Silicon Valley has ceased to be an outlier in terms of technological innovation. Innovation itself has decentralized, all across the globe, but Silicon Valley remains a hub of… something. Of what? If one looks purely at its economics, it’s a world centered on marketing experiments that use technology. The golden age of makers is over, at least there. Said “golden age” has been replaced by a time for those who buy and sell the labor and produce of others.
Of course, to acknowledge this fact would diminish the Valley’s appeal greatly. In order to convince the rising generation, and the next, and the one after that, to give up lucrative careers elsewhere, it needs to sell a mythology and pretend that the makers’ era is still alive. Yet Silicon Valley does more than repackage bland, played-out business ideas in technological accoutrements. It’s political. It holds strong and impractical views of how the world should be run, it calls itself a “meritocracy” as a way of implying that there is corruption (and there is, but less of it than in Silicon Valley) in the political and economic mainstream, and it’s increasingly secessionist. Its elite has successfully convinced the rest of society that laws shouldn’t apply to them. It wants an “Ultimate Exit” from the United States from which it came.
Ask one of these Silicon Valley billionaire “thought leaders”, and you’ll hear that we’re in 1773 and the contemporary U.S. has become Britain, while Silicon Valley casts itself as the New America. Instead of redcoats, it’s “suits” and “government bureaucrats” they despise. Larry Page has famously said that he’d rather give his billions to Elon Musk than to charity– because everything not run by a Silicon Valley billionaire is, by definition, run by the original Mad King: George III. The Silicon Valley elite despise the American government, military, and national-security apparatuses that keep them safe. The U.S government has its problems but, by and large, it functions well enough that these people can pretend that they don’t need it. Rather than attribute their continuing wealth to political stability and a smooth-running financial system, they’re allowed to indulge in the belief that their personal genius is what upholds their status. So they obsess over the things that they don’t want. They really don’t want to pay their taxes, nor follow U.S. labor laws.
How will this conflict evolve? My prediction is that it won’t be in their favor. People who compare liberals to Nazis are not sympathetic, nor are billionaires who demand $30-million payments to stop breaking the law. The current government establishment bends over backward to let these people get their way, an unreasonable proportion of the time. It offers tax breaks when whiny “tech entrepreneurs” threaten to move their offices to the next town over. I wouldn’t do any of this.
What does Silicon Valley run on? First and most importantly, it runs on passive capital: teachers’ pension funds, university endowments, and the like. The money comes from Real Americans, not Sand Hill Road man-children. Second, it requires technical talent, which is available because of a university system that has been heavily supported by the U.S. government for decades and that, even still, attracts some of the smartest and most ambitious people from all over the world. Silicon Valley didn’t create this. The U.S. did. It’s New York and Chicago and Los Angeles and Seattle that inspire people to immigrate here– not that hideous strip mall called Palo Alto.
Lest it seem like I’m blindly patriotic, I’m not. I came of age during an egregious low point (the early and mid-2000s) during which our president (Bush, if anyone forgot) lied in order to drag us into an illegal war that has destabilized an entire region of the world. I’m a political and economic realist. Sure, this country is screwed up in many ways: racism, right-wing politics, a healthcare system that has been a disaster for decades and only barely improved by recent changes. There are also many good things about it: we’ve been a world leader in R&D for a long time, the best products of our popular culture are truly outstanding, and while we’ve screwed up in some major ways, we are a force for good in the world. Taking the good and bad together, let me say this: in the emerging conflict between Silicon Valley and this country, I’m going to side with the country every fucking time.
This said, there is a revolution underway. It doesn’t have to be a violent one; it’s a global economic one and it’s inevitable. The Industrial Revolution of 1750-1875 was a true revolution, and so is the Technological Revolution of today. The world is changing rapidly, and it will continue to do so.
Here’s where we get to discuss Paul Graham, an early figure in the Technological Revolution. Paul Graham wrote some good books, back in the 1990s, about the programming language, Lisp. And having lucked into being born in the right year, he managed to found and sell a startup (in a time when literally any idiot could) to Yahoo and make a few million dollars. This gave him a platform and a reputation that he managed to monetize by creating Y Combinator, an ideological outfit that became profitable once venture capitalists began to trust it to do their thinking for them.
