of Silicon valleys promises are lies. The tech industry is a failure that has made life worse for virtually everyone.

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Episode Transcript

Speaker 1 (00:04):
Hey, everybody, Robert Evans here and welcome to It could
happen here. You know, when we started the show, when
I did the first season of it, you know, the
one about all the Civil War stuff back in twenty nineteen,
this was basically a place for me to write long
essays explaining my vision of the future and the present. Uh,
And people seem to like that a lot. We did

(00:25):
a little bit of that at the start of this
new Eternal daily season of the show. Um, but obviously
over the last year or so, it's it's morphed into
something very different and something wonderful and successful, and it's
brought a lot of new voices, or at least voices
people maybe hadn't heard from as much out in front

(00:46):
of the audience, and I've been really happy about that.
But what I also haven't been doing is writing any
more essays about the world and how fucked up shit is,
because you know, I've been managing a bunch of stuff
and there's been a lot of work to do. But
I like doing that stuff, and I think you people
like it, So I'm gonna try to do more of that.

(01:07):
And I wanted to kind of start by talking a
little bit about Silicon Valley, and I'm going to say
something at the start of this essay that a lot
of people are probably instinctively going to want to disagree with,
which is that Silicon Valley and the tech industry have
been gigantic failures by every metric that matters. They have
made life comprehensively worse for humanity, and there is no

(01:29):
real fact based counter argument to that statement. This is
a hard pill for people to swallow. I'm sure a
lot of folks are frustrated in me for saying it
right now, and they're thinking of counter arguments. Most people
today are critical of the tech industry, obviously, particularly major
social media companies, but they still tend to acknowledge the
tremendous wealth created by Silicon Valley, as if there's some

(01:50):
sort of inherent value to that Behind a number on
a spreadsheet. Collectively, Amazon, Apple, Microsoft, Facebook, and Google, the
so called Big five had a seven point I have
trillion dollar market cap in every person listening to this
keeps a device in their pocket made by or using
the software of one or more of these companies, And
so when people want to make the counter argument to

(02:12):
what I just said, they'll tend to point out some
version of this. Uh yeah, companies like Facebook have done
bad things, but the Internet still a tool for good.
It connects people, YadA, YadA, YadA. Smartphones empower us. You know.
There's all these positive things about the internet, to which
I will say, present me with your fucking evidence that
that has mattered for people really in terms that actually

(02:32):
inaggregate improve their lives. I will show you my arguments
to the contrary. In the period of time from Harry
Truman's election to the end of the Nixon administration, American
productivity on a per capita basis increased at a faster
rate than it did at any other point in history.
But then something happened. From nineteen seventy three to two
thousand and thirteen, income growth was eight percent slower than

(02:55):
it had been in the previous three decades. If productivity
had continued to grow with the same rate from nineteen
seventy three to two thousand thirteen as it did from
nineteen forty six to nineteen seventy three, the economy in
two thousand thirteen would have been sixty percent larger than
it actually was. Now, I'm gonna guess a decent number
of the people listening to this grew up watching the Jetsons.

(03:16):
I know I didn't. For the most part, it was
a silly, pretty harmless animated show, but at the center
of it was a dream about the future that seems
unfathomable in light of current events. George Jetson, who was
in the show a pretty normal working class guy, worked
three hours a day for three days a week. One
of the running jokes in the show is that he
considered himself overworked despite this pretty idyllic schedule. Now, this

(03:39):
was never particularly a focus of the show. It was
just kind of something that was mentioned from time to time.
And that's because the idea that a work week might
just be nine hours in the future wasn't a joke.
This was the direction of futurists in the nineteen sixties,
looking at that surgeon productivity I just mentioned, and all
of the middle class wealth that had been created from
the forties through the early exties. This is the direction

(04:01):
they saw us heading in around a decade ago, in
a period that was still significantly more optimistic than our
current age. The Atlantics Alexis Madrigal, when on a reading
spree of some early twentieth century futurist novels. His conclusion
was this quote. Technological optimists sold the world on automation
by telling people it would create unimaginable amounts of leisure

