Dana Blankenhorn

The Big Tech Conspiracy That Wasn’t

Once you show you like something, I offer you more of it.

Is this a conspiracy?

Not unless I’m a scaled Web site. Because this is at the heart of the charge against “Big Tech,” the companies I call Cloud Czars.

• Show a preference for certain videos on YouTube and YouTube offers you more videos like them.
• “Like” things on Facebook or Instagram, and you will get more things like them.
• Follow certain celebrities on Twitter, you’re offered more like them.
• The same with Amazon Kindle books. When you buy something from Amazon, you’ll be followed for days by ads offering the same thing.

The algorithms follow human nature. Chances are that if you like a book about 12^th century monks who solve murders, you might like another one. If you like Henry Winkler, you’ll probably like Ron Howard.

The problem is that if you like crazy conspiracy theories on Instagram, or videos describing the terrors of the Illuminati on YouTube, you’ll get more of them. Like those, you’ll get more. And more and more.

Things Are About to Happen

This country, with its institutions, belongs to the people who inhabit it. Whenever they shall grow weary of the existing Government, they can exercise their constitutional right of amending it or their revolutionary right to dismember or overthrow it. 

A political campaign can start only after policies are implemented.

In 2023, a lot of things are about to happen that will have profound impacts on how people vote next year.

• Ukraine is coming for Russia. We’ll know a lot more about that by fall.
• Jack Smith is coming for Trump. We’ll know a lot more about that by fall.
• Gun, abortion, and education policies are being implemented by states and we’ll know a whole lot more about their effect by fall.

I haven’t even mentioned the weather, which will show in no uncertain terms just how damaging our reliance on fossil fuels has become. Droughts and hurricanes will wreak terrible havoc on the whole planet this summer, and on Americans too.

Beating Jim Crow

What Republicans in the South are trying to do is to reimpose the political and social order that went by the name of Jim Crow.

Between the 1877 withdrawal of federal troops, and the 1964 Civil Rights Act, the South had a social order based on racism and the misogynistic tenets of the Southern Baptist Church. This required strict separation of the races, and the sexes. Blacks were either exiled to the North or condemned to lives of brutality. It wasn’t slavery. In many ways it was worse.

What sustained Jim Crow was a leaky economic boycott by the North. Atlanta tried to resist it, with economic exhibitions, with education, then with social pressure. (To learn more about the struggle, read anything by or about W.E.B. Dubois (1867-1963).)

The “white” history of this period, from Henry Grady’s New South Speech to the story of Coca-Cola, is much less heroic.  What businesses mainly did was treat the South as a colony. Tobacco and cotton drew a price, but most of the value went elsewhere. What modernity came in, starting in the early 20^th century, was a century-old order of textile manufacture, drawn from New England by cheap labor. The South remained backward.

The status quo was protected by white race riots, by lynching, and by laws like Georgia’s “county unit system,” which prevented liberals from ever winning statewide by requiring candidates to win a majority of its 159 counties. This was defended by poor white farmers, the “wool hat boys”  whose muscle, and guns, maintained segregation.

The North built railway networks, utility systems, then scaled high-margin manufacturing. The South didn’t. That is, until the advent of air conditioning which, combined with the Civil Rights movement, blew the whole thing up.

Beating Moore’s Law

I spent 20 years, off and on, researching Moore’s Law, its history, and how it worked. 

As I wrote my book, and rewrote it twice more, most industries succumbed to its charms, its promise of productivity. Journalism succumbed. Retailing succumbed. So did distribution and management.

Three industries have not yet succumbed, and I have a chapter in the book devoted to them.

These are health care, the law, and education.

It’s not that there aren’t solutions. Law libraries are obsolete. So, too, college libraries. Health care has finally surrendered to electronic records, lured by sweet, sweet stimulus cash.

But final costs, and prices, have gone up in all these areas.

It’s politics.

States refuse to define what graduates need, and unions insist teachers must give the lesson, not just test and tutor. Courts have used technology to pile more work on lawyers and judges. Time is money. Doctors have used their gatekeeping function to stop standardization of treatment, while drug companies have used regulatory capture to create pricing based on the value of your life.

SBF 30 (or higher)

“White collar crime” is crime.

Robbing someone at pen point is worse than doing it at gunpoint. You’re in a position of trust. You have a fiduciary responsibility. You are supposed to have ethics, before you have the law, to guide your actions.

Break all of that and it can be murder. People die when their wealth and future is stolen. White collar thieves steal college educations, they steal retirements, they steal food from the mouths of grandbabies. They make every honest businessperson suspect.

I thought everyone felt that way until I heard Michael Lewis, author of The Big Short and other light classics, interview Harvard Business School professor Eugene Soltes on his podcast Against the Rules.” 

Everything is Liquid

What happened to Silicon Valley Bank is known as a liquidity crisis.