Y Combinator is a creepy organization. It aggressively supports the ageist culture of Silicon Valley; in fact, the corporate color is orange, because it reminds Paul Graham of a little boy’s T-shirt. Its infantile, simplistic corporate motto is “Make something people want”– because, you know, those out-of-touch Americans-who-are-now-King-George-era-British never figured that trick out. What is its true ideology? Or, to put it more precisely, what ideology is it there to manipulate?
I liken the first wave of technological libertarians to Jeffersonian idealists. Thomas Jefferson was brilliant and important but, in a few ways (and in one really big way) he was on the wrong side of history. The Jeffersonian ideal was of a republic run by educated yeoman farmers: people who’d till the fields by day and study Cicero and Sophocles by night. It would be a world with small, local governments, it would remove all vestiges of “aristocratic” British culture and bureaucracy, and it would be roughly egalitarian (for property-owning free men). The first wave of techno-libertarians held a similar ideology: yeoman capitalists and life-hackers, a desire to keep computing-related professional fields free of regulation, an isolationist stance toward mainstream economics and politics, and an extreme distrust of formal education (even held by Stanford graduates).
Jeffersonian idealism worked (or seemed to work) in America because, in a time when land was wealth, there was an enormous amount of it that was perceived as free. (The natives lacked the guns, germs, and steel to defend it.) People who disliked their stations in stodgy European (or Northeastern) societies could move west and outperform. Techno-libertarian idealism came from different circumstances. Land isn’t the main source of wealth, in 2016. It’s still important (especially in Silicon Valley) but information matters a lot more. For people who excel at acquiring and using information– to use a Jeffersonian term, “natural aristocrats”– this seems exciting. Yet, it’s become quite a drag. Why so? It’s important to recognize what has changed over the past twenty years with regard to information and its role in the economy. What matters in 2016 doesn’t seem to be having the best information, but holding the power to control the flow of information. Specifically, the most important kind of information is the public but subjective kind that we call reputation.
Sadly, we’re at least fifty years into the Technological Revolution and the economic world even more dominated by business corporations and the private-sector social climbers we call “executives”. Corporations are legally people, but they are immortal and cannot be imprisoned, and they can extend protection to their rank-holders, which makes them extremely powerful. The only thing that can kill a corporation is if people stop believing in it– if people stop wanting to work there and buy the company’s products, and if regulators stop giving it a voice over their work. What is an immortal, unaccountable being that can only die if people stop believing in it? That’s not a person; it’s a god. Like the several thousand ethnic gods that humans have created, largely to justify the continued elevation of a ruling class, there is no existence behind such a being other than a self-perpetuating pattern of devotion and reputation. In the 1980s, business corporations had no idea how important computing technology would be to protecting and expanding their reputations. They were behind. Smart people could take advantage of the gaps between optimal play and how the established entities did play. Paul Graham could build a reputation out of nothing and turn it into Y Combinator, the most profitable NAMBLA chapter in human history. He’s now probably worth half a billion dollars. That opportunity isn’t there, anymore. What has changed? The establishment has caught up. The depressing fact of this is that reputation, information, and technology have ceased being a competitive advantage of the smart and diligent, and are now just another armament.
Jeffersonian idealism was a driving force in American politics for almost a hundred years. It came into conflict with Hamiltonian federalism, and it won. The Federalist party broke down, and Hamilton’s career fell to pieces, culminating in his embarrassing and fatal duel with another downwardly-mobile politician of his time: Aaron Burr. The Jeffersonian vision, despite its victory in the early 19th century, had a fatal flaw. Whatever pastoral appeal the agrarian lifestyle may have, there isn’t much new land being made, and that economy required a servile underclass: landless sharecroppers, displaced natives, indentured servants, and slaves.