(04:22):
for them. The big question for the workers of the
twenty first century would be how to spend their copious
amounts of free time. Now, the future we've actually gotten
has given us the opposite of this dream to try
and cover up the rank and rampant ways modern technology
has failed humanity. Think tanks funded by venture capitalists and
tech gurus produce an endless stream of identical futurist thinker

(04:43):
types who write columns about how the world is actually
better today than it's ever been. A good example of
this would be this June column by Rob Askar titled
the World's getting better, Here's why your brain can't believe it.
It opens with this paragraph, Life has improved for most
people around the world over the past generation, temporary pandemics aside.

(05:04):
The rub is that you can't get anyone to believe
the good news, and the result is a toxic political
environment and the potential collapse of democratic norms if too
few people feel that a stressed system is worth saving.
Now I might point out, for example, that if people
don't actually feel like the system is good, perhaps it's
not really working well. There's a number of counter arguments

(05:24):
you can make to this. Now, two years later, this
again was written in June, we've got a massive war
in Europe. People are worried about nuclear warfare as a
result of that. Again, we've got a degradation of democracy
worldwide that's continued to pace from where it was in
We've got soaring inequality, we've got inflation the likes of
which a lot of people alive have never seen, myself

(05:45):
included prior to this point. And we still have a pandemic.
So it's clear that Rob is at least not as
smart as he thinks he is, which is what I
would say about everyone who makes versions of the same
claim that he was making. Now, this doesn't mean I'm
saying that life is worse now than it was at
some imagined pre lapse arian version of the past. I
actually think that's kind of a useless way to think

(06:05):
about the past. In the future, there's different things people
would have preferred. There's things that are objectively better, there's
things that are objectively indebatably worse. You know, that's hard
to make those kind of claims about history, especially when
they often rely on saying, well, X amount of more
people have been pulled out of poverty, and the question
to that as well, I don't know, before colonization of Africa,

(06:25):
would you say all of those people in what became
the colonized parts of Africa were in poverty or were
they simply not part of a system that measures poverty
and anyway, whatever. We can go on and on about that.
My point is that the metrics these people used to
claim the success of our current system to talk about
how wonderful things are today are constantly shifting, and they're

(06:47):
widely arbitrary. The same year Rob wrote his stupid column,
an in O r C studies showed that Americans self
reported being happy at the lowest levels in fifty years.
You can quote jupe statistics about wealth or acts as
to luxury goods all you want, but the modern world
and the post two thousand eight financial crash economy, all
of which was built in the shade of the tech industry,

(07:08):
is making people miserable now. Happiness is obviously not a
perfect measure of progress either. Self reporting is always dicey,
but things like the consumer price index in per capita income,
which are often used by folks on the optimist side,
are also juked and jiggered to hell and back. So
to provide a bit more of an international scale, I'm
going to quote from the Berkeley University's Greater Good magazine quote.

(07:31):
Released annually on the International Day of Happiness, the World
Happiness Report ranks countries based on their life satisfaction and
the Gallop World Poll. Residents rate how satisfied they are
with their lives in the scale of zero to ten,
from the worst possible life to the best possible life.
This year's report also analyzes how global happiness has changed
over time, based on data stretching back to two thousand five.
One trend is very clear. Negative feelings, worries, sadness, and

(07:54):
anger have been rising around the world, up by from
two thousand ten to two thousand eighteen. The others also
found troubling trends, and happiness in equality, which is the
psychological parallel to income inequality, how much individuals in society
differ and how satisfied they are with life. Since two
thousand seven, happiness inequality has been rising within countries, meaning
that the gap between the unhappy and the happy has

(08:16):
been getting wider. This trend is particularly strong in Latin America,
Asia and Sub Saharan Africa. And this is kind of
getting it. I think, what is an incredibly important point,
for one thing, if you want to look at how
people have self reported their unhappiness rising. This massive recent
surge and unhappiness occurs almost at exactly the period of