They had plenty of assets. But the assets were in instruments whose value had fallen, that weren’t worth as much as the bank claimed. When Peter Thiel and his bros learned this, they all pulled out their money at once and the bank collapsed.

The main lesson is that everything is now liquid.

Financial assets are liquid. Political assets are liquid. Your reputation and marriage are liquid.

Before the Web was spun this wasn’t the case. It would take time for depositors to pull their money out of a bank, time the bank could use to sell assets in an orderly way. There were still runs but these could be managed through regulation.

This time the fall was sudden, and the punishment had to be severe. The executives all lost their jobs. They deserve to face criminal charges, for cashing out while the walls were falling around them. Everyone who invested in SVB or its debt lost all their money. That’s a hit of nearly $100 billion, mainly to very rich people. Hopefully it teaches other banks to manage their assets better, to sell out money-losing securities quickly so they’re not caught out, in other words to be more transparent.

The Apartment Crisis

I wrote about the housing crisis” last year. My focus was on the tax law. It needs to discourage private equity from buying up houses, and encourage home ownership.

But there’s a second element at work. It’s demographic. Millennials, like my kids, aren’t marrying. If they’re marrying, they’re not having kids. They want small apartments near where they work. Most of them work in cities, where it’s very expensive to build.

Developers, united with young renters, are trying to increase density by block-busting urban homeowners. That’s what a lot of the current “affordable housing” debate is about. I saw it in the 1960s, when it was a racial divide. It’s ugly and leads to crime.

The good news is that apartment construction is already increasing. It is now near the level it was in 1972, just before the first oil crisis. If interest rates moderate even a little, the industry will blow past that number. 

I’m no NIMBY. Planned density can work. But rather than giving developers open season to wreck home values in the name of “15 minute neighborhoods," destroying the tree canopy, start with “30-minute cities," so that the infrastructure keeps up with the demand.

Rope a Dope

You may be too young to recall, but the greatest fight in history occurred in 1974.

“The Rumble in the Jungle” was more noteworthy for the tactic of challenger Muhammad Ali than the result. Ali called it the “rope a dope.” He held his forearms against his body and let George Foreman punch himself out. Ali won in the 8^th round.

In the war against Trumpism, Joe Biden is using the same tactic. It requires patience, discipline, and getting hit a lot. But a politics based on always attacking exhausts the attacker. It leaves them open to a counterpunch.

To make the rope a dope work, you must take some hits. Gandhi knew that. Dr. King knew that. People must see the cliff they’re falling into. Not just what the monkeys on Fox News claim, the world organ grinders like Rupert Murdoch are shaping.

The Limits of Senior Power

If I were around 100 years ago, I would be dead. Instead, I’m rich. (Pictured are my grandparents, May and Edmund O'Donnell, in 1918.)

It’s a demographic and economic transformation that is destroying hope for change in America and (perhaps) making us the last generation.

Until recently, people lived their first 20 years dependent on parents, the next 20 as parents, the next (if they were lucky) 20 as grandparents and anything past that dependent on the children. Most of the world still lives this way.

But starting with Social Security in 1934, and continuing through general prosperity to today, America has turned this on its head. Seniors aren’t just living to an average age of 83, we’re doing it with money. I’m just a 68-year old journalist but, thanks in large part to a wife who works in tech, I’m a millionaire. We own our house. We have enough invested to guarantee a fine retirement, God willing. There may even be something left when we’re gone.

This has changed political incentives. There’s no better example than Florida where The Villages, a huge retirement town of 150,000 (almost all of whom vote), has turned the state’s politics on its head. Add them to those already living up-and-down the state’s east, west and south coasts, and you get a huge state entirely devoted to short term thinking. Education, the environment? Fuck ‘em. We’ll be gone.

The Why of the Guns

Guns have replaced drugs as the tool of systemic racism.

When I was young drugs were effective at this. Push drugs on young black people who are unemployed and feeling hopeless. Arrest the black people doing the drugs. Toss them in jail and they’re not only slaves (for the duration of their sentence) but non-voters for life.

It worked.

But as white folk started getting sentenced, and as black families learned better, you needed a new mechanism.

Lax gun laws are the mechanism.

Righteous War

America hasn’t fought many righteous wars.

In the 19^th century the Civil War was righteous. Everything else was conquest. The “winning of the west” was a slow motion genocide. We took the Southwest from Mexico. We took the Philippines and Puerto Rico from Spain. We teach it as democracy, as freedom. It was empire.

World War II was righteous. In retrospect, I’m glad we fought in Korea.

Other than that? We have been involved in more coups, in more places, for worse reasons, than the British Empire ever thought of. Vietnam was not a righteous war. The Gulf War was not a righteous war. Neither was the Iraq War. Afghanistan began as a righteous mission then turned into a distinctly unrighteous war.

Americans have the blood of the world on our hands, and we deny that every day. The difference between the parties is that Republicans do it more systematically.