Likewise, neo-Jeffersonian techno-libertarianism is deeply flawed. The ideal of the yeoman techno-capitalist, working in isolation and outperforming a corrupt, stagnant society, doesn’t hold up. As for the $300/hour consulting gigs that enable yeoman programmers to exist, they have to come from somewhere. We need to look at the massive infrastructure that allows them to exist. The machines that our economy relies upon are produced by people working in abominable conditions. Data centers are a leading contributor to climate change. And increasingly, Silicon Valley is a source of new ideas for the worst kinds of business operators: people who want to break laws that are hard to enforce (“regulatory arbitrage”) or bust unions or take Taylorist employee monitoring to levels that were impossible 30 years ago. This is not to say that technological progress should be rolled back (it shouldn’t be) or that it’s undesirable (it’s not). We just have to take stock of our effects on the world and, instead of bloviating about our supposed ability to “change” it, actually think seriously about correcting the mistakes that we’ve already made.
I suppose I’ve outed myself as a neo-Hamiltonian, and I recognize that as an unpopular stance among technologists. I actually like strong governments and, within reason, competent central authorities. Some problems will just never be solved by swarms of organizations focused on short-term self-interest, and inflating their financial strength with venture capital and calling them “unicorns” won’t change that. What we call a “startup boom” is actually a widespread acceleration of organizational dissolution and decay, and the brand of individualism that we’ve injected into the business world has become toxic. In opposition to this, I would like to revisit old, “aristocratic” ideas (like a strong federal government, high investment in R&D, long-lived companies, and bilateral loyalty instead of mindless layoffs and job-hopping) that worked. For as much as the Jeffersonians loathed everything British, who abolished slavery first? The British.
Alexander Hamilton (who wanted to abolish slavery from the outset, even when that was a radical position) recognized the fatal flaw of the Jeffersonian idealism that was powering the new nation. To him, it was absurd to reject ideas (such as a national bank) simply because they seemed “British”. He recognized the values of the American Revolution but, at the same time, wanted to build a modern, industrial country on those ideals. More than two centuries later, he has arguably won; but within his lifetime, he lost.
Are the Y Combinator partners and the Sand Hill oligarchs, in this view, Jeffersonian idealists? Well, not quite. They’re marketing experts who’ve found a way to exploit that ideology. I don’t think that they subscribe to it, but that doesn’t matter. They’re people-hackers. What they share in common is their adherence to antiquated and offensive patterns of labor relations. Y Combinator’s purpose is to separate the “founder grade” elites from the “employee grade” losers who are expected to throw down 80-hour weeks for 0.02-percent (subject to cliff, dilution, and preferences) equity slices. Y Combinator is, above all, where founders go to learn how to be unethical. Moreover, Silicon Valley’s most effective political arm is dedicated toward abusing the H1-B program (designed to admit high-talent immigrants) to create a caste of indentured servants who can be threatened with deportation by their managers. The Silicon Valley culture– the hatred of unions, the eager and uncritical acceptance of “yeoman” capitalism, the contempt for government and formal education and legal principles like “don’t run illegal hotels” and “workplace sexual harassment isn’t OK”– has been crafted to exploit a sort of neo-Jeffersonian idealism, although those who made this culture do not need to subscribe to such views in order to be able to manipulate them.
Silicon Valley wants the world to believe that it is the new America, and that the United States is the Great Britain of 1773. It does not wish for explicit political secession, but it wants economic and cultural secession. It doesn’t want to pay its taxes, and it only wants to follow American laws when they are convenient to it. It has emotionally divorced itself from the rest of us.
So should we let it secede? On the contrary, we should secede from it. Silicon Valley draws its strength from Real Americans. This means that we can wake up and stop it dead. That money comes from Tennessee teachers’ pensions funds, not from Paul Graham’s purported brilliance. Venture capitalists tell their own kids to stay the hell away from VC-funded technology, and certainly to avoid engineering roles. That means that the programmers in these companies come from elsewhere. Where? From here, from Real America: New York, Chicago, Arkansas, Vermont, Pennsylvania, Wyoming, and even the parts of California that haven’t been invaded yet. So let’s stop sending Sand Hill Road money, let’s stop sending them talent, and let’s stop downloading their stupid apps and buying their horrible products.