(08:37):
time that the smartphone takes off and becomes ubiquitous. And
the smartphone is such a bafflingly useful device. I would
never want to give mine up as a thing that
I had access to. And the Internet is incredibly powerful tool.
I wouldn't want to give the Internet up either. But
the usefulness and the the undoubtable brilliance behind these products
makes it seem inconceivable to argue that they haven't made

(08:59):
us better at accomplishing the things that matter to us.
But the evidence on this is pretty clear. I want
to quote now from a write up in The Atlantic.
No matter how aggressively you torture the numbers, the computer
age has coincided with a decline in the rate of
economic growth. When Chad Civerson, an economist, at the University
of Chicago's Business School looked at the question of missing growth.

(09:20):
He found that the productivity slowdown has reduced GDP by
two points seven trillion dollars since two thousand four. Americans
may love their smartphones, but all those free apps aren't
worth trillions of dollars. The physical world of the city,
the glow of electric powered lights, the rumble of automobiles,
the roar of airplanes overhead and subways below is a
product of late nineteenth century In early twentieth century invention,

(09:42):
the physical environment feels depressingly finished. The bulk of innovation
has been shunted into the invisible realm of bites and code.
All of that code, technology advocates argue has increased human
ingenuity by allowing individuals to tinker, talk, and trade with
unprecedented ease. This certainly feels true. Who could spute the
fact that it's easier than ever to record music, market

(10:02):
a video game, or published an essay. But by most measures,
individual innovation is in decline. In two thousand fifteen, Americans
were far less likely to start a company than they
were in the nineteen eighties. According to the economist Tyler Cohen,
the spread of broadband technology has corresponded with a drop
off an entrepreneurial activity in almost every city and in
almost every industry. Now you might think from all this

(10:33):
that I'm left ahead into some sort of techno dum
er anti primitives rant here. I'm not. Perhaps I should,
but I'm not. I am a person who loves technology.
I got my start as a journalist as a tech journalist.
I've joyously traveled the world for years visiting conventions looking
at new gadgets, and a lot of this was in
that pretty wondrous period if you're a gadget nerd from

(10:54):
two thousand eight to two thousand eleven, where there were
just these amazing, new, weird sci fi gadgets dropping every
single week, stuff that you'd grown up watching, and like
Star Trek, the next generation suddenly getting mailed to your
door for you to test out. I tested hundreds of
tablets and smart gadgets in that time frame, and there's
some really great products that came out from that period.
Bluetooth speakers are wonderful. A lot of people, including me,

(11:16):
use them happily on a daily basis, But when it
comes to legitimately life changing applications of technology that's come
to us in the last fifteen years or so. I
can really only think of three things. Number one is
the ability to navigate by GPS basically everywhere. Number two
is the ability to be in constant contact with people
around the world. And number three is the ability to

(11:37):
store a shipload of media on a portable device. So
I'm not anti technology. Nor am I saying that big
tech doesn't make things that are cool or useful. Nor
am I saying we should get rid of this stuff.
The point I'm making is that viewed at thirty thou feet,
the tech industry has produced very little of quantifiable value
to the human race, and it has caused unfathomable harm

(11:58):
at the same time. Now, in my opinion, this has nothing,
or at least fairly little to do with how the
technology inherently works, and instead has everything to do with
the ideology behind the people who developed and who continue
to marshal that technology. In nineteen ninety five, two of
the smartest guys in the twentieth century by my estimation,

(12:19):
Richard Barbrook and Andy Cameron, wrote an essay about the
ideology that animated the men who had come to dominate
the twenty first century tech industry. They titled their essay
the Californian Ideology, and I think it still counts as
one of the three or four most incisive accurate essays
of that century. The gist of the idea was that
as the first wave of the digital boom started to

(12:40):
hit in the mid nineteen nineties, the thinkers behind it
were fueled by a mix of left wing by a
mix of left wing egalitarian, often anti status beliefs that
got wedded to right wing free market fundamentalist libertarian ideology
and created this deeply toxic way of thinking about the future.
You can see this in the story of guys like

(13:00):
Steve Wozniak, the inventor of the personal computer, who was
also a former phone freaker. He committed federal crimes as
a kid, hacking the phone system primarily because fuck the man.
But then when he's a young man, the waws hooks
up with a guy named Steve Jobs, and Jobs is
a brilliant but heartless con man who cares about nothing
but market dominance. Jobs recognizes the naive brilliance of Steve Wozniak,

(13:23):
and he turns it into an engine for wealth creation.
At one point, he steals money that Wosniak was owed
for a project that they took on together, money Wosniac
probably would have just given him if he'd asked, and
he used it secretly to fund their business, which became Apple.
In their essay, Cameron and Barbara, who are much better
writers than I, described the Californian ideology this way. The

(13:43):
Californian ideology is a mix of cybernetics, free market economics,
and counterculture libertarianism, and is promuligated by magazines such as
Wired and Mondo two thousand and preached in the books
of Stuart Brand, Kevin Kelly, and others. The New Faith
has been embraced by computer nerds, slacker students, thirty something
cap the lists, hip academics, futurist bureaucrats, and even by
the President of the USA himself. Now, the tech industry

(14:08):
as we know it got its start courtesy of government money.
Everyone knows that the first version of the Internet was
developed as part of a Defense Department project, but the
entire computer industry, all of the coders and engineers who
would form the first generation of selincom Valley profit engines.
All these guys got their start working for or as
defense contractors. When the US pulled out of Vietnam, thousands

(14:29):
of these people were left out of jobs and they
were forced to move into the private sector. Everything worthwhile
that's come out of big tech has involved a titanic
amount of public funding, one way or the other. And
I'm gonna quote from that essay again. Almost every major
technological advance of the last two hundred years has taken
place with the aid of large amounts of public money
and under a good deal of government influence. The technologies

(14:49):
of the computer in the net were invented with the
aid of massive state subsidies. For example, the first difference
Engine project received a British government grant of five hundred
and seventeen thousand, four hundred and seven d pounds a
small fortune in eighteen thirty four. From Colossus to ed VAC,
from flight simulators to virtual reality, the development of computing
has depended at key moments on public research handouts or

(15:11):
fat contracts with public agencies. The IBM Corporation built the
first programmable digital computer only after it was requested to
do so by the U. S Defense Department during the
Korean War. The result of a lack of state intervention
meant that Nazi Germany lost the opportunity to build the
first electronic computer in the late thirties when the Wehrmacht
refused to fund Conrad Zooz, who had pioneered the use

(15:32):
of binary code, stored programs, and electronic logic gates. One
of the weirdest things about the Californian ideology is that
the West Coast itself was a product of massive state intervention.
Government dollars were used to build the irrigation systems, highway schools, universities,
and other infrastructural projects which make the good life possible.
On top of these public subsidies, the West Coast high

(15:53):
tech industrial complex has been feasting off the fattest pork
barrel in history. For decades, the US government has poured
billions of tax dollars in to buying planes, missiles, electronics,
and nuclear bombs from Californian companies. Americans have always had
state planning, but they prefer to call it the defense budget.

(16:18):
Now this state of affairs is more or less unchanged today.
Elon Musk is probably the most celebrated modern tech visionary.
Miss Sundry companies have taken nearly five billion dollars in
public funding, subsidies, and government support since two thousand fifteen.
All of these libertarian visionaries who push in their political
lives for a world of lossyfair economics and corporate sovereignty,

(16:41):
only produce value with the help of taxpayer dollars. Period.
The irrational exuberance of public financing and the narcissism to
ignore its role in innovation has given us a generation
of tech industry overlords who seem bound and determined to
destroy their own creations. Steve Jobs represented the most successful
and probably the most intelligent manifestation of the Californian ideology.

(17:04):
Every tech industry ghoul currently boiling away fortunes for the
sake of their ego. I'm thinking of Zuckerberg and Musk
most prominently right now, is trying to be him. Steve's
skill was being able to perfectly inhabit the form of
a visionary, and he was so good at doing this
that he convinced this generation they could follow in his footsteps.
But Steve Jobs was only ever playing at being a creator,

(17:27):
at being an inventor. His skill was not in making things.
He had other people to do the making Steve was
an exceptional confidence man, and like all good confidence men,
he was able to make money because he understood on
a deep level what other human beings wanted. This skill
allowed him to lock Apple into spending hundreds of millions

(17:47):
of dollars on R and D for what would become
the first proper smartphone, and for a while he was
just having them toss that money into an apparent chasm,
repeatedly turning back iterations of the product that weren't quite right,
on the strength of his leaf that when they got
it right, it would be worth it. In the year since,
we've seen many wanna be Steves try to follow in
his footsteps, igniting tens of billions of dollars of venture

(18:09):
capital for absolutely nothing. One of the best examples would
be Uber. They lost eight point five billion dollars in
two thousand nineteen, six point eight billion dollars. Once upon
a time, the understanding, the jobs and vision of what
Uber could be was that all of this ignited VC
cash would be worthwhile because eventually the company would succeed
in replacing human drivers with autonomous cars, cutting out the

(18:32):
primary cost in the entire professional driving industry, and making
the potential for a shipload of profit, but after investing
more than a billion dollars in self driving cars, Uber
sold their entire autonomous vehicle division off at a loss.
All of that expense had resulted in self driving cars
that averaged one half mile travel per accident. Despite this,

(18:55):
after a two point six billion dollar loss in August
of two Uber stocks sword Now the realities of what
generates profit and loss in the tech industry have been
completely divorced from productive reality or value created for quite
some time. The delamination of real value in big tech
happens subtly. It's not hard to see why Apple, who

(19:15):
created a device every human being wanted to have in
their pocket, became worth a shipload more money, right pretty obvious.
The value case for Google's core business, search is also
pretty obvious. And as much as I hate Facebook, it
became initially successful because it provided people with something of
real value, a way to stay in touch with human
beings they had met over the course of their lives.

(19:37):
Younger folks may find this odd because they've grown up
with the Internet, but as a kid, I can remember
very vividly my parents talking about the friends they'd had
in high school and in college and how a lifetime
of moving regularly had severed many of the connections they'd
valued with these people. When I joined Facebook and my
freshman year of college, I found real value and the
ability to maintain and sometimes even build stronger connection with

(20:00):
people I would otherwise have lost touch with entirely. There
is the core of something good, or something at least
valued inherently by people in Facebook, and that's true with most,
if not all, of the Big five companies. When people
reflexively leap to defend the tech industry as an engine
of innovation, they can point to these successes. But the
point that I'm making isn't that no good ideas come

(20:21):
out of Silicon Valley, or that there isn't anything valuable
that is involved in what these companies do. It's that
the endless quest for profit and the narcissism of this
Californian ideology lead inevitably to the destruction of whatever value
the industry creates. This is why none of these innovations
have actually led to surges and productivity, why none of

(20:41):
them have made us any happier, which I think might
be more important. Any potential these creations had was smothered
by the ideology that drives Silicon Valley money. Facebook took
the connections that they'd made with people and used them
to feed those same people rage bait. They destroyed the
open Internet, shut countless local news sites, put tons of

(21:02):
people out of business, while algorithmically pushing millions of folks
around the world towards whatever kept them angriest and most online.
Google spent billions on an endless stream of spinoff products
like Google Plus and Google Glass, which were nearly all
catastrophic failures, at least on a financial sense, and all
the while they gradually turned the search results they prided

(21:25):
themselves on into a sponsored ad feed. Google is less
useful now than it was a couple of years ago.
You noticed this immediately if you just get on there
and start asking it questions. Elon Musk has taken the
visionary technology that underpins the Tesla, all created by other people,
and used the clout from that to shatter any chance
of California developing a high speed rail system. By the way,

(21:47):
in June of two, Tesla stock value plunged seventy five
billion dollars, which is substantially more money than the company
has ever actually made. Elucidating the full scale of the
failure of Silicon Valley and America and techno optimism would
take more time than I'm able to spend right now,
So instead, I want to talk about the idea that's
behind so much of the recent big failures that we've

(22:08):
seen from big tech, stuff like Meta pissing away ten
billion dollars half the budget of NASA in a year
to create a worse version of vr chat. The idea
is called blitz scaling, and it basically means attempting to
achieve massive scale at breakneck speed. You take big risks
and you spend huge amounts of money very quickly to
try enforce apps or other products onto the market that

(22:30):
are then adopted rapidly by huge numbers of people. This
brings in a shipload of VC money and as a
way that you can make a fortune. In the years
since Jobs brought the first iPhone out on stage, this
has become the dominant model of Silicon Valley entrepreneurship. Everyone
is looking for the next iPhone, right, something that can
take over an industry, something you can take over the
world that rapidly, that can change human life almost overnight.

(22:54):
In funding Calls, Mark Zuckerberg says this in Funding Calls,
Mark Zuckerberg says this very directly, comparing his company's metaverse
dreams to the new smartphone. The thing that Mark misses
because his ideology renders it invisible, is that Steve Jobs
didn't make people want the iPhone. He was able to
figure out what they wanted already, what they had talked

(23:14):
about wanting for decades, starting with trike orders and communicators
on Star Trek, and he lashed his dev team until
they built the damn thing. Now. The metaverse has some
analogs in fiction, including the thing that it gets its
name from um, but number one, most depictions of the
metaverse in fiction are not aspirational things people want their

(23:36):
dystopian uh. There's no evidence that people actually want this
thing that he's igniting a fortune to build, or that
they'd spend meaningful periods of time in it if it existed.
There's not a lot of polling on this data, but
one in seven but one se person survey I found
showed less than respondents respect expressing an interest in meta
in a metaverse like the one Zuck is trying to build.

(23:58):
The last time Facebook provided any kind of information about
how many people are on Horizon Worlds, which is kind
of the core of their metaverse efforts, It was somewhere
around three thousand people in the most recent quarter. They
declined to provide an update to those numbers, which suggests
the number has not increased um And if you just
want to look at what happens when people create a
digital product that actually has a strong base of interest,

(24:21):
look at how quickly World of Warcraft went from, you know,
a thing that very few people outside of nerds would
have known much about, to a thing that was entirely mainstream,
millions of users, regular references to it on television. You're
just not seeing that with any of this metaverse ship
because there's nothing in it that people actually want. The

(24:41):
sheer hollowness of big tech is starting to become financially
obvious to Facebook, Stock has lost fifty seven percent of
its value in the last year. Amazon is down Google
by and even Apple has fallen by fourteen percent. More
to the point, I think any honest person has to
look at the last fifteen years or so in which
these companies have ruled our economic and social lives and asked,

(25:04):
are we better off now? Over the course of the
nineteenth century, productivity and income rose at unprecedented rates. There
was a lot of brutality in this process, right. We talked,
you know, on Behind the Bastards regularly about all of
the horrible labor things that happened in the nineteenth century.
It also marked the beginning of the fossil fuel age,
which may well kill us all. But while all this

(25:24):
was going on, another thing that happened is wages for
the working class doubled in the first half of the
nineteenth century, and the second half. Life expectancy rose faster
than it ever had before as well, and that continued
through the first part of the twentieth century. Now, near
the end of the first quarter of the twenty one century,
we're not seeing that kind of movement. The United States

(25:44):
is now ending its second consecutive year of declining life
expectancy for the first time in any of our lifetimes,
and real average wage, adjusted for inflation, has remained flat
for almost half a century. Progress has flatlined, and nothing
about how brilliant the modern tech industry is or how
cool some of these gadgets and products are can change

(26:06):
those fundamental facts. It's a failure. It Could Happen Here
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You can find sources for It could Happen Here, updated

(26:27):
